tv Bloomberg Markets Asia Bloomberg April 22, 2021 10:00pm-11:00pm EDT
david: china and india may deflate president biden's grand climate ambitions with president xi making no promises of other caps on climate emissions while prime minister modi said india is already doing its part. haslinda: and is it game over for the super league? with only three teams left, the breakaway league is in limbo as uefa seeks to punish the breakaway teams that chose to rebel. david: at-wise, here is what is happening. we were lower up until about 30 minutes ago when some of these markets started reversing losses , and look at some of the green, csi 300, that means the momentum was enough to take the 50-day
moving average below the 100-day moving average. looking at australia, it is really about this red-hot metals rally really improving the earnings for many of these companies. take a look with -- take a look closely. we are looking at india and nearly 270,000 daily -- the seven-day average right now -- infections. we are also looking at europe. while the market close before the news broke about the capital gains taxes, we will see quickly at the european open. following what happened overnight in case you missed it, you see on your screen, that red circle marks when the news dropped. we have not recovered all the way. i would say we are trading
nearly nine hours. haslinda: joe biden is planning to double the capital gains tax. kathleen hays is here with details. let's start with numbers. what is the white house actually proposing? kathleen: sources familiar to what is going on in washington shared this with us. let's look at some of the details because is it's going to be a higher capital gains tax rate on people earning more than $1 million a year, $1 million and up. in fact, there will be a new marginal tax rate of 39.6 percent, as you can see there. that is about double the current tax rate of 20%, and when you add up all the bells and whistles, the tax rates for wealthy investors could be as much as 43.4% under this new
law. also, the proposal is to keep the tax already there on investment income that was passed under barack obama's presidency. it funds obama care, and we know biden and his team are already talking about higher estate taxes for wealthy people, higher income taxes, higher corporate taxes, so there is a lot in play here so far, and if you look at what this would mean for some of the wealthiest earners in some of the highest tax states in in new york, $1 million-plus early could face a combined rate of 52.2%. for those in california, it could be about 56.7%. the urban brookings tax policy center -- very important numbers , but let's get off of the street and focus on this number -- they are saying this could raise $370 billion over the next
decade. that's about half $1 trillion depending on the way you look at it. it is something being pushed hard for. president biden will have to find a way to pay for what is being spent. this is something he obviously feels is important. david: republicans, not surprisingly, are already pushing back. kathleen: they have a different view. let's face it. joe biden made it pretty clear, he is with the tax camp. it is the farther left camp of the democratic party, but republicans in general have said capital gains taxes staying low encourages savings, promotes growth. chuck grassley, who was a very important republican, high-ranking, the head of the senate finance committee -- he says that tax hikes on capital gains will cut investment and boost unemployment.
the gop wants to keep all the 2017 tax cuts passed by donald trump. grassley said if it ain't broke, don't fix it. president biden will be talking about his new plan, the american families plan, in a joint address to congress on april 28, happens to be the same day the federal reserve will be meeting, so we will have a lot to talk about that day. tim scott, a republican senator from south carolina, one of two african-american senators in office right now, will be giving the rebuttal to whatever joe biden has to say. haslinda: our global economics and policy editor, kathleen hays. our question of the day -- how will biden's proposal affect stocks? some say the -- some say it was
well signposted. >> we did see a decent selloff in nasdaq contracts, other they are recovering slightly today. it is hard to say it will not have any impact at all. even though people may have been expecting tax hikes, it is still quite a large increase if it goes through, as kathleen was saying. you cannot really expect people to be too bullish about that. probably more interesting is where else it might lead. equities are the obvious place that people trace in america, but it could also affect things like corporate bonds as well. one of the biggest areas of support for corporate bonds on's the past few years has been from the private wealth camp. it is now pretty well known that a lot of the high-yield corporate bonds that are issued globally rely a lot on the private wealth, on the home office environment to support those bonds, sometimes as much as 50% or 60% of new issues are
brought by those people. if the rich people are going to be taxed more, it is not just equities that will be affected, but it could be on the bond market which would mean higher yields for companies, so implications could go a lot farther than simply the equity market. there's a lot of dollar bonds issued by companies in the region, and they do rely on higher network people, so we could be talking about this for some time, and it may well go beyond the markets initially impacted in this proposal. david: i love how we started this story. just turning our attention out to china, tom and i were speaking over the last hour, he mentioned we have been stuck in a funk and what is really going to get us out of here. what do you need?
what are we talking about here? >> you might call it a bit of a reverse indica in some respects. we were flagging earlier this week that the chinex index was going to break out of range, and it appears to be doing that. one of the reasons that is helping that -- helping all chinese stocks to some extent, is there might be -- that level has been rising again. leverage traders typically prefer smaller stocks which is where the china is very strong, so you can see that has had a pretty good week. also, if people are already heavily short some of the companies, a very incremental strong -- a very incremental, small change in the market can cost a lot of money. that can help to drift the market a little bit higher. what you are seeing is a pretty resilient performance from china stocks. it will not need them to go to
much higher before people feel as though they are missing out on the momentum. volumes have been relatively low in the big china markets, and yet, the indices have been rising. big fund managers suddenly find they are behind the curve in the sense they do not have enough exposure to the market, and they jumped back in at higher levels. just because the market might seem a little quiet does not mean it cannot go up. haslinda: still ahead, from a super week to spectacular flop. david: coming up as well, we are talking biden's climate summit, now showing how far the u.s. has to go. that conversation in a few minutes. ♪
president biden: no nation can solve this crisis on our own, as i know you all fully understand. quickly fight against climate change will be the engine for all global recovery. >> we can build back at her from this pandemic by building back greener. >> follow the principle of equity and justice, and focus on respective action. >> concrete action is needed at a high scale, on a large scale, and with a global score. >> i'm delighted to see that the united states is back to work together with us in climate politics because there can be no
doubt about the world meeting your contribution if we really want to fulfill our ambitious goals. >> all of us, particularly those who represent the world's largest economies -- we have to step up. david: world leaders speaking about their own climate change ambitions on day one of president biden's virtual summit. haslinda: president biden pledged to cut u.s. fossil fuel emissions by 52% by the end of the decade, and he brought world leaders together for a two-day summit. meanwhile, china and india made no new major pledges. let's discuss a carbon neutral future with the chairman and ceo of what was just named the most sustainable business in the world. no new commitments from the likes of india and china. are you disappointed? are governments doing enough?
are they showing enough commitment? >> it is encouraging. what happened yesterday, which is the u.s. and canada going one step further. remember, china recently committed to carbon neutrality in 2060, peeking carbon emissions in 2030 -- peaking carbon emissions in 2030. in europe, you see clear efforts to tackle climate change. when you put that together with the mobilization of financial markets, you've got a convergence so that we are now seeing that climate change is the priority on everybody's agenda. haslinda: we can talk about priority, but even as china and india talk about moving towards carbon neutral, they are adding
even more coal powered plants. will that dampen the efforts being done by europe? >> you cannot take the commitment which have been done by china without a very precise plan, so you see actually at the moment real plans of renewables. india announced eagle lots of renewables to power the country, so let's face it, at the end of the day, climate change is all about carbon emissions. carbon emissions is 80% of interviewed -- of energy. the way you consume and the way you produce. energy efficiency, using new technology can be the catalyze or of change there. smart buildings, smart cities, smart industries -- it is what
we have to put in place. then there's low carbon energy, and what you see is a global movement that drives at lot of innovation, and a lot of changes. haslinda: there remains the gas. >> i believe people underestimate or do not understand fully that all the technologies that we need to organize make everything more efficient -- make everything connected, therefore more efficient, and make an much less carbon intensive do exist. they want to resolve the big energy equation, which is first
simply energy to everybody. we have those who do not have access to energy at all, and then those who have access to unreliable energy. this is still a priority. cut carbon emissions by a factor of two. this is actually possible by rethinking the way we design buildings, cities, industries, and leveraging the combination of digitization, low carbon electrification for the future. david: in terms of -- let's talk about the private sector. we talked about the need for financing and the ability to raise, you know, green financing, that sort of thing, to increase capacity. is there a dollar figure that you think the private sector will need to raise in the markets or in the banking system within the next decade to be able to put in that capacity to help them reach their goal?
>> there is investment, but that investment has a very short return, a very good return because what you do is invest and actually not that much, to decrease your operation cost, so what we see is that the investment in efficiency is actually one of the best return investments that industries do. the other thing is that it is a basic condition of competitiveness. 90% of our carbon footprint is with our suppliers, so in the future, every company on earth would have to report about carbon emissions. that means if you want to remain competitive on the markets, you will have to operate with a very low carbon footprint, and we will resource companies to measure their carbon footprint to put into place strategies
with quick return on reducing their carbon footprint, on making them, in fact, more competitive. president biden was saying yesterday that countries which are proactive on climate change would actually be more resilient and more competitive than others because overall, -- because the world will choose low carbon solutions in the future. david: when we have these conversations every now and then on climate change, obviously, the idea that i'm getting from what you are saying is the private sector will fix itself, and that might give us a little bit more boost than people expect right now. when governments talk about and debate and argue about who pays, do governments really have to pay anything at the end of the day? >> first, to come back to your previous question, there is a
lot of money looking for use in reducing carbon footprints. we are partnering with carlisle, for instance, in the u.s. so that we work together. they finance, we lead the projects so that we help infrastructure to operate better with a lower carbon footprint. we have many examples of partnerships around the world where we used technological power to resolve customers' problems. government has to make sure he gives the right incentives. many people will find a quick return in going into a low carbon economy, but they need help into the transition. first of all, all governments need to make sure they are not subsidizing the economy, which
is still happening too much. we have to make sure governments make sure they are on the transition side of the government. we spoke for about inequality inclusion -- inequality inclusion. this sector, based on digital technologies, based on renewables, is a sector which is very new. to train the youngsters which are the first victims of covid in terms of marginalization of society, using stimulus packages to train a lot of youngsters to do older jobs, which are necessary, to come back on existing buildings, existing
homes, existing industries to make them more efficient and more low carbon. david: have a great weekend. have a great rest of your friday. we are not done, of course. but thank you for joining us. critical moving issue. let's get to vonnie quinn in new york. bonnie: india marks the world's biggest ever single day jump in covid cases bringing their total caseload now to almost 16 million. the latest wave is pushing hospitals to the brink. while the number of vaccinations administered lie with wealthier nations. vice president kamala harris will speak with guatemala's
president monday. the team -- the two will discuss relief and ways to deepen cooperation for migration. harris seeks to limit the humanitarian crisis on the border. more than 170,000 people crossed the border in march, the highest in two decades. a senate committee was formed to combat hate crimes. a bill would boost recourses for addressing hate crimes. supporters say it would send a clear message of assurance to asian americans that violence against them will not be tolerated. house speaker nancy pelosi says the chamber will pass the bill and it will be back by president biden next month. i'm vonnie quinn. this is bloomberg. haslinda: intel's latest results have stoked concerns about its market share after revenue from
its data center dropped. let's get the details from the executive editor for asia tech in tokyo. let's start with the results. peter: as you mentioned, it was a quarter where intel saw some mixed results. intel, of course, best known for its processors. they are sold to be used in computers, laptops, and data centers, which has been a really big growth area for them, and they have been at the cutting edge of that data center demand and have defended quite a bit, especially during the pandemic, as people spend more time at home and needed to use these cloud services that are powered by the data centers. anyway, revenue fell about 20% from a year earlier. there were concerns and questions from analysts about if we were losing market share in that business, which has been very profitable for them. this comes, of course, as intel is trying to engineer a broader
turn around, trying to get back on track with its manufacturing capabilities and catch up with some companies that have jumped ahead of it in terms of manufacturing, like tsmc in taiwan. david: the broader story across the industry are these shortages. did you hear anything from the ceo? what was the spin? >> the ceo was asked about the shortages that have been hitting the chip industries. the customers of the chip companies have been struggling to get as many chips as they need, particularly in the auto sector. we have seen that pop up in a few other areas, too, but some of the automakers have had to idle plants, put workers on furlough. ceo pat gelsinger said they are concerned about these supply constraints and he feels like they will last for a long time. we heard a few people say it could last into next year. he said it could stretch as long
as two years as long as the chip industry has to make investments in plants that take a long time to be built and built up the capacity that all these customers need to add technology to cars and computers and many other things. shery: you won't want to miss your interview with intel's ceo at 11:00 a.m. in new york and 11:00 p.m. in hong kong. david: a brief look across the markets. the movers across many of these different areas of the asia-pacific. i think we are down about 20% on the week for my next, perhaps being dragged down on the retracement lower on bitcoin, which earlier fell below 50,000 for the first time i believe since march. dollar-yen, we are looking closely as we approach the tokyo lunch break.
looking at this currency, and they are saying watch the support level closely. below that, we might add to that pink circle. there's plenty more ahead. you are watching bloomberg. ♪ want to save hundreds on your wireless bill? with xfinity mobile, you can. how about saving hundreds on the new samsung galaxy s21 ultra 5g? you can do that too. all on the most reliable network? sure thing! and with fast, nationwide 5g included - at no extra cost? we've got you covered. so join the carrier rated #1 in customer satisfaction... ...and learn how much you can save at xfinitymobile.com/mysavings.
>> a tough year for credit suisse, one scandal after another. credit suisse's first-quarter results may have been better than expected, but the nest loss -- with a net loss, but additional losses of $655 billion from archegos will be seen until the second quarter. regulators have opened a probe. we spoke with thomas scott stein
and asked whether the bank's problems are now over. >> we have to address the issues. archegos, we are down to the last 3%. we have exited the positions. we have raised almost $2 billion this morning, have taken action now, risk organizations, we have taken management changes. we have done quite a lot. still some work to do in the second or third quarter. we have taken a lot of measures. >> why did you arrive to the decision of a convertible bond instead of doing something else? >> we had conditional capital, that is the best way for us to raise the equity. it was important for us to get to 13% ratio, which we now have.
that was important for us, to take the capital discussion off the table. >> what measures have you taken to reduce risk, especially in the brokerage business? >> we are going through the portfolio. our plan is to reduce leverage exposure by $35 billion by the end of the second quarter in this business. we will take further action in terms of control systems on the first line of defense as well at the second line of defense. >> before archegos, you warned of potential financial hit from greenville -- from greensill. >> we are working through with the administrator of greensill capital. we have good visibility for a
large portion of the remaining positions. there are three more distinct positions which will work through over the next few months, quarters. we are not planning to do any form of step-in. we are very clearly focused on getting the cash back to our investors. that is our priority. >> what is the status of the reviews? do you see any further personnel changes? >> we don't foresee any other personnel changes at this point. we obviously are doing an investigation. we will inform about that outcome one we are ready to do so.
the leadership of the board and myself to look for a new risk officer. you know we have appointed our interim chief risk officer and we will then inform further once we are ready. >> do you think you will have to tighten risk parameters in other parts of the business? >> we have two incidents. we have had a very strong record the last 10, 11 years, in terms of credit provisions, if you look at our original credit losses. it has been very strong over the last 11 years. i don't think we have a dna problem in terms of risk. we will review our risk systems and processes as part of this exercise. >> how different do you think credit suisse will look? >> we have incoming chairman from the first of may. we will review our entire organization and we will then also inform the public as we move into the second and third quarter. >> what will your priority be? what are you looking at? >> the priority is to really go back to running the business and to have, again, a stable situation. that is very important to us. we are open for business.
the reason we did the mandatory convertible was to have the strength of the capital base, not only to withstand any possible shock, but also to grow the business. it is important for us that especially in asia, switzerland, but also i w m, we have the capital to further grow the business. >> the credit suisse boss thomas gottstein speaking with francine lacqua. have a look at this. citi naming credit suisse a stock among their best risk reward ideas in terms of upside potential. keep that in mind. >> sources tell bloomberg president joe biden will propose
upping the capital gains tax on wealthy americans to pay for social spending plans. for those earning $1 million or more, that means federal taxes as high as 43.4% after an existing tax on investment comes out -- comes out. it could reverse the long-standing provision that texas returns on investment are lower than labor. . the biden administration is weighing an appeal from progressive democrats to accelerate global access to covid-19 vaccines by supporting a waiver of intellectual property protections. more than 50 countries support the move including india and south africa saying it would save lives. it is opposed by big drugmakers. former president trump blocked the initial proposer last year. intel says 70 people working for a construction contractor at an expansion office any factoring plaint in ireland have contacted covid-19. the world's largest chipmaker said it learned about it this
weekend and says the plant remains operational while it follows government health protocols. intel has committed to expanding spending on new plans to remain competitive amid a chip shortage. singapore and hong kong are said to have called off planes to announce a highly anticipated quarantine free air travel bubble for the second time in five months. no reason has been given. sources say a new date has not been set adding it was initiated by singapore. the cities have been trying to revive bubble plans after pushback due to a virus playback -- flareup in hong kong. in a year that saw global airline travel grind to a halt, china's international airport in guangzhou claimed the title of easiest airport hub. it knocked atlanta's heart phil jackson airport in the u.s. off the top spot it has held for more than two decades. the international trade group ranking says it moved up from
11th place. china was home to seven of the 10 busiest airport hubs last year. global news -- global news, 24 hours a day, on air and at quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. >> markets looking for direction. asian markets swinging between gains and losses. resurgence in violence cases -- virus cases. the csi 300 bucking the trend up by 1%. here is some of the stocks we are tracking. cnooc recovers from the pandemic. china banca -- china vanke is down. amp is set to split after talks
ended. down by almost 13%, slumping as much as 20% after its q3 update. taking a quick look at commodities, particularly agriculture, down 0.8%. it was at the highest in almost eight years. crude palm oil up by 1.6% above the 4000 ringgit mark. a mixed bag. >> there we go. we are talking sport next. what super league? the spectacular collapse in the project and how european soccer can emerge from what some are calling one of the biggest blunders in sports history. the ceo of sports capital advisors will be on the show next to talk about what happens and where we go from here.
condemnation. have a listen. >> it is going to be one of the most ridiculous proposals in nearly 40 years of business. another 20 plus -- it is one of the most ridiculous i have ever heard in my life. >> let's get perspective from our next guest, who has represented high-profile stars in their commercial endeavors. a very early morning in stuttgart, germany. thank you for being up so early for us. i guess we start with the obvious. this project. it is dead, that is it. >> it is dead. one of the fastest launched and fastest dying process in sports
politics in a long time. >> the core issue is it comes down to money like it always does. we can obviously debate the merits. talk to us then, what changes are needed when it comes to this so it does not happen again? >> the irony of this debacle is the fans have been protesting the just recently announced changes to the new champions league cycle expansion from 32 to 3016. the reason for that -- from 32 to 36 teams. the reason for that is more money. the controversy over more money versus fans and the originality of the sport has been around for
years. the fact that the top clubs have wanted a larger allocation of tv and other income revenues the champions league generate is also nothing new. what was new was the fact there was a breakaway club if you like that made an announcement on a one pager that no one really anticipated. this is when everything just blew up. the controversial element has always been more money and how do you extract more of that to accelerate revenue? >> it does go against one of the principles of sports. it is not about money. you should give smaller clubs
more chance. that is ryu get more people tuning in. -- where you get more people tuning in. what happens next? do we go back to square one and then to the drawing board? >> you are diverting the plans announced today ago. really nothing much will change. it will be an expanded league from 32 to 36 teams. there will be more games, and that means more money. the other thing that will likely happen is the top clubs which see their ip is the main driver of the success of the champions league will likely have a much stronger see at the negotiation table coming up in terms of the allocation of the revenue.
>> what do you make of the fallout? the six clubs are now under a lot of pressure to step down. >> yes. it was never really a possibility of this happening, in my opinion. the leagues as well as the federation ultimately are the bigger people at the table. they can put out sanctions. they can ban players from competing in sanctioned events. they would have had a number of ways of making this so difficult that what is really puzzling is the clubs that started this whole thing actually thought there was a legitimate opportunity to push this through , which i don't think ultimately existed.
>> in your opinion, do you think we need new laws to protect the game? boris johnson trying to come up with new regulations in how english football is run. >> there are two sides to this. one is this is not just an english issue even though they have most of the teams -- half of the 12 were british. but you see that if a prime minister takes often focuses on a football issue in times we live in, it means there is a lot of voting power behind the subject. i don't believe there needs to be a massive regulatory reframing of the game. the champions league format has worked extremely well over the last decade. it has generated more revenue than anybody anticipated. it is more about the fact that private ownership in sports, in
this case football, but other sports as well, is part of the new world we live in. you will continue to see interests clash between ownership that needs to generate revenue and make a profit versus fans who feel the game does not belong to anybody. if you look at the numbers, the 12 clubs have a liability of over 7.5 billion euros. it would be very difficult to come up with a scenario where these clubs can under the current structure ever get rid of that load of debt. that was hardly a key driver for them to make a quick fix to the balance sheets that we otherwise don't know how to really rectify.
>> it is not just about selling the big-name. that is quite a massive number. since we are talking about the commercial part of the business, a lot of wealthy families and groups in the asia-pacific have taken stakes in european clubs. not the top tier ones. it has been a very bad past 16 months for sport. there are many distressed athletes out there. how much would it cost me if i wanted to buy a majority stake, controlling stake, in a competitive club, first division , outside the big four football leagues in europe. give me a price. >> the per merely being the upper echelon -- premier league being the upper echelon, prices change, but you should run ballpark half $1 billion will get you a nice team. >> done.
collects as the chinese government targets big tech giants, one question is whether proprietary data from alibaba and tencent will eventually get nationalized. as part of a new bloomberg tv special, our chief north asia correspondent stephen engle looks at how national pooling of data could have significant ramifications for user privacy and effect tech profitability. >> from a government standpoint, it is not in the interest to see tech companies become smaller and weaker. >> what leverage does jack ma have? >> the leverage lies in the cash-rich. they have a strong talent pool. they are very sophisticated. >> they have the data which the government probably wants as
well. >> i would not disagree with that. >> a year and a half ago, china released a document codifying data as one of the core socialist factors of production. under the idea you must have a well regulated data market in order to maintain economic growth. this is the fundamental core operating principle that china will be using to regulate big tech over the next 10 years and it is something that has not entered the western lexicon. 3 the chinese government is said to be mulling a state backed joint venture with the large platform to oversee how their combined data is managed and shared. >> there should be agency in china which serves as -- in other words, not try to crack down. >> but pooling data raises a host of privacy issues.
data is extremely complicated. there is a fine line between ensuring users' privacy and opening up data to sharing. others like baidu claim to be open to opening their data. >> it is in line with our ability. we run open platforms for ai. we have baidu brain which is open. we want to share data with other partners. >> giving up one's data could upend existing market-leading positions. noncompliance is perhaps the bigger risk. for alibaba, getting off with a fine does not mean it is in the clear and that alone will surely pave the way for a resurrection. >> it depends how the government restructures our regulatory framework in terms of financial technology. it also depends how the company
reacts to the changing. >> how go will the government -- how far will the government go? >> they need the golden egg. they need the innovation, the growth. they know if they try to do this all from state companies that is not going to work. >> that is redlines, china and big tech. for now, a quick check of the latest business flash headlines. bridgestone says it will support the tokyo olympics and paralympic games as a key sponsor as long as the safety of participants is secured. in an interview with bloomberg, the ceo said it will refrain from holding a big marketing campaign and will not invite guests. china's largest insurer by market value says investment income jumped.
>> welcome to a special edition of "bloomberg technology." we are covering earth day with a hard look at the challenges facing our planet and bringing you some solutions. we are speaking with google's sustainability officer, the former tesla cto working to create a circular economy for electric cars and gadgets of all kinds.