September 19, 2025 • 21 mins
Your morning briefing, the business news you need in just 15 minutes.
On today's podcast:
(1) Nvidia plans to invest £2 billion ($2.7 billion) to support the UK’s artificial intelligence industry in partnership with several venture capital firms.
(2) With golden carriages, military splendor and an opulent banquet, the UK’s royal gambit paid off this week, as President Donald Trump and Prime Minister Keir Starmer concluded an historic state visit by hailing the trans-Atlantic relationship and — at least publicly — smoothing over their policy differences.
(3) The Bank of England’s decision to slow the pace and change the make-up of its quantitative tightening plan on Thursday shattered any lingering illusion the policy remains on autopilot.
(4) The call Friday between US President Donald Trump and Chinese President Xi Jinping promises to determine the fate of TikTok — and potentially ease trade tensions between the world’s two biggest economies.
(5) Europe’s top business lobby in China urged Beijing to address price wars and unsustainable competition as the country readies its next five-year plan — adding to pressure from the US over the matter.
(6) President Donald Trump said US broadcast networks should face scrutiny over their licenses if they’re too critical of him, in what amounts to his furthest-reaching threat to media freedoms.
(7) It turns out that all the “Sell America” angst swirling in markets earlier this year was misplaced. The real mantra from global investors is more like “Hedge America” — that is, keep snapping up US stocks and bonds but do so while buying derivatives that protect those investments against any further declines in the dollar.
Podcast Conversation: What You Need to Know About Ketamine Therapy, the Buzzy Mental Health Trend
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 (00:00):
Bloomberg Audio Studios, podcasts, radio news.
Speaker 2 (00:10):
This is the Blue Big dayba Q your podcast Givebrning.
It's Friday, the nineteenth of September. I'm Caroline Hepget in
London coming up today, and Vidia's Jensen Wong rounds off
a big week for American tech in Britain as Keir
Starmer's flattery of the US President pays off with major
pitfalls averted and a hint at better trade terms. Donald
(00:31):
Trump and China Xijingping get ready for a call to
discuss TikTok tariffs and trade curbs. Plus, as US stock
indexes close and a simultaneous record high for the first
time since twenty twenty one, we look at the hedge
America trade that is expected to top a trillion dollars.
Let's start with a roundup of our top stories. In
(00:52):
Vidia plans to invest two billion pounds to support the
UK's artificial intelligence industry. The chip maker is giving the
money to venture capital firms to invest in the likes
of Wave Revolute and Synthesia. CEO Jensen Wong says Britain
is in a goldilocks moment.
Speaker 3 (01:10):
This is the third largest AI stargs ecosystem in the world,
only behind the United States and China. So I think
that the moment is right, it's just missing the infrastructure.
This is the week. This is the week that I
declare that the UK will be an AI superpower.
Speaker 2 (01:26):
Jensen Wong, speaking there to journalists at a press briefing
about the news. And Vidia's investments are part of a
slew of AI announcements from US technology companies this week
time to coincide with President Trump's visit to Britain. While
the UK is the biggest European market for startups by
volume and by size of deals, Britain has yet to
(01:48):
produce a national AI champion like Open AI in the
US or France's mistral President Donald Trump Ampraman is a kistarma,
though concluded and historic state visit by hailing the transatlantic
relationship with little sign of public disagreement, the two world
leaders welcome two hundred and fifty billion pounds of bilateral
(02:09):
investment deals and a new tech agreement. After the summit
US at President Trump told Fox News that the UK
had pushed for lower tariffs on its steel exports.
Speaker 4 (02:20):
They would like to see if they could make a
little bit better were you open to that.
Speaker 5 (02:24):
I like them.
Speaker 6 (02:25):
We're making a lot of money.
Speaker 2 (02:27):
So they're at twenty five percent right now, you're going
to go lower than they're actually.
Speaker 4 (02:30):
Had fifty percent for steal and aluminum, and I want
to see them.
Speaker 5 (02:36):
They're having a lot of difficulty.
Speaker 2 (02:38):
But talks between the two leaders did not lead to
any obvious diplomatic breakthroughs on Ukraine or Gaza. Despite that,
one UK official expressed relief to Bloomberg that the UK's
Prime Minister kist Salma had got through the visit without
any further controversy over the UK's former ambassador Peter Mandelson's
(02:59):
relationship with Jeffrey Epstein. The Bank of England's decision to
rain in its quantitative tightening plan has shattered any illusion
that the policy remains on autopilot. This amid recent volatility
in the bond market. Yesterday's announcements or the Bank's Manage
Policy Committee reduced the annual runoff of its guilt holdings
(03:20):
to seventy billion pounds a year, down from one hundred billion.
The Governor of the Bank of England, Andrew Bailey, says
that he would take into account the impact of guilt
sales on interest rates.
Speaker 6 (03:30):
We take into account all market conditions, so any effect
that our sales have on market conditions and therefore on
interest rates going out along the sort of the whole
maturity spectrum of interest rates, we will take into account
when we set a bank rates, so there wouldn't be
an offset there. In other words, if there's a feeling
(03:54):
that in some sense quantity of tightening it's pushing rates
up in the market, then the effect of that we
would take into account when we say bank correct, so
there would be an offset there.
Speaker 2 (04:06):
So that was the Governor of the Bank of England,
Andrew Bailey speaking. He announced the changes to a quantitative
tightening alongside the bank's decision to hold interest rates at
four percent. The bank kept its guidance warning that future
cuts will be quote gradual and careful and depend on
the extent to which underlying disinflationary pressures continued to ease. Now,
(04:32):
Chinese President Shi Jinping and US President Donald Trump will
discuss trade tariffs and the future of TikTok on a
phone call at two pm London time today. It's the
first conversation since June between the leaders of the world's
two largest economies. Part of the discussion will focus on
plans to shift control of TikTok's US operations from Chinese
(04:54):
parent company byte Dance to a group of American investors.
Speaking yesterday, Trump tease the head to the deal.
Speaker 4 (05:02):
The United States is getting a tremendous fee plus. I
call it a fee plus for just making the deal.
And I don't want to throw that out the window now.
I'd rather reap the benefits. I mean, the kind of
money we're talking about is very substantial, and it'll be
owned by all American investors, and the best investors, and
the very rich people and companies are going to be
(05:25):
owning it, very very straight, very legitimate companies, and really
companies that love America. So they're going to be owning it.
Speaker 2 (05:32):
It's a big thing, President Trump speaking there, As Bloomberg understands,
byte Dance will hold no more than a twenty percent
stake in TikTok, while other investors, including Oracle and silver Lake,
would be involved. The two leaders will also discuss ongoing
trade restrictions when it comes to semiconductors and rare earth.
(05:55):
It's hope that the call may lay the groundwork for
their first in person meeting since President Trump returned to
office in the US. Now, President Trump says that US
broadcasters should face licensed scrutiny if they are too critical
of him. The comments came as he defended ABC's decision
(06:16):
to suspend Jimmy Kimmel's TV show indefinitely following remarks about
conservative activist Charlie Kirk. Speaking to reporters on board Air
Force one, the president suggested he is often targeted by
late night television hosts.
Speaker 7 (06:33):
I read some places that the networks were ninety seven
percent against me. I get ninety seven percent negative, and
yet I won easily won all seven s, makes safe popular.
Speaker 5 (06:44):
WORTE won everything.
Speaker 7 (06:45):
And if they're ninety seven percent against, they give you
only bad bookless or press. I mean they're getting a license.
I would think maybe their license should be taken away.
Speaker 2 (06:58):
So that was Donald Trump's speaking there. His remarks come
days after he filed a fifteen billion dollar lawsuit against
the New York Times newspaper. The president and his allies
have long complained that America's mainstream media is biased against conservatives.
Trump has repeatedly called for CBS, ABC and NBC News
(07:19):
on networks to get rid of late night comedy hosts,
who he says frequently criticize his administration. And lastly, the
UK's Secret Surface is aiming to recruit new spies using a.
Speaker 5 (07:34):
Website on the dark web.
Speaker 2 (07:36):
Six IS chief Richard Moore is launching a secure messaging
platform called Silent Courier, which is designed to target foreign agents.
Bloomberg's James Walcock has more.
Speaker 8 (07:47):
How do you become the next James bond Well? One
modern answer is b Russian and download a VPN. Six's boss,
who goes by the moniker C is calling on people
all over the world to help British intelligence over the
Internet in the name of global stability. It's a message
being targeted particularly at Russians, with a new website being
(08:10):
hosted on the Darkweb for anonymity in London. James Wilcock,
Bloomberg Radio.
Speaker 2 (08:16):
Those are our top stories this morning. Let's get to
the markets. Europe In stocks rose eight tens of one
percent at the close yesterday, but we didn't quite make
the highs that we saw for four of the US's
main stock indices yesterday. Huge run up in terms of
the S and P five hundred futures. They are consolidating
above six seven hundred. Also, we saw the Bank of
(08:39):
Japan keep interest rates at half of one percent at
the end of a very busy central banking week. That
has meant the yen has strengthen, Japanese equities have dropped.
You've also heard about the Bank of Japan of floating
its ETF holdings or beginning to do that. So that
was the other big news from that decision. In terms
of treasure yields, ten year treasury yields at the moment
(09:03):
upper basis point at four twelve. Right now, the Bloomberg
dollar spot indexes flat, all prices are down, and gold
is up four tenths of one percent. Those are the markets.
In a moment, I'm going to bring you more on
the Trump she call that we're expecting at nine am
Washington time at two pm in London here, and also
the global surge in stocks after a record breaking QS
(09:24):
rally yesterday. So we'll get to that in a moment.
But another story caught my eye is being marketed as
a quick fix for mental health. But behind the slick advertising,
the drug ketamine has some unknown, possibly really serious downsides,
and it is the subject of Bloomberg Businessweeks. Michelle Luke
in a piece that she's written, she describes ketamine as
(09:46):
this rapid acting substance that increases the brain's neuroplasticity. It
has also got some antidepressant effects. Obviously we know that
it has been used as an anesthetic in operations, both
for human beings and yes, for horses.
Speaker 5 (10:00):
But she talks in a.
Speaker 2 (10:02):
Very interesting way in her piece about how social media
has fueled the rise of ketamine is a kind of
trendy mental health hack, and that this market staggeringly is
worth three point four billion dollars in the US, and
she kind of charts the rise of it, but also
the massive potential unknowns and downsides, the risks of addiction
(10:24):
and misuse, and I just it got me thinking about
the UK. Ketamine use here in the UK has also
been massively on the rise. It hit a record high
in the year to the end of March twenty twenty three.
That's why it's got the government thinking about raising it
not just from a Class B drug I illegal to
buy and sell, but actually to a Class A drug,
which would you know, put it into an even more
(10:46):
serious category. But it is just staggering, you know how
much the online hype has sort of contributed to the
rise of ketamine that it really isn't such a straightforward,
you know, life hack. Anyway, it's a very piece. I
will put a link to it in our show notes
to Bloomberg BusinessWeek's Michelle Luke. Now present, Trump will hold
(11:08):
a call with Xijingping this Friday. It will include potentially
a decision on TikTok and also whyder trade discussions, perhaps
setting up an in person meeting. It comes after a
state visit to the UK in which policy differences were
smoved over. Joining me now is Bloomberg's Chief Asia correspondent
Roslyn Matheson to discuss Good morning, was TikTok and transactional diplomacy?
(11:33):
What do you think might emerge a US owned but
a Chinese controlled algorithm?
Speaker 9 (11:39):
Well seems to be it'll be owned by a group
of US investors. But we don't know a lot of
the details yet and Donald Trump did not want to
be drawn on it, particularly yesterday. But what we do
understand is part of that is bitt dancers holding would
go down to less than twenty percent, so potentially under
that threshold that would trigger those national security law aspects
(12:01):
and Oracle silver Lake and recent Horowitz would have the rest. So,
as you're saying, byt Dance essentially licenses its technology to
that group for a new platform, so that the people
who use TikTok now in the US will be migrated
to a new platform that essentially mirrors the experience they
have now. And by it, Dance and TikTok as we
know it now would help build it because they have
(12:22):
to know how. But the US feeling this is an
arrangement that protects US users. Well, the Chinese company retains
ownership of its technology, which is a key asset in
its own right, So those appear to be the parameters
for now, at least the understanding going into the call.
So of course the majority ownership shifts to those US shareholders,
(12:45):
but byt Dance retains control, particularly of its technology.
Speaker 2 (12:50):
There are lots of wider trade tensions, of course, between
the US and China. Will tariffs or chip controls be eased?
Speaker 9 (12:57):
Well, Trump's been talking in recent days mostly about extending
the current trade truth on its existing terms. It's due
to expire in November, so perhaps extending it again, which
doesn't sound like movement much on tarifs in the minute,
but you never know, obviously, when the two of them
are on the call together, and perhaps they might prefer
to have a big bang announcement on taris if or
(13:20):
when they meet in person, because the idea is this call,
as you say, paves the way potentially for a meeting
in October in Asia.
Speaker 5 (13:27):
So perhaps this.
Speaker 9 (13:28):
Lays the groundwork and they want to come out and
make a splash with an announcement on tariffs in the minute. Obviously,
there are a lot of issues there still to go through,
in a lot of potential roadblocks for them, and Chips
a particular issue because we have China saying in Video
violated anti monopoly laws. They're trying to get Chinese tech
companies to stop buying in video products. And no doubt
(13:51):
the CEO of in Video, Jensen Huang, who's got a
very close relationship with Donald Trump, will be hoping the
US President brings it up on the cour But again,
you're unlikely to see China change it stance significantly in
a minute.
Speaker 2 (14:06):
In terms of conflicts, do you think the US person
will try to press China in terms of support for
Russia's war in Ukraine or even on Taiwan, the South
China Sea where's the US president on those issues?
Speaker 7 (14:16):
Now?
Speaker 9 (14:18):
Well, it's obviously frustrated with Vladimir Putin, the Russian president.
He wants traction on ending the war in Ukraine, but
his stance seems to be more that it's on Europe
to pressure Russia first on the energy side, and to
do so perhaps by penalizing China on Russian energy purchases.
So it be interesting to see whether or how that
comes up, because Trump does want to keep this call
(14:40):
as a starting point to that in person meeting, and
Russian energy is a very sensitive topic for cgmping.
Speaker 5 (14:46):
It's something he might bristle.
Speaker 9 (14:47):
At the idea that he's like, well, this is an
issue for China and Russia, this is not an issue
for anybody else to get involved in. So be interesting
to see how or whether that comes up. And on Taiwan, interestingly,
we have this report in the Washington Post that Trump
has declined to approve it's a more than four hundred
million military aid package for Taiwan, and this include minissions
(15:09):
and autonomous drones rejected by the White House, and interesting
to see that happen also potentially so close to this
call and a potential meeting because Taiwan's a very sensitive
issue obviously in the relationship. Beijing sees Taiwan as a
self you know, as part of its territory. It is
a self ruled democracy, of course, and perhaps you know,
(15:33):
gold Trump's just treading a bit carefully. They're also so yeah,
it'll be interesting to see how weather that comes up to.
Speaker 2 (15:39):
Okay, So that's all the kind of anticipation around the
US and China.
Speaker 5 (15:43):
But I do want to get a word in.
Speaker 2 (15:44):
There about the president's state visit to the UK. What
did you make of it? What do you think is
the conclusion in Britain certainly around.
Speaker 9 (15:52):
This well, I imagine quite a few size of relief
this morning he's gone. There were no major problems in
the it. He got all the pomp and ceremony of
the royal family, which he likes. They kind of stepped
over the most delicate issues in the minute.
Speaker 5 (16:08):
Even in their.
Speaker 9 (16:09):
Press conference yesterday, you know, things came up on the
UK stance on a Palestinian state, on free speech, on migration.
Trump said he disagreed with Stum on a few things,
but they were quite polite about it.
Speaker 5 (16:19):
And the mood seemed pretty friendly.
Speaker 9 (16:22):
So this visit probably went as well as it could
for the UK Prime Minister, but the hard stuff was
also off the table in a way. They punted on
steel tariffs, they didn't really get into detail on Ukraine
and a path forward from there. So you know, some
of the hard stuff was obviously left off the table
in order just to have this meeting go as smoothly
as possible.
Speaker 2 (16:43):
Yeah, absolutely, Rolls, thank you so much for being with
me this morning. BlueBag Chief Asia correspondent Roslyn Matheson, stay
with us. More from Bloomberg dbake Cube coming up after this. Now,
the S and P five hundred, NASDAQ one hundred, Dow
Jones in dust to average and Russell two thousand small
cap indegs all closed together at fresh record highs for
(17:06):
the first time since November twenty twenty one. So it
turns out that all the Cell America Incs swelling in
marcuts earlier this year may have been misplaced. Is the
mansion now for global in versus more like Hedge America? Well,
that's the question that I'm going to put to Bloomberg's
markets were bought of Titel.
Speaker 5 (17:22):
Good morning val.
Speaker 2 (17:23):
Rning just forir Sally on the stocks rally and what
happened at the end of yesterday's trading. I mean, how
rare is this to happen to have all these indices
doing so well.
Speaker 5 (17:32):
Look, it's pretty rare.
Speaker 10 (17:34):
It's not happened since twenty twenty one, and it's something
that's only happened twenty five times in this century that
we've seen. The S and P five hundred, the tech
heavy NASDAC, the small cap Russell two thousand, and the
blue chip Dow Jones all hit record high closing levels
at the same time. Now, a lot of it, I
think was it maybe a reassessment of the FED yesterday?
(17:56):
The fact that they are cutting to protect growth instead
of fighting in fla in some way cutting interestrates because
they can not necessarily because they have to, led to
quite a risk on rally yesterday. Across at the equity market,
the Russell two thousand was actually the outperformer yesterday, that's
the small cap index. It was up some two and
a half percent, which kind of ties into that narrative
(18:17):
of domestically led US growth that would benefit small caps
the most on the back of this restarted easing cycle
from the FED.
Speaker 2 (18:25):
So why do you think that leaves valuations then.
Speaker 10 (18:29):
Well, look, that's a hard one to argue. I mean,
there are plenty of people who have come on this
show and sat around this table and said valuations are
stretched in the US, only to get it wrong a
few weeks later. I think the issue here, Caroline is
is that if you miss a bull market, if you're
a portfolio manager, if you're a manager of funds, and
you miss a bull market, it's the biggest thing to
make up for in your portfolio. So, yes, valuations are stretched,
(18:53):
but the FED is kicking off the second round of
this easing cycle. And usually when the FED is cutting,
if there's no immediate recession on the horizon, that is
a good that is a good framework for equity sur rally.
And I think that was just was the conclusion yesterday
that no matter the valuation, it is looking better and
better for US stocks if the interest rate of the
(19:14):
Federal Reserve is going to keep decreasing this year.
Speaker 5 (19:17):
Yeah.
Speaker 2 (19:17):
Absolutely, And so does that mean the rest of the world,
As you say once in on this US Dot market Valley,
I mean, what does it mean for other US assets?
Speaker 10 (19:26):
Well, I think it's interesting what you noted there about
inflows into US assets, But a lot of these inflows
are becoming hedged on an FX basis, and that's something
that's really interesting to talk about because the first time
this decade, FX hedged inflows into US assets are now
dominating unhedged exposure. And this is a very big shift
(19:47):
that's happened in the market in the last six months,
really since the tariff tailspin back in April. Because previously,
you know, holding unhedged dollar unhedged tech stocks was the
biggest winning trade of the century. The fact that we
at least in the previous decade had a rising stock
market alongside US dollar appreciation really led to foreign investors
(20:11):
dropping their FX hedges on a pretty steady basis. But
that a lot of that has been spun around. We
have some estimates from the street that out of the
thirty trillion dollars of US assets held in foreign hands,
now one trillion of that is now hedged, which puts
the hedging ratio really back in line to where it
was a decade ago.
Speaker 1 (20:32):
This is Bloomberg Daybreak Europe, your morning brief on the
stories making news from London to Wall Street and beyond.
Speaker 2 (20:38):
Look for us on your podcast feed every morning. On Apples, Spotify,
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Speaker 1 (20:44):
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Speaker 2 (20:50):
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Speaker 5 (20:57):
I'm Caroline Hepka and.
Speaker 1 (20:59):
I'm Stephen Carroll. 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 (00:10):
This is the Blue Big dayba Q your podcast Givebrning.
It's Friday, the nineteenth of September. I'm Caroline Hepget in
London coming up today, and Vidia's Jensen Wong rounds off
a big week for American tech in Britain as Keir
Starmer's flattery of the US President pays off with major
pitfalls averted and a hint at better trade terms. Donald
(00:31):
Trump and China Xijingping get ready for a call to
discuss TikTok tariffs and trade curbs. Plus, as US stock
indexes close and a simultaneous record high for the first
time since twenty twenty one, we look at the hedge
America trade that is expected to top a trillion dollars.
Let's start with a roundup of our top stories. In
(00:52):
Vidia plans to invest two billion pounds to support the
UK's artificial intelligence industry. The chip maker is giving the
money to venture capital firms to invest in the likes
of Wave Revolute and Synthesia. CEO Jensen Wong says Britain
is in a goldilocks moment.
Speaker 3 (01:10):
This is the third largest AI stargs ecosystem in the world,
only behind the United States and China. So I think
that the moment is right, it's just missing the infrastructure.
This is the week. This is the week that I
declare that the UK will be an AI superpower.
Speaker 2 (01:26):
Jensen Wong, speaking there to journalists at a press briefing
about the news. And Vidia's investments are part of a
slew of AI announcements from US technology companies this week
time to coincide with President Trump's visit to Britain. While
the UK is the biggest European market for startups by
volume and by size of deals, Britain has yet to
(01:48):
produce a national AI champion like Open AI in the
US or France's mistral President Donald Trump Ampraman is a kistarma,
though concluded and historic state visit by hailing the transatlantic
relationship with little sign of public disagreement, the two world
leaders welcome two hundred and fifty billion pounds of bilateral
(02:09):
investment deals and a new tech agreement. After the summit
US at President Trump told Fox News that the UK
had pushed for lower tariffs on its steel exports.
Speaker 4 (02:20):
They would like to see if they could make a
little bit better were you open to that.
Speaker 5 (02:24):
I like them.
Speaker 6 (02:25):
We're making a lot of money.
Speaker 2 (02:27):
So they're at twenty five percent right now, you're going
to go lower than they're actually.
Speaker 4 (02:30):
Had fifty percent for steal and aluminum, and I want
to see them.
Speaker 5 (02:36):
They're having a lot of difficulty.
Speaker 2 (02:38):
But talks between the two leaders did not lead to
any obvious diplomatic breakthroughs on Ukraine or Gaza. Despite that,
one UK official expressed relief to Bloomberg that the UK's
Prime Minister kist Salma had got through the visit without
any further controversy over the UK's former ambassador Peter Mandelson's
(02:59):
relationship with Jeffrey Epstein. The Bank of England's decision to
rain in its quantitative tightening plan has shattered any illusion
that the policy remains on autopilot. This amid recent volatility
in the bond market. Yesterday's announcements or the Bank's Manage
Policy Committee reduced the annual runoff of its guilt holdings
(03:20):
to seventy billion pounds a year, down from one hundred billion.
The Governor of the Bank of England, Andrew Bailey, says
that he would take into account the impact of guilt
sales on interest rates.
Speaker 6 (03:30):
We take into account all market conditions, so any effect
that our sales have on market conditions and therefore on
interest rates going out along the sort of the whole
maturity spectrum of interest rates, we will take into account
when we set a bank rates, so there wouldn't be
an offset there. In other words, if there's a feeling
(03:54):
that in some sense quantity of tightening it's pushing rates
up in the market, then the effect of that we
would take into account when we say bank correct, so
there would be an offset there.
Speaker 2 (04:06):
So that was the Governor of the Bank of England,
Andrew Bailey speaking. He announced the changes to a quantitative
tightening alongside the bank's decision to hold interest rates at
four percent. The bank kept its guidance warning that future
cuts will be quote gradual and careful and depend on
the extent to which underlying disinflationary pressures continued to ease. Now,
(04:32):
Chinese President Shi Jinping and US President Donald Trump will
discuss trade tariffs and the future of TikTok on a
phone call at two pm London time today. It's the
first conversation since June between the leaders of the world's
two largest economies. Part of the discussion will focus on
plans to shift control of TikTok's US operations from Chinese
(04:54):
parent company byte Dance to a group of American investors.
Speaking yesterday, Trump tease the head to the deal.
Speaker 4 (05:02):
The United States is getting a tremendous fee plus. I
call it a fee plus for just making the deal.
And I don't want to throw that out the window now.
I'd rather reap the benefits. I mean, the kind of
money we're talking about is very substantial, and it'll be
owned by all American investors, and the best investors, and
the very rich people and companies are going to be
(05:25):
owning it, very very straight, very legitimate companies, and really
companies that love America. So they're going to be owning it.
Speaker 2 (05:32):
It's a big thing, President Trump speaking there, As Bloomberg understands,
byte Dance will hold no more than a twenty percent
stake in TikTok, while other investors, including Oracle and silver Lake,
would be involved. The two leaders will also discuss ongoing
trade restrictions when it comes to semiconductors and rare earth.
(05:55):
It's hope that the call may lay the groundwork for
their first in person meeting since President Trump returned to
office in the US. Now, President Trump says that US
broadcasters should face licensed scrutiny if they are too critical
of him. The comments came as he defended ABC's decision
(06:16):
to suspend Jimmy Kimmel's TV show indefinitely following remarks about
conservative activist Charlie Kirk. Speaking to reporters on board Air
Force one, the president suggested he is often targeted by
late night television hosts.
Speaker 7 (06:33):
I read some places that the networks were ninety seven
percent against me. I get ninety seven percent negative, and
yet I won easily won all seven s, makes safe popular.
Speaker 5 (06:44):
WORTE won everything.
Speaker 7 (06:45):
And if they're ninety seven percent against, they give you
only bad bookless or press. I mean they're getting a license.
I would think maybe their license should be taken away.
Speaker 2 (06:58):
So that was Donald Trump's speaking there. His remarks come
days after he filed a fifteen billion dollar lawsuit against
the New York Times newspaper. The president and his allies
have long complained that America's mainstream media is biased against conservatives.
Trump has repeatedly called for CBS, ABC and NBC News
(07:19):
on networks to get rid of late night comedy hosts,
who he says frequently criticize his administration. And lastly, the
UK's Secret Surface is aiming to recruit new spies using a.
Speaker 5 (07:34):
Website on the dark web.
Speaker 2 (07:36):
Six IS chief Richard Moore is launching a secure messaging
platform called Silent Courier, which is designed to target foreign agents.
Bloomberg's James Walcock has more.
Speaker 8 (07:47):
How do you become the next James bond Well? One
modern answer is b Russian and download a VPN. Six's boss,
who goes by the moniker C is calling on people
all over the world to help British intelligence over the
Internet in the name of global stability. It's a message
being targeted particularly at Russians, with a new website being
(08:10):
hosted on the Darkweb for anonymity in London. James Wilcock,
Bloomberg Radio.
Speaker 2 (08:16):
Those are our top stories this morning. Let's get to
the markets. Europe In stocks rose eight tens of one
percent at the close yesterday, but we didn't quite make
the highs that we saw for four of the US's
main stock indices yesterday. Huge run up in terms of
the S and P five hundred futures. They are consolidating
above six seven hundred. Also, we saw the Bank of
(08:39):
Japan keep interest rates at half of one percent at
the end of a very busy central banking week. That
has meant the yen has strengthen, Japanese equities have dropped.
You've also heard about the Bank of Japan of floating
its ETF holdings or beginning to do that. So that
was the other big news from that decision. In terms
of treasure yields, ten year treasury yields at the moment
(09:03):
upper basis point at four twelve. Right now, the Bloomberg
dollar spot indexes flat, all prices are down, and gold
is up four tenths of one percent. Those are the markets.
In a moment, I'm going to bring you more on
the Trump she call that we're expecting at nine am
Washington time at two pm in London here, and also
the global surge in stocks after a record breaking QS
(09:24):
rally yesterday. So we'll get to that in a moment.
But another story caught my eye is being marketed as
a quick fix for mental health. But behind the slick advertising,
the drug ketamine has some unknown, possibly really serious downsides,
and it is the subject of Bloomberg Businessweeks. Michelle Luke
in a piece that she's written, she describes ketamine as
(09:46):
this rapid acting substance that increases the brain's neuroplasticity. It
has also got some antidepressant effects. Obviously we know that
it has been used as an anesthetic in operations, both
for human beings and yes, for horses.
Speaker 5 (10:00):
But she talks in a.
Speaker 2 (10:02):
Very interesting way in her piece about how social media
has fueled the rise of ketamine is a kind of
trendy mental health hack, and that this market staggeringly is
worth three point four billion dollars in the US, and
she kind of charts the rise of it, but also
the massive potential unknowns and downsides, the risks of addiction
(10:24):
and misuse, and I just it got me thinking about
the UK. Ketamine use here in the UK has also
been massively on the rise. It hit a record high
in the year to the end of March twenty twenty three.
That's why it's got the government thinking about raising it
not just from a Class B drug I illegal to
buy and sell, but actually to a Class A drug,
which would you know, put it into an even more
(10:46):
serious category. But it is just staggering, you know how
much the online hype has sort of contributed to the
rise of ketamine that it really isn't such a straightforward,
you know, life hack. Anyway, it's a very piece. I
will put a link to it in our show notes
to Bloomberg BusinessWeek's Michelle Luke. Now present, Trump will hold
(11:08):
a call with Xijingping this Friday. It will include potentially
a decision on TikTok and also whyder trade discussions, perhaps
setting up an in person meeting. It comes after a
state visit to the UK in which policy differences were
smoved over. Joining me now is Bloomberg's Chief Asia correspondent
Roslyn Matheson to discuss Good morning, was TikTok and transactional diplomacy?
(11:33):
What do you think might emerge a US owned but
a Chinese controlled algorithm?
Speaker 9 (11:39):
Well seems to be it'll be owned by a group
of US investors. But we don't know a lot of
the details yet and Donald Trump did not want to
be drawn on it, particularly yesterday. But what we do
understand is part of that is bitt dancers holding would
go down to less than twenty percent, so potentially under
that threshold that would trigger those national security law aspects
(12:01):
and Oracle silver Lake and recent Horowitz would have the rest. So,
as you're saying, byt Dance essentially licenses its technology to
that group for a new platform, so that the people
who use TikTok now in the US will be migrated
to a new platform that essentially mirrors the experience they
have now. And by it, Dance and TikTok as we
know it now would help build it because they have
(12:22):
to know how. But the US feeling this is an
arrangement that protects US users. Well, the Chinese company retains
ownership of its technology, which is a key asset in
its own right, So those appear to be the parameters
for now, at least the understanding going into the call.
So of course the majority ownership shifts to those US shareholders,
(12:45):
but byt Dance retains control, particularly of its technology.
Speaker 2 (12:50):
There are lots of wider trade tensions, of course, between
the US and China. Will tariffs or chip controls be eased?
Speaker 9 (12:57):
Well, Trump's been talking in recent days mostly about extending
the current trade truth on its existing terms. It's due
to expire in November, so perhaps extending it again, which
doesn't sound like movement much on tarifs in the minute,
but you never know, obviously, when the two of them
are on the call together, and perhaps they might prefer
to have a big bang announcement on taris if or
(13:20):
when they meet in person, because the idea is this call,
as you say, paves the way potentially for a meeting
in October in Asia.
Speaker 5 (13:27):
So perhaps this.
Speaker 9 (13:28):
Lays the groundwork and they want to come out and
make a splash with an announcement on tariffs in the minute. Obviously,
there are a lot of issues there still to go through,
in a lot of potential roadblocks for them, and Chips
a particular issue because we have China saying in Video
violated anti monopoly laws. They're trying to get Chinese tech
companies to stop buying in video products. And no doubt
(13:51):
the CEO of in Video, Jensen Huang, who's got a
very close relationship with Donald Trump, will be hoping the
US President brings it up on the cour But again,
you're unlikely to see China change it stance significantly in
a minute.
Speaker 2 (14:06):
In terms of conflicts, do you think the US person
will try to press China in terms of support for
Russia's war in Ukraine or even on Taiwan, the South
China Sea where's the US president on those issues?
Speaker 7 (14:16):
Now?
Speaker 9 (14:18):
Well, it's obviously frustrated with Vladimir Putin, the Russian president.
He wants traction on ending the war in Ukraine, but
his stance seems to be more that it's on Europe
to pressure Russia first on the energy side, and to
do so perhaps by penalizing China on Russian energy purchases.
So it be interesting to see whether or how that
comes up, because Trump does want to keep this call
(14:40):
as a starting point to that in person meeting, and
Russian energy is a very sensitive topic for cgmping.
Speaker 5 (14:46):
It's something he might bristle.
Speaker 9 (14:47):
At the idea that he's like, well, this is an
issue for China and Russia, this is not an issue
for anybody else to get involved in. So be interesting
to see how or whether that comes up. And on Taiwan, interestingly,
we have this report in the Washington Post that Trump
has declined to approve it's a more than four hundred
million military aid package for Taiwan, and this include minissions
(15:09):
and autonomous drones rejected by the White House, and interesting
to see that happen also potentially so close to this
call and a potential meeting because Taiwan's a very sensitive
issue obviously in the relationship. Beijing sees Taiwan as a
self you know, as part of its territory. It is
a self ruled democracy, of course, and perhaps you know,
(15:33):
gold Trump's just treading a bit carefully. They're also so yeah,
it'll be interesting to see how weather that comes up to.
Speaker 2 (15:39):
Okay, So that's all the kind of anticipation around the
US and China.
Speaker 5 (15:43):
But I do want to get a word in.
Speaker 2 (15:44):
There about the president's state visit to the UK. What
did you make of it? What do you think is
the conclusion in Britain certainly around.
Speaker 9 (15:52):
This well, I imagine quite a few size of relief
this morning he's gone. There were no major problems in
the it. He got all the pomp and ceremony of
the royal family, which he likes. They kind of stepped
over the most delicate issues in the minute.
Speaker 5 (16:08):
Even in their.
Speaker 9 (16:09):
Press conference yesterday, you know, things came up on the
UK stance on a Palestinian state, on free speech, on migration.
Trump said he disagreed with Stum on a few things,
but they were quite polite about it.
Speaker 5 (16:19):
And the mood seemed pretty friendly.
Speaker 9 (16:22):
So this visit probably went as well as it could
for the UK Prime Minister, but the hard stuff was
also off the table in a way. They punted on
steel tariffs, they didn't really get into detail on Ukraine
and a path forward from there. So you know, some
of the hard stuff was obviously left off the table
in order just to have this meeting go as smoothly
as possible.
Speaker 2 (16:43):
Yeah, absolutely, Rolls, thank you so much for being with
me this morning. BlueBag Chief Asia correspondent Roslyn Matheson, stay
with us. More from Bloomberg dbake Cube coming up after this. Now,
the S and P five hundred, NASDAQ one hundred, Dow
Jones in dust to average and Russell two thousand small
cap indegs all closed together at fresh record highs for
(17:06):
the first time since November twenty twenty one. So it
turns out that all the Cell America Incs swelling in
marcuts earlier this year may have been misplaced. Is the
mansion now for global in versus more like Hedge America? Well,
that's the question that I'm going to put to Bloomberg's
markets were bought of Titel.
Speaker 5 (17:22):
Good morning val.
Speaker 2 (17:23):
Rning just forir Sally on the stocks rally and what
happened at the end of yesterday's trading. I mean, how
rare is this to happen to have all these indices
doing so well.
Speaker 5 (17:32):
Look, it's pretty rare.
Speaker 10 (17:34):
It's not happened since twenty twenty one, and it's something
that's only happened twenty five times in this century that
we've seen. The S and P five hundred, the tech
heavy NASDAC, the small cap Russell two thousand, and the
blue chip Dow Jones all hit record high closing levels
at the same time. Now, a lot of it, I
think was it maybe a reassessment of the FED yesterday?
(17:56):
The fact that they are cutting to protect growth instead
of fighting in fla in some way cutting interestrates because
they can not necessarily because they have to, led to
quite a risk on rally yesterday. Across at the equity market,
the Russell two thousand was actually the outperformer yesterday, that's
the small cap index. It was up some two and
a half percent, which kind of ties into that narrative
(18:17):
of domestically led US growth that would benefit small caps
the most on the back of this restarted easing cycle
from the FED.
Speaker 2 (18:25):
So why do you think that leaves valuations then.
Speaker 10 (18:29):
Well, look, that's a hard one to argue. I mean,
there are plenty of people who have come on this
show and sat around this table and said valuations are
stretched in the US, only to get it wrong a
few weeks later. I think the issue here, Caroline is
is that if you miss a bull market, if you're
a portfolio manager, if you're a manager of funds, and
you miss a bull market, it's the biggest thing to
make up for in your portfolio. So, yes, valuations are stretched,
(18:53):
but the FED is kicking off the second round of
this easing cycle. And usually when the FED is cutting,
if there's no immediate recession on the horizon, that is
a good that is a good framework for equity sur rally.
And I think that was just was the conclusion yesterday
that no matter the valuation, it is looking better and
better for US stocks if the interest rate of the
(19:14):
Federal Reserve is going to keep decreasing this year.
Speaker 5 (19:17):
Yeah.
Speaker 2 (19:17):
Absolutely, And so does that mean the rest of the world,
As you say once in on this US Dot market Valley,
I mean, what does it mean for other US assets?
Speaker 10 (19:26):
Well, I think it's interesting what you noted there about
inflows into US assets, But a lot of these inflows
are becoming hedged on an FX basis, and that's something
that's really interesting to talk about because the first time
this decade, FX hedged inflows into US assets are now
dominating unhedged exposure. And this is a very big shift
(19:47):
that's happened in the market in the last six months,
really since the tariff tailspin back in April. Because previously,
you know, holding unhedged dollar unhedged tech stocks was the
biggest winning trade of the century. The fact that we
at least in the previous decade had a rising stock
market alongside US dollar appreciation really led to foreign investors
(20:11):
dropping their FX hedges on a pretty steady basis. But
that a lot of that has been spun around. We
have some estimates from the street that out of the
thirty trillion dollars of US assets held in foreign hands,
now one trillion of that is now hedged, which puts
the hedging ratio really back in line to where it
was a decade ago.
Speaker 1 (20:32):
This is Bloomberg Daybreak Europe, your morning brief on the
stories making news from London to Wall Street and beyond.
Speaker 2 (20:38):
Look for us on your podcast feed every morning. On Apples, Spotify,
and anywhere else you get your podcasts.
Speaker 1 (20:44):
You can also listen live each morning on London Dab Radio,
the Bloomberg Business app, and Bloomberg dot Com.
Speaker 2 (20:50):
Our flagship New York station, is also available on your
Amazon Alexa devices. Just say Alexa Play Bloomberg eleven thirty.
Speaker 5 (20:57):
I'm Caroline Hepka and.
Speaker 1 (20:59):
I'm Stephen Carroll. 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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