Daybreak Weekend: Bank Earnings, UK Eco Data, Taiwan Election, Biden Polls

This is Bloomberg day Break Weekend, our global look at 0:00:04.920 --> 0:00:07.240 the top stories in the coming week from our Daybreak 0:00:07.280 --> 0:00:10.160 anchors all around the world, and straight ahead on the program, 0:00:10.360 --> 0:00:13.800 Bank earnings, Wall Street's top burn start reporting this week. 0:00:14.000 --> 0:00:16.360 I'm Tom Busby in New York and I'll have that story. 0:00:16.560 --> 0:00:19.000 I'm Stephen Caroll in London, where we're watching it closely 0:00:19.079 --> 0:00:22.360 for signs of whether or not the UK is in recession. 0:00:22.520 --> 0:00:26.040 I'm Doug Prisoner looking at Taiwan's presidential election, one that 0:00:26.160 --> 0:00:29.760 will help shape the course of US China relations for years. 0:00:29.920 --> 0:00:32.839 I'm Keebie Lines in Washington, where we're looking at pulling 0:00:32.960 --> 0:00:36.000 as election. You're twenty twenty four gets under well. 0:00:37.159 --> 0:00:41.239 That's all straight ahead on Bloomberg Daybreak Weekend. The business 0:00:41.280 --> 0:00:45.240 news you need to wrap up your week, Available on Apple, Spotify, 0:00:45.400 --> 0:00:48.720 the Bloomberg Business Appen everywhere you get your podcasts. 0:00:53.040 --> 0:00:55.000 Good day to you. I'm Tom Busby and we begin 0:00:55.000 --> 0:00:57.840 today's program with the kickoff of the latest earning season. 0:00:58.000 --> 0:01:01.560 Four of Wall Street's biggest banks report their latest quarterly 0:01:01.600 --> 0:01:03.959 results this week, wrapping up a year of some mid 0:01:04.040 --> 0:01:07.160 sized bank failures, rising interest rates, and a dearth of 0:01:07.280 --> 0:01:09.640 deal making. At least for most of the year, but 0:01:09.800 --> 0:01:12.320 we also saw the major averages sore higher, the Dow 0:01:12.480 --> 0:01:14.959 reaching an all time high in late December, and there 0:01:15.080 --> 0:01:19.000 was no real recession. For a preview, we welcome Bloomberg 0:01:19.040 --> 0:01:23.200 Intelligence Senior Analyst Alison Williams and Bloomberg Global Finance correspondent 0:01:23.280 --> 0:01:26.520 Shanali Basik. Now, all the action starts on Friday. We 0:01:26.560 --> 0:01:29.880 hear from JP Morgan, Chase, City Group, Wells Fargo, and 0:01:30.000 --> 0:01:33.280 Bank of America, and we're going to start today with Alison. Alison, 0:01:33.440 --> 0:01:36.520 what are you expecting to see from those major lenders. 0:01:36.720 --> 0:01:38.920 The two key things we're going to be looking at 0:01:39.040 --> 0:01:44.240 are net interest income and expenses. So in the fourth quarter, 0:01:44.800 --> 0:01:47.680 we're going to be looking for further evidence that the 0:01:47.960 --> 0:01:51.840 pressure on deposit pricing is easing a bit and those 0:01:51.840 --> 0:01:53.760 costs are easing a bit. And we think that the 0:01:53.800 --> 0:01:57.360 outlook for next year is going to factor in further 0:01:57.680 --> 0:02:00.760 moderation of that pressure. Just given the fact that the 0:02:00.800 --> 0:02:05.200 markets are pricing in an inflection point for federal reserve hikes. 0:02:05.440 --> 0:02:10.320 As those hikes turn to easing, the pressure for banks 0:02:10.360 --> 0:02:13.040 to raise those prices on deposits. Keep in mind that 0:02:13.040 --> 0:02:17.120 that's their cost of goods sold. That pressure eases, and 0:02:17.160 --> 0:02:19.680 so that will be a positive for the biggest banks. 0:02:19.680 --> 0:02:23.239 We think that JP Morgan's net interest income is going 0:02:23.320 --> 0:02:26.160 to be resilient. We think there could be some upside 0:02:26.160 --> 0:02:29.400 to those numbers. But the second thing that we're looking 0:02:29.440 --> 0:02:32.840 at is the cost guidance, and again JP Morgan will 0:02:32.880 --> 0:02:37.680 be a focus in particular because we get a lot 0:02:37.760 --> 0:02:40.639 of macro clues for all the banks during the quarter, 0:02:41.040 --> 0:02:45.639 but expense guidance always includes an element of investment spending. 0:02:46.440 --> 0:02:50.320 JP Morgan has one in the long term by making 0:02:50.360 --> 0:02:54.679 those investments, but if we look at the consensus forecasts, 0:02:55.080 --> 0:02:56.960 those investments are going to cause the bank to have 0:02:57.080 --> 0:03:01.080 negative operating leverage in twenty twenty four. We'll see what 0:03:01.120 --> 0:03:05.640 we hear from management in terms of what the outlook is. 0:03:05.720 --> 0:03:08.720 Because while there is investment spending, and we do think 0:03:08.720 --> 0:03:11.440 that banks need to invest for the future, there's also 0:03:11.520 --> 0:03:14.519 pressure and cost coming from inflation. There's also going to 0:03:14.560 --> 0:03:17.680 be pressure from what we call the cost to compete, 0:03:17.919 --> 0:03:20.800 and we think the compensation costs could be a little 0:03:20.800 --> 0:03:22.560 bit sticky across the global banks. 0:03:22.720 --> 0:03:26.399 Sonali, Yeah, there's definitely expenses, But to Allison's point, one 0:03:26.400 --> 0:03:30.000 big question is if interest rates start to cool, at 0:03:30.040 --> 0:03:32.960 what point does that not only flow into the notion 0:03:33.320 --> 0:03:37.280 of deposit pricing, but also loan demand. Does loan demand 0:03:37.320 --> 0:03:39.520 start to pick up if interest rates start to cool. 0:03:39.600 --> 0:03:43.160 Now what's interesting too is in recent months you've start 0:03:43.440 --> 0:03:47.640 to see different credit markets open up meaningfully, including leverage finance. 0:03:47.760 --> 0:03:49.720 So we're not just talking about lending for the consumer. 0:03:49.760 --> 0:03:52.720 We're even talking about risky parts of debt markets for 0:03:52.760 --> 0:03:56.960 big corporations, buyouts, things that could start to fuel activity again. 0:03:57.280 --> 0:04:00.880 So you will see a we all need to look 0:04:00.880 --> 0:04:03.680 at the outlook from these bankers because they have come 0:04:03.720 --> 0:04:07.120 in to the prior quarters with so much caution, and 0:04:07.160 --> 0:04:11.680 you really are seeing that caution starting to wane. Jamie Diamond, 0:04:11.880 --> 0:04:14.280 who has been warning that rates could move higher than 0:04:14.320 --> 0:04:17.279 expected for many many months, if he starts to change 0:04:17.279 --> 0:04:19.720 his tone there, it would be a massive bell weather 0:04:19.760 --> 0:04:22.200 for the rest of the industry. Whereas you already had 0:04:22.279 --> 0:04:24.760 James Gorman, who just stepped down as the CEO of 0:04:24.800 --> 0:04:30.680 Morgan Stanley. He had definitely been very sanguine in terms 0:04:30.680 --> 0:04:33.440 of the outlook for interest rates this year, and remember 0:04:33.480 --> 0:04:36.039 he was still leading Morgan Stanley through the end of 0:04:36.080 --> 0:04:36.839 the last quarter. 0:04:37.240 --> 0:04:40.920 Well, Shanali, you mentioned James Gorman. You had a one 0:04:40.960 --> 0:04:43.440 on one interview with him last week about his fourteen 0:04:43.520 --> 0:04:46.560 year tenure a CEO of Morgan Stanley. Now he is 0:04:46.640 --> 0:04:50.240 executive chairman. He also spoke about some proposed banking rules 0:04:50.240 --> 0:04:53.080 that would require the biggest lenders to increase to twenty 0:04:53.120 --> 0:04:57.080 percent their capital cushion. Now it's proposed, but let's hear 0:04:57.120 --> 0:04:58.560 a bite from that interview right now. 0:04:58.880 --> 0:05:03.280 It was a proposal that I would say was extremely 0:05:03.320 --> 0:05:07.440 aggressive and set a MARKA. It will not go through 0:05:07.520 --> 0:05:10.240 in that form. If it did, I think it would 0:05:10.279 --> 0:05:14.040 have very very negative consequences for corporate lending across this country, 0:05:14.080 --> 0:05:15.719 which is not what you want. It's not going to 0:05:15.720 --> 0:05:16.719 help the economy growth. 0:05:16.760 --> 0:05:19.919 Well, you've also spoken about the treasury market potential impacts 0:05:19.920 --> 0:05:23.039 from these regulations. We've already seen stresses of late in 0:05:23.080 --> 0:05:25.679 the treasury market. Do you have fears that those stresses 0:05:25.680 --> 0:05:26.680 will be exacerbated? 0:05:27.000 --> 0:05:29.080 I can't tell until I see the actual rules, but 0:05:29.200 --> 0:05:32.960 all I know is what was put out is highly 0:05:33.080 --> 0:05:36.279 highly highly unlikely to be what is ultimately regulated. 0:05:36.440 --> 0:05:39.440 Now, is he right, and what are those proposals and 0:05:39.480 --> 0:05:40.760 what would have to change. 0:05:40.880 --> 0:05:43.480 You saw James Gorman and many of his peers take 0:05:43.520 --> 0:05:46.960 to Washington, DC and address lawmakers about this fact. And 0:05:47.040 --> 0:05:49.040 what they were trying to do is get the lawmakers 0:05:49.040 --> 0:05:53.839 to put pressure on regulatory officials to start to rethink 0:05:54.000 --> 0:05:57.200 the strictness of these capital rules. They were warning that 0:05:57.240 --> 0:06:00.000 it would really restrict lending across different parts of the economy. 0:06:00.000 --> 0:06:03.080 I mean, it would restrict trading activities in certain key 0:06:03.120 --> 0:06:06.400 markets like commodities. It would increase the cost of hedging 0:06:07.120 --> 0:06:11.240 for many big players in commodity markets and farming markets. 0:06:11.600 --> 0:06:15.200 Rural America would be impacted, they warned. Now, what's interesting 0:06:15.279 --> 0:06:18.360 here is we know from a Wall Street perspective that 0:06:18.400 --> 0:06:21.320 those increase in capital rules would be very expensive for 0:06:21.360 --> 0:06:24.960 the banks, and for him to say they're likely to 0:06:25.000 --> 0:06:29.320 be less really starts to draw a question of how 0:06:29.400 --> 0:06:32.560 much these banks can start to recalibrate their expectations on 0:06:32.600 --> 0:06:36.720 how costly it would be, maybe less costly than investors 0:06:36.800 --> 0:06:40.840 initially expected. If James Gorman is right, Alison, what's your 0:06:40.839 --> 0:06:41.320 thoughts on that? 0:06:42.680 --> 0:06:47.280 So if you look at some of these regulations, you 0:06:47.320 --> 0:06:50.479 know two things. First of all, as you said, it 0:06:50.520 --> 0:06:55.440 does require relatively large increases in capital to be held 0:06:55.920 --> 0:06:58.920 across the largest banks, and actually Morgan, Stanley and Gold 0:06:59.000 --> 0:07:01.800 and Sachs are some of the hardest hit because two 0:07:01.839 --> 0:07:05.839 of the key you know, two of the key risk 0:07:05.880 --> 0:07:09.080 factors that the rule aims to address are market risk 0:07:09.480 --> 0:07:15.680 and operational risk. But if you analyze the rules, and 0:07:15.760 --> 0:07:18.960 again we've heard you know, perhaps Jamie Diamond has been 0:07:19.280 --> 0:07:21.480 one of the most vocal about some of the double 0:07:21.520 --> 0:07:27.640 counting of operational risk inherent in this proposal. If we 0:07:27.680 --> 0:07:30.160 look across some of the other regulations, such as the 0:07:30.200 --> 0:07:35.160 Stress capital Buffer, which already penalizes banks for this type 0:07:35.160 --> 0:07:38.120 of risk, and so there is sort of an element 0:07:38.160 --> 0:07:41.160 of double counting. Also, if we look at the rules 0:07:41.280 --> 0:07:44.080 versus some of the other jurisdictions, it does seem that 0:07:44.120 --> 0:07:46.920 there is a fair amount of gold plating, meaning that 0:07:46.960 --> 0:07:49.800 the rules do look a little bit tougher in the 0:07:49.800 --> 0:07:53.520 way that they've been implemented in the US versus jurisdictions 0:07:53.560 --> 0:07:56.560 such as the UK and Europe. 0:07:56.600 --> 0:07:58.200 Well, until we get to that, I want to just 0:07:58.280 --> 0:08:00.560 dial back on what we can look look forward to 0:08:00.560 --> 0:08:03.640 this week and which of those big banks Shanali, I'm 0:08:03.680 --> 0:08:05.720 going to ask you, we have JP Morgan Chase, City Group, 0:08:05.760 --> 0:08:08.520 Wells Fargo, Bank of America. Which ones do you think 0:08:08.560 --> 0:08:11.200 are going to have the results that Wall Street is 0:08:11.200 --> 0:08:11.640 looking for? 0:08:11.720 --> 0:08:13.120 Now? You have to remember that a lot of these 0:08:13.160 --> 0:08:16.360 banks really either sold off or had very weak performance 0:08:16.400 --> 0:08:18.800 last year, except for JP Morgan, which rose more than 0:08:18.800 --> 0:08:21.640 the pack and actually hit a new record high early 0:08:21.720 --> 0:08:24.400 this year in its stock price. But you'd think about 0:08:24.400 --> 0:08:27.360 Goldman for example, and Goldman's analyst that covers the banking 0:08:27.360 --> 0:08:30.560 sector has recently said that JP Morgan and Wells Fargo 0:08:30.800 --> 0:08:34.000 could see more higher could even higher net interest income 0:08:34.080 --> 0:08:36.680 like we've been talking about. It's two of their big 0:08:36.720 --> 0:08:41.200 picks we know. Wells Fargo's Mike Mayo has also pointed 0:08:41.240 --> 0:08:43.640 out that City Group has a lot of growth potential. 0:08:43.880 --> 0:08:46.280 There's a lot of divergence here, but what we've seen 0:08:46.440 --> 0:08:48.520 in the trends is that the bigger get bigger. What's 0:08:48.520 --> 0:08:51.960 going to get interesting after the biggest banks report is 0:08:52.160 --> 0:08:55.040 the regional banks, and the week after also is the 0:08:55.320 --> 0:08:58.880 big investment banks. You were talking about the weak deal volumes, 0:08:59.080 --> 0:09:02.319 right stinct thing here is in the third the fourth 0:09:02.360 --> 0:09:05.160 quarter of last year, you saw deal volumes jump by 0:09:05.200 --> 0:09:07.840 one hundred and sixty billion dollars just from the third 0:09:07.880 --> 0:09:09.200 to the fourth quarter after. 0:09:09.000 --> 0:09:10.599 Being stagnant all year pretty. 0:09:10.360 --> 0:09:12.720 Much, it's been the worst year in a decade for deals. 0:09:12.800 --> 0:09:14.640 And so what happens is the bankers get paid when 0:09:14.640 --> 0:09:18.320 those deals close, not upon announcement typically, So those deals 0:09:18.320 --> 0:09:22.000 that are announced lead to fees tomorrow. And so those 0:09:22.080 --> 0:09:25.559 banks Morgan Stanley, Goldman, Sachs and JP Morgan, which can 0:09:25.600 --> 0:09:29.400 start to also see those deal fees start to impact 0:09:29.440 --> 0:09:32.400 their bottom line, they could become very interesting this year 0:09:32.760 --> 0:09:36.760 if their predictions come true and they finally see deals 0:09:36.800 --> 0:09:38.720 pick up like they've been expecting for so long. 0:09:39.160 --> 0:09:40.599 Alison, the final word. 0:09:40.440 --> 0:09:43.760 I would say that on Friday, well, we'll see JP 0:09:43.840 --> 0:09:48.160 Morgan and Bank of America continuing to execute despite some 0:09:48.240 --> 0:09:52.280 challenges in the environment. Wells Fargo and City Group are 0:09:52.960 --> 0:09:56.559 more longer term stories where they're restructuring, and I think 0:09:56.600 --> 0:09:58.640 investors are going to want to hear from, you know, 0:09:58.720 --> 0:10:00.960 City Groups sort of where they are are in the 0:10:01.000 --> 0:10:04.360 path of that restructuring somewhere. Wells Fargo, what is going 0:10:04.400 --> 0:10:07.720 to be the outlook for costs, Are we getting closer 0:10:07.920 --> 0:10:12.199 any kind of news related to some of their regulatory challenges. 0:10:12.640 --> 0:10:16.440 We'll also be looking for any big legal costs, because 0:10:16.480 --> 0:10:19.080 we do tend to get those kitchen thinks for some 0:10:19.160 --> 0:10:22.400 of the banks in the quarter. But again it is 0:10:22.480 --> 0:10:25.839 all about the expectations and what is in the stock. 0:10:26.000 --> 0:10:30.000 JP Morgan is likely to generate the highest return we expect, 0:10:30.760 --> 0:10:31.840 but that's no secret. 0:10:32.280 --> 0:10:34.599 Well, a lot to look forward to our thanks to 0:10:34.600 --> 0:10:38.920 Bloomberg Intelligence Senior Analyst Alison Williams and Bloomberg Global Finance 0:10:38.920 --> 0:10:42.760 Correspondent Shanali Bossic, and coming up on Bloomberg day Break weekend, 0:10:42.760 --> 0:10:44.679 we take you to London and a look ahead to 0:10:44.760 --> 0:10:48.199 a busy week on the economic calendar. I'm Tom Busby 0:10:48.320 --> 0:10:54.840 and bloom This is Bloomberg day Break Weekend, our global 0:10:54.840 --> 0:10:56.960 look ahead at the top stories for investors in the 0:10:56.960 --> 0:11:00.679 coming week. I'm Tom Busby in New York. Hey's economic 0:11:00.720 --> 0:11:03.760 trajectory back in focus in the coming days as a 0:11:03.760 --> 0:11:06.680 batch of data will help tell us whether Britain could 0:11:06.800 --> 0:11:10.720 avoid a recession. A recent survey of company executives highlighted 0:11:10.720 --> 0:11:15.240 their pessimism about the outlook, despite encouraging science from some quarters. 0:11:15.280 --> 0:11:17.240 Now for more, let's go to London and bring in 0:11:17.240 --> 0:11:19.600 Bloomberg Daybreak. Europanker Stephen Carroll. 0:11:20.040 --> 0:11:23.600 Tom, it's twenty twenty four and we're still asking questions 0:11:23.600 --> 0:11:26.280 about whether or not the UK will fall into recession, 0:11:26.400 --> 0:11:29.120 when it might happen, and how bad it could be. 0:11:29.240 --> 0:11:31.559 We'll get an update on the monthly GDP numbers in 0:11:31.600 --> 0:11:33.520 the coming days. It'll give us some more clues, along 0:11:33.559 --> 0:11:36.480 with other indicators we're watching too. There have been some 0:11:36.640 --> 0:11:40.200 positive signals, the latest Composite PMI survey showing an uptake 0:11:40.240 --> 0:11:42.440 and activity to a reading a fifty two point one 0:11:42.559 --> 0:11:46.040 in December. Thinking more long term, a recent forecast from 0:11:46.080 --> 0:11:49.080 the Center for Economics and Business Research predicted the UK's 0:11:49.080 --> 0:11:51.880 growth trajectory over the next decade or so will help 0:11:51.920 --> 0:11:55.120 it retain its position as the world's sixth largest economy. 0:11:55.400 --> 0:11:57.920 There's gloom in other quarters, though. The Institute of Directors 0:11:58.000 --> 0:12:01.320 Economic Confidence survey fell into too close to its lowest 0:12:01.559 --> 0:12:04.080 point in the year. So are we hurtling towards a 0:12:04.080 --> 0:12:06.880 recession or is growth getting back on track? To discuss, 0:12:06.920 --> 0:12:09.280 we've got our UK Economy reporter Tom Reese, and for 0:12:09.320 --> 0:12:11.000 a look at how the consumer is faring, our UK 0:12:11.120 --> 0:12:13.920 retail reporter Katie Lindsell. Tom, I'd like to start with 0:12:14.000 --> 0:12:16.480 you were due to receive some economic date in the 0:12:16.480 --> 0:12:19.360 coming days, including figures on UK manufacturing and the monthly 0:12:19.400 --> 0:12:21.959 GDP figures. I mentioned what might they tell. 0:12:21.840 --> 0:12:25.240 Us, So while it's quite hard to read signals from 0:12:25.240 --> 0:12:29.120 one month's data, November's GDP figures could be a bit 0:12:29.160 --> 0:12:32.360 more significant than the usually just because it may show 0:12:32.440 --> 0:12:37.160 that the UK was on track for technical recession in 0:12:37.200 --> 0:12:40.959 the second half of last year. We had some revised 0:12:41.000 --> 0:12:44.640 data from just before Christmas that show GDP contracted zero 0:12:44.640 --> 0:12:48.560 point one percent in the third quarter, and then that 0:12:48.679 --> 0:12:51.160 was followed by a zero point three percent falling GDP 0:12:51.240 --> 0:12:54.400 in October, so that that leaves some catching up to 0:12:54.400 --> 0:12:56.319 do in November December if we're going to avoid a 0:12:56.360 --> 0:13:00.559 technical recession I two straight quarters of fall output. I 0:13:00.760 --> 0:13:03.160 think the main thing to take away from the second 0:13:03.160 --> 0:13:06.240 half of last year it was a real diverging picture 0:13:07.040 --> 0:13:09.800 between the sectors. You know, we have services that have 0:13:09.880 --> 0:13:13.600 been relatively resilient despite you know the extreme pressure on 0:13:14.160 --> 0:13:16.480 consumers from the cost of living crisis and you know, 0:13:16.559 --> 0:13:20.719 higher mortgage paints to everything, but the manufacturing sector is struggling. 0:13:21.559 --> 0:13:24.160 We've seen that in the survey data, seen lower demand 0:13:24.160 --> 0:13:27.600 from overseas and domestically, factories are feeling, you know, the 0:13:27.640 --> 0:13:31.000 pain from higher interest rates and they're starting to cut 0:13:31.080 --> 0:13:33.720 employment and so it's it's it's quite it's quite a 0:13:33.720 --> 0:13:37.720 complicated picture, but it's all it all looks quite stagnant 0:13:37.760 --> 0:13:40.880 from from from the second half of you. 0:13:41.240 --> 0:13:42.880 Yeah, and as you say, it's it's that question of 0:13:43.200 --> 0:13:45.880 where we are in that last quarter GDPs and we 0:13:45.880 --> 0:13:47.880 get the monthly figures just giving us a piece of 0:13:47.920 --> 0:13:50.679 that picture and whether or not that we will have 0:13:50.800 --> 0:13:53.800 for those two quarters of negative growth. Katie. I wanted 0:13:53.800 --> 0:13:55.079 to bring you in here because one of the figures 0:13:55.080 --> 0:13:56.480 we're going to be getting is one of the retail 0:13:56.480 --> 0:13:59.600 sales measures and the British Retail Consortium. This is going 0:13:59.640 --> 0:14:02.640 to for a period which is very important for retailers, 0:14:02.640 --> 0:14:05.040 towards the end of the year, that pre Christmas shopping period. 0:14:05.040 --> 0:14:06.320 What are you expecting? 0:14:06.480 --> 0:14:09.840 Absolutely, you're right, I mean that Christmas period is so important, 0:14:09.920 --> 0:14:12.680 so crucial for many retailers. If we look at the 0:14:12.679 --> 0:14:15.720 figures that we saw in November from the British Retail Consortium, 0:14:15.960 --> 0:14:18.480 they were actually quite weak. They did show growth, but 0:14:18.559 --> 0:14:22.400 much weaker growth compared to a year earlier. So what 0:14:22.440 --> 0:14:24.800 we have to be hoping is that many consumers pushed 0:14:24.800 --> 0:14:28.360 their Christmas spend into December rather than relying on that 0:14:28.400 --> 0:14:32.920 earlier November shopping period. But I think it's really yet 0:14:32.960 --> 0:14:36.160 to be seen. From what we hear so far, online 0:14:36.280 --> 0:14:39.560 has had a better performance the Christmas just gone compared 0:14:39.600 --> 0:14:43.440 to twenty twenty two. Many shoppers were put off by 0:14:43.640 --> 0:14:47.400 career delays and postal strikes in that earlier Christmas season, 0:14:47.920 --> 0:14:50.160 which meant they visited more stores to be sure they 0:14:50.200 --> 0:14:52.560 could get hold of items. I think online will have 0:14:52.600 --> 0:14:56.080 had a much better time in Christmas twenty three, but 0:14:56.160 --> 0:14:59.760 really it's still it's still to be seen how this goes. 0:15:00.080 --> 0:15:02.360 From what we've seen from retailers, it's a mixed bag, 0:15:02.480 --> 0:15:05.440 you know, some performing better than the Christmas before, others 0:15:05.480 --> 0:15:07.960 having a bit of a difficult time, So it's still 0:15:07.960 --> 0:15:09.000 to be seen how it will go. 0:15:09.440 --> 0:15:11.480 Yeah, Katie, I'm always very interested to see when we 0:15:11.520 --> 0:15:14.320 get the split from grocers on this, because I mean 0:15:14.320 --> 0:15:17.960 grocers are very competitive. Marcus in the UK and seeing 0:15:18.000 --> 0:15:21.120 the discounters coming out and talking about having their best 0:15:21.240 --> 0:15:23.440 Christmas as ever, is that something that we've heard from 0:15:23.440 --> 0:15:26.320 many retailers In what we've heard so far from them 0:15:26.320 --> 0:15:27.640 about their pre Christmas period. 0:15:27.880 --> 0:15:28.080 Yeah. 0:15:28.080 --> 0:15:30.440 Absolutely. So as you say, we've had Aldi and Liddle 0:15:30.520 --> 0:15:32.440 come out very quickly in the new year saying they 0:15:32.480 --> 0:15:37.040 had record Christmas sales, and Cantar, which actually tracks sales 0:15:37.040 --> 0:15:40.440 figures across supermarkets, so that there was a record thirteen 0:15:40.480 --> 0:15:43.760 point seven billion pounds spent in the run up to Christmas. 0:15:44.120 --> 0:15:46.920 I think it's fair to say that most supermarkets did well. 0:15:47.640 --> 0:15:51.479 We're going to be getting both Sainsbury and Tesco reporting 0:15:52.080 --> 0:15:55.440 next week and I think both those have probably done 0:15:55.480 --> 0:15:59.000 pretty well over that Christmas season. I mean, food inflation 0:15:59.160 --> 0:16:03.320 has come down a bit, it's still at nearly seven percent, 0:16:04.520 --> 0:16:07.640 so I think that that the higher prices do have 0:16:07.680 --> 0:16:10.160 a role to play in these big, chunky sales figures 0:16:10.160 --> 0:16:13.840 we're seeing. But at the same time, hopefully shoppers are 0:16:13.840 --> 0:16:16.040 feeling more encouraged to spend all food than they did, 0:16:16.080 --> 0:16:19.240 say a year ago. So yeah, supermarkets have been a 0:16:19.360 --> 0:16:23.359 very very comfortable part of retail these past few weeks. 0:16:23.760 --> 0:16:26.240 Tom and we think to looking back at the data 0:16:26.280 --> 0:16:28.760 we have already and thinking about where the trajectory we're 0:16:28.840 --> 0:16:29.200 going in. 0:16:29.280 --> 0:16:30.880 Yet, it feels like we've. 0:16:30.720 --> 0:16:33.320 Been hearing about warnings of a recession in the UK 0:16:33.520 --> 0:16:35.720 for I mean at least a year now at this day, 0:16:36.000 --> 0:16:38.600 Let's be honest, are we overdue a recession here? 0:16:39.320 --> 0:16:41.000 It has felt like we've been on the brink of 0:16:41.080 --> 0:16:45.360 recession basically since that post lockdown Surgeon GDP wharf and 0:16:45.440 --> 0:16:48.320 the cost of living crisis began. But I mean, this 0:16:48.440 --> 0:16:52.200 economy has shown incredible ability to muddle through, to be 0:16:52.240 --> 0:16:56.720 stagnant but resilient against some pretty massive headwinds and double 0:16:56.760 --> 0:17:00.400 digit inflation and the Surgeon interest rates you said that 0:17:00.480 --> 0:17:02.840 date we got just before Christmas. It did show that 0:17:02.880 --> 0:17:06.040 we may have suffered a technical recession, but I mean, 0:17:06.359 --> 0:17:09.200 the difference between the technical recession and very slight growth 0:17:09.240 --> 0:17:11.359 at the moment is pretty tiny. But it also showed, 0:17:11.400 --> 0:17:13.920 and I think this is crucial for the outlook, it 0:17:14.000 --> 0:17:16.399 showed that inflation came down a lot more than the 0:17:16.440 --> 0:17:19.560 Bank of England was expecting, down to below four percent. 0:17:19.600 --> 0:17:21.840 And I think for the outlook that is the key 0:17:21.880 --> 0:17:24.760 really because that not only affects you know, you know, 0:17:24.880 --> 0:17:28.040 real wages for consumers, but also what we might see 0:17:28.040 --> 0:17:29.159 on interest rates. 0:17:29.280 --> 0:17:31.680 Yeah, and of course the fact that we had the 0:17:31.760 --> 0:17:34.080 run of fourteenth strake hights in the Bank of England 0:17:34.440 --> 0:17:36.960 still feeling acrourse the effects of that feeding into the market, 0:17:37.000 --> 0:17:39.119 partly due to the way that the mortgage market structured. Here, 0:17:39.240 --> 0:17:41.600 not everyone has actually had the interest rate increase, although 0:17:41.880 --> 0:17:45.480 we're getting closer to that position now. What should we 0:17:45.520 --> 0:17:47.720 be thinking about when it comes to where the Bank 0:17:47.720 --> 0:17:50.520 of England goes from here? Of course, speculation abound about 0:17:50.760 --> 0:17:53.239 central banks around the world and when they're going to 0:17:53.280 --> 0:17:56.840 cut interest rates. What sort of scenario is the Bank 0:17:56.840 --> 0:17:59.520 of England facing when we look into twenty twenty four. 0:18:00.040 --> 0:18:04.920 Stressing because after that inflation print just before Christmas that 0:18:05.440 --> 0:18:09.360 showed inflation coming down much faster than we expecting. Obviously, 0:18:09.400 --> 0:18:12.719 markets took that as the green light for early interest 0:18:12.760 --> 0:18:15.159 rate cuts and they're are currently they're pricing in the 0:18:15.200 --> 0:18:18.679 first cut from May and then a further four or 0:18:18.720 --> 0:18:22.760 five after that over the by the end of the year. 0:18:23.320 --> 0:18:25.479 But the Bank of England, you know, it had its 0:18:25.560 --> 0:18:29.280 latest policy meeting just after that those inflation figures and 0:18:29.480 --> 0:18:32.920 it was it was still holding this high for longer message. 0:18:32.920 --> 0:18:35.320 It's still trying to tell markets that you know, don't 0:18:35.359 --> 0:18:38.080 expect us to pivot to cuts anytime soon, which was 0:18:38.200 --> 0:18:41.120 quite in quite sharp contrast with what we're hearing from 0:18:41.200 --> 0:18:45.639 the Fed around that time as well. So although you 0:18:45.680 --> 0:18:48.440 know the Bank of England's trying to you know, ward 0:18:48.480 --> 0:18:51.480 off markets and tell them to you know that they're 0:18:51.480 --> 0:18:53.840 going to hold path for quite quite some time, that 0:18:54.040 --> 0:18:56.040 markets are running away with it now, and that they 0:18:56.080 --> 0:18:59.480 are expecting cuts to come sometime in the first half 0:18:59.520 --> 0:18:59.960 of this year. 0:19:00.320 --> 0:19:02.119 Yeah, I'm just looking at the market pricing for that 0:19:02.160 --> 0:19:04.240 as well. Market's currently pricing in a first rate cut 0:19:04.240 --> 0:19:07.280 from the Bank of England in around May of this year, 0:19:07.320 --> 0:19:09.679 and around one hundred and just over one hundred and 0:19:09.680 --> 0:19:12.280 thirty five basis points of cuts by the end of 0:19:12.320 --> 0:19:14.320 twenty twenty four as well. So it's certainly a very 0:19:14.320 --> 0:19:17.280 interesting year for the Bank of England. Okay, Katie Linsel, 0:19:17.320 --> 0:19:20.639 our UK Retail reporter and our UK Economy reporter, Tom Reese, 0:19:20.640 --> 0:19:22.480 thank you so much for joining us and giving us 0:19:22.520 --> 0:19:24.600 your analysis on that subject. We will of course have 0:19:24.680 --> 0:19:28.280 coverage of those GDP and other economic indicators on the 0:19:28.320 --> 0:19:31.359 program in the coming days. I'm Stephen Carroll in London. 0:19:31.400 --> 0:19:34.720 You can catch us every weekday morning here for Bloomberg Daybreak. 0:19:34.760 --> 0:19:37.200 You're at beginning at six am in London and one 0:19:37.240 --> 0:19:39.160 am on Wall Street, Tom. 0:19:39.200 --> 0:19:41.919 Our thanks to Bloomberg Daybreak. You're a banker, Stephen Carroll, 0:19:42.040 --> 0:19:44.360 And coming up on Bloomberg day Break weekend, we head 0:19:44.359 --> 0:19:48.320 to Asia and preview a key presidential election in Taiwan. 0:19:48.960 --> 0:20:02.359 I'm Tom Busby, and this is Bloomberg. I'm Tom Busby 0:20:02.359 --> 0:20:04.040 in New York with your global look ahead at the 0:20:04.040 --> 0:20:07.720 top stories for investors in the coming week. Taiwan's presidential 0:20:07.760 --> 0:20:11.320 election is set for January thirteenth, and the results will 0:20:11.320 --> 0:20:13.879 help shape the course of US China relations for years 0:20:13.920 --> 0:20:18.639 to come. Bloomberg Daybreak Asia anchor Doug Krisner looks ahead Tom. 0:20:18.640 --> 0:20:21.879 The election is a competitive three way race, and the 0:20:22.000 --> 0:20:26.080 ruling Democratic Progressive Party is seeking to maintain Taiwan's de 0:20:26.200 --> 0:20:29.840 facto political independence. Now to help us set up the contest, 0:20:29.880 --> 0:20:34.800 we have Bloomberg Samson. Elyssy is our Taipei bureau chief. Samson, 0:20:35.200 --> 0:20:37.240 thank you for being with us. As I mentioned, it's 0:20:37.240 --> 0:20:39.960 a three way race. Can you quickly kind of help 0:20:40.040 --> 0:20:44.240 sketch out who the candidates are, what their perspective parties 0:20:44.320 --> 0:20:47.639 stand for, particularly in relation to the government in Beijing. 0:20:47.800 --> 0:20:51.840 Well, first of all, you have the current Vice President Laichinda. 0:20:52.359 --> 0:20:55.400 So he is the candidate for the as you said, 0:20:55.480 --> 0:20:58.560 the Democratic Progressive Party the DPP. So this is a 0:20:58.560 --> 0:21:03.320 party that holds as one of its foundational tenets that 0:21:03.920 --> 0:21:08.640 Taiwan is a sovereign, independent nation. The only problem is 0:21:08.640 --> 0:21:11.119 is that it's not widely recognized by the rest of 0:21:11.160 --> 0:21:15.920 the world. So they are pushing for a permanent separate 0:21:16.000 --> 0:21:21.160 status for Taiwan, separate from China. Obviously, So right now 0:21:21.160 --> 0:21:24.720 he's the current vice president and he is looking to 0:21:24.760 --> 0:21:30.200 succeed his current boss president signing one then running against him. 0:21:30.400 --> 0:21:33.840 You have the largest opposition party in Taiwan, the gormin 0:21:33.880 --> 0:21:37.600 dang or the KMT, and this is a party that 0:21:38.160 --> 0:21:43.199 holds that Taiwan is actually a part of a China 0:21:43.320 --> 0:21:46.119 of slightly more vaguely defined China, not necessarily the People's 0:21:46.160 --> 0:21:49.760 Republic of China, but a some kind of China, and 0:21:49.800 --> 0:21:54.920 that Taiwan's eventual future lies with China and in some 0:21:55.000 --> 0:21:59.679 form of unification with the mainland. And their candidate is 0:22:00.160 --> 0:22:04.720 former policeman, Taiwan's former top policeman Ho Yoi, who is 0:22:04.800 --> 0:22:08.040 running against Lie. And then this year, which makes this 0:22:08.160 --> 0:22:14.040 election slightly unique, as you have a third competitive candidate, 0:22:14.320 --> 0:22:19.680 and this is a Kerwanza from the new relatively young 0:22:20.040 --> 0:22:24.360 at Taiwan's People's Party. So Kerr is something of a 0:22:24.520 --> 0:22:27.840 left field candidate, a very non traditional politician. So he 0:22:27.960 --> 0:22:31.680 was a surgeon in one of Taiwan's top hospitals for 0:22:31.720 --> 0:22:35.119 a long time until one day he decided that he 0:22:35.119 --> 0:22:37.480 couldn't stand the state of politics in Taiwan and ran 0:22:37.520 --> 0:22:40.840 for mayor of Taipei as an independent and surprisingly won 0:22:41.800 --> 0:22:44.919 around ten years ago. He was then a mayor for 0:22:44.960 --> 0:22:48.440 eight years, and then after he stepped down, he set 0:22:48.520 --> 0:22:51.000 up his own party and since then he's been teasing 0:22:51.080 --> 0:22:52.919 that he could run for president, and this year he 0:22:52.960 --> 0:22:57.080 actually did it, and so he has proved to be 0:22:57.359 --> 0:23:01.480 quite popular with voters who were are tired of the 0:23:01.560 --> 0:23:05.000 duopoly of Taiwan politics, the traditional either the the DPP 0:23:05.200 --> 0:23:08.080 or the KMT, and now a KA has given this 0:23:08.200 --> 0:23:09.800 effective vote as something of an option. 0:23:10.040 --> 0:23:13.480 Recently, we had a President chi with his New Year address, 0:23:13.560 --> 0:23:15.919 and one of the things he reiterated was that China 0:23:15.960 --> 0:23:19.720 will be surely unified, maybe a reference to the aim 0:23:19.800 --> 0:23:22.760 here of eventually bringing Taiwan back under the control of 0:23:22.800 --> 0:23:26.119 the mainland if forced by necessary, and I'm based on 0:23:26.160 --> 0:23:29.880 what you just said, I'm imagining that the KMT candidate 0:23:29.960 --> 0:23:31.840 would be Beijing's preferred choice. 0:23:32.080 --> 0:23:32.600 Is that fair? 0:23:33.320 --> 0:23:38.960 Yes? Absolutely so. They do share this one overarching goal 0:23:39.160 --> 0:23:45.720 that eventually Taiwan should be formally unified as part of China. 0:23:45.840 --> 0:23:48.600 What they do disagree on is what that China should be. 0:23:48.680 --> 0:23:52.560 So obviously, from Sijinping's perspective, it's the People's Republic of China, 0:23:52.600 --> 0:23:55.879 the China that we all know now. But for the 0:23:55.960 --> 0:23:59.080 KMT in Taiwan, really important part of their history was 0:23:59.119 --> 0:24:02.960 there fighting the Tiny Civil War against the Communist Party, 0:24:03.800 --> 0:24:07.040 and so theoretically they many people in the party still 0:24:07.119 --> 0:24:09.719 view the Chinese Communist Party as an enemy, and if 0:24:09.960 --> 0:24:12.400 you meet them, you know, privately, they'll quite happily tell 0:24:12.440 --> 0:24:16.119 you that, you know, the Communists in Beijing are still 0:24:16.160 --> 0:24:22.080 their mortal enemy. But at least they do have one 0:24:22.080 --> 0:24:24.959 thing in common is that they feel Taiwan would be 0:24:24.960 --> 0:24:26.960 better off eventually being part of China. 0:24:27.520 --> 0:24:29.480 I think the US probably is going to be watching 0:24:29.560 --> 0:24:31.800 this race very closely. I think that's fair to say. 0:24:31.920 --> 0:24:33.920 At the end of last year, near the end, I 0:24:33.960 --> 0:24:36.480 think it was in November that presidents Biden and she 0:24:36.640 --> 0:24:39.000 were at the APEX summit in San Francisco, and it 0:24:39.040 --> 0:24:42.399 was then that she told Biden that the issue of 0:24:42.440 --> 0:24:45.240 Taiwan was the most important and dangerous issue for the 0:24:45.359 --> 0:24:49.040 US and China and their relationship. How do you think, 0:24:49.600 --> 0:24:52.359 and I'm not asking you to speculate, but based on 0:24:52.400 --> 0:24:56.199 what you know of US Taiwan relations, how might the 0:24:56.320 --> 0:24:59.879 US kind of be watching this contest? And not that 0:25:00.080 --> 0:25:03.080 it would put its finger on the scale in any way, 0:25:03.200 --> 0:25:05.480 but is there something that the US would kind of 0:25:05.520 --> 0:25:08.760 communicate to Beijing to make sure that there is no 0:25:09.080 --> 0:25:13.280 interference or let's say, a reduction in the degree of 0:25:13.400 --> 0:25:16.320 influence Beijing may like to have over these elections. 0:25:16.920 --> 0:25:19.000 Well, there's no doubt that the US is watching this 0:25:19.040 --> 0:25:24.680 election very very closely. Taiwan has become this pivotal point 0:25:24.760 --> 0:25:29.560 in the geopolitical standoff between the United States and China, 0:25:29.600 --> 0:25:33.280 and as Hujinping said there, as you mentioned, you know, 0:25:33.359 --> 0:25:36.440 it is one of the most important issues in relations 0:25:36.440 --> 0:25:39.480 between Washington and Beijing. And so one of the things 0:25:39.480 --> 0:25:43.680 the US has repeatedly reiterated so that number one, they 0:25:43.720 --> 0:25:47.520 have no preferred winner of the Taiwanese election. They've been 0:25:47.600 --> 0:25:51.240 very clear that, you know, they respect the choice of 0:25:51.560 --> 0:25:56.440 Taiwanese voters, and they have also urged other parties. I 0:25:56.520 --> 0:25:59.720 think we can further largely talking to Beijing here. The 0:25:59.760 --> 0:26:01.919 other parties should stay out of the race. They should 0:26:01.920 --> 0:26:05.280 not meddle in this election. Beijing, for its part, it 0:26:05.280 --> 0:26:07.720 has made it absolutely clear that they would prefer the 0:26:07.800 --> 0:26:11.560 KMT candidate to win this election. To be honest, there's 0:26:11.560 --> 0:26:14.240 a bit of a you know, who would the US 0:26:14.320 --> 0:26:18.639 prefer to win? You hear different voices out of the 0:26:18.760 --> 0:26:21.359 United States on this. On the one hand, if the 0:26:21.440 --> 0:26:24.440 DPP stays in power, the US can be fairly sure 0:26:24.480 --> 0:26:28.200 they have a reliable, steady partner who is on board 0:26:28.240 --> 0:26:33.200 with the United States and their more broader regional goals 0:26:33.200 --> 0:26:36.880 when it comes to standing up against China, and also 0:26:36.920 --> 0:26:40.359 they have a more willing recipient for US arms sales. 0:26:41.480 --> 0:26:43.680 But on the other hand, if the KMT were to win, 0:26:43.800 --> 0:26:46.640 some in the US do point out that this could 0:26:47.119 --> 0:26:49.840 take a little bit of the temperature out of the 0:26:50.800 --> 0:26:53.199 cross rate relations in this part of the world and 0:26:53.240 --> 0:26:57.000 therefore make US China relations a little bit easier. 0:26:57.160 --> 0:26:59.720 Yeah, I understand the notion of supporting democracies from the 0:26:59.800 --> 0:27:02.399 US side. But I'm understanding also that there is a 0:27:02.560 --> 0:27:05.360 little bit of a national security concern if you consider 0:27:05.400 --> 0:27:10.160 the fact that Taiwan is basically the leader in semiconductor production. 0:27:10.240 --> 0:27:13.720 I'm thinking in particular of Taiwan semi. If that were 0:27:13.760 --> 0:27:16.760 not the case, would the US stance be slightly different? 0:27:16.760 --> 0:27:17.240 Do you think? 0:27:17.359 --> 0:27:19.320 I think it's a question of degrees. I think there's 0:27:19.359 --> 0:27:23.879 no doubt that the United States, as you said, supports 0:27:24.520 --> 0:27:27.159 a fellow democracy, and it's a very bad look for 0:27:27.200 --> 0:27:32.399 the United States if they're seen throwing a democracy to 0:27:32.440 --> 0:27:35.320 the wolves in Asia, so to speak. And also, you know, 0:27:35.359 --> 0:27:37.320 there is the Taiwan Relations Act in the United States. 0:27:37.359 --> 0:27:40.600 You know, the US has committed itself to providing for 0:27:40.680 --> 0:27:44.040 Taiwan's own self defense, and so there is a legal 0:27:44.119 --> 0:27:48.199 basis for the US to continuing to support Taiwan. So 0:27:48.200 --> 0:27:51.000 I don't think that would be something the US could 0:27:51.040 --> 0:27:55.359 easily abandon. Plus, within the United States, I mean, you 0:27:55.400 --> 0:28:00.119 look at Congress, there's an enormous amount of support on 0:28:00.160 --> 0:28:02.919 both sides of the Aisle for Taiwan. There So, even 0:28:02.960 --> 0:28:07.760 if the executive were to decide that supporting Taiwan is 0:28:07.760 --> 0:28:11.399 no longer in America's best interests. I think they'd find 0:28:11.440 --> 0:28:16.840 a lot of pushback from Congress on anything that would 0:28:17.080 --> 0:28:18.200 disadvantage Taiwan. 0:28:18.520 --> 0:28:21.640 It was January first, nineteen seventy nine. I believe that 0:28:21.800 --> 0:28:25.439 Washington officially cut diplomatic ties with Taipei in favor of 0:28:25.480 --> 0:28:28.959 recognizing Beijing. How well do you think the US has 0:28:29.000 --> 0:28:31.919 been doing it? It kind of balancing the situation. 0:28:32.080 --> 0:28:38.520 It's underappreciated exactly how successful the Taiwan's Relations Act and 0:28:39.160 --> 0:28:44.320 strategic ambiguity has worked over the past forty plus years 0:28:44.320 --> 0:28:48.080 forty five years now at maintaining the peace in this 0:28:48.160 --> 0:28:48.840 part of the world. 0:28:48.880 --> 0:28:50.880 Samson's so good of you to stop by and help 0:28:50.960 --> 0:28:54.600 us set up the Taiwan presidential election that will happen 0:28:54.640 --> 0:28:58.520 on January thirteenth. Samson Ellis is Bloomberg's Taipei bureau chief. 0:28:58.960 --> 0:29:01.280 I'm Doug Krisner, and you can join Brian Curtis and 0:29:01.360 --> 0:29:04.320 myself weekdays here for Bloomberg day Break Asia beginning at 0:29:04.360 --> 0:29:08.600 seven am in Hong Kong six pm on Wall Street tom. 0:29:08.240 --> 0:29:10.920 Our thanks to Bloomberg day Break Asia anchor Doug Krisner, 0:29:10.920 --> 0:29:13.640 and coming up here on Bloomberg day Break Weekend, we 0:29:13.680 --> 0:29:16.440 look ahead to the presidential election right here in the 0:29:16.520 --> 0:29:21.040 US with Gallup editor in chief Mohammed Unics. Next, I'm 0:29:21.080 --> 0:29:27.520 Tom Busby, and this is Bloomberg. This is Bloomberg day 0:29:27.560 --> 0:29:29.800 Break weekend, our global look ahead at the top stories 0:29:29.800 --> 0:29:32.640 for investors in the coming week. I'm Tom Busby in 0:29:32.680 --> 0:29:36.480 New York. New polling from Gallup shows President Joe Biden 0:29:36.520 --> 0:29:39.800 finishing twenty twenty three with a job approval rating of 0:29:40.000 --> 0:29:43.400 just thirty nine percent. That's the lowest of recent presidents 0:29:43.720 --> 0:29:47.360 at the same point in their presidency. Gallup Editor in 0:29:47.400 --> 0:29:50.680 chief Mohammed Unis tells Bloomberg's Kaylee Lines and our Bloomberg 0:29:50.760 --> 0:29:53.840 ninety nine one news from in Washington about trends to 0:29:53.960 --> 0:29:57.479 follow heading into the twenty twenty four presidential election. 0:29:57.800 --> 0:30:01.040 I'm not sure that President Biden is feeling particularly happy 0:30:01.080 --> 0:30:03.320 as he comes into this new year, knowing he ended 0:30:03.400 --> 0:30:06.960 last year twenty twenty three, according to Gallups figures, with 0:30:07.040 --> 0:30:09.960 an approval rating of just thirty nine percent. Can you 0:30:10.000 --> 0:30:12.840 give us some context around that number? It's quite low. 0:30:13.040 --> 0:30:16.520 The real context is compared to every other president in 0:30:16.600 --> 0:30:20.640 modern history who has sought reelection, he's far behind where 0:30:20.680 --> 0:30:24.160 they were traditionally speaking what we've seen in our numbers 0:30:24.200 --> 0:30:27.480 is that a president going into a reelection campaign at 0:30:27.520 --> 0:30:30.640 that fifty point mark is a really critical number to 0:30:30.680 --> 0:30:34.400 be at. And obviously President Biden is far behind that, 0:30:34.520 --> 0:30:38.160 but he's also significantly behind where Barack Obama was and 0:30:38.200 --> 0:30:41.640 where Donald Trump was, which is pretty important to note. 0:30:41.680 --> 0:30:44.120 I think during the Trump campaign there was so much 0:30:44.160 --> 0:30:47.400 focus on how low and steady the number stayed, and 0:30:47.560 --> 0:30:50.640 President Biden right now is behind where President Trump was. 0:30:50.880 --> 0:30:54.000 Well, and you talk about the number staying low and 0:30:54.040 --> 0:30:56.600 being pretty steady, isn't that the case with Biden? I mean, 0:30:56.640 --> 0:30:58.800 he's been in and around that kind of forty percent 0:30:58.840 --> 0:31:01.080 figure or below for some time now, and it doesn't 0:31:01.080 --> 0:31:04.080 seem like that that needle has moved to any real 0:31:04.120 --> 0:31:04.760 degree at all. 0:31:04.920 --> 0:31:05.440 It hasn't. 0:31:05.480 --> 0:31:08.240 He started off like most presidents do in a honeymoon phase. 0:31:08.280 --> 0:31:10.680 He has that fifty seven percent approval, which is pretty 0:31:10.920 --> 0:31:14.520 high in our era. Another thing Kaylee, to always keep 0:31:14.520 --> 0:31:16.720 in mind with these numbers specifically, is we are in 0:31:16.960 --> 0:31:21.240 what it truly is a hyperpartisan era. So since President Obama, 0:31:21.720 --> 0:31:25.400 the difference between people's views on the president and how 0:31:25.480 --> 0:31:29.480 closely it's tied to their party ID is stronger than ever. 0:31:29.840 --> 0:31:34.200 So presidents have had flatter sort of frequencies on their 0:31:34.200 --> 0:31:37.640 approval ratings. But I think what's concerning about President Biden's 0:31:37.680 --> 0:31:40.880 situation is that even compared to Obama and Trump, who 0:31:41.040 --> 0:31:44.560 also face that reality, he's significantly behind. Right now. 0:31:44.680 --> 0:31:46.760 Okay, well, let's talk about the options. I mentioned that 0:31:46.800 --> 0:31:50.120 we're seeing in pretty consistently in polls that the majority 0:31:50.160 --> 0:31:52.160 of voters would prefer it not to be a Biden 0:31:52.240 --> 0:31:55.320 Trump rematched like twenty twenty all over again. And yet 0:31:55.320 --> 0:31:57.920 that's likely what they're going to get unless there is 0:31:58.360 --> 0:32:00.640 a viable alternative. What are you say seeing a round 0:32:00.680 --> 0:32:03.479 support for a third party candidate, whoever that is? 0:32:03.680 --> 0:32:05.560 Well, I can tell you who we see in terms 0:32:05.600 --> 0:32:07.600 of favorables. Of all the folks that are out there 0:32:07.680 --> 0:32:10.680 right now, President Biden and Trump are basically tied at 0:32:10.720 --> 0:32:12.960 forty one percent of a favorable rating. And this is 0:32:12.960 --> 0:32:15.080 do you have a favorable or unfavorable view of the 0:32:15.080 --> 0:32:19.200 following person? Desantus Haley in specific Sarty are at their 0:32:19.240 --> 0:32:23.520 thirty so really low thirty percent favorable rating. It's important 0:32:23.600 --> 0:32:26.160 to note that this tends to happen with new names. 0:32:26.200 --> 0:32:29.440 People don't know who they are. Kennedy, on the other hand, 0:32:29.480 --> 0:32:31.760 is already breaking the fifty point mark, but that's probably 0:32:31.760 --> 0:32:35.080 because of that name recognition factor that he has in 0:32:35.120 --> 0:32:38.440 his favor. So looking at the favorable ratings, which is 0:32:38.480 --> 0:32:40.680 really a really good proxy, I think at this point 0:32:40.760 --> 0:32:43.760 of the contest to see who's graining traction with the public, 0:32:44.200 --> 0:32:46.800 really none of them are. Nobody's really shot through the 0:32:46.920 --> 0:32:51.280 roof and impressed or wowed. Of course, January fifteenth is 0:32:51.400 --> 0:32:55.000 just down the street. A lot can change, particularly when 0:32:55.000 --> 0:32:57.440 those first results start coming out from the caucuses, But 0:32:57.560 --> 0:32:59.160 right now, nobody's dominating. 0:32:59.320 --> 0:33:01.280 All right, we only have about a minute left, Muhammad, 0:33:01.320 --> 0:33:03.120 But we've discussed we've covered a lot of ground here 0:33:03.120 --> 0:33:05.560 in what twenty twenty four may bring, how people are feeling. 0:33:05.600 --> 0:33:08.800 What is one other trend or something that you'll be 0:33:08.880 --> 0:33:10.280 focusing on in twenty twenty four. 0:33:10.720 --> 0:33:12.960 I think for us it'll be the election. It'll be 0:33:13.040 --> 0:33:17.840 what people are really tuning into for making that decision 0:33:17.840 --> 0:33:20.480 to cast their vote. One thing we really know right 0:33:20.480 --> 0:33:23.240 now is most Americans are still totally checked out. They're 0:33:23.280 --> 0:33:26.360 not focused on political news as unlike you and I 0:33:26.600 --> 0:33:28.760 night and day. I know it hurts my feelings too, 0:33:29.200 --> 0:33:32.920 but as it gets closer to November, that number is 0:33:32.960 --> 0:33:34.840 going to rise, and we're going to start asking people 0:33:35.040 --> 0:33:37.320 what do you bring into mind when you cast that vote. 0:33:37.440 --> 0:33:38.960 It's a good point. I feel like we've been living 0:33:39.000 --> 0:33:41.520 and breathing this for a year now, but really it's 0:33:41.560 --> 0:33:44.760 still early days. Mohammed Unis joining us. Gallups editor in chief. 0:33:44.800 --> 0:33:47.200 Thank you so much as always for being here. It's 0:33:47.240 --> 0:33:48.680 going to be a doozy of the year, guys. 0:33:48.880 --> 0:33:51.400 Thank you, Kaylee. That was Bloomberg sound On co host 0:33:51.480 --> 0:33:54.560 Kaylee Lines reporting from our Bloomberg ninety nine one newsroom 0:33:54.560 --> 0:33:57.640 in Washington, and you can hear sound on weekdays one 0:33:57.680 --> 0:34:00.440 to three pm on Bloomberg Radio. And that does it 0:34:00.520 --> 0:34:02.840 for this edition of Bloomberg day Break Weekend. Join us 0:34:02.840 --> 0:34:05.320 again Monday morning, five am Wall Street Time for the 0:34:05.400 --> 0:34:08.319 latest on markets overseas and the news you need to 0:34:08.320 --> 0:34:11.479 start your day. I'm Tom Busby. Stay with us. Top 0:34:11.520 --> 0:34:14.640 stories and global business headlines are coming up right now.