October 6, 2025 • 17 mins
Your morning briefing, the business news you need in just 15 minutes.
On today's podcast:
(1) Japan’s election of a pro-stimulus leader shook up global markets, sending stocks surging on prospects for more spending, while currencies and bonds weakened, driving investors toward alternative assets such as gold and Bitcoin.
(2) President Donald Trump is pressing Israel and Hamas to seal a settlement to the two-year conflict that’s devastated Gaza and destabilized the Middle East as the warring sides are set to begin mediated talks on Monday.
(3) UK Home Secretary Shabana Mahmood will give police new powers to place limits on repeated protests and is considering legislation to ban them outright, after weeks of demonstrations led to mass arrests and strained resources.
(4) French President Emmanuel Macron’s decision to appoint a broadly unchanged cabinet sparked an immediate backlash from opposition parties, undermining Prime Minister Sebastien Lecornu’s chances of surviving a make-or-break week in parliament.
(5) OPEC+ is showing a cautious commitment to keep battling for a share of the global oil market — despite signs that a long-awaited surplus is starting to emerge.
Podcast Conversation: Custom Vacheron Constantin Timepiece Shines at the Louvre: Essay
See omnystudio.com/listener for privacy information.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:02):
Bloomberg Audio Studios, podcasts, radio news.
Speaker 2 (00:10):
This is the Blue Big Day, Bake You Podcast. Good Morning,
It's Monday, the sixth of October. I'm Caroline Hepkeitt in London.
Speaker 3 (00:16):
And I'm Stephen Caroline Brussels. Coming up today, Japanese stocks
sore and the yen weekends as investors react to sanay
Takeiichi's pro stimulus stance as she's on track to become
the country's first female prime minister.
Speaker 2 (00:29):
Israel and Hamas prepare for talks aimed at ending the
two year conflict that's devastated Gaza and destabilized the Middle East.
Speaker 3 (00:38):
Plus an eleven thousand to one gamble gone wrong. Big
banks count the cost after a tiny fund's big bet
ends in disaster.
Speaker 4 (00:48):
Let's start with a roundup of our top stories.
Speaker 3 (00:51):
Sanae taka Ichi, a pro stimulus conservative, is poised to
become Japan's first female prime minister. Japanese equities led Asian
stocks to an old time high following her surprise win
and the ruling.
Speaker 5 (01:03):
LDP's leadership race.
Speaker 3 (01:05):
While equity investors embraced the news, bond markets did not
longer dated Japanese bond slid with the forty year yields
surging as investors balanced the potential upside of stimulus against
debt market risk with more. Here's our editor at large
in Tokyo, Sherry Anne.
Speaker 1 (01:21):
We know that Sananatakaichi is a nationalist. We know that
she's a fan of Margaret Thatcher, a fan of heavy
metal music as well.
Speaker 5 (01:28):
But it's really the pro.
Speaker 1 (01:30):
Growth policies that Sanattakaichi has talked about that is really
the focus for investors. She's talked about the bogspeezy monetary policy.
Toned down her rhetoric during this election campaign, but we
know that she wants to continue expanding fiscal policy. She's
promised cash Handel's tax rebate, hinting at raising the tax
free income allowance as well.
Speaker 3 (01:52):
Charry Ama was speaking as analysts that Goldman Sachs warns
that volatility in Japan's longer dated bonds may now spill
over into markets as far away is the US and
UK scrutiny of longer data. Debt in many developed economies
has increased as government's ramp up borrowing, and inflation remains
stubbornly high.
Speaker 2 (02:10):
Now, the growing fiscal concerns in some of the world's
biggest economies has seen some investors flocked to the perceived
safety of precious metals and bitcoin. Gold hit another record
today and is now closing in on four thousand dollars
an ounce, following a glittering run that's seen its surge
almost fifty percent this year. Bitcoin meanwhile, set another all
(02:32):
time high over the weekend as a border risk rally
around the US government shut down Boyd, the world's largest cryptocurrency.
Speaker 3 (02:40):
Her mass representatives have arrived in Egypt for peace talks,
seen as the most optimistic moment for diplomacy in the
war with Israel. US President Donald Trump is pressing both
parties to end their near two year war and sign
up to his twenty point peace plan. Trump told reporters
he's honored to be a big part of it.
Speaker 5 (03:01):
They've been fighting for a plan for years.
Speaker 4 (03:04):
We get the passages back almost immediately.
Speaker 1 (03:07):
Negotiations are going on right now, will probably take a
couple of days, and people very happy about it.
Speaker 3 (03:13):
The details of what President Trump's plan would mean for
Gaza's long term future are unclear. For its part, Hamasa
has said that it will release all hostages if the
deal is signed, but haven't yet agreed to disarm after
nearly two years of fighting. The UN backed organizations say
Palestinians have been subjected to famine and genocide.
Speaker 2 (03:34):
Here in the UK, Home Secretary Shabanamatt Mood says that
she is considering new laws to ban repeated protests in
Britain after pro Palestine marches over the weekend. Almost five
hundred people were arrested at a march on Saturday the
police and the government had tried to cancel after a
terror attack on a synagogue. Mahmood says the large scale
(03:55):
demonstrations over Gaza are causing considerable fear for the Jewish
commune unity.
Speaker 6 (04:01):
And what I will be making explicit is that cumulative disruption,
that is to say, the frequency of particular protests in
particular places is in and of itself a reason for
the police to be able to restrict and place conditions.
That is to say, they can move them to a
different place, they can restrict the time that those protests
can occur on my moods.
Speaker 2 (04:22):
Critics include civil liberties groups like Amnesty International, who warn
the UK's right to protest is being evoded. Reports of
anti Semitic and Islamophobic attacks in Britain are on the
rise as security officials fear the war in Gaza radicalizing
people living in the UK.
Speaker 3 (04:41):
French President Emmanuel Macran has appointed a largely unchanged cabinets,
with most senior ministers from the previous government staying on.
Among the key changes, Rolanda Scure, a close ally of
the president, becomes Finance Minister, well former minister Bruno Leameier
returns as Defense Minister. The announcement of sparks backlash from
opposition parties who've demanded a change of course after months
(05:02):
of political turmoil that could threaten Prime Minister Sebastianna kron
New's survival and parliament this week. Opposition groups have said
they will call a no confidence vote as soon as
he lays out his policy plans in the National Assembly tomorrow.
Speaker 2 (05:17):
Opek Plus has agreed to return one hundred and thirty
seven thousand bowels a day of halted supply to markets,
a slower pace than earlier this year. That's despite signs
of a global oil surplus starting to emerge, and after
an earlier difference in position between co leaders Saudi Arabia
and Russia. Our reporter Wailan Soon says OPEC producers are
(05:39):
each facing different circumstances.
Speaker 7 (05:42):
Some like Russia is actually trying to contend with like
increased attacks on its oil production capacity. So let's all
put pulling back some of their potential production. We do
see some estimates for their one hundred and thirty seven
thousand barrels per day that or pet promise over the weekend,
Actually Russia took up about a third of that and
(06:04):
a third of debt might come under stress because of
your princess hex on our expot.
Speaker 2 (06:09):
Facilities, bloombergs Whalenson speaking there. The decision to drip feed
more barrels into the market shows opek's commitment to keep
battling for a share of the global oil market. But
the market's forward curve, which is closely watched by OPEK,
is filtering. Wall Street forecasters like JP Morgan and Goldman
Sachs expect the oil price slide will extend below sixty
(06:33):
dollars a barrel.
Speaker 3 (06:34):
And those are your top stories on the markets. The
Mscish Pacific Index is up slightly on the day, with
the standout performer in Asia is the Nika and Tokyo,
which is four point seven percent higher. The topics of
by three point two percent, the Japanese yen one point
nine percent weaker against the dollar at one fifty to
thirty one point eight percent weeker against the euro at
one seventy six twenty three. The Bloomberg Dollar Spot Index
(06:56):
three tenths stronger this morning, the euro training at one
seventeen twenty three. EUROSDOKS fifty futures are up by a
tenth of one percent.
Speaker 2 (07:05):
Well, those are the markets. In a moment, We're going
to bring you more on the political and market fallout
from the surprise choice for prime minister in Japan, plus
the eleven thousand to one bet that has burned some
of Wall Street's biggest banks. But there is another story
that has caught our right as ever. This Monday morning,
we're going to bring you the case for mechanical watches
(07:26):
in a digital age. I love this story.
Speaker 5 (07:29):
A Quest for Time Caroline.
Speaker 3 (07:31):
What a great title for a piece of quite frankly
ar so Chris Rossar has been writing about this from
Bar Bloomberg Proceeds team about So it's essentially the history
of watches. I suppose discussed around this incredible piece that
was created that he went on a private trip to
the Louver to see It's called La cuet duton, so
the quest for a time made by the Swiss watchmaker
of aacheron Constantin, and the piece itself is exquisite.
Speaker 5 (07:54):
There are photos of it in the article.
Speaker 3 (07:55):
It's got Lapis Lazilai mother of Pearl gold statuette on
top of it. It seems to tell the time, but
also your mood and the moon cycles and probably whether
it's going to rain tomorrow by the look of it
as well. But it is something that is a work
of art sighted in the Louvers so in its home there,
and that prompted this reflection from Chris about the art
(08:15):
form of time pieces and also where they are now.
You know, we had that big pandemic rush into people
buying more watches. That's of course now facing the realities
of things like tariff stickley for Swiss companies as well.
But Chris kind of poses the more existential question for
watchmakers of you know, the Apple watch, does that kill everything?
(08:35):
Does the digital device no give you you know, the
alternative definitely doesn't.
Speaker 2 (08:40):
I've a watch and a timer obviously you've got, you know,
my phone with its digital countdown on it. Also, but
I also wear a watch too, so no, I think
the more time pieces you've got, the better.
Speaker 3 (08:52):
See I last wore a watch in two thousand and
six because I stopped wearing one, partly because of being
surrounded by clocks at every other moment of my life.
But I have to say reading Chris's piece has made
me perhaps reconsider all of those watches people have given
me of gifts over the years that are hiding.
Speaker 5 (09:10):
In drawers and various parts of my home. Maybe it's
time to take one out. We'll see. Anyway, we will put
a link to piece in our podcast show notes.
Speaker 4 (09:17):
Absolutely good stuff.
Speaker 2 (09:18):
Look, let's get to our main story though, Japan, where
we're seeing major market reactions to the news of a
pro stimulus lawmaker to become Prime minister. Japanese stock soaring,
the yen weakening to a record low against the year
long dated bonds also selling off. Our Asia News Desk
Managing editor Jill Desis joins us now for more on this.
Speaker 4 (09:38):
Jill, good morning. How much do.
Speaker 2 (09:42):
You think markets are reacting to this and potential what
are only really potential policies? Why is such a big
market reaction?
Speaker 8 (09:52):
It's really I think comes down to a lot of
takea ICHI's previous comments when it comes to easy money
policy being very pro stimulus. I mean, this is somebody
that at one point last year described the prospect of
the Bank of Japan raising rates as quote stupid. She's
certainly kind of, you know, toned down her rhetoric a
little bit since then. But I think a lot of that,
(10:14):
in combination with you know, some things that she said
about her expansion of spending policies and tendencies in the past,
have really kind of, you know, thrown into you know,
relief here this idea that you do have somebody that's
really embracing the policies of her former mentor the former
Prime ministertion z of Abe. So I think all of that,
in combination with each other, you're really seeing traders kind
(10:37):
of rush to recalibrate their chances of a BOJ rate
hike at the next meeting later this month. You're seeing
them kind of start to price in that idea that
there could be more stimulus on the way. Again, she
has toned down some of her rhetoric recently, but I
think that's sort of where the vibe is shifting her win.
Speaker 3 (10:52):
In the LTP leadership price though was a surprise. What
was it? Do we know that won it for her?
Speaker 1 (10:58):
Yeah?
Speaker 8 (10:58):
I think it's a combination of a couple of different
factors here. So first of all, you know, point out,
she did get the most votes in the first round
against her opponent, Quwaizumi, who was assumed to be, you know,
somebody is a front runner there. So maybe there's momentum
that she was really gaining sort of in those repeated
rounds of gunning for this leadership role. But I also
think that you know, look, the the LDP, this you know,
(11:21):
political party, leading political party in Japan has kind of
in shambles at this point. I mean, the former Prime
Minister Ishiba, you know, lost two really critical elections. You've
really seen sort of a historic low in terms of
the amount of power and influence this party has. And
somebody like Takaichi represents, you know, somebody that could potentially
you know, swing back to the right to attract younger
(11:41):
voters who have flocked to some of these smaller populist
outfits that you know, seem to really be capturing a
lot of the attention of those younger voters. Maybe she
appeals to that crowd and then I also think the
fact that she doesn't come from the starrried political family,
which is quite unusual for somebody with this level of
power in Japan. Her mother was a cop. She she
came from pretty sort of normal, humble beginnings here, and
(12:03):
I think that's something that has the potential to really,
you know, kind of resonate, particularly with some of those
younger voters.
Speaker 4 (12:10):
Yeah, absolutely so.
Speaker 2 (12:11):
Then in terms of other issues facing Japan, Taki she
has previously said that she would renegotiate Japan's trade deal
with the United States.
Speaker 4 (12:20):
How possible is that?
Speaker 8 (12:22):
Yeah, that's one that we're certainly looking out for with
a great interest. So what she was talking about just
last month was that there could be a renegotiation of
the trade deal with the US if the implementation specifically
of this really large investment fund doesn't serve Japan's interest.
So announced was part of the US Japan trade deal
(12:43):
was the idea of a five hundred and fifty billion
dollar investment fund US dollars a billion with a B.
And I think that that's one thing that she seems
to be open to revising. She did say after being
newly elected to lead the ruling party but you know,
it's not going to be immediately revised, but it does
seem to be something that she's certainly taken some great
(13:04):
interest in.
Speaker 2 (13:06):
Okay, interesting, Jill, Thank you so much for your time
for being with us today. That is Bloomberg's Asian News
Desk Managing editor jilld.
Speaker 4 (13:12):
Sis.
Speaker 2 (13:14):
Stay with us. More from Bloomberg daybaqube coming up after this.
Speaker 3 (13:19):
Now to some exclusive Bloomberg reporting on the collapse of
financial firm Blackbrook. Back in twenty twenty, City Group and
Goldman Sachs were among the firms stung by a two
point six billion dollar trade that's now at the heart
of a London lawsuits raising questions about client checks.
Speaker 5 (13:34):
Our legal reporter Luca Depparley is with us for more. Luca,
good morning.
Speaker 3 (13:38):
There are lots of stories about banks making losses on
big financial trades.
Speaker 5 (13:41):
What's different about this one?
Speaker 9 (13:43):
So yeah, I think, particularly Bloomberg and other financial media,
we write a lot about banks or funds losing money.
But the thing that is so remarkable about this one
is who the banks lost money to. There were two
hundred and fifty million dollars of losses sustained in trading
with a company that had no real offices, seemingly only
one real trader, this guy called Jan Ralph, and nets
(14:06):
assets of less than two hundred thousand pounds in the
most brutal terms. The trade that cost all of these
banks this money was lever at about eleven thousand to one.
It's not really like any of the losses banks take
that I've seen or written about before.
Speaker 4 (14:22):
Okay, so what do we know then about Yan?
Speaker 9 (14:24):
Ralph so Yan started Blackbrook a little less than a
decade ago. He had a sort of peripatetic career in finance,
going through a few different firms. He does have a
public profile on social media. He's given interviews to newspapers
talking about his love of ferraris, making flights around Asia
(14:44):
on a plane that he owns. There's a little bit
about collecting watches. But people who follow financial markets have
never heard of him and his company. And that's important
because a lot of people would like to think that
pay attention to markets, that if someone's got a two
point six billion dollars short bet on treasuries, you would
have at least heard of them. Despite being almost totally unknown,
(15:05):
Ralph Ralph and his company were able to take on
one of the most lever trades that I think people
have ever heard of.
Speaker 3 (15:11):
So why were the banks willing to allow this tiny
firm to make such a large trade.
Speaker 9 (15:17):
So that's a question that I still like to know
the answer to. I'm not sure we totally got to
the answer in our piece. My colleague Donald and I
spoke to a lot of people with knowledge of Ralph
and his trades, but very few of them could even
begin to understand how Blackbrook was even allowed to make
trades like this. The trades were done way back in
twenty twenty. Coronavirus was causing a lot of panic and
(15:39):
financial markets things were moving around a lot, But that
still doesn't really explain why the banks were offering this
tiny firm such a huge amount of leverage, why they
were effectively lending so much money to this firm. For
the banks that lost money, which are big banks like City, Goldman, Wells, Fargo,
you have to wonder how their due diligence enabled Blackbrook
(15:59):
to take these enormous positions.
Speaker 2 (16:02):
So what happens now? Will the banks get any of
their money back? The money that they lost?
Speaker 9 (16:07):
So black Book collapsed, as you can imagine after it
incurred all these losses and the running of the company
was taken over by administrators. The administrators are there effectively
to make sure that creditors can get as much money
as they can back from the collapse. As they became
liquidators and looked into the running of the company by Ralph,
they decided that they would take a suit against him
(16:30):
for wrongful trading in London. They want him to repay
something close to one hundred and eighty million pounds, but
it'll be up to a judge to decide whether whether
he has to stump up that cash.
Speaker 3 (16:42):
This is Bloomberg Daybreak Europe, your morning brief on the
stories making news from London to Wall Streets and beyond.
Speaker 2 (16:49):
Look for us on your podcast feed every morning, on Apple, Spotify,
and anywhere else you get your podcasts.
Speaker 3 (16:55):
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Speaker 2 (17:01):
Our flagship New York station is also available on your
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Speaker 5 (17:08):
I'm Caroline Hepka and I'm Stephen. Carol.
Speaker 3 (17:11):
Join us again tomorrow morning for all the news you
need to start your day right here on Bloomberg day Break.
Speaker 5 (17:16):
Europe
Bloomberg Audio Studios, podcasts, radio news.
Speaker 2 (00:10):
This is the Blue Big Day, Bake You Podcast. Good Morning,
It's Monday, the sixth of October. I'm Caroline Hepkeitt in London.
Speaker 3 (00:16):
And I'm Stephen Caroline Brussels. Coming up today, Japanese stocks
sore and the yen weekends as investors react to sanay
Takeiichi's pro stimulus stance as she's on track to become
the country's first female prime minister.
Speaker 2 (00:29):
Israel and Hamas prepare for talks aimed at ending the
two year conflict that's devastated Gaza and destabilized the Middle East.
Speaker 3 (00:38):
Plus an eleven thousand to one gamble gone wrong. Big
banks count the cost after a tiny fund's big bet
ends in disaster.
Speaker 4 (00:48):
Let's start with a roundup of our top stories.
Speaker 3 (00:51):
Sanae taka Ichi, a pro stimulus conservative, is poised to
become Japan's first female prime minister. Japanese equities led Asian
stocks to an old time high following her surprise win
and the ruling.
Speaker 5 (01:03):
LDP's leadership race.
Speaker 3 (01:05):
While equity investors embraced the news, bond markets did not
longer dated Japanese bond slid with the forty year yields
surging as investors balanced the potential upside of stimulus against
debt market risk with more. Here's our editor at large
in Tokyo, Sherry Anne.
Speaker 1 (01:21):
We know that Sananatakaichi is a nationalist. We know that
she's a fan of Margaret Thatcher, a fan of heavy
metal music as well.
Speaker 5 (01:28):
But it's really the pro.
Speaker 1 (01:30):
Growth policies that Sanattakaichi has talked about that is really
the focus for investors. She's talked about the bogspeezy monetary policy.
Toned down her rhetoric during this election campaign, but we
know that she wants to continue expanding fiscal policy. She's
promised cash Handel's tax rebate, hinting at raising the tax
free income allowance as well.
Speaker 3 (01:52):
Charry Ama was speaking as analysts that Goldman Sachs warns
that volatility in Japan's longer dated bonds may now spill
over into markets as far away is the US and
UK scrutiny of longer data. Debt in many developed economies
has increased as government's ramp up borrowing, and inflation remains
stubbornly high.
Speaker 2 (02:10):
Now, the growing fiscal concerns in some of the world's
biggest economies has seen some investors flocked to the perceived
safety of precious metals and bitcoin. Gold hit another record
today and is now closing in on four thousand dollars
an ounce, following a glittering run that's seen its surge
almost fifty percent this year. Bitcoin meanwhile, set another all
(02:32):
time high over the weekend as a border risk rally
around the US government shut down Boyd, the world's largest cryptocurrency.
Speaker 3 (02:40):
Her mass representatives have arrived in Egypt for peace talks,
seen as the most optimistic moment for diplomacy in the
war with Israel. US President Donald Trump is pressing both
parties to end their near two year war and sign
up to his twenty point peace plan. Trump told reporters
he's honored to be a big part of it.
Speaker 5 (03:01):
They've been fighting for a plan for years.
Speaker 4 (03:04):
We get the passages back almost immediately.
Speaker 1 (03:07):
Negotiations are going on right now, will probably take a
couple of days, and people very happy about it.
Speaker 3 (03:13):
The details of what President Trump's plan would mean for
Gaza's long term future are unclear. For its part, Hamasa
has said that it will release all hostages if the
deal is signed, but haven't yet agreed to disarm after
nearly two years of fighting. The UN backed organizations say
Palestinians have been subjected to famine and genocide.
Speaker 2 (03:34):
Here in the UK, Home Secretary Shabanamatt Mood says that
she is considering new laws to ban repeated protests in
Britain after pro Palestine marches over the weekend. Almost five
hundred people were arrested at a march on Saturday the
police and the government had tried to cancel after a
terror attack on a synagogue. Mahmood says the large scale
(03:55):
demonstrations over Gaza are causing considerable fear for the Jewish
commune unity.
Speaker 6 (04:01):
And what I will be making explicit is that cumulative disruption,
that is to say, the frequency of particular protests in
particular places is in and of itself a reason for
the police to be able to restrict and place conditions.
That is to say, they can move them to a
different place, they can restrict the time that those protests
can occur on my moods.
Speaker 2 (04:22):
Critics include civil liberties groups like Amnesty International, who warn
the UK's right to protest is being evoded. Reports of
anti Semitic and Islamophobic attacks in Britain are on the
rise as security officials fear the war in Gaza radicalizing
people living in the UK.
Speaker 3 (04:41):
French President Emmanuel Macran has appointed a largely unchanged cabinets,
with most senior ministers from the previous government staying on.
Among the key changes, Rolanda Scure, a close ally of
the president, becomes Finance Minister, well former minister Bruno Leameier
returns as Defense Minister. The announcement of sparks backlash from
opposition parties who've demanded a change of course after months
(05:02):
of political turmoil that could threaten Prime Minister Sebastianna kron
New's survival and parliament this week. Opposition groups have said
they will call a no confidence vote as soon as
he lays out his policy plans in the National Assembly tomorrow.
Speaker 2 (05:17):
Opek Plus has agreed to return one hundred and thirty
seven thousand bowels a day of halted supply to markets,
a slower pace than earlier this year. That's despite signs
of a global oil surplus starting to emerge, and after
an earlier difference in position between co leaders Saudi Arabia
and Russia. Our reporter Wailan Soon says OPEC producers are
(05:39):
each facing different circumstances.
Speaker 7 (05:42):
Some like Russia is actually trying to contend with like
increased attacks on its oil production capacity. So let's all
put pulling back some of their potential production. We do
see some estimates for their one hundred and thirty seven
thousand barrels per day that or pet promise over the weekend,
Actually Russia took up about a third of that and
(06:04):
a third of debt might come under stress because of
your princess hex on our expot.
Speaker 2 (06:09):
Facilities, bloombergs Whalenson speaking there. The decision to drip feed
more barrels into the market shows opek's commitment to keep
battling for a share of the global oil market. But
the market's forward curve, which is closely watched by OPEK,
is filtering. Wall Street forecasters like JP Morgan and Goldman
Sachs expect the oil price slide will extend below sixty
(06:33):
dollars a barrel.
Speaker 3 (06:34):
And those are your top stories on the markets. The
Mscish Pacific Index is up slightly on the day, with
the standout performer in Asia is the Nika and Tokyo,
which is four point seven percent higher. The topics of
by three point two percent, the Japanese yen one point
nine percent weaker against the dollar at one fifty to
thirty one point eight percent weeker against the euro at
one seventy six twenty three. The Bloomberg Dollar Spot Index
(06:56):
three tenths stronger this morning, the euro training at one
seventeen twenty three. EUROSDOKS fifty futures are up by a
tenth of one percent.
Speaker 2 (07:05):
Well, those are the markets. In a moment, We're going
to bring you more on the political and market fallout
from the surprise choice for prime minister in Japan, plus
the eleven thousand to one bet that has burned some
of Wall Street's biggest banks. But there is another story
that has caught our right as ever. This Monday morning,
we're going to bring you the case for mechanical watches
(07:26):
in a digital age. I love this story.
Speaker 5 (07:29):
A Quest for Time Caroline.
Speaker 3 (07:31):
What a great title for a piece of quite frankly
ar so Chris Rossar has been writing about this from
Bar Bloomberg Proceeds team about So it's essentially the history
of watches. I suppose discussed around this incredible piece that
was created that he went on a private trip to
the Louver to see It's called La cuet duton, so
the quest for a time made by the Swiss watchmaker
of aacheron Constantin, and the piece itself is exquisite.
Speaker 5 (07:54):
There are photos of it in the article.
Speaker 3 (07:55):
It's got Lapis Lazilai mother of Pearl gold statuette on
top of it. It seems to tell the time, but
also your mood and the moon cycles and probably whether
it's going to rain tomorrow by the look of it
as well. But it is something that is a work
of art sighted in the Louvers so in its home there,
and that prompted this reflection from Chris about the art
(08:15):
form of time pieces and also where they are now.
You know, we had that big pandemic rush into people
buying more watches. That's of course now facing the realities
of things like tariff stickley for Swiss companies as well.
But Chris kind of poses the more existential question for
watchmakers of you know, the Apple watch, does that kill everything?
(08:35):
Does the digital device no give you you know, the
alternative definitely doesn't.
Speaker 2 (08:40):
I've a watch and a timer obviously you've got, you know,
my phone with its digital countdown on it. Also, but
I also wear a watch too, so no, I think
the more time pieces you've got, the better.
Speaker 3 (08:52):
See I last wore a watch in two thousand and
six because I stopped wearing one, partly because of being
surrounded by clocks at every other moment of my life.
But I have to say reading Chris's piece has made
me perhaps reconsider all of those watches people have given
me of gifts over the years that are hiding.
Speaker 5 (09:10):
In drawers and various parts of my home. Maybe it's
time to take one out. We'll see. Anyway, we will put
a link to piece in our podcast show notes.
Speaker 4 (09:17):
Absolutely good stuff.
Speaker 2 (09:18):
Look, let's get to our main story though, Japan, where
we're seeing major market reactions to the news of a
pro stimulus lawmaker to become Prime minister. Japanese stock soaring,
the yen weakening to a record low against the year
long dated bonds also selling off. Our Asia News Desk
Managing editor Jill Desis joins us now for more on this.
Speaker 4 (09:38):
Jill, good morning. How much do.
Speaker 2 (09:42):
You think markets are reacting to this and potential what
are only really potential policies? Why is such a big
market reaction?
Speaker 8 (09:52):
It's really I think comes down to a lot of
takea ICHI's previous comments when it comes to easy money
policy being very pro stimulus. I mean, this is somebody
that at one point last year described the prospect of
the Bank of Japan raising rates as quote stupid. She's
certainly kind of, you know, toned down her rhetoric a
little bit since then. But I think a lot of that,
(10:14):
in combination with you know, some things that she said
about her expansion of spending policies and tendencies in the past,
have really kind of, you know, thrown into you know,
relief here this idea that you do have somebody that's
really embracing the policies of her former mentor the former
Prime ministertion z of Abe. So I think all of that,
in combination with each other, you're really seeing traders kind
(10:37):
of rush to recalibrate their chances of a BOJ rate
hike at the next meeting later this month. You're seeing
them kind of start to price in that idea that
there could be more stimulus on the way. Again, she
has toned down some of her rhetoric recently, but I
think that's sort of where the vibe is shifting her win.
Speaker 3 (10:52):
In the LTP leadership price though was a surprise. What
was it? Do we know that won it for her?
Speaker 1 (10:58):
Yeah?
Speaker 8 (10:58):
I think it's a combination of a couple of different
factors here. So first of all, you know, point out,
she did get the most votes in the first round
against her opponent, Quwaizumi, who was assumed to be, you know,
somebody is a front runner there. So maybe there's momentum
that she was really gaining sort of in those repeated
rounds of gunning for this leadership role. But I also
think that you know, look, the the LDP, this you know,
(11:21):
political party, leading political party in Japan has kind of
in shambles at this point. I mean, the former Prime
Minister Ishiba, you know, lost two really critical elections. You've
really seen sort of a historic low in terms of
the amount of power and influence this party has. And
somebody like Takaichi represents, you know, somebody that could potentially
you know, swing back to the right to attract younger
(11:41):
voters who have flocked to some of these smaller populist
outfits that you know, seem to really be capturing a
lot of the attention of those younger voters. Maybe she
appeals to that crowd and then I also think the
fact that she doesn't come from the starrried political family,
which is quite unusual for somebody with this level of
power in Japan. Her mother was a cop. She she
came from pretty sort of normal, humble beginnings here, and
(12:03):
I think that's something that has the potential to really,
you know, kind of resonate, particularly with some of those
younger voters.
Speaker 4 (12:10):
Yeah, absolutely so.
Speaker 2 (12:11):
Then in terms of other issues facing Japan, Taki she
has previously said that she would renegotiate Japan's trade deal
with the United States.
Speaker 4 (12:20):
How possible is that?
Speaker 8 (12:22):
Yeah, that's one that we're certainly looking out for with
a great interest. So what she was talking about just
last month was that there could be a renegotiation of
the trade deal with the US if the implementation specifically
of this really large investment fund doesn't serve Japan's interest.
So announced was part of the US Japan trade deal
(12:43):
was the idea of a five hundred and fifty billion
dollar investment fund US dollars a billion with a B.
And I think that that's one thing that she seems
to be open to revising. She did say after being
newly elected to lead the ruling party but you know,
it's not going to be immediately revised, but it does
seem to be something that she's certainly taken some great
(13:04):
interest in.
Speaker 2 (13:06):
Okay, interesting, Jill, Thank you so much for your time
for being with us today. That is Bloomberg's Asian News
Desk Managing editor jilld.
Speaker 4 (13:12):
Sis.
Speaker 2 (13:14):
Stay with us. More from Bloomberg daybaqube coming up after this.
Speaker 3 (13:19):
Now to some exclusive Bloomberg reporting on the collapse of
financial firm Blackbrook. Back in twenty twenty, City Group and
Goldman Sachs were among the firms stung by a two
point six billion dollar trade that's now at the heart
of a London lawsuits raising questions about client checks.
Speaker 5 (13:34):
Our legal reporter Luca Depparley is with us for more. Luca,
good morning.
Speaker 3 (13:38):
There are lots of stories about banks making losses on
big financial trades.
Speaker 5 (13:41):
What's different about this one?
Speaker 9 (13:43):
So yeah, I think, particularly Bloomberg and other financial media,
we write a lot about banks or funds losing money.
But the thing that is so remarkable about this one
is who the banks lost money to. There were two
hundred and fifty million dollars of losses sustained in trading
with a company that had no real offices, seemingly only
one real trader, this guy called Jan Ralph, and nets
(14:06):
assets of less than two hundred thousand pounds in the
most brutal terms. The trade that cost all of these
banks this money was lever at about eleven thousand to one.
It's not really like any of the losses banks take
that I've seen or written about before.
Speaker 4 (14:22):
Okay, so what do we know then about Yan?
Speaker 9 (14:24):
Ralph so Yan started Blackbrook a little less than a
decade ago. He had a sort of peripatetic career in finance,
going through a few different firms. He does have a
public profile on social media. He's given interviews to newspapers
talking about his love of ferraris, making flights around Asia
(14:44):
on a plane that he owns. There's a little bit
about collecting watches. But people who follow financial markets have
never heard of him and his company. And that's important
because a lot of people would like to think that
pay attention to markets, that if someone's got a two
point six billion dollars short bet on treasuries, you would
have at least heard of them. Despite being almost totally unknown,
(15:05):
Ralph Ralph and his company were able to take on
one of the most lever trades that I think people
have ever heard of.
Speaker 3 (15:11):
So why were the banks willing to allow this tiny
firm to make such a large trade.
Speaker 9 (15:17):
So that's a question that I still like to know
the answer to. I'm not sure we totally got to
the answer in our piece. My colleague Donald and I
spoke to a lot of people with knowledge of Ralph
and his trades, but very few of them could even
begin to understand how Blackbrook was even allowed to make
trades like this. The trades were done way back in
twenty twenty. Coronavirus was causing a lot of panic and
(15:39):
financial markets things were moving around a lot, But that
still doesn't really explain why the banks were offering this
tiny firm such a huge amount of leverage, why they
were effectively lending so much money to this firm. For
the banks that lost money, which are big banks like City, Goldman, Wells, Fargo,
you have to wonder how their due diligence enabled Blackbrook
(15:59):
to take these enormous positions.
Speaker 2 (16:02):
So what happens now? Will the banks get any of
their money back? The money that they lost?
Speaker 9 (16:07):
So black Book collapsed, as you can imagine after it
incurred all these losses and the running of the company
was taken over by administrators. The administrators are there effectively
to make sure that creditors can get as much money
as they can back from the collapse. As they became
liquidators and looked into the running of the company by Ralph,
they decided that they would take a suit against him
(16:30):
for wrongful trading in London. They want him to repay
something close to one hundred and eighty million pounds, but
it'll be up to a judge to decide whether whether
he has to stump up that cash.
Speaker 3 (16:42):
This is Bloomberg Daybreak Europe, your morning brief on the
stories making news from London to Wall Streets and beyond.
Speaker 2 (16:49):
Look for us on your podcast feed every morning, on Apple, Spotify,
and anywhere else you get your podcasts.
Speaker 3 (16:55):
You can also listen live each morning on London DAB Radio,
the Bloomberg Business app, and Blueburg dot Com.
Speaker 2 (17:01):
Our flagship New York station is also available on your
Amazon Alexa devices. Just say Alexa play Bloomberg eleven thirty.
Speaker 5 (17:08):
I'm Caroline Hepka and I'm Stephen. Carol.
Speaker 3 (17:11):
Join us again tomorrow morning for all the news you
need to start your day right here on Bloomberg day Break.
Speaker 5 (17:16):
Europe
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