Daybreak Weekend: Holiday Shopping, BOJ Decision, Bitcoin ETFs

This is Bloomberg day Break Weekend, our global look at 0:00:05.480 --> 0:00:07.800 the top stories in the coming week from our Daybreak 0:00:07.840 --> 0:00:10.520 anchors all around the world, and straight ahead on the program. 0:00:10.560 --> 0:00:14.240 After this week's encouraging retail sales numbers, we check in 0:00:14.280 --> 0:00:17.360 on the health of the US consumer. I'm Tom Busby 0:00:17.400 --> 0:00:18.000 in New York. 0:00:18.280 --> 0:00:21.000 I'm callin Hedge here in London, where we're asking what's 0:00:21.120 --> 0:00:23.079 next for the UK retail center. 0:00:23.360 --> 0:00:25.880 I'm Derek Prisoner. We map out what comes next for 0:00:25.960 --> 0:00:26.800 the Bank of Japan. 0:00:27.240 --> 0:00:29.760 I'm Kabie Liones in Washington, where the SEC is in 0:00:29.800 --> 0:00:32.519 the spotlight as it soon may decide whether to approve 0:00:32.560 --> 0:00:34.080 a spotfit point ets. 0:00:37.159 --> 0:00:41.239 That's all straight ahead on Bloomberg Daybreak Weekend. The business 0:00:41.280 --> 0:00:44.040 news you need to wrap up your week, Available on 0:00:44.120 --> 0:00:48.720 Apple Spotify, The Bloomberg Business Happen everywhere you get your podcasts. 0:00:53.240 --> 0:00:55.760 Good day to you. I'm Tom Busby. It's the most 0:00:55.800 --> 0:00:59.000 wonderful time of the year for retailers anyway. So we 0:00:59.080 --> 0:01:01.640 begin today's program with a look at the US retail 0:01:01.680 --> 0:01:05.400 sector and the strength of the US consumer. Last week's 0:01:05.480 --> 0:01:09.199 unexpected rise in retail sales for November. I'll welcome sign 0:01:09.400 --> 0:01:11.919 as we enter the final shopping week of the holiday season, 0:01:11.959 --> 0:01:15.039 and for more we're joined by economists a Stelle Oh 0:01:15.160 --> 0:01:20.080 of Bloomberg Economics and Bloomberg Intelligence retail analyst Abigail gil Martin. 0:01:20.160 --> 0:01:22.560 Thank you both for being here. All right, is Stelle, 0:01:22.600 --> 0:01:24.960 We're going to start with you. After that early Christmas 0:01:25.000 --> 0:01:27.720 gift last week from the Fed signaling several interest rate 0:01:27.880 --> 0:01:31.720 cuts in the new year, solid jobs data, the unemployment 0:01:31.800 --> 0:01:33.880 rate down to three point seven percent last month, and 0:01:34.040 --> 0:01:37.319 retail sales in November up more than four percent year 0:01:37.360 --> 0:01:41.399 over year. How is the US consumer doing right now? 0:01:41.600 --> 0:01:44.520 Thanks Tom? Yeah, so, the US consumer right now is 0:01:44.560 --> 0:01:51.120 still continuing their spending moment from over the summer, but 0:01:51.560 --> 0:01:55.120 ver seeing that the consumer is still remaining under pressure 0:01:55.240 --> 0:01:59.680 even with this week's upbeat retail sales report. And that's 0:01:59.720 --> 0:02:01.960 because when we look under the hood of the retail 0:02:02.000 --> 0:02:04.480 sales report, we see that most of the strength is 0:02:04.520 --> 0:02:09.359 actually coming from non store retail sales and food services 0:02:09.560 --> 0:02:13.400 retail sales categories. What this means is that, you know, 0:02:14.000 --> 0:02:18.639 consumers are still very much bargain hunting online, where when 0:02:18.639 --> 0:02:22.440 you're online you can compare prices much more easily between stores. 0:02:22.800 --> 0:02:26.560 And also still not really purchasing big ticket items that 0:02:26.600 --> 0:02:30.760 are sensitive to interest rates right now, So they're not 0:02:30.919 --> 0:02:36.280 purchasing large home appliances that require more credit card spending, 0:02:36.560 --> 0:02:40.880 and they're also not purchasing more larger electronic products at 0:02:40.880 --> 0:02:43.600 this time of the year where you would expect more 0:02:44.440 --> 0:02:48.360 you know, big ticket discretionary purchases. So overall, Tom, we 0:02:48.440 --> 0:02:52.040 still think that the US consumer health is still more 0:02:52.120 --> 0:02:55.040 fragile than it was at the very beginning of the year. 0:02:55.200 --> 0:02:58.560 And could many consumers, especially younger ones, be kind of 0:02:58.639 --> 0:03:01.560 hurting themselves relying a little too much on credit cards, 0:03:01.720 --> 0:03:04.280 buy now, pay later plans for their spending habits. 0:03:04.360 --> 0:03:07.799 Absolutely, Tom. In fact, we actually think that with the 0:03:07.960 --> 0:03:11.080 increase in interest rates, there's a risk that you know, 0:03:11.200 --> 0:03:15.000 household debt servings cost debt servings costs as a ratio 0:03:15.240 --> 0:03:18.440 of income, that's, you know, the interest rate you would 0:03:18.480 --> 0:03:21.880 have to pay on your credit card balances could rise 0:03:21.960 --> 0:03:25.760 to at least you know, eleven or twelve percent by 0:03:25.919 --> 0:03:29.520 year end next year, even if the labor market stays 0:03:29.600 --> 0:03:33.520 cool and the Fed, as you know, cut may cut 0:03:33.560 --> 0:03:36.880 interest Even if the Fed cuts interest rates as they 0:03:36.960 --> 0:03:41.280 suggest that they might do earlier this week, and you know, 0:03:41.400 --> 0:03:46.240 with the household debt servicing cost ratio that is roughly 0:03:46.320 --> 0:03:49.960 eleven percent, that's the highest it's been since early twenty ten. 0:03:50.160 --> 0:03:54.600 So we really expect that, you know, if consumers continue 0:03:54.640 --> 0:04:00.720 to build up their credit card balances through purchases in 0:04:00.760 --> 0:04:05.360 the holiday season, that is just you know, more debt 0:04:05.400 --> 0:04:07.080 burden for the household ahead. 0:04:07.520 --> 0:04:10.840 Well, that does not paint a very good picture. Abigail, 0:04:10.920 --> 0:04:13.600 let's turn to you. How is that, you know, this 0:04:13.840 --> 0:04:17.560 uneven recovery in the consumer spending and how does that 0:04:17.640 --> 0:04:19.080 impact the retail sector. 0:04:19.279 --> 0:04:21.120 You know, we weren't too surprised so that we've been 0:04:21.160 --> 0:04:25.640 kind of saying all November we've been seeing strong holiday momentum, 0:04:25.720 --> 0:04:28.240 as it was evident in Cyber Week numbers. You know, 0:04:28.279 --> 0:04:30.920 we saw sales beating or in line with forecasts all 0:04:30.960 --> 0:04:34.479 week and what we've heard from companies and retailers after 0:04:34.560 --> 0:04:38.080 reporting three key results, you know, going into four Q 0:04:38.240 --> 0:04:40.960 this holiday quarter, inventory is our leaner, which is going 0:04:41.000 --> 0:04:43.880 to bode well for you know, margins because there won't 0:04:43.880 --> 0:04:47.719 be discounts. What we've seen so far are similar to 0:04:47.839 --> 0:04:52.360 last year, but nowhere near you know, as steep as 0:04:52.400 --> 0:04:55.360 a few years prior. So that's really great, and retailers 0:04:55.400 --> 0:04:58.120 are encouraged with the strong start and also the fact 0:04:58.160 --> 0:05:01.120 that there's an extra shopping day between Thanksgiving and Christmas 0:05:01.160 --> 0:05:04.920 this year, with Christmas actually falling on a Monday, it's 0:05:04.920 --> 0:05:07.560 giving consumers at one extra weekend day, which is going 0:05:07.600 --> 0:05:11.160 to be pretty important and probably also help retailer sales 0:05:11.240 --> 0:05:13.440 kind of going into the holidays. 0:05:13.440 --> 0:05:15.880 So well, one thing is still mentioned. I want to 0:05:15.880 --> 0:05:19.560 go back to and Abigail, you would know this encouraging 0:05:19.600 --> 0:05:23.480 retail sales figures for online retailers, they are getting the 0:05:23.640 --> 0:05:28.040 bulk of this, you know, largest and spending. What can 0:05:28.080 --> 0:05:33.040 you tell me about Amazon, which started it's holiday sales 0:05:33.040 --> 0:05:35.000 back in October, maybe even before. 0:05:36.080 --> 0:05:38.640 Yeah, it did, and I'm pretty sure they actually had 0:05:38.680 --> 0:05:42.520 a couple extra days for their Black Friday sales event 0:05:42.600 --> 0:05:45.159 this year as well, so they actually extended their deals. 0:05:45.400 --> 0:05:48.320 But at the same time, their deals were in line 0:05:48.440 --> 0:05:51.359 or even you know, less than last year. And we 0:05:51.400 --> 0:05:53.640 think that's because they were spread out over a longer time. 0:05:53.760 --> 0:05:56.120 So they're just trying to draw those sales on earlier 0:05:56.120 --> 0:05:58.599 in the month first, you know, later now where things 0:05:58.640 --> 0:06:01.760 are about to get congested. But yeah, the shift online 0:06:01.800 --> 0:06:05.239 it's persisting from COVID, and we're seeing consumers really value 0:06:05.279 --> 0:06:08.600 convenience and speed, and those are two big things that 0:06:08.640 --> 0:06:10.600 are going to be driving holiday spending this year, and 0:06:10.680 --> 0:06:13.640 Amazon really hits both of those on the head and 0:06:13.800 --> 0:06:17.320 it provides that to customers, so we're not surprised. We 0:06:17.360 --> 0:06:20.560 saw that online retailers were doing strong over Cyber Week, 0:06:20.600 --> 0:06:24.080 and even on Thanksgiving and Black Friday, we saw stores 0:06:24.080 --> 0:06:26.719 were strong, but online was just as strong on Black Friday, 0:06:27.720 --> 0:06:29.360 So I think it goes well for Amazon. But yeah, 0:06:29.400 --> 0:06:32.000 I think it's really that value and convenience that's helping there. 0:06:32.200 --> 0:06:32.400 Now. 0:06:32.520 --> 0:06:36.600 Conversely, one big name, Etsy, the craft retailer, not doing 0:06:36.640 --> 0:06:38.360 as well, just announce some layoffs. 0:06:38.720 --> 0:06:42.760 Yeah, they announced some layoffs. You know, they're going back 0:06:42.800 --> 0:06:46.159 to their staffing back in twenty twenty two, similar Earth levels. 0:06:46.720 --> 0:06:49.039 But they did, you know, they raised guidance. They raised 0:06:49.040 --> 0:06:52.000 GMB guidance and profit guidance, which I think went a 0:06:52.040 --> 0:06:54.239 little unnoticed just due to the you know, the cost 0:06:54.240 --> 0:06:57.000 cuts as well as they still see two to three 0:06:57.000 --> 0:07:02.800 percent sales revenue gains in four Q. So some good 0:07:02.800 --> 0:07:04.680 and bad things there, but we think in the long run, 0:07:04.760 --> 0:07:08.239 it's what they need at drive profitable growth going forward. 0:07:08.720 --> 0:07:10.680 Estella, I want to go back to you and the 0:07:10.760 --> 0:07:15.800 impact of lower gasoline prices and how that has helped retailers. 0:07:16.160 --> 0:07:20.280 Maybe consumers feeling a little more impoltant to spend more, 0:07:20.320 --> 0:07:22.440 they're spending a lot less at the gas pump. Now, 0:07:22.800 --> 0:07:23.280 we we. 0:07:23.200 --> 0:07:27.120 Did some estimates on our team of how much of 0:07:27.160 --> 0:07:30.440 a contribution the recent decline and oil prices may have 0:07:30.880 --> 0:07:35.320 boosted spending space and consumer's wallet and estimate that, you know, 0:07:35.480 --> 0:07:39.800 depending on how long lower gas prices last and how 0:07:39.920 --> 0:07:43.680 much further they dropped, they could potentially see savings that 0:07:43.840 --> 0:07:46.360 range from you know, twenty dollars per month to almost 0:07:46.360 --> 0:07:49.200 one hundred dollars per month per household. And that's quite 0:07:49.240 --> 0:07:53.360 a bit of stimulus that's been provided to consumers during 0:07:53.400 --> 0:07:54.320 the holiday season. 0:07:54.520 --> 0:07:56.920 And another sector that did well and these are in 0:07:56.960 --> 0:08:00.480 the numbers for November, bars and restaurants. People are they 0:08:00.480 --> 0:08:02.240 want to get out, they want to eat, they want 0:08:02.240 --> 0:08:03.880 to drink, they want to see other people. 0:08:04.240 --> 0:08:09.440 Absolutely right. That's actually a continuation from what we've been 0:08:09.480 --> 0:08:13.800 seeing throughout the most of the year, where you know, service, 0:08:13.840 --> 0:08:16.520 the services sector has been quite the pillar of strength 0:08:16.600 --> 0:08:19.840 for the US economy, but we do expect that to 0:08:19.920 --> 0:08:24.520 slow down as again, you know, households see increase debt 0:08:24.520 --> 0:08:26.560 burdens and higher interest recosts. 0:08:27.000 --> 0:08:28.360 Abigail, I want to go back to you. I want 0:08:28.360 --> 0:08:32.080 to talk about some of the retailers that are doing well, 0:08:32.520 --> 0:08:34.760 maybe some aren't. And we can start with some of 0:08:34.800 --> 0:08:39.480 the biggest like Walmart, Target, some other discount and then 0:08:39.480 --> 0:08:43.679 also the traditional department stores. So one week left of shopping, 0:08:44.040 --> 0:08:45.920 how are these retailers doing. 0:08:46.200 --> 0:08:49.240 You know, they're doing good. I think they retailers are 0:08:49.280 --> 0:08:52.680 going out to you know, mass margins. Like she said, 0:08:52.840 --> 0:08:56.880 people consumers are still looking to buy you know, the necessities, 0:08:56.880 --> 0:09:00.640 and I think that's where Walmart will continue to benefit 0:09:00.720 --> 0:09:04.480 as well as with this value proposition. I think department 0:09:04.559 --> 0:09:07.400 stores are coming out, you know, they're really going strong 0:09:07.440 --> 0:09:10.960 for the holiday with experiences as well, which you know, 0:09:11.120 --> 0:09:13.640 back to kind of what you mentioned with restaurants and services. 0:09:13.679 --> 0:09:17.680 Consumers are still seeking those experiences this holiday season, and 0:09:18.280 --> 0:09:20.920 the more that those retailers can start to provide them, 0:09:21.400 --> 0:09:23.400 you know, we think that that'll bide really well. But 0:09:23.480 --> 0:09:25.920 I think what's really going to be driving any kind 0:09:25.960 --> 0:09:28.520 of winners or losers this year is going to be 0:09:28.600 --> 0:09:32.640 the value proposition that they're offering shoppers. Like you know, 0:09:33.000 --> 0:09:36.240 she mentioned, they're under pressure. We're still seeing some strong 0:09:36.320 --> 0:09:39.320 sales results, but it's where the deals are. Where are 0:09:39.320 --> 0:09:40.920 they going to get the best staying for their buck. 0:09:41.280 --> 0:09:43.080 So the more that they can kind of provide that, 0:09:43.200 --> 0:09:44.960 the more that we think they'll do well. 0:09:45.400 --> 0:09:47.920 And do you think some of the smaller retailers, the 0:09:48.320 --> 0:09:50.599 mom and pop stores, how are they faring against the 0:09:50.640 --> 0:09:51.200 big names? 0:09:51.640 --> 0:09:55.640 Yeah, I think, you know, I think with the younger generations, 0:09:55.679 --> 0:09:58.720 you know, they're actually doing well. They're going younger generations 0:09:58.760 --> 0:10:01.040 are looking for those kind of one off shop so 0:10:01.160 --> 0:10:04.440 they can find something unique, which is always good for 0:10:04.520 --> 0:10:06.680 those mom and pop retailers. But they're going to be 0:10:06.679 --> 0:10:09.520 having to compete with these larger retailers for the price, 0:10:09.960 --> 0:10:11.560 and it's going to be a little harder for them 0:10:11.960 --> 0:10:14.560 to kind of have that discount down compared to some 0:10:14.640 --> 0:10:16.760 other retailers that have the scale and are able to 0:10:16.840 --> 0:10:20.720 drive that more. So they'll definitely be pressured going forward. 0:10:20.800 --> 0:10:24.720 But the more they can leverage Amazon with Amazon Amazon 0:10:24.760 --> 0:10:27.480 today kind of in that sense that they're kind of 0:10:27.520 --> 0:10:30.000 still getting some of that online sales. 0:10:29.880 --> 0:10:32.240 Well with one week left a lot to look forward to. 0:10:32.280 --> 0:10:35.559 Our thanks to economists To stell Oh of Bloomberg Economics 0:10:35.559 --> 0:10:40.320 and Bloomberg Intelligence, retail analyst Abigail gil Martin. Coming up 0:10:40.360 --> 0:10:42.960 on Bloomberg day Break weekend, we continue looking at the 0:10:43.040 --> 0:10:45.640 retail sector and get a view from the perspective of 0:10:45.720 --> 0:10:59.440 European shoppers. I'm Tom Busby, and this is Bloomberg. This 0:10:59.520 --> 0:11:01.839 is Bloomberg Daybreak weekend, our global look ahead at the 0:11:01.880 --> 0:11:04.480 top stories for investors in the coming week. I'm Tom 0:11:04.480 --> 0:11:07.440 Busby in New York. Up later in our program, after 0:11:07.480 --> 0:11:11.520 the FED, the BOE, and the ECB all holding rates steady, 0:11:11.800 --> 0:11:13.880 we get a preview of what we can expect from 0:11:13.920 --> 0:11:16.840 the Bank of Japan. But first in the UK, we'll 0:11:16.840 --> 0:11:20.120 get new consumer and retail price data in the coming days. 0:11:20.320 --> 0:11:24.720 Despite falling inflation, festive shopping might still be held back 0:11:24.880 --> 0:11:28.560 by slowing wage growth as COVID piggybank savings run dry. 0:11:28.960 --> 0:11:31.040 For more, Let's go to London and bring in Bloomberg 0:11:31.080 --> 0:11:33.280 Daybreak europe banker Caroline Hepger. 0:11:33.559 --> 0:11:36.480 Tom, It's crunch time for last minute shoppers ahead of 0:11:36.520 --> 0:11:39.600 the holidays here in London, with retailers hoping for a 0:11:39.720 --> 0:11:44.359 last minute surge in spending despite the general economic gloom. 0:11:44.400 --> 0:11:47.880 The latest growth data for the UK showed that consumer 0:11:47.960 --> 0:11:51.960 facing services contracted for a fourth month in a row, 0:11:52.240 --> 0:11:56.120 while the economy overall contracted more than had been expected. 0:11:56.400 --> 0:11:59.600 Now Here is what Dan Hanson of Bloomberg Economics told 0:11:59.640 --> 0:12:02.760 us about the outlook for the coming months. 0:12:03.200 --> 0:12:07.040 This line between contraction and stagnation is going to be 0:12:07.040 --> 0:12:08.720 a fine one, and it remains a fine one. It 0:12:08.720 --> 0:12:10.400 has been a fine one for the past eighteen months, 0:12:10.520 --> 0:12:11.880 is probably going to be the same for the next 0:12:11.960 --> 0:12:15.240 nine months. But I think you know, it was worse 0:12:15.280 --> 0:12:17.800 than expected, and you know, it looks like the fourth 0:12:17.880 --> 0:12:22.000 quarter there'll probably be a contraction. I think everyone's understanding 0:12:22.040 --> 0:12:24.320 is that the goal to grow the economy was to 0:12:24.360 --> 0:12:27.200 get quarterly growth in the final quarter of the year, 0:12:27.559 --> 0:12:29.679 and it looks like it's based on this data. It's 0:12:29.720 --> 0:12:30.520 going to be a tough ask. 0:12:31.080 --> 0:12:34.040 Is there anything in the data or in the stance 0:12:34.080 --> 0:12:37.080 at the moment that proves that next year could be 0:12:37.080 --> 0:12:38.320 better than expected? 0:12:38.840 --> 0:12:39.040 Yeah? 0:12:39.080 --> 0:12:41.600 Absolutely. So you can look at the sort of data 0:12:41.600 --> 0:12:43.840 in two ways, can't You can always be like, oh, well, 0:12:43.880 --> 0:12:46.680 the economy contracted and it contracted by a bit, but 0:12:46.679 --> 0:12:48.839 it's still contracted and that's not very good. But if 0:12:48.880 --> 0:12:51.480 you compare that to the reality or sort of what 0:12:51.520 --> 0:12:55.160 you would have expected if you were told eighteen months 0:12:55.200 --> 0:12:57.520 ago or two years ago that the Bank of England 0:12:57.600 --> 0:12:59.720 was about to jack up interest rates by five hundred 0:12:59.720 --> 0:13:02.040 bases points, you know, most of us would have fallen 0:13:02.080 --> 0:13:04.640 off chair and said there'd be a deep recession, and 0:13:04.679 --> 0:13:07.520 we just haven't had that. So this sort of upside 0:13:07.679 --> 0:13:09.679 or the sort of better news story that's there is 0:13:09.720 --> 0:13:13.959 that the economy has almost consistently outperformed expectations and the 0:13:14.080 --> 0:13:17.440 hit from interest rates has been far, far less than 0:13:17.640 --> 0:13:20.000 anyone would have expected if you'd sort of been given 0:13:20.000 --> 0:13:23.079 this scenario and said, how will this play out over 0:13:23.120 --> 0:13:25.280 the next two years or so. And you know, the 0:13:25.320 --> 0:13:27.680 other thing, the other very important point for consumers is 0:13:27.720 --> 0:13:30.280 that there's real wage growth has returned, and that is 0:13:30.360 --> 0:13:34.240 that's a really positive thing. Nominal wages are growing faster 0:13:34.880 --> 0:13:37.480 than prices, and that that is a really positive story, 0:13:37.520 --> 0:13:40.040 and that could be a reason why again the economy 0:13:40.080 --> 0:13:42.000 does hold up over the course of twenty twenty four. 0:13:42.320 --> 0:13:45.440 So that was Dan Hanson with his view from Bloomberg 0:13:45.600 --> 0:13:50.199 Economics after those GDP figures. Well, inflation in the UK 0:13:50.840 --> 0:13:53.240 is slowing. That's one bit of good news. In October 0:13:53.280 --> 0:13:56.240 the headline print was at four point six percent. The 0:13:56.360 --> 0:13:59.840 CPI released you in the coming few days will also 0:14:00.080 --> 0:14:02.840 tell us just how far it remains above the Bank 0:14:02.880 --> 0:14:03.680 of England's goal. 0:14:03.800 --> 0:14:04.120 Now. 0:14:04.520 --> 0:14:07.079 Ahead of that, we've been thinking about the outlook for 0:14:07.120 --> 0:14:10.520 the UK consumer, hit hard by price rises over the 0:14:10.559 --> 0:14:14.480 past year. I've been discussing this with Bloomberg opinion columnist 0:14:14.559 --> 0:14:19.000 Andrea Felsted and our UK retail reporter Katie linsel. I 0:14:19.040 --> 0:14:22.920 started by asking Andrew what the mindset of British consumers 0:14:23.320 --> 0:14:24.240 is right now. 0:14:24.840 --> 0:14:28.680 I think it really depends where you are. You know, 0:14:28.920 --> 0:14:33.920 older people they don't have mortgages. They're finally getting some 0:14:34.360 --> 0:14:37.320 return on their savings, their pensions of one up. They're 0:14:37.320 --> 0:14:42.000 doing very nicely and are spending well on holidays, eating out. 0:14:43.080 --> 0:14:47.800 Midlife families much more difficult. They've got mortgage. You know, 0:14:47.920 --> 0:14:52.120 inflation hasn't gone away. You know, we think about things 0:14:52.160 --> 0:14:55.280 like school fees they've been going up for years, and 0:14:55.320 --> 0:14:58.200 then you've got you know, unfortunately, those who are really 0:14:58.280 --> 0:15:01.360 struggling in the economy, who spend a lot more on 0:15:01.560 --> 0:15:04.320 essential so they're still having to pay more for food 0:15:04.480 --> 0:15:08.520 even though inflation is easing, more for heating, and we're 0:15:08.600 --> 0:15:11.800 not getting the help that we got for the government 0:15:11.840 --> 0:15:15.400 on heating last year, so they are really struggling. It 0:15:15.480 --> 0:15:19.000 really depends where you are on how you are looking 0:15:19.520 --> 0:15:21.840 forward to Christmas and next year. 0:15:22.040 --> 0:15:25.640 Yeah, really a segmentation the issue or issues around inequality 0:15:25.680 --> 0:15:29.040 and what your pay pack. It looks like Katie, the 0:15:29.080 --> 0:15:33.160 UK consumer having said that, has been quite broadly resilient. 0:15:33.680 --> 0:15:35.680 What's the outlook for the coming months as far as 0:15:35.680 --> 0:15:36.920 you're concerned. 0:15:36.720 --> 0:15:38.680 I think exactly as Andrew said, you know, this is 0:15:38.680 --> 0:15:40.360 the time when people are going to be spending on 0:15:40.440 --> 0:15:44.080 Christmas within their means as much as they can. So 0:15:44.120 --> 0:15:46.160 I think the key thing is to see really how 0:15:46.320 --> 0:15:49.640 the consumer copes in January and the months beyond when 0:15:49.680 --> 0:15:51.840 the credit card bills come in. The buy now, pay 0:15:51.920 --> 0:15:56.400 later figures need to be settled. We have seen that 0:15:56.960 --> 0:16:00.360 figures from PwC say that Christmas spending is going to 0:16:00.360 --> 0:16:04.040 be down thirteen percent to twenty billion pounds in the UK, 0:16:04.240 --> 0:16:06.840 and so shoppers are sort of pulling back a bit, 0:16:08.120 --> 0:16:10.240 and I think it's going to be interesting to see 0:16:10.280 --> 0:16:12.920 how they how they cope in the months when the 0:16:12.920 --> 0:16:13.800 bills come due. 0:16:13.960 --> 0:16:16.640 Oh yeah, they buy now, pay later. Yes, that's a 0:16:16.640 --> 0:16:20.840 big issue. But on the other side of things, luxury Andrew, 0:16:20.880 --> 0:16:24.320 you keep a close watch on this sector amongst others 0:16:24.320 --> 0:16:28.320 in retail. Are there those sectors that remain robust. 0:16:28.720 --> 0:16:31.760 The only set of retail that really seems to be 0:16:31.880 --> 0:16:36.280 remaining robust is that catering through the very wealthiest echelon 0:16:36.360 --> 0:16:39.080 in society. So we had Brunello Cucinelli makes, you know, 0:16:39.280 --> 0:16:43.600 very expensive cashmere. They upgraded their outlook for the fourth 0:16:43.680 --> 0:16:48.120 time this year. Hermes make a very expensive bags, still 0:16:48.160 --> 0:16:52.080 doing well, but lower down luxury, the luxury that you know, 0:16:52.120 --> 0:16:56.160 perhaps the simply comfortable treat themselves too. They might treat 0:16:56.200 --> 0:16:59.920 themselves to a Gucci handbag or perhaps a nice watch. 0:17:00.160 --> 0:17:03.520 They're really under pressure from interest rates, you know, stock 0:17:03.600 --> 0:17:09.560 markets being quite volatile, less crypto gains, you know, interest rates. 0:17:09.560 --> 0:17:12.040 They can't buy things on credit, or they're putting their 0:17:12.080 --> 0:17:13.960 safe if they've got savory, they may be putting them 0:17:13.960 --> 0:17:17.639 to work rather than perhaps spend spending it on a rolex, 0:17:17.720 --> 0:17:20.960 so that they're they're really you know, they are pulling 0:17:21.240 --> 0:17:24.960 it pulling back, and we've got luxury really normalizing. Aside 0:17:24.960 --> 0:17:26.200 from that really top. 0:17:26.080 --> 0:17:30.600 End, Well, what about the pricing power that retailers broadly have, Katie, 0:17:30.600 --> 0:17:32.919 Do they have much of that left? We talked a 0:17:32.920 --> 0:17:35.960 lot about that, you know, with the rise in inflation. 0:17:36.640 --> 0:17:39.200 Yes, I think retailers are still really flagging the fact 0:17:39.200 --> 0:17:41.760 that they are under pressure from inflation, that there is 0:17:41.800 --> 0:17:44.120 still a huge burden from the cost of energy. Yes, 0:17:44.160 --> 0:17:46.040 it's come down, but it's still much higher than where 0:17:46.080 --> 0:17:48.520 it was before. And then the other key thing to 0:17:48.560 --> 0:17:52.439 look at is the labor market, and labor costs have 0:17:52.480 --> 0:17:55.280 really gone up. Also, we can look at the fact 0:17:55.359 --> 0:17:58.240 that we had the recent awesome statement announcing that from 0:17:58.320 --> 0:18:01.200 April we will see a rise in the national living wage, 0:18:01.280 --> 0:18:04.679 and we had a piece recently out from saying that 0:18:04.720 --> 0:18:07.320 retailers are really not not best placed in a way 0:18:07.320 --> 0:18:10.560 about this burden. They have a huge workforce and that's 0:18:10.600 --> 0:18:13.600 really going to push up their costs. And I think 0:18:13.600 --> 0:18:17.359 therefore we can actually expect that inflation won't necessarily come down. 0:18:17.640 --> 0:18:20.080 Price inflation from retailers won't come down as fast as 0:18:20.119 --> 0:18:23.200 we might hope, because they've got to help their margins, 0:18:23.240 --> 0:18:25.800 you know, they can't cost their cut their prices as 0:18:25.840 --> 0:18:28.199 frequently as quickly as they might like to because of 0:18:28.200 --> 0:18:29.920 that burden from the higher wages. 0:18:30.600 --> 0:18:32.960 And then you have the story of the Dice and 0:18:33.040 --> 0:18:36.800 Air app which is apparently one of the potentially hot 0:18:36.840 --> 0:18:39.639 items of the holiday season of this quarter, and it's 0:18:39.680 --> 0:18:43.600 something you've written about. Andrea, A thousand bucks. What's the 0:18:43.640 --> 0:18:46.000 price tag in the UK or in Europe, Well. 0:18:46.040 --> 0:18:49.359 It should be about four hundred and eighty pounds, but 0:18:49.440 --> 0:18:51.919 at the moment there's about eighty pounds off, so this 0:18:52.000 --> 0:18:55.520 is quite unusual that it's actually been discounted at the moment. 0:18:55.640 --> 0:18:58.720 Now curries are saying they're selling very well, and this 0:18:58.800 --> 0:19:02.159 is really interesting because you know, we're buying them so 0:19:02.400 --> 0:19:06.119 we can save on getting our hairstyled. We can do, 0:19:06.280 --> 0:19:09.919 you know, a bouncy look at home rather than have 0:19:10.080 --> 0:19:11.960 to go to the salon. So I thought that was 0:19:12.040 --> 0:19:15.520 quite an interesting little take on the consumer mindset. 0:19:15.720 --> 0:19:17.560 Yes, and I'm sorry your peace was talking about how 0:19:17.600 --> 0:19:19.800 they should be a thously They. 0:19:19.640 --> 0:19:23.080 Should they should be because there's lots of competition in 0:19:23.160 --> 0:19:23.719 this space. 0:19:23.800 --> 0:19:23.960 Now. 0:19:24.440 --> 0:19:27.359 Interesting last year there were no discounts. I mean you 0:19:27.359 --> 0:19:29.840 couldn't count the amount of times. I googled dice and 0:19:29.880 --> 0:19:33.280 air app discount last year and there were none, But 0:19:33.520 --> 0:19:35.159 this year, you know, there were a lot of discous 0:19:35.240 --> 0:19:39.240 There's a lot of competition out there, so to stay 0:19:39.280 --> 0:19:42.800 ahead of the curve, Dyson needs to reinvent itself as 0:19:42.840 --> 0:19:43.840 a luxury brand. 0:19:43.920 --> 0:19:47.400 Thanks to Blimberg's consumer goods opinion colonist Andrew Fel said, 0:19:47.400 --> 0:19:51.040 and our UK retail reporter Katie Lindsel, I'm Calline Hepgar 0:19:51.080 --> 0:19:53.560 here in London. You can catch us every weekday morning 0:19:53.560 --> 0:19:56.719 for Bloomberg Daybreak Europe, beginning at six am in London. 0:19:56.880 --> 0:19:58.320 That's one am on Wall Street. 0:19:58.440 --> 0:20:02.040 Tom, Thanks Caroline, and coming up on Bloomberg day Break weekend, 0:20:02.080 --> 0:20:04.560 we preview the upcoming rate decision out of the Bank 0:20:04.600 --> 0:20:18.440 of Japan. I'm Tom Busby and this is Bloomberg. I'm 0:20:18.440 --> 0:20:20.480 Tom Busby with your global look ahead at the top 0:20:20.520 --> 0:20:24.080 stories for investors in the coming week. Onto Japan and 0:20:24.160 --> 0:20:26.879 whether we're at the end of an unprecedented run of 0:20:27.000 --> 0:20:30.639 monetary easing policies. Economists expect the Bank of Japan to 0:20:30.720 --> 0:20:34.040 scrap negative interest rates by the end of April. Meantime, 0:20:34.040 --> 0:20:37.160 Bloomberg has reported Japan's Central Bank is likely to keep 0:20:37.200 --> 0:20:41.720 its monetary stimulus settings unchanged at a policy meeting next week. 0:20:42.160 --> 0:20:44.520 Let's take a further look with Bloomberg Daybreak Asia co 0:20:44.600 --> 0:20:45.960 host Doug Krisner. 0:20:46.280 --> 0:20:48.800 Tom Our sources tell us the Bank of Japan is 0:20:48.840 --> 0:20:51.720 in no rush to scrap negative interest rates, nor is 0:20:51.760 --> 0:20:55.240 the BOJ ready to drop its yield curve control program. 0:20:55.560 --> 0:20:58.439 Now this does counter market speculation a bit. There have 0:20:58.520 --> 0:21:02.680 been bets on the BOJ shifting to end negative interest rates, 0:21:02.960 --> 0:21:05.240 and some were saying it could happen as soon as 0:21:05.240 --> 0:21:07.280 this meeting. But what we are told is that the 0:21:07.280 --> 0:21:10.439 BOJ has yet to see enough evidence of wage growth, 0:21:10.480 --> 0:21:14.560 and wage growth would support the notion of sustainable inflation. 0:21:15.240 --> 0:21:15.880 To help us. 0:21:15.800 --> 0:21:19.160 Preview the BOJ meeting, we bring in Bloomberg's Taro Komura. 0:21:19.720 --> 0:21:24.760 Tarrow is Bloomberg Economics Japan economist. He joins us from Tokyo. Taro, 0:21:24.880 --> 0:21:27.640 thanks for making time for us. I think we have 0:21:27.720 --> 0:21:31.080 to say that the BOJ has in the past surprise 0:21:31.240 --> 0:21:34.800 not only economists but markets. Is it likely that we 0:21:34.840 --> 0:21:36.479 get a surprise this time around? 0:21:36.960 --> 0:21:40.399 No, I don't think so. I At this time, the 0:21:40.480 --> 0:21:43.840 busy will stand pad on its ilk curve control and 0:21:43.920 --> 0:21:47.720 negative interest rates. So of course, like I understand, the 0:21:47.840 --> 0:21:53.199 market suspects another surprise this month, particularly after last year's 0:21:53.480 --> 0:21:58.800 December accrued US YCC surprise. That's understandable, But the governor 0:21:58.920 --> 0:22:04.000 changed and with us communication, although he had to tweak 0:22:04.480 --> 0:22:07.760 YCC a little bit in July in October, but I 0:22:07.760 --> 0:22:10.639 think his baseline is he don't want to make a 0:22:10.800 --> 0:22:15.800 huge surprise and shock to the financial market. And based 0:22:15.840 --> 0:22:21.560 on his communication, it's clear that economic development doesn't support 0:22:22.240 --> 0:22:26.720 achieving two percent inflation near time soon and with a 0:22:27.160 --> 0:22:31.199 clearly underscores that he has to see the result of 0:22:31.280 --> 0:22:34.800 the spring waste negotiation, which is an annual catalyst of 0:22:36.240 --> 0:22:40.680 Japanese workers regular workers base pay. So that's why he 0:22:40.920 --> 0:22:45.240 at least has to wait until April before scrapping YC 0:22:45.320 --> 0:22:47.960 see a negative rate instead of this month. 0:22:48.160 --> 0:22:51.240 So Governor Wada, the head of the BOJ, has a 0:22:51.280 --> 0:22:53.320 long history with the Bank of Japan, and I think 0:22:53.359 --> 0:22:56.520 it's fair to say that he understands the danger of 0:22:56.680 --> 0:23:00.000 moving hastily. Am I right on that right absolutely? 0:23:00.080 --> 0:23:05.600 Looking back the boj's history, there are two painful experience 0:23:06.200 --> 0:23:11.640 in which the BOJ was hugely criticized as their exits 0:23:11.720 --> 0:23:16.280 were hasty. One timing is its exit from zero interest 0:23:16.400 --> 0:23:21.199 rate policy already back in two thousand and Actually the 0:23:21.400 --> 0:23:25.359 terrent governor Uda was one of the policy members then 0:23:25.480 --> 0:23:28.600 and he actually voted against to that exit, but also 0:23:28.920 --> 0:23:31.320 as a policy member, I think he has a vivid 0:23:31.400 --> 0:23:36.280 memory that its exit was probably too quick, given that 0:23:36.800 --> 0:23:40.520 soon after that there was a US tech bubble collapse 0:23:40.760 --> 0:23:43.600 and a huge downturn in the economy. And the second 0:23:43.640 --> 0:23:46.239 one is back in two thousand and six, when it 0:23:46.720 --> 0:23:51.879 exits from its first quantitative easing started in two thousand 0:23:51.920 --> 0:23:56.040 and one, and even though it was criticized as hasty, 0:23:56.840 --> 0:24:01.880 the BOJ took more than half a year to signals. 0:24:01.960 --> 0:24:05.680 It's given that timeframe, I think it's still a long 0:24:05.720 --> 0:24:09.560 way for the BOJ to communicate and to make market 0:24:09.680 --> 0:24:11.359 understand the exits is coming. 0:24:11.720 --> 0:24:14.840 That said, I can understand the market's tendency to want 0:24:14.880 --> 0:24:17.119 to make a bet that the BOJ would move at 0:24:17.119 --> 0:24:20.000 the December meeting. We've been well above or when I 0:24:20.040 --> 0:24:23.159 say we am speaking of the Japanese economy, we have 0:24:23.280 --> 0:24:26.480 seen inflation well above the two percent target for more 0:24:26.520 --> 0:24:28.960 than a year now, and I'm going to go back 0:24:28.960 --> 0:24:32.480 to last week with the ton Con data, the large 0:24:32.520 --> 0:24:37.760 manufacturing and non manufacturing indexes were much above forecast. So 0:24:37.960 --> 0:24:40.159 is there not a case to be made that the 0:24:40.160 --> 0:24:44.000 economy is doing well enough where the BOJ could begin 0:24:44.640 --> 0:24:46.879 altering policy at this point in time? 0:24:47.320 --> 0:24:51.680 Right the assessment about the assessment of the Japan's economy, 0:24:51.920 --> 0:24:56.399 it's correct that the Tonkens data was a big positive, 0:24:56.560 --> 0:25:00.359 so the sentiment for at least big corporates are getting better. 0:25:00.920 --> 0:25:04.320 And actually that's right. The headline inflation as well above 0:25:04.520 --> 0:25:10.000 boj's two percent target for nineteen months. Now. I'm having 0:25:10.080 --> 0:25:13.960 said that in terms of the inflation, as a japan 0:25:14.080 --> 0:25:17.879 economist and as a person who grew up in Japan, 0:25:18.040 --> 0:25:23.359 I cannot underscore enough that it's such a high hurdle 0:25:24.119 --> 0:25:28.720 for this country to have two percent inflation. So long 0:25:28.800 --> 0:25:35.680 term macroeconomic stagnation since nineteen nineties led firms very reluctant 0:25:35.880 --> 0:25:42.240 to raise prices because customers got really price sensitive. And 0:25:42.320 --> 0:25:48.960 at the same time, we haven't had inflation for three decades. 0:25:49.000 --> 0:25:55.000 That means one generation. That means people don't expect inflation 0:25:55.359 --> 0:25:58.639 to happen very easily. So those are the background in 0:25:58.680 --> 0:26:02.679 which the BOJ is very causes. Although headline inflation is 0:26:03.200 --> 0:26:05.159 above two percent, they are very I think they are 0:26:05.280 --> 0:26:08.600 very afraid of after the cost push factor abates, it's 0:26:08.680 --> 0:26:12.560 getting back to this inflation state. That's why they keep 0:26:12.640 --> 0:26:16.000 the stimulus. At the same time, a recent positive note 0:26:16.040 --> 0:26:21.679 in TUNCAM supports the next year's annual spring wage negotiation. 0:26:22.080 --> 0:26:25.679 So if there's a huge wage hike happened there in 0:26:25.720 --> 0:26:28.080 the next spring, it's going to be a big push 0:26:28.119 --> 0:26:31.720 for the BOJA to consider shifts about the policy. 0:26:32.000 --> 0:26:34.760 Last week on Daybreak Asia, we were talking with Bloomberg's 0:26:34.800 --> 0:26:37.440 Paul Jackson, one of your colleagues in Tokyo, about the 0:26:37.520 --> 0:26:41.080 Japanese economy, and we tried to address the issue of 0:26:41.119 --> 0:26:44.199 how consumers in Japan are feeling and whether or not 0:26:44.720 --> 0:26:48.360 mister and Missus Watanabe are optimistic about the economy. Here's 0:26:48.400 --> 0:26:49.480 what Paul had to say. 0:26:49.640 --> 0:26:53.320 They're not happy at all. The popularity and support for 0:26:53.400 --> 0:26:57.199 the Prime Minister has been at historic record lows for 0:26:57.280 --> 0:27:01.080 his administration, and he's been pulling out all the stops 0:27:01.119 --> 0:27:05.000 with subsidies to try and lower the impact of inflation. 0:27:05.160 --> 0:27:09.479 So the inflation rate actually would be significantly higher without 0:27:09.560 --> 0:27:13.040 these government subsidies. This, of course, has created a lot 0:27:13.080 --> 0:27:16.199 of you know, conflicting signals for the public. You know, 0:27:16.480 --> 0:27:20.159 the government wants inflation and yet it's giving measures to 0:27:20.280 --> 0:27:23.600 lower inflation. It's going to make up your mind. So 0:27:23.920 --> 0:27:27.359 in a sense, if the boj does scrap its negative 0:27:27.400 --> 0:27:30.280 interest rate, it's going to look more like the government 0:27:30.320 --> 0:27:32.520 and the Bank of Japan are pointing in the same 0:27:32.560 --> 0:27:34.919 direction for the average person on the street. 0:27:34.840 --> 0:27:37.119 Tara, I'd like to get your reaction on what you 0:27:37.280 --> 0:27:39.680 just heard there from Paul about the way in which 0:27:40.119 --> 0:27:44.400 the average consumer in Japan is making sense of government policies, right. 0:27:44.800 --> 0:27:50.639 I totally agree with Paul's view. Actually, the current inflation 0:27:51.160 --> 0:27:54.560 is it's clear that it's sapping the consumer sentiment, and 0:27:55.320 --> 0:27:59.280 not only the sentiment. The GDP data shows are GDP 0:27:59.359 --> 0:28:05.040 data show the private consumption drops for the second straight quarters, 0:28:05.119 --> 0:28:07.960 in the second quarter, in the third quarter of this year, 0:28:08.880 --> 0:28:13.359 even though Japan should have had a strong tailwink from 0:28:13.520 --> 0:28:18.600 COVID reopening happened since May. So that says like inflation 0:28:18.880 --> 0:28:22.879 usually way on consumer sentiments and consumption. So it's the 0:28:22.960 --> 0:28:26.800 tricky part is as a Japanic Onnlyst, I always struggle 0:28:27.040 --> 0:28:30.400 to give a easy explanation on this. But the BOJ 0:28:30.680 --> 0:28:36.000 is irked by inflation, the cost push inflation or bad inflation. 0:28:36.200 --> 0:28:39.280 So that's why in their logic they have to keep 0:28:39.400 --> 0:28:44.160 a stimulus in the economy. And actually the government wants 0:28:44.200 --> 0:28:47.200 to do something for that and that Fishita Prime Minister 0:28:47.800 --> 0:28:50.320 decided an income tax cut, but it's going to be 0:28:50.360 --> 0:28:54.600 happening only in June or July in next year. So 0:28:54.840 --> 0:28:59.120 kind of the government is not giving a strong leadership 0:28:59.400 --> 0:29:03.160 and sending a clear message to help the consumer and households. 0:29:03.160 --> 0:29:07.200 And probably that's one of the main reasons Prime Minister 0:29:07.280 --> 0:29:10.400 Kishida's supporting rate is getting lower and lower. 0:29:10.520 --> 0:29:12.680 Taro, thank you so much for helping us set up 0:29:12.880 --> 0:29:17.360 this week's BOJ meeting. Taro Komura is a Bloomberg Economics 0:29:17.520 --> 0:29:21.040 Japan economist joining us. I'm Doug Krisner. You can join 0:29:21.080 --> 0:29:24.160 Brian Curtis and myself weekdays here for Bloomberg day Break 0:29:24.160 --> 0:29:27.880 Asia beginning at seven am in Hong Kong six pm 0:29:27.960 --> 0:29:28.719 on Wall Street. 0:29:28.760 --> 0:29:31.640 Tom, thank you, Doug, and coming up on Bloomberg day 0:29:31.640 --> 0:29:34.760 Break weekend, we hear from the SEC about a possible 0:29:34.800 --> 0:29:38.800 approval of a spot bitcoin et F. I'm Tom Busby 0:29:38.880 --> 0:29:52.040 And this is Bloomberg. This is Bloomberg day Break weekend, 0:29:52.080 --> 0:29:54.400 our global look ahead at the top stories for investors 0:29:54.400 --> 0:29:56.840 in the coming week. I'm Tom Busby in New York. 0:29:57.520 --> 0:30:01.240 Anticipation of a new wave of investors has bitcoin booming 0:30:01.400 --> 0:30:05.320 once again. Key to the newfound optimism indications that the 0:30:05.400 --> 0:30:08.760 US will likely soon approve exchange traded funds that invest 0:30:08.840 --> 0:30:11.920 directly in the cryptocurrency. For more, Let's add to our 0:30:11.920 --> 0:30:14.960 Bloomberg ninety nine to one newsroom in Washington and Bloomberg 0:30:15.160 --> 0:30:18.040 Sound On co host Kaylee lines. 0:30:17.920 --> 0:30:20.480 Yeah, Tom, So often here in Washington we talk about 0:30:20.520 --> 0:30:24.160 politics because this is where the politicians are, but it's 0:30:24.200 --> 0:30:27.680 also where the regulators are, and one in particular has 0:30:27.720 --> 0:30:31.160 been in the spotlight, the SEC. There's a big question 0:30:31.320 --> 0:30:34.200 around whether the Securities in Exchange Commission may be getting 0:30:34.200 --> 0:30:38.800 close to doing something it hasn't done yet, finally approving 0:30:39.080 --> 0:30:42.760 a spot bitcoin ETF. I actually asked the SEC chair, 0:30:42.840 --> 0:30:45.040 Gary Gensler about that. This past week. 0:30:45.280 --> 0:30:49.200 We have I think somewhere between eight and a dozen 0:30:49.360 --> 0:30:53.640 filings in front of this agency with regard to exchange 0:30:53.680 --> 0:30:59.480 traded products around bitcoin, and the staff of the various 0:30:59.480 --> 0:31:06.080 divisions respond when market participants have filings. We also had 0:31:06.280 --> 0:31:11.000 a court case earlier this fall in this regard, and 0:31:11.080 --> 0:31:15.080 so we do things according to our authorities and how 0:31:15.160 --> 0:31:18.480 courts interpret our authorities, and that's what we'll do here 0:31:18.560 --> 0:31:19.320 as well. 0:31:19.480 --> 0:31:21.440 The court case he is alluding to, by the way, 0:31:21.640 --> 0:31:24.640 is the gray Scale case. Long story short. Grayscale wanted 0:31:24.680 --> 0:31:29.080 to convert its Bitcoin Investment Trust GBTC into a spot ETF. 0:31:29.280 --> 0:31:32.480 The SEC originally said no, so Grayscale sued, and a 0:31:32.560 --> 0:31:36.120 judge ruled that the SEC was arbitrary and capricious. That's 0:31:36.120 --> 0:31:39.120 a quote in its rejection. So the prevailing thinking is 0:31:39.160 --> 0:31:41.360 that gray Scale's finally going to be able to convert, 0:31:41.600 --> 0:31:44.560 and that opens the door to other spot ETFs being approved. 0:31:44.680 --> 0:31:47.400 Let's get more on this with an actual expert. James 0:31:47.440 --> 0:31:51.360 Steifert is joining us. He's an ETF analyst for Bloomberg Intelligence. 0:31:51.600 --> 0:31:53.760 All right, James, is this going to happen and when? 0:31:54.040 --> 0:31:56.239 Yeah? So, first of all, I want to commend you 0:31:56.280 --> 0:31:59.280 on getting like a very unique and differentiative response from 0:31:59.320 --> 0:32:02.800 Kensler on this topic. He's notorious for giving a lot 0:32:02.840 --> 0:32:07.080 of long winded non answers, so that was not exactly 0:32:07.080 --> 0:32:09.680 a clear straightforward answer, but it was better than most 0:32:09.720 --> 0:32:13.000 people get, so put the job on that front. Yeah. 0:32:13.040 --> 0:32:16.520 So we basically since the beginning of October, even since August, 0:32:16.560 --> 0:32:18.000 we've been saying we think this is going to happen 0:32:18.040 --> 0:32:19.800 in January because we thought gray Scale was going to 0:32:19.840 --> 0:32:22.720 win this case. In October we went to ninety percent 0:32:22.760 --> 0:32:26.600 odds that we'd see approvals on this front for spotpack 0:32:26.640 --> 0:32:30.000 on ets by January tenth. There's been some moves by 0:32:30.040 --> 0:32:33.320 the SEC, by Gensler's SEC in the recent weeks, and 0:32:33.440 --> 0:32:35.680 it's really looking like these things are going to be approved, 0:32:36.000 --> 0:32:38.200 and we could see those orders come down anywhere from 0:32:38.280 --> 0:32:41.000 January eighth to January tenth if we're really narrowing in 0:32:41.040 --> 0:32:43.480 on this window. So things are looking good and looking 0:32:43.480 --> 0:32:45.920 like our call is going to be correct. But there 0:32:45.920 --> 0:32:48.320 obviously there's no guarantees here, but that's the way things 0:32:48.320 --> 0:32:50.360 are looking right now. And based on his quote that 0:32:50.400 --> 0:32:52.880 he gave you there, that sounds pretty promising that he's 0:32:52.920 --> 0:32:54.200 basically going to listen to the courts. 0:32:54.320 --> 0:32:56.160 Yeah. Well, he may not have a choice when all 0:32:56.200 --> 0:32:58.760 this said and done, but as we just heard from Chairgainsler, 0:32:58.800 --> 0:33:01.080 there are a lot of these file in front of him, 0:33:01.200 --> 0:33:04.440 so in front of the commission more broadly, and I 0:33:04.480 --> 0:33:08.320 wonder if it's going to be an idea where Greyscale 0:33:08.360 --> 0:33:10.600 won the battle, everybody else gets to win the war. 0:33:10.680 --> 0:33:12.880 Who gets to go first? Does everybody get to go 0:33:13.360 --> 0:33:17.040 all at once? Assuming it is going to be approval, 0:33:17.320 --> 0:33:18.960 Are they all going to get approved at the same time? 0:33:18.960 --> 0:33:19.880 How do you see this working? 0:33:20.120 --> 0:33:22.720 Yeah, so we've been pretty vocal in thinking that they're 0:33:22.760 --> 0:33:24.800 going to approve all at once. Basically, the way they 0:33:24.800 --> 0:33:28.080 approve Bitcoin futures GTS was they let it go first come, 0:33:28.120 --> 0:33:30.080 first serve, and pro shares was the first come in 0:33:30.120 --> 0:33:33.120 that case. And they've basically become dominant in the space. 0:33:33.160 --> 0:33:34.760 They are the only game in town for the most 0:33:34.760 --> 0:33:37.040 part when you look at trading liquidity and volume and 0:33:37.200 --> 0:33:40.720 assets for bitcoin futures etf So they'd learned from that 0:33:40.800 --> 0:33:42.640 and they basically don't want to be a king maker. 0:33:42.880 --> 0:33:45.480 We saw this when they allowed each futures ETFs in October, 0:33:45.480 --> 0:33:48.520 they allowed everyone to go at once. There's thirteen applications 0:33:48.720 --> 0:33:51.480 if you include grey Scale's application for spot Bitcoin ETFs, 0:33:51.480 --> 0:33:53.560 and some of them have different variations how they would 0:33:53.560 --> 0:33:55.240 do this, But our view is they're going to allow 0:33:55.280 --> 0:33:57.360 all of them, basically approve all of them at once. 0:33:57.440 --> 0:33:59.560 All right, Well, they still need to get approval first, 0:33:59.560 --> 0:34:01.440 but it sounds like you think that'll be coming in 0:34:01.560 --> 0:34:04.200 just a few week. Extreme Safer of Bloomberg Intelligence, thank 0:34:04.200 --> 0:34:07.000 you so much, and Tom, I guess it may finally happen. 0:34:07.120 --> 0:34:09.680 Thank you, Kaylee. That was Bloomberg's sound on co host 0:34:09.760 --> 0:34:12.600 Kaylee Lines, reporting from our Bloomberg ninety nine to one 0:34:12.640 --> 0:34:15.920 newsroom in Washington. And you can hear sound on weekdays 0:34:16.000 --> 0:34:19.680 one to three pm Eastern Time on Bloomberg Radio. And 0:34:19.719 --> 0:34:22.160 that does it for this edition of Bloomberg day Break Weekend. 0:34:22.520 --> 0:34:24.800 Join us again Monday morning at five am Wall Street 0:34:24.840 --> 0:34:27.040 Time for the latest on the market's overseas and the 0:34:27.080 --> 0:34:30.000 news you need to start your day. I'm Tom Buzzby. 0:34:30.200 --> 0:34:33.080 Stay with us. Top stories and global business headlines are 0:34:33.120 --> 0:34:35.239 coming up right now.