tv Boom Bust RT January 21, 2020 5:30am-6:01am EST
for watching all. this is broadcasting around the world and covering all angles of business and the impact on you i'm christiane and i've been one in washington here's what we have coming up. while there are signs of civilization the global outlook remains sluggish on the run no clear signals of a turning point. or slowdowns in india and other emerging markets mean that global growth forecasts are slowing down so what is in store for 2020 we're breaking it down for us and e.u. trade war president from threatening billions in tariffs on france we'll tell you why it will explain why the next few days will determine where this flight is going
. the artificial intelligence regulation needs to take and a balanced approach so what is he looking for lawmakers to do and what has to go promise he won't do with a i will tell you so much to get to so let's get started. i had of the world economic forum in davos today the i.m.f. has tremendous economic forecast for 2020 from 3.4 percent to 3.3 the downgrade was issued on the back of we data at the end of $29000.00 led by india slowing growth and credit squeeze this is the i.m.f. 6 straight reduction though it's cautiously optimistic that global growth may be stabilizing at subdued levels manufacturing activity and global trade have bottomed out but the i'm not warned that the global outlook remains on the downside additional risks include rising geopolitical tensions between us and iran and higher tariff barriers between us and its trading partners most notably china mark conflict is a rising between france and the u.s. over the new french didn't. attacks targeting big tech companies and this poses
a big risk if it is not resolved davos as italy the u.k. turkey and other e.u. countries are likely to follow francis lead the i.m.f. upgraded china's 2020 glos forecasts from 5.8 percent to 6 percent on the account of the council tariffs in december but it did not lose the u.s. growth forecasts instead the u.s. got downgraded to 2 percent growth because of the fading effects of the 2017 tax cuts and the fed's monetary easing interesting enough that the u.s. growth did not get a boost despite china's pledges of the $200000000000.00 worth of ag purchases and with more let's bring in todd horowitz chief strategist so let's start there isn't it a bit strange that despite the $200000000000.00 worth of u.s. ag purchases which is more than a 20 percent increase from 2017 that didn't affect the i.m.f. projection for the u.s. growth at all so is the u.s. economy slowing down that much or is the i.m.f.
actually discounting phase one like the rest of us here and we don't actually think that these purchases are going to happen at the said scale. good afternoon christie and good next time the i.m.f. is right it'll be the 1st time their projections are never correct and whatever they say it's like the fed talking or anybody else they're making projections based on nothing the china trade deal may or may not go through china may or may not buy our goods in the meantime growth is slowing it's slowing globally so it has to eventually affect the united states as well and of course boeing's problems have not helped our growth either so you take all that into consideration and where we're going you're going to see potential slowdown whatever china does not get if prices will get lower and china will be a buyer if we can continue to compete with brazil and argentina and everybody else versus the grains this is always been the case and we will see you know these
numbers are never easy to calculate because a lot comes back to the price of the dollar the price of the reale and other factions that are involved in the buying of grains and things like that so they can commit to whatever they want but they're not going to overpay just to make that the 0 work so despite phase one of the trade deal offering investors i guess we can say it's at least some level of stability right it's certainly not over phase 2 was where things are going to continue to kind of amp up here it is affecting investor appetite as foreign investments have fallen to a decade low and it's somewhat alarming because developing nations are going to be impacted the most so who do you think is most at risk here. well i think right now is you know to me if i look around the globe everybody's in trouble except for so far the united states i would say this that the next big move that the markets make here is going to be to lower however there are still a lot of money whether it's foreign whether it's american worker it's coming from there was a lot of money still flowing into the u.s. i quote he's and they're still making new highs and this can continue for an
extended period of time no matter what the actual economy does remember the economy . and the markets are not necessarily related until somebody decides that they're related and for no there's only one place to put your money you've got to go to us likely as were else can you get any return it's not a good situation in my opinion but right now today that is still the case actually contrary to what you just said in 29000 and now in 2020 we've seen record outflows from u.s. equities into u.s. bonds and this is despite of the fact that the market continues to ramp up and this is probably on account of corporate buybacks or the simply the fed pumping money so is this even sustainable and what do you think about this entire rotation over into treasuries. again the rotation of treasuries or some people that want to think that they're trying to be safe we could talk about outflows but you're talking about closer mutual funds not that inflows from hedge funds and other things so again
there's a real fine line that you can draw based on that at the end of the day there are less equities the buy there are still corporate buybacks the fed is still on the free money train and money is still overflowing into equities and of course you continue to hear the same rumor we've heard for is money yours is our markets have been or is mine in the sidelines while the fact is there's always money on the sidelines that go into a market and as long as the fed keeps this low policy you're going to continue to see buybacks come again because again if i can borrow the money at 3 percent or pay a 4 percent given what am i going to do i'm in a brahmin to buy my stock back and i think that's going to continue and when we talk about bonds we did have this announcement coming in last week when the treasury announced it will be issuing a 20 year bond for the 1st time in 34 years to help pay for the $1.00 trillion dollar budget deficit well now issued a total of 2.7 trillion in treasuries and 21000 is expected to do the same if not more here in 2020 so question time is who's buying these i mean china's appetite is
obviously slow japan's appetite is slowed who is left to fund the u.s. . well again you know if you see there's always a little bit of money and of course words china going to go if they want to stockpile some care somewhere are they going to go where there's negative rights are they going to bring it here this is the whole argument again the bonds are in a bubble they've been in a bubble for a long time and you're starting to see it but again when you're borrowing money and people want a place to get some sort of yield they're going to chase after him i don't agree with it i don't think it's the right trade myself but again there's still money there that will come in and one of the you have to remember you know it's the old story right if you owe a bank 5000 they own you if you own 5000000 you own them all right now you know china is in control because we owe them so much debt but where are they going to go i mean there are not going to make us to fault so they're going to continue to keep money here to keep the u.s. economy strong no matter where it comes from well it seems like most active managers are actually sitting on record levels of dry powder dry cash on the
sidelines right now because they simply don't know where to deploy them right now equities are at record high and right now left ridge is actually a record lows there's record levels of outflows out of u.s. equities so every continues to sit on the sidelines here where we're going to go. well again i think that the money will continue to flow into u.s. equities again whether there's dry powder or not again i don't you know i don't always believe the numbers that are given to me because again you can see it by the price section and the market's going up so again we can we can choose to believe that there is or there isn't but let's say that there is well again very have to get yield or they're going to lose their customer base so they're either going to put it in the u.s. equities or they're going to try to you know you might see some money start to flow the some emerging markets i mean they may have indeed bottomed and now you might see some money flow back into china that maybe we're going to start to see some action you know between the u.s.
and china but overall the number one place will still be equities here until. proven otherwise and we've been trying to say for now 11 years people been calling for the end of this market that the world is coming and i'm yet here we are another set a new record highs and another so again you can look at whatever you want but at the end of the day most of the money is flowing here because we're just going up and that's just the way it is i guess we have to ride it out on tell this market meltdown and todd horowitz to start advocating thanks so much. well it seems like there is a whole new trade war on the horizon but this time it's between the u.s. and the e.u. right now the european union's trade chief is working to avert an escalation of that possible trade war specifically between the u.s. and france and all of it started over a digital tax so here's what happened france passed
a digital services tax that would target tech companies essentially like google apple and amazon as a result president trump is now threatening to hit france with new tariffs in retaliation these tariffs would hit about $2400000000.00 worth of french goods and now france is threatening that if that happens france or the rest of the e.u. could respond with tariffs of their own as a bloc well the european trade commissioner phil hogan sees me says that the next few days will be critical in determining whether or not the e.u. can broker an international agreement on taxation of digital businesses hogan went on to say in an interview with bloomberg quote next week is a very important week to try and see could we come to a positive outcome on this i'm not going to prejudge the outcome and joining us now is hillary ford for the with the british american business association hillary they have you here to talk about that is that all right so the 1st big question all really about to see a trade war take place here between the u.s.
and france and certainly you know the trumpet ministration appears to be going out on a limb here to fight a fight. of of privately own digital companies well actually it reminds me of what our general here she just said right after dropping the bombs on pole harbor you know i fear we've awoken the giant which proved to be true hogan of course is the bully irish trade negotiation he's a new one at the e.u. so the e.u. has going for is they have this this rather tough new negotiator he's far tougher than they've ever had before however you've got to look in any deal 'd who has the leverage the u.s. purchases $3200000000.00 euros worth of french wine and that's 2 and a half times the next biggest nation that purchases and that's the u.k. which is 1300000000 what are the u.k. the u.s. about to do we're about to form a global trade deal so the e.u. really is on their back foot so phil hogan has to do something to have a trade agreement he's already said that he is willing to talk about agricultural issues although he said he's not willing to talk about agricultural tariffs but
he's going to have to do something because he knows he cannot lose for all of europe those wind purchases little loan the auto deals the auto makers suffering because the u.s. has already threatened robot lighthouses already threatened not only have we imposed those 'd tariffs on the e.u. but also we may impose towers adventure on european automakers just think of the germans would react to that and my answer is all of us have been to europe and a lot of our viewers have all those that are based there how many american cars drove us over there have you ever seen a mercedes or a b.m.w. here i would say so it's so much easier to sell into the u.s. and trump is right this has been unfair for years and now it needs to be rectified now is the ultimate compromise here that the e.u. will negotiate a services tax that will be completely uniform across europe and wouldn't that actually go against france or sovereignty well that's a problem with europe you see with the e.u. is yes it's undemocratic and yes there is an individual sovereignty at all there never will be so you're absolutely right it's not going to be about french sovereignty and don't forget the french really only produce the locks have the main
exports are of course food products and fashion prada. so yes it goes against french sovereignty and there's not much that the french can do individually because it's all under the either hillary or my head is exploding at the thought of this the trouble ministration is using language that essentially says that look by france imposing this digital services tax it's clearly no question about it it's clearly targeted towards google towards apple and towards an american high tech giant it has to deal because you have to be a large enough company to be able to even have the tax imposed on you yes so it's very targeted and so the target ministrations as well look this is a targeting of u.s. companies and so we're defending u.s. companies yes hillary these companies don't even pay taxes here in the united well . yes right yes corporate taxes amazon apple they don't pay anything why are we using the power and the strength not just the bully pulpit but the strength of the force of the u.s. government to go after another country to say you can impose taxes on this private
company i guess that isn't even pay in corporate taxes here well actually what you're going to and you're right about the corporate taxes it's what we talked about before which is the double is the called the double irish dutch sort of loophole it's totally legal but american corporate giants they have headquarters in ireland then they they have a tax policy which puts all the revenue through bermuda and the long run they pay no taxes anywhere so it's not just in the u.s. federal tax rate or anywhere globally then by the way and they all hate trump well so why are you actually bought i will say what they do is of course being headquartered here in the u.s. they employ thousands and thousands of americans who pay taxes number $1.00 number 2 they work with us vendors and they do their deals predominately with us and us who those vendors pay taxes like myself my company lots of little companies do all the vendors pay taxes and then all the employees of all those vendors pay taxes so it definitely is within i think the bounds of a totally consistent thing about trump he's totally consistent it is consistent with an america 1st policy that's for certain because this is about all the jobs
and all the other companies paying taxes here in the u.s. and now meanwhile despite the mine. crippling protests and the walkout across france over the efforts to reform the pension system france's president many on the ground is now telling outside investors that france is still open for business apparently so how important is this effort to keep the economy moving forward is absolutely critical kristie and yes he's absolutely been saying that one thing he's not going to do is they don't come to france we'd like this like strikes to continue he's not going to say that what do you go to give him credit for though he just recently i think it was the other day he was just. he was talking to astra zeneca employs of course that's the british swedish i'll go before masood pharmaceutical company and do his efforts actually one has to give him credit because coca-cola is investing now over a 1000000001 point $1000000000.00 in france then astra zeneca has announced a $500000000000.00 investment over 5 years and toyota just an announced $100000000.00 investment so he's doing something right he's hosting also all these global executives using besides the inducement i think google executives netflix
astra zeneca as well so the answer is absolutely mission critical for him he actually also deserves a bit of credit because he has now held his ground and a lot of these funds union workers off to $48.00 days of striking they're running out of funds they're running out of morale and some of them are actually crossing the picket lines and going back to work so i think he's actually going to i believe turn from surround because you cannot finally succeed with socialistic policies just like in the us so there would really be these high tax states in the end it will fail we will see how it turns out who we were member with the british american business association thanks again for your. pleasure because the. time now for a quick break but hang here because when we return google c.e.o. says that artificial intelligence regulation needs to take a balanced approach so what is he looking for lawmakers to do and what has google promise it won't do with a i will tell you more. extradition hearing in canada on
when you want to be president i'm sure. some want to be rich. but you'd like to be for us but what about for 3 of them or 10 people that i'm interested always in the waters of our. city. as you would you go to one of the 4 something beyond what because. that's pretty much what i mean i well me. when i was losing my double who moved me to. school.
seems wrong. to me. to shape out these days because. engagement equals betrayal. when so many worlds apart. choose to look for common ground. and welcome back google's c.e.o. son our precious says that when it comes to artificial intelligence there must be a balanced approach he went on to tell the european audience in brussels that ai can bring negative consequences you think in part for shy said quote since of all regulation must also be must also take a proportionate approach balance the potential harms with social opportunities to say what those opportunities were but it did go on to say that regulation could
incorporate existing standards like europe stuff general data protection regulation rather than just starting from scratch but she has been meeting with european leaders along with other silicon valley tech company executives like brad smith of microsoft so in reality there is likely trying to head off broad based crackdowns by the e.u. on the artificial intelligence technology in 2018 google pledge to not use a high in applications related to weapons surveillance that violates international norms or in other ways they go against human rights i guess the big question is do you believe everything that he's saying i mean this is the same man who was running operations within google where he said they were not working with the chinese government then it appears they were then they seem to scrap that once they came out it just seems like a lot of the things he says look good in the public view but then there's other activity going on that contradicts every listen to a statement there is a lot of dolls he can add because he says we need more regulation but then he goes on to say how good how dangerous it is to not use ai and it would actually be
a detriment to not consistently advanced technology so it's actually kind of double talk into the regulating the entire space deregulating that perhaps to some extent but on the other hand i get this impression from. jeff bezos right from mark zuckerberg over all these guys who run these tech companies seem to have the same view which is that they want regulation as long as they and their teams get to write it because they tailor it to kind of fit what they're doing. and so it regulates everyone else but it gives them a free pass when they have the funds the ability of the technology to pursue certain goals i do think that for him this new c.e.o. he is actually much more in line with the shareholder with the corporate shareholders in their agenda right now because they're apparently cutting back on a lot of the google spend that they've had on the unicorn bets that the previous co-founders they've actually place so apparently they're trying to conserve everything and dell that to deliver that towards furthering i think is doubly headed where shareholders want him to go. on age 51 is the youngest ever
president appointed at samsung electronics monday as former head of mobile development rose seeks to defend samsung lead in the handset market from emerging rivals most notably huawei he has championed samsung strategic shift to outsource more phones to chinese companies to cut costs as well as ports significant resources into telecom network equipment business which is aimed to capitalize on the security fears hobbling away now while i meanwhile is battling allegations by the us in order to secure contracts across europe to build its new 5 g. network the u.k. is expected to reach a final decision soon and the guardian reports that prime minister boris johnson is likely to approve the use of equipment despite the pleas of the us government samsung held a 21 percent market share in the 3rd quarter but huawei expanded to 18 percent despite the ban prohibiting u.s. firms given access to technologies like google's android. yes fission hearing for a while weighs chief financial officer began monday in vancouver british columbia more than a year after men arrested the court battle began to see if she will be sent to the
u.s. to face charges are not are to. this report. the 47 year old chinese executive was taken into custody in vancouver back in december 2018 she has been under house arrest since then now she's been held in canada under suspicion of fraud related to allegations that she violated u.s. sanctions against iran denies these allegations now many suspect that the request for the arrest by the u.s. is politically motivated with her with the china and the u.s. being in a trade war at this time to try to one so far as to say that this is political persecution here's china's foreign ministry spokesperson 2 london woman has a consistent and clear position on the wings of case and the u.s. learning into abuse from bilateral extradition agreement to margaret you rarely make horses you measure it against the chinese citizen severely infringe on the
chinese nationals who only get it right and the interest is the current proceedings are to figure out should be extradited by canada to the u. s. the province of british columbia supreme court is looking into this in vague coover and they're focusing on that next step which would be extradition or not much of what happens rests on a motion of double criminality in other words with the crowd that maggie is accused of in the u.s. also be a crime in canada now her lawyers are expected to argue that she cannot be turned over because the charges simply don't qualify canada does not have the same sanctions against iran as the u.s. so according to that argument she should be released from custody canadian department of justice lawyers will be arguing for her extradition now the canadian government has promised to stay out of the legal proceedings but that said canada's federal justice minister. has the last say whether an individual is surrender to the u.s. or not the case has caused a major rift between canada and china and china has been asking canada to release
men from the get go but with the u.s. and china in a trade battle now canada stuck in the middle china says the release of manning is a precondition to improving canada trying to really sions but no matter what the outcome the major fear from canadians is if she is released then the u.s. will be ticked off at canada and if she's held and sent to the states well then we have a problem with china and how to add to all of this there's also a question of 5 g. networks canada up there in the middle of deciding whether to allow you to persist participate in its new 5 g. network so as you can see there's a lot of twists and turns in this case from beginning to end and we won't know the outcome most likely until the end of this week if manning is actually going to be extradited or not. because the i know you would love to live on the moon if it were possible but if humans like this they were ever able to actually live on the moon what would their vehicles look like according to lexus they would be exactly what
you would find in the movie sleek and shiny and apparently branded with the lexus logo take a look at some of the 7 lunar vehicle concepts that the lexus european advanced design studio for name came up with everything from this one that kind of looks like a mascara tube to the one design concept that was published look at this a motorcycle like a vehicle called 0 gravity and this bike of course does not have wheels it was designed to be ridden like a motorcycle but instead 'd uses magnetic levitation kind of like something from tron right but we'll achieve only lexus could create something cool looking here on earth you want to ride a maverick car around here so what do you think of those i mean they're they're pretty incredible you can see them on the the wall behind us i mean they're cool looking i want out all right rather than one of those i. actually only drive like this you really only like i said if they could just if they could just make something that look cool here on earth maybe more people would drive and not just.
because they're not exactly known for forward thinking design they're the best selling cars in china actually. that's it for this time you can catch boom bust on directv a child 301 dish network to 80 or screen 247 unplayed a t.v. that the t.v. at 79 or as always had us up at you tube dot com slash boom bust and we'll see you back here next time. see you know before george says our us became vilified as a global market manipulator and electioneering or he wrote a lot of interesting books and of course c.n.n. jim rogers had the quantum fund which was one of the best performing hedge funds
ever kind of invented the modern hedge fund and he's got a lot of things to say if you look at his old work and we're going to get into it. see if the plus lead to a little boy is no good keep the slime do you force new focus on the so do you still. want. to see in the film was not the. most good movie the. more you. know what.
the u.n. security council the west continues to defend the chemical weapons watchdog proport on syria's 20. despite the watchdogs known for the inspector calling it contradictory. the findings in the final day of the reform. party for victory were complete. and were. part of. the divide between the ridiculously rich on the rest of offices are appalling levels a new report finds as the walls richest the most powerful god of the 5th jet was becoming for him this was solid. as the u.s. secretary of state.