September 12, 2025 • 21 mins
Your morning briefing, the business news you need in just 15 minutes.
On today's podcast:
(1) When Peter Mandelson was appointed the UK’s ambassador to the US in February, many in the British government predicted it would end in a scandal. Mandelson, a political operator once known as the “Prince of Darkness” for his capacity for political intrigue and spin, was fired by Prime Minister Keir Starmer on Thursday after Bloomberg published a series of emails between Mandelson and convicted pedophile Jeffrey Epstein, which cast new light on their relationship.
(2) The suspect in the killing of Charlie Kirk slipped behind a building, braced himself on the roof and swung off the edge, hitting the ground hard and leaving behind palm smudges and a single shoe print. He bolted across a patch of grass, cut through a parking lot and vanished into the trees.
(3) NATO is preparing a defensive military measures in response to the drone incursion in Poland to strengthen deterrence across the alliance’s eastern flank, according to a person familiar with the matter.
(4) OpenAI said it’s closer to converting into a more traditional for-profit company — nearing the resolution of painful negotiations with top shareholder Microsoft Corp. and outlining terms of at least $100 billion in equity for its nonprofit arm.
(5) European Central Bank policymakers are convinced that no further interest-rate cuts are needed to deliver 2% inflation, despite new economic projections pointing to an undershoot over the next two years, according to people familiar with their thinking.
Podcast Conversation: Photo-Editing Tools May Be AI’s Killer App: Catherine Thorbecke
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:02):
Bloomberg Audio Studios, podcasts, radio news.
Speaker 2 (00:09):
This is the Big DAYBAK podcast. Good morning, It's Friday,
the twelfth of September. I'm Caroline Hepkat in London.
Speaker 3 (00:15):
And I'm Stephen Caroline Brussels. Coming up today. Questions mount
over the British Prime Minister's judgment as he sacks his
ambassador to the US, Peter Mandelsson, after Bloomberg's exclusive reporting
on his ties to Jeffrey Epstein.
Speaker 2 (00:29):
The FBI releases footage of a suspect in the killing
of US conservative activist Charlie Kirk and a reward of
up to one hundred thousand dollars for information.
Speaker 3 (00:39):
Plus kicking open Europe's IPO window. We look at a
flurry of listings that suggest that tariff induced caution of
recent mods may have passed.
Speaker 2 (00:48):
Let's start with a round up of our top stories.
Speaker 3 (00:50):
The UK's Prime Minister is facing growing questions over what
he knew about Peter Mandelson's relationship with Jeffrey Epstein when
he appointed him as US ambassador. Here Starmer fired Mandelsson
after Bloomberg published a series of emails between Mandelson and
the convicted pedophile. Semester's show. The former ambassador offered Epstein's
support and advice after the financiers conviction in two thousand
(01:12):
and eight for soliciting sex from a minor, saying quote,
I think the world of view. Peter Mandelsson's ties to
Epstein were known when he was made ambassador, although he
denied that they were extensive and said he regretted them.
But Starmer's office concluded that Bloomberg's reporting showed their relationship
to be closer than was known about. Here's what Foreign
Office Minister Stephen Doherty told the House of Commons.
Speaker 4 (01:36):
The email's show was to speaker that the depth and
extent of Lord Mallison's relationship with Jeffrey Epstein is materially
different from that known at the time of his appointment.
Speaker 3 (01:47):
Stephen Doherty speaking there. The timing could hardly be worse
for the British government, which is preparing to host US
President Trump's state visit next week, as the American leader
is facing questions of his own about his relationship with Epstein.
Speaker 2 (02:01):
The FBI has released footage of these suspects believed to
be involved in the shooting of American political activist Charlie
Kirk in Utah. The video shows an individual fleeing the scene.
Investigators have recovered what they believe to be the murder weapon,
but are still searching for the culprit. Utah Governor Spencer
Coggs says prosecutors will seek the most severe punishment.
Speaker 5 (02:23):
More than anything, we are going to catch this person.
Last thing I will just say is we've been working
with our attorneys getting everything that we need after Davits
ready so that we can pursue the death penalty in
this case.
Speaker 2 (02:38):
Utah Governor Spencer Cox speaking there, he also accused other
countries of spreading disinformation about the incident and trying to
cause unrest in the US. A reward of up to
one hundred thousand dollars is now being offered for information
about the killing.
Speaker 3 (02:55):
NATO was preparing defensive military measures to strengthen its eastern
flank after Russian drones crossed into Poland this week. Military
planning is being led by Supreme Allied Commander in Europe
Alexis Grinkovich, who is assessing the situation and what supplies
may be needed.
Speaker 6 (03:11):
And just as you are committed to us, we are
committed to you. NATO Land Forces Forward led by Germany,
with additional contributions from Belgium, Chechia, Luxembourg, the Netherlands in
Norway are here and growing. Germany will permanently station a
brigade in Lithuania. This is a major step to strengthen
(03:32):
our deterrence and defense on the eastern flank of the Alliance's.
Speaker 3 (03:37):
The top US commander in Europe, Alexis Grinkovich, speaking during
a visit to Lithuania Poland, yesterday, asked allies for additional
air defense systems and counter drone technology to better protect
against Russian incursions. With offers of assistance starting to come in.
President Trump said the incident could have been a mistake,
but expressed his frustration with the event that has alarmed
(03:59):
WARSAW and other NATO allies.
Speaker 2 (04:02):
Open AI says that it's closer to converting into a
for profit company, which would include giving its nonprofit arm
one hundred billion dollars inequity. The maker of chat GPT
announced it's nearing the end of months of negotiations with
top shareholder Microsoft to overhaul its structure and unlock an
eventual public listing. The one hundred billion dollar at stake
(04:26):
would also give the company a roughly twenty percent share
of open ai if it closes a deal to let
employees sell shares at evaluation of five hundred billion dollars.
Speaker 3 (04:37):
The leaders of open Ai and Nvidia are planning to
invest billions of dollars in UK data centers when they
visit the country next week. Bloomberg's Freddie Filstone has more.
Speaker 7 (04:47):
US President Donald Trump is on a state visit to
Britain next week, but he's bringing with him open Ais,
Sam Altman and Nvidia's Jensen Hwang as part of a
group of American executives. They're poised to invest tens of
billions of dollars in artificial intelligence, and Prime Minister kir
Starmer has promised to turbocharge AI to help grow the
(05:09):
UK economy. Bloomberg now understands open Ai and Nvidia are
working with London based and Scale as part of a
billion dollar deal to build data centers in London. Freddie
Fulston Bloomberg Radio.
Speaker 2 (05:23):
Bloomberg understands the ECB policymakers are convinced that no further
interest rate cuts are needed to deliver two percent inflation
barring a major shock in the Euro Area. The European
Central Bank has kept interest rates unchanged at two percent
for a second meeting in a row. Yesterday, new ECB
forecasts show inflation staying close to two percent target and
(05:44):
growth holding steady, even as Donald Trump's tariffs and political
turmil in France way on sentiment. ECB President Christina Guard
signaled confidence that inflation is under control.
Speaker 8 (05:56):
The disinflationary process is over. Inflation is where we want
it to be, laterst reading two point one two to
two point one medium term outlook on target. In the
same breadth affair, I say that we decide meeting by meeting,
that we are data dependent, and that we will decide
(06:17):
accordingly in order to make sure that we stay in
a good.
Speaker 2 (06:21):
Place, ECB President Christine the Guard, speaking there. Trade is
reacted by dialing back bets on more rate cuts. Meanwhile,
in the US, underlying inflation rose as expected in August,
keeping the US Federal Reserve on track to cut interest
rates next week.
Speaker 3 (06:40):
In a moment, we'll bring you more in the file
out from Bloomberg's exclusive reporting on those emails between Jeffrey
Epstein and Peter Mandelson and what it means for the
British Prime Minister now, plus why Europe's IPO pipeline is
starting to look a little more rosy after the latest
string of listings. But in the story we've been reading
this morning on photo editing tools and could this be
(07:02):
what lifts AI to the next level for Internet users,
this is what Bloomberg Opinions Katherine Warbeck has been writing about.
She got a preview of one of the new Chinese
tools in this areas try to use it to restore
a photo of her late grandfather. That didn't quite work
as planned, but she was able to generate some interesting
images by just pulling inspiration fromages available online. So she
(07:23):
was able to make one of President Trump holding up
a bedazzled l Boo Boo doll, for example, although when
she asked the software to do it for cheating ping,
it did not respond to that request. But she's talking
about I suppose the potential for advertisers and consumers of
if you can create photos that are essentially manipulated by AI,
this could be the path to monetization for some of
(07:45):
these tools, which is, as you know, one of the
really big questions about AI, the multi billions of dollars
being poured into this technology. But oftentimes it's not actually
yielding the results or the return for those companies just yet.
Of course, the other side of this is the risks
involved too. You start putting manipulated photos out there, how
do you control it? How do you flag it to
Internet users? But an interesting thought I suppose on that
(08:07):
moment of where we are in AI now, and of
course the big question is the technology evolves so fast,
how do you keep up with regulatoring US, monitoring us
trying to understand the sort of impact it can have.
Speaker 6 (08:19):
Yeah.
Speaker 2 (08:19):
Absolutely, I think that you are already seeing how AI.
I mean just since January when I was downloading a
whole suite of different AI applications just to kind of
have a go and see whether I could use it
or not. It feels like this September, in that space
of time, it has already really dawned on people how
much it's going to revolutionize different industries. And I think
(08:41):
advertisings are absolutely key if you do play around with
the tools. Yes, I could. I've put myself in all
space outfit. Yeah, exactly, you can. It is strange and interesting,
but you're right, it's also about regulation. I mean, I
think this goes to the point that we were making
earlier about data centers in the UK week, this expectation
of billions of dollars being invested into creating data centers
(09:05):
in the UK. The part of that is also to
do with the slightly tougher regulations that there are in
the EU around artivision intelligence. But you know, if it
also supercharges growth in the UK, will it be worth it?
I think that's a big question, isn't it.
Speaker 1 (09:20):
Yeah?
Speaker 3 (09:20):
Indeed, And of course those data centers something that is
going to be announced as part of Donald Trump's visit
to the UK. The big story now overshadowing that visit
is the sacking of Peter Mandelsson, the British ambassador to
the US, after his ties to Jeffrey Epstein were revealed
in those emails published by Bloomberg. We have our Bloomberg
opinion columnist Rosa Prince with us for more on that
(09:41):
as well. Rosie, you've been writing about this story. What
was it in these emails revealed by our reporting that
made it impossible for Peter Mandelson to stay on.
Speaker 1 (09:52):
Well?
Speaker 9 (09:52):
When he joined the government as UK Ambassador to the US,
Peter Mandlson would have had a thorough vetting to make
sure there were no issues in his background. Now, what
the government is saying is that he wasn't fully transparent
about the extent of his friendship and relationship with Jeffrey Epstein,
(10:13):
as the emails that Bloomberg published yesterday showed the friendship
was very close and continued after Epstein had been sent
to prison for the first time, and even included kind
of lobbying for him to seek early release. It suggested
that he didn't believe that the crimes he were accused
(10:33):
of were valid, that perhaps the accusers were not telling
the truth, and it definitely showed that he wanted Epstein
to fight to get out of prison early. Kirstym and
his team are now saying that they felt that that
was not disclosed to them at the time, that this
was embarrassing and in the circumstances he had to go.
Speaker 2 (10:54):
Look, Peter Mandelson was dubbed, you know, the first spin doctor.
There was always this possibility, wasn't there. I mean, the
reason that he was hired was for his business ties,
his network in both politics and business, and so I
suppose there are questions now aberhout kis Stalman whether he
got the balance right. Does it raise questions about the
(11:17):
Prime Minister's judgment in picking Mandelssohn.
Speaker 9 (11:22):
Yeah, I wrote in my column yesterday that I think
it really does. It was always a risk to hire
Peter Mandalsson. He's got such a long reputation, he had
already had to resign from the cabinet twice. Trouble seems
to follow him wherever he goes. Now. He does have
undoubted talents, as you say, he's very good at getting
(11:42):
on with people, he's very effective, he's very smart. But
kirs Starmer was taking a risk when he hired him,
and I think it's a risk that has not paid off.
There was this sort of sickening air of inevitability about
this scandal, and I also think that what it highlights
is the fact that Kirstarmer's claim to have been putting
the victims first at all time times just isn't true.
(12:05):
If he'd really thought this true, I think he would
have appreciated that it wasn't worth it. And he's now
paying the price, not just as you say, having lost
his ambassador on the eve of a very important visit
by Donald Trump, but also in his own political standing.
It's two weeks running now that he has stood up
(12:25):
in the House of Commons during Prime Toter's question time
and defended someone very close to him in who were
in such indefensible positions really that within hours they had
to stand down, And I just think that's not a
very good look for the Prime Minister.
Speaker 6 (12:40):
Right.
Speaker 3 (12:40):
So this is happening at the time that we're just
days away from Donald Trump's visit to the UK. Now
the key point person between the UK and the US
won't be there. How much of a problem is that
going to be.
Speaker 9 (12:52):
I don't think it's a huge problem in terms of
the logistics, the arrangements, everything that's going on with the visit.
That's all been done. The hard work has been done
thanks to those girls that Peter Manderson has. He had
a very able number two in the form of James Roscoe,
who is now in charge of the embassy. So I
think the visit from that point of view will go
(13:13):
ahead just as it was planned to. I think that
it will not please Donald Trump to have this big
fuss just as he travels to the UK. Obviously, Donald
Trump has his own issues with the Epstein affair. He
will not want that or to be amplified. He won't
want to have to go into a press conference and
ask questions about Jeffrey Epstein, which I think the UK
(13:34):
press in particular will now feel they are justified in
asking because of this scandal around Peter Mandilsson. So the
whole thing is not ideal on that front.
Speaker 2 (13:44):
Yeah, and that's one significant question, isn't it for next week?
How the Prime minister is going to navigate that during
the visit.
Speaker 9 (13:53):
That's right, there are a number of moments of jeopardy.
They are meeting at Checkers, which is the Prime minister's
country tree residents. There is a formal press conference planned,
and as you know, there are opportunities, any number of
opportunities for Donald Trump to speak off the cuffee. Likes
to do that, he likes being around reporters. I kind
of think that in normal circumstances he would see this
(14:15):
is a fresh challenge, you know, a new pack of
journalists to sort of wrangle with. But in the current moment,
it's such a difficult time anyway politically in the US,
given the assassination of Charlie Kirk, he is probably not
going to be in a mood for their typical banter.
So I wonder if perhaps those moments, those unscheduled moments
(14:38):
will be less than usual. But yeah, he's coming here
not in the best frame of mind, and obviously it's
an important time for the UK. UK wants to talk
about trade. It wants to talk about some of those
deals like the investment opportunities by and Video and Open
AI that we were reporting on this morning. So I
think Kirstarma is currently in number ten. Just crossing his
fingers that things go well next week.
Speaker 3 (15:00):
Okay, Rosa Prince, Bloomberg Opinion columnist, thank you very much.
You can read the late us from Rosa by the
way at Bloomberg dot Com Forward Slash Opinion. Stay with us.
More from Bloomberg Daybreak Europe. Coming up after this.
Speaker 2 (15:15):
Now is the gloom over initial public offerings in Europe lifting.
There's been a florry of listings activity this week with
several large issuers wading into the market. Here with more
is our European capital markets reporter Pablo Moo Sircarro. Thank
you so much for being with us at Pablo remind
us of the context here. What kind of a year
(15:36):
has it been in terms of IPOs across Europe?
Speaker 1 (15:39):
Having me, it's been a pretty slow year. Unfortunately, going
into twenty twenty five, I think deal makers expected the
coming months to be quite busy and to become the
start of a renaissance in European capital markets. What happened
(16:01):
was that there was about of volatility in the first
half of the year on the back of the tariff
announcements by the Trump administration, and that prompted a lot
of issuers to delay their IPO plans, and some that
tried to actually pull the trigger and go public they
(16:23):
were forced to pull out at the very last minute.
So it's been a really quiet year that now has
the potential to end on a high, and we count
about a dozen companies that could potentially go public in
this window, so twenty twenty five could in a potentially
(16:45):
very different note.
Speaker 3 (16:46):
Talk to us about what's been happening this week and
why that's giving some calls for optimism from here.
Speaker 1 (16:51):
I think it's because of the sheer number of companies
that could potentially pull the trigger and the fact that
we've seen a couple of the larger ones actually go
ahead and you know, communicate plants to go public. We
have one IPO in Switzerland by a company calls SMG
Swiss Marketplace Group. It's a classified business and they're looking
(17:14):
to raise around a billion dollars, so that's a pretty
significant offer size. We got Nova Bank in the Nordics,
which is a consumer lender owned by private equity. These
guys were initially gone to IPO in the first half
of the year, but they decided to wait for better markets.
It seems like some of that volatility that we saw
(17:37):
in the first half of the year derived from tariffs.
It seems to have subsided somewhat. Equity prices are sky
high at the moment, and you know, bearing something unexpected,
like an escalation in the Middle Eastern or Ukrainian conflicts,
or some change in the economic direction of the world,
(18:00):
then we could we could actually have a pretty busy window.
So that's why people are getting excited about it.
Speaker 2 (18:05):
Okay, So I asked this question with hope and also
a bit of trepidation. Where is London in all of this?
How does it compare with what's happening in Europe.
Speaker 1 (18:15):
That's a good question. Look, London, we are aware that
there are a couple of IPOs in the works. There's
one that actually got announced earlier this week. If I'm
not mistaken. It's on the smaller on the smaller side
of the spectrum. The beauty tech group they're famous for
this led mask, the TikTokers and gen Ziers use for skincare,
(18:36):
and there's a couple at least a couple others. There's
a specialist bank shop Rock and potentially one subsidiary of
the Milan listed foods company New Princess SPA. Now TVD
like whether these IBOs will launch. As you very well know,
I pos are why caprecious and fickle. The market can
(18:58):
shut pretty quickly and at the end of it day
it comes down to investor sentiment and how they feel
about the UK. And there's some budget coming up, so
I think there's hope that we might see a little
bit of our revival in London IPOs before the year
is out. But there's still some question marks and we'll
be watching this very carefully.
Speaker 3 (19:20):
And Pablo, just to take a step back to sort
of the bigger picture, perhaps over a little bit of
a longer term, what is the outlook for European capital
markets now? Is the US still drawing all the biggest
names for listings.
Speaker 1 (19:32):
I think that we will continue to see some European
companies look to the US. There was some news this
week by Bloomberg. For example, the UK Stirling Bank is
starting to pivot towards the potential US IPO in the future.
Some of the more tech enabled names are attempted to
(19:55):
go to the US because there's this perception that Europe
is old economy in the US is new economy. So
in particular FinTechs and technology names are tempted by the US.
Having said that, this year, there's been there's been a
bit of rotation from investors toward European assets. There is
a bit of excitement around Europe with you know, the
(20:18):
prospect of increased defence spending, you know, Germany lifting the
borrowing breaks and starting to invest into growth. So I
think that we have the chance to see quite a
few i pos on the side of the Atlantic now
while companies continue to examine the US. I think that
(20:39):
will remain the case. For now. Europe is trying to
make things more attractive to retain the highest number of
companies possible. It's to be tbd whether Europe will manage
to effectively do that.
Speaker 3 (20:53):
This is Bloomberg Daybreak Europe, your morning brief on the
stories making news from London to Wall Street and beyond.
Speaker 2 (21:00):
Look for us on your podcast feed every morning, on Apples, Spotify,
and anywhere else you get your podcasts.
Speaker 3 (21:06):
You can also listen live each morning on London Dab Radio,
the Bloomberg Business app, and Bloomberg dot Com.
Speaker 2 (21:12):
Our flagship New York station, is also available on your
Amazon Alexa devices. Just say Alexa play Bloomberg eleven thirty.
I'm Caroline Hepka.
Speaker 3 (21:21):
And I'm Stephen Carol. Join us again tomorrow morning for
all the news you need to start your day right
here on Bloomberg day Break Europe
Bloomberg Audio Studios, podcasts, radio news.
Speaker 2 (00:09):
This is the Big DAYBAK podcast. Good morning, It's Friday,
the twelfth of September. I'm Caroline Hepkat in London.
Speaker 3 (00:15):
And I'm Stephen Caroline Brussels. Coming up today. Questions mount
over the British Prime Minister's judgment as he sacks his
ambassador to the US, Peter Mandelsson, after Bloomberg's exclusive reporting
on his ties to Jeffrey Epstein.
Speaker 2 (00:29):
The FBI releases footage of a suspect in the killing
of US conservative activist Charlie Kirk and a reward of
up to one hundred thousand dollars for information.
Speaker 3 (00:39):
Plus kicking open Europe's IPO window. We look at a
flurry of listings that suggest that tariff induced caution of
recent mods may have passed.
Speaker 2 (00:48):
Let's start with a round up of our top stories.
Speaker 3 (00:50):
The UK's Prime Minister is facing growing questions over what
he knew about Peter Mandelson's relationship with Jeffrey Epstein when
he appointed him as US ambassador. Here Starmer fired Mandelsson
after Bloomberg published a series of emails between Mandelson and
the convicted pedophile. Semester's show. The former ambassador offered Epstein's
support and advice after the financiers conviction in two thousand
(01:12):
and eight for soliciting sex from a minor, saying quote,
I think the world of view. Peter Mandelsson's ties to
Epstein were known when he was made ambassador, although he
denied that they were extensive and said he regretted them.
But Starmer's office concluded that Bloomberg's reporting showed their relationship
to be closer than was known about. Here's what Foreign
Office Minister Stephen Doherty told the House of Commons.
Speaker 4 (01:36):
The email's show was to speaker that the depth and
extent of Lord Mallison's relationship with Jeffrey Epstein is materially
different from that known at the time of his appointment.
Speaker 3 (01:47):
Stephen Doherty speaking there. The timing could hardly be worse
for the British government, which is preparing to host US
President Trump's state visit next week, as the American leader
is facing questions of his own about his relationship with Epstein.
Speaker 2 (02:01):
The FBI has released footage of these suspects believed to
be involved in the shooting of American political activist Charlie
Kirk in Utah. The video shows an individual fleeing the scene.
Investigators have recovered what they believe to be the murder weapon,
but are still searching for the culprit. Utah Governor Spencer
Coggs says prosecutors will seek the most severe punishment.
Speaker 5 (02:23):
More than anything, we are going to catch this person.
Last thing I will just say is we've been working
with our attorneys getting everything that we need after Davits
ready so that we can pursue the death penalty in
this case.
Speaker 2 (02:38):
Utah Governor Spencer Cox speaking there, he also accused other
countries of spreading disinformation about the incident and trying to
cause unrest in the US. A reward of up to
one hundred thousand dollars is now being offered for information
about the killing.
Speaker 3 (02:55):
NATO was preparing defensive military measures to strengthen its eastern
flank after Russian drones crossed into Poland this week. Military
planning is being led by Supreme Allied Commander in Europe
Alexis Grinkovich, who is assessing the situation and what supplies
may be needed.
Speaker 6 (03:11):
And just as you are committed to us, we are
committed to you. NATO Land Forces Forward led by Germany,
with additional contributions from Belgium, Chechia, Luxembourg, the Netherlands in
Norway are here and growing. Germany will permanently station a
brigade in Lithuania. This is a major step to strengthen
(03:32):
our deterrence and defense on the eastern flank of the Alliance's.
Speaker 3 (03:37):
The top US commander in Europe, Alexis Grinkovich, speaking during
a visit to Lithuania Poland, yesterday, asked allies for additional
air defense systems and counter drone technology to better protect
against Russian incursions. With offers of assistance starting to come in.
President Trump said the incident could have been a mistake,
but expressed his frustration with the event that has alarmed
(03:59):
WARSAW and other NATO allies.
Speaker 2 (04:02):
Open AI says that it's closer to converting into a
for profit company, which would include giving its nonprofit arm
one hundred billion dollars inequity. The maker of chat GPT
announced it's nearing the end of months of negotiations with
top shareholder Microsoft to overhaul its structure and unlock an
eventual public listing. The one hundred billion dollar at stake
(04:26):
would also give the company a roughly twenty percent share
of open ai if it closes a deal to let
employees sell shares at evaluation of five hundred billion dollars.
Speaker 3 (04:37):
The leaders of open Ai and Nvidia are planning to
invest billions of dollars in UK data centers when they
visit the country next week. Bloomberg's Freddie Filstone has more.
Speaker 7 (04:47):
US President Donald Trump is on a state visit to
Britain next week, but he's bringing with him open Ais,
Sam Altman and Nvidia's Jensen Hwang as part of a
group of American executives. They're poised to invest tens of
billions of dollars in artificial intelligence, and Prime Minister kir
Starmer has promised to turbocharge AI to help grow the
(05:09):
UK economy. Bloomberg now understands open Ai and Nvidia are
working with London based and Scale as part of a
billion dollar deal to build data centers in London. Freddie
Fulston Bloomberg Radio.
Speaker 2 (05:23):
Bloomberg understands the ECB policymakers are convinced that no further
interest rate cuts are needed to deliver two percent inflation
barring a major shock in the Euro Area. The European
Central Bank has kept interest rates unchanged at two percent
for a second meeting in a row. Yesterday, new ECB
forecasts show inflation staying close to two percent target and
(05:44):
growth holding steady, even as Donald Trump's tariffs and political
turmil in France way on sentiment. ECB President Christina Guard
signaled confidence that inflation is under control.
Speaker 8 (05:56):
The disinflationary process is over. Inflation is where we want
it to be, laterst reading two point one two to
two point one medium term outlook on target. In the
same breadth affair, I say that we decide meeting by meeting,
that we are data dependent, and that we will decide
(06:17):
accordingly in order to make sure that we stay in
a good.
Speaker 2 (06:21):
Place, ECB President Christine the Guard, speaking there. Trade is
reacted by dialing back bets on more rate cuts. Meanwhile,
in the US, underlying inflation rose as expected in August,
keeping the US Federal Reserve on track to cut interest
rates next week.
Speaker 3 (06:40):
In a moment, we'll bring you more in the file
out from Bloomberg's exclusive reporting on those emails between Jeffrey
Epstein and Peter Mandelson and what it means for the
British Prime Minister now, plus why Europe's IPO pipeline is
starting to look a little more rosy after the latest
string of listings. But in the story we've been reading
this morning on photo editing tools and could this be
(07:02):
what lifts AI to the next level for Internet users,
this is what Bloomberg Opinions Katherine Warbeck has been writing about.
She got a preview of one of the new Chinese
tools in this areas try to use it to restore
a photo of her late grandfather. That didn't quite work
as planned, but she was able to generate some interesting
images by just pulling inspiration fromages available online. So she
(07:23):
was able to make one of President Trump holding up
a bedazzled l Boo Boo doll, for example, although when
she asked the software to do it for cheating ping,
it did not respond to that request. But she's talking
about I suppose the potential for advertisers and consumers of
if you can create photos that are essentially manipulated by AI,
this could be the path to monetization for some of
(07:45):
these tools, which is, as you know, one of the
really big questions about AI, the multi billions of dollars
being poured into this technology. But oftentimes it's not actually
yielding the results or the return for those companies just yet.
Of course, the other side of this is the risks
involved too. You start putting manipulated photos out there, how
do you control it? How do you flag it to
Internet users? But an interesting thought I suppose on that
(08:07):
moment of where we are in AI now, and of
course the big question is the technology evolves so fast,
how do you keep up with regulatoring US, monitoring us
trying to understand the sort of impact it can have.
Speaker 6 (08:19):
Yeah.
Speaker 2 (08:19):
Absolutely, I think that you are already seeing how AI.
I mean just since January when I was downloading a
whole suite of different AI applications just to kind of
have a go and see whether I could use it
or not. It feels like this September, in that space
of time, it has already really dawned on people how
much it's going to revolutionize different industries. And I think
(08:41):
advertisings are absolutely key if you do play around with
the tools. Yes, I could. I've put myself in all
space outfit. Yeah, exactly, you can. It is strange and interesting,
but you're right, it's also about regulation. I mean, I
think this goes to the point that we were making
earlier about data centers in the UK week, this expectation
of billions of dollars being invested into creating data centers
(09:05):
in the UK. The part of that is also to
do with the slightly tougher regulations that there are in
the EU around artivision intelligence. But you know, if it
also supercharges growth in the UK, will it be worth it?
I think that's a big question, isn't it.
Speaker 1 (09:20):
Yeah?
Speaker 3 (09:20):
Indeed, And of course those data centers something that is
going to be announced as part of Donald Trump's visit
to the UK. The big story now overshadowing that visit
is the sacking of Peter Mandelsson, the British ambassador to
the US, after his ties to Jeffrey Epstein were revealed
in those emails published by Bloomberg. We have our Bloomberg
opinion columnist Rosa Prince with us for more on that
(09:41):
as well. Rosie, you've been writing about this story. What
was it in these emails revealed by our reporting that
made it impossible for Peter Mandelson to stay on.
Speaker 1 (09:52):
Well?
Speaker 9 (09:52):
When he joined the government as UK Ambassador to the US,
Peter Mandlson would have had a thorough vetting to make
sure there were no issues in his background. Now, what
the government is saying is that he wasn't fully transparent
about the extent of his friendship and relationship with Jeffrey Epstein,
(10:13):
as the emails that Bloomberg published yesterday showed the friendship
was very close and continued after Epstein had been sent
to prison for the first time, and even included kind
of lobbying for him to seek early release. It suggested
that he didn't believe that the crimes he were accused
(10:33):
of were valid, that perhaps the accusers were not telling
the truth, and it definitely showed that he wanted Epstein
to fight to get out of prison early. Kirstym and
his team are now saying that they felt that that
was not disclosed to them at the time, that this
was embarrassing and in the circumstances he had to go.
Speaker 2 (10:54):
Look, Peter Mandelson was dubbed, you know, the first spin doctor.
There was always this possibility, wasn't there. I mean, the
reason that he was hired was for his business ties,
his network in both politics and business, and so I
suppose there are questions now aberhout kis Stalman whether he
got the balance right. Does it raise questions about the
(11:17):
Prime Minister's judgment in picking Mandelssohn.
Speaker 9 (11:22):
Yeah, I wrote in my column yesterday that I think
it really does. It was always a risk to hire
Peter Mandalsson. He's got such a long reputation, he had
already had to resign from the cabinet twice. Trouble seems
to follow him wherever he goes. Now. He does have
undoubted talents, as you say, he's very good at getting
(11:42):
on with people, he's very effective, he's very smart. But
kirs Starmer was taking a risk when he hired him,
and I think it's a risk that has not paid off.
There was this sort of sickening air of inevitability about
this scandal, and I also think that what it highlights
is the fact that Kirstarmer's claim to have been putting
the victims first at all time times just isn't true.
(12:05):
If he'd really thought this true, I think he would
have appreciated that it wasn't worth it. And he's now
paying the price, not just as you say, having lost
his ambassador on the eve of a very important visit
by Donald Trump, but also in his own political standing.
It's two weeks running now that he has stood up
(12:25):
in the House of Commons during Prime Toter's question time
and defended someone very close to him in who were
in such indefensible positions really that within hours they had
to stand down, And I just think that's not a
very good look for the Prime Minister.
Speaker 6 (12:40):
Right.
Speaker 3 (12:40):
So this is happening at the time that we're just
days away from Donald Trump's visit to the UK. Now
the key point person between the UK and the US
won't be there. How much of a problem is that
going to be.
Speaker 9 (12:52):
I don't think it's a huge problem in terms of
the logistics, the arrangements, everything that's going on with the visit.
That's all been done. The hard work has been done
thanks to those girls that Peter Manderson has. He had
a very able number two in the form of James Roscoe,
who is now in charge of the embassy. So I
think the visit from that point of view will go
(13:13):
ahead just as it was planned to. I think that
it will not please Donald Trump to have this big
fuss just as he travels to the UK. Obviously, Donald
Trump has his own issues with the Epstein affair. He
will not want that or to be amplified. He won't
want to have to go into a press conference and
ask questions about Jeffrey Epstein, which I think the UK
(13:34):
press in particular will now feel they are justified in
asking because of this scandal around Peter Mandilsson. So the
whole thing is not ideal on that front.
Speaker 2 (13:44):
Yeah, and that's one significant question, isn't it for next week?
How the Prime minister is going to navigate that during
the visit.
Speaker 9 (13:53):
That's right, there are a number of moments of jeopardy.
They are meeting at Checkers, which is the Prime minister's
country tree residents. There is a formal press conference planned,
and as you know, there are opportunities, any number of
opportunities for Donald Trump to speak off the cuffee. Likes
to do that, he likes being around reporters. I kind
of think that in normal circumstances he would see this
(14:15):
is a fresh challenge, you know, a new pack of
journalists to sort of wrangle with. But in the current moment,
it's such a difficult time anyway politically in the US,
given the assassination of Charlie Kirk, he is probably not
going to be in a mood for their typical banter.
So I wonder if perhaps those moments, those unscheduled moments
(14:38):
will be less than usual. But yeah, he's coming here
not in the best frame of mind, and obviously it's
an important time for the UK. UK wants to talk
about trade. It wants to talk about some of those
deals like the investment opportunities by and Video and Open
AI that we were reporting on this morning. So I
think Kirstarma is currently in number ten. Just crossing his
fingers that things go well next week.
Speaker 3 (15:00):
Okay, Rosa Prince, Bloomberg Opinion columnist, thank you very much.
You can read the late us from Rosa by the
way at Bloomberg dot Com Forward Slash Opinion. Stay with us.
More from Bloomberg Daybreak Europe. Coming up after this.
Speaker 2 (15:15):
Now is the gloom over initial public offerings in Europe lifting.
There's been a florry of listings activity this week with
several large issuers wading into the market. Here with more
is our European capital markets reporter Pablo Moo Sircarro. Thank
you so much for being with us at Pablo remind
us of the context here. What kind of a year
(15:36):
has it been in terms of IPOs across Europe?
Speaker 1 (15:39):
Having me, it's been a pretty slow year. Unfortunately, going
into twenty twenty five, I think deal makers expected the
coming months to be quite busy and to become the
start of a renaissance in European capital markets. What happened
(16:01):
was that there was about of volatility in the first
half of the year on the back of the tariff
announcements by the Trump administration, and that prompted a lot
of issuers to delay their IPO plans, and some that
tried to actually pull the trigger and go public they
(16:23):
were forced to pull out at the very last minute.
So it's been a really quiet year that now has
the potential to end on a high, and we count
about a dozen companies that could potentially go public in
this window, so twenty twenty five could in a potentially
(16:45):
very different note.
Speaker 3 (16:46):
Talk to us about what's been happening this week and
why that's giving some calls for optimism from here.
Speaker 1 (16:51):
I think it's because of the sheer number of companies
that could potentially pull the trigger and the fact that
we've seen a couple of the larger ones actually go
ahead and you know, communicate plants to go public. We
have one IPO in Switzerland by a company calls SMG
Swiss Marketplace Group. It's a classified business and they're looking
(17:14):
to raise around a billion dollars, so that's a pretty
significant offer size. We got Nova Bank in the Nordics,
which is a consumer lender owned by private equity. These
guys were initially gone to IPO in the first half
of the year, but they decided to wait for better markets.
It seems like some of that volatility that we saw
(17:37):
in the first half of the year derived from tariffs.
It seems to have subsided somewhat. Equity prices are sky
high at the moment, and you know, bearing something unexpected,
like an escalation in the Middle Eastern or Ukrainian conflicts,
or some change in the economic direction of the world,
(18:00):
then we could we could actually have a pretty busy window.
So that's why people are getting excited about it.
Speaker 2 (18:05):
Okay, So I asked this question with hope and also
a bit of trepidation. Where is London in all of this?
How does it compare with what's happening in Europe.
Speaker 1 (18:15):
That's a good question. Look, London, we are aware that
there are a couple of IPOs in the works. There's
one that actually got announced earlier this week. If I'm
not mistaken. It's on the smaller on the smaller side
of the spectrum. The beauty tech group they're famous for
this led mask, the TikTokers and gen Ziers use for skincare,
(18:36):
and there's a couple at least a couple others. There's
a specialist bank shop Rock and potentially one subsidiary of
the Milan listed foods company New Princess SPA. Now TVD
like whether these IBOs will launch. As you very well know,
I pos are why caprecious and fickle. The market can
(18:58):
shut pretty quickly and at the end of it day
it comes down to investor sentiment and how they feel
about the UK. And there's some budget coming up, so
I think there's hope that we might see a little
bit of our revival in London IPOs before the year
is out. But there's still some question marks and we'll
be watching this very carefully.
Speaker 3 (19:20):
And Pablo, just to take a step back to sort
of the bigger picture, perhaps over a little bit of
a longer term, what is the outlook for European capital
markets now? Is the US still drawing all the biggest
names for listings.
Speaker 1 (19:32):
I think that we will continue to see some European
companies look to the US. There was some news this
week by Bloomberg. For example, the UK Stirling Bank is
starting to pivot towards the potential US IPO in the future.
Some of the more tech enabled names are attempted to
(19:55):
go to the US because there's this perception that Europe
is old economy in the US is new economy. So
in particular FinTechs and technology names are tempted by the US.
Having said that, this year, there's been there's been a
bit of rotation from investors toward European assets. There is
a bit of excitement around Europe with you know, the
(20:18):
prospect of increased defence spending, you know, Germany lifting the
borrowing breaks and starting to invest into growth. So I
think that we have the chance to see quite a
few i pos on the side of the Atlantic now
while companies continue to examine the US. I think that
(20:39):
will remain the case. For now. Europe is trying to
make things more attractive to retain the highest number of
companies possible. It's to be tbd whether Europe will manage
to effectively do that.
Speaker 3 (20:53):
This is Bloomberg Daybreak Europe, your morning brief on the
stories making news from London to Wall Street and beyond.
Speaker 2 (21:00):
Look for us on your podcast feed every morning, on Apples, Spotify,
and anywhere else you get your podcasts.
Speaker 3 (21:06):
You can also listen live each morning on London Dab Radio,
the Bloomberg Business app, and Bloomberg dot Com.
Speaker 2 (21:12):
Our flagship New York station, is also available on your
Amazon Alexa devices. Just say Alexa play Bloomberg eleven thirty.
I'm Caroline Hepka.
Speaker 3 (21:21):
And I'm Stephen Carol. Join us again tomorrow morning for
all the news you need to start your day right
here on Bloomberg day Break Europe
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