SpaceX Eyes $40B for Nvidia Chips, Asian Stocks Hold Near Record Highs

SHERY: THIS IS THE ASIA TRADE. THE TOP STORIES THIS HOUR, ASIAN STOCKS SET TO EXTEND A RALLY THAT SENT THE S&P 500 TO ITS WORST RECORD CLOSE SINCE AUGUST. 10-YEAR TREASURY YIELD'S ARE TREATING EVEN WITH BRENT OIL STILL ABOVE $100. ABLATE SHARES CONTINUING THEIR DANCE WITH HIM GET HIS MARKET CAP APPROACHING $6 TRILLION. A IN D.C. PREDICTING YEARS OF HIGH CHIP DEMAND. AVRIL: I'M IN SINGAPORE WHERE EXECUTIVES, INVESTORS AND POLICYMAKERS ARE GATHERING TO DISCUSS GEOPOLITICAL RISK WITH THE CANADIAN TRADE MINISTER AND TALK INVESTMENT STRATEGY WITH DAVID STEINBACK. HAIDI: AS WE HIT THE MIDWEIGHT SESSION, FOR THE FIRST TIME SINCE AUGUST WERE SEEING A RECORD HIGH BEEN PUSHED FOR THE S&P 500. THE RECORD-BREAKING RALLY, WE COULD SEE THAT SET UP TO BE QUITE NICE FOR ASIAN MARKETS AS WE REVERT THAT FOCUS BACK TO CORPORATE EARNINGS, EVEN AS WE GET THIS REVIVAL OF ELEVATED OIL PRICES AGAIN, AGAIN THREATENING TO KEEP INFLATION HOT AND INTEREST RATES HIGHER FOR LONGER. GLOBAL BOND YIELDS HIGHER FOR LONGER AS WELL. IF WE LOOK AT THE EXPECTATIONS WHEN IT COMES TO EQUITIES, WE'RE LOOKING LIKE WE COULD SEE A STEADY SESSION IN PARTICULAR GAINS ACROSS A ARE RELATED SHARES, AND BEAUTY MARKET VALUE APPROACHING $6 TRILLION, AND WITH THE KOREAN TAIWAN SESSIONS WERE WATCHING AS WELL. AND SHIPMENTS OF EXCELLENT TAX STILL VERY MUCH FRONT AND CENTER. AND YOUR TRADE CRUDE STILL SHY OF $90 A BARREL. SHERY: MARK CRANFIELD JOINS US FROM SINGAPORE. AND ANTHONY STEPHENS IS IN HONG KONG. MARK, LET'S START WITH YOU BECAUSE AS HEIDI JUST MENTIONED, OIL PRICES REMAIN ELEVATED. WE GOT SOME RELIEF WHEN IT COMES TO TREASURY YIELDS COMING DOWN FROM MULTI-DECADE HIGHS BUT STOCKS DID MANAGE ANOTHER RECORD. WHERE IS THE DISCONNECT HERE? MARK: THERE'S NOT REALLY A DISCONNECT, IT'S ALL ABOUT THE EARNINGS POWER OF THESE MAJOR COMPANIES, ESPECIALLY IN THE U.S. AND SOME IN ASIA AS WELL. THE LIKES OF SAMSUNG AND ONYX AND DSM SEE AS WELL. WE'VE NEVER -- NEVER BEEN IN A SITUATION WHERE THE MAJOR COMPANIES ARE GENERATING SUCH ENORMOUS PROFITABILITY WHICH OVERWHELMS THE IDEA THAT A 5% INTEREST RATE HAS AS MUCH VALUE AS IT DID TWO DECADES AGO. FOR TRYING TO COMPARE WITH DEFECTIVE INTEREST RATES IS WE WILL PROBABLY HAVE TO LOOK FOR MUCH HIGHER NUMBER BECAUSE 5% IS JUST NOT MEANINGFUL WHEN YOU CONSIDER THE KIND OF PROFITABILITY THAT IS EXPECTED. WE JUST HAD REPORT OVERNIGHT, BLOOMBERG INTELLIGENCE SAYING THEY EXPECTED 25% JUMP IN THE CURRENT EARNINGS PERIOD FOR MAJOR U.S. COMPANIES. THAT'S PRETTY AMAZING YOU CONSIDER WHERE WE ARE COMING FROM. WE ARE AT A PRETTY HIGH LEVEL ALREADY. YOU TALKING ABOUT NVIDIA GOING FOR $6 TRILLION MARKET CARE. A REPORT FROM FINANCIAL TIMES IS SAYING SPACEX IS LOOKING TO BUY ANOTHER $40 BILLION WORTH OF NVIDIA CHIPS. THAT WILL PUSH THE NVIDIA STOCK PRICE EVEN HIGHER AND THEIR STOCK PRICE DOESN'T COME OUT FOR A FEW WEEKS YET. THE PICTURES VERY MUCH A PEOPLE JUST WANT TO GRAB HOLD OF THESE MAJOR COMPANIES. 5% YIELD IS JUST NOT GOING TO PUT THEM OFF. SHERY: THAT'S A WHOLE POINT, THE FACT THAT WERE SEEING ALL THIS RALLY AMONG JUST A FEW COMPANIES. WHETHER IT'S IN THE U.S. ARE HERE ACROSS ASIA AS WELL, JUST A HANDFUL OF COMPANIES ARE LEADING INDICES. MARK: AS GEORGE SOROS USED TO SAY, IT WILL TROUBLE US WHEN IT TROUBLES US. THE MARKET THREAT ISSUE SOMETHING WE'VE BEEN DISCUSSING FOR THE LAST FIVE YEARS. THERE BEEN VARIOUS PERIODS DURING THAT TIME WHEN THE SO-CALLED MAG 7 STOCKS HAD TOO MUCH WEIGHT. NOW IT SPREADING OUT, THERE'S A FEW OTHER NAMES YOU CAN INJURE LIKE AMD AND MICRON INTO THE MIX. YET WE ARE STILL WORRIED ABOUT THE FACT THAT THERE ARE NOT TOO MANY COMPANIES PARTICIPATING, THERE'S MANY LET BEHIND AND YET THE S&P AND ASKED THAT CONTINUE TO MAKE RECORD HIGHS. REALLY THE ISSUE IS NOT SO MUCH ABOUT THE BREATH, IT'S ABOUT CAN THOSE COMPANIES SUSTAIN THE PROFITABILITY EMBEDDED IN THEIR PRICE AND THE OUTLOOK. SO FAR, THEY ARE DOING IT. THE REPORTING NUMBERS COMING IN RECENTLY FROM MICRON ARE INCREDIBLE. EXPECTATIONS ARE VERY HIGH, SO AS LONG AS THOSE HUGE COMPANIES DELIVER THE RESULTS OR SOON FORGET ABOUT THE FIELD. AT SOME STAGE IT WILL BECOME A NEGATIVE FOR THE MARKETS. WHEN IT DOES, VERY DIFFICULT TO PREDICT EXACTLY. SHERY: WE'VE BEEN DANCING AROUND THE SAME ISSUES FOR YEARS, PERHAPS ONE THING THAT IS MUCH MORE NEW, ESPECIALLY WITH THE JAPANESE MARKET IN THE LAST COUPLE OF YEARS HAS BEEN JGB YIELDS CONTINUING TO RISE. AT LEAST DESI GIVES THE MARKET SOME COMFORT THAT THE TENURE OPTION WHEN WELL BECAUSE OF HOW TRACK -- ATTRACTIVE IT IS NOW? MARK: THERE'S OTHER THINGS FALLING INTO THE BACKGROUND AS WELL. AND INVESTORS ARE MORE OPTIMISTIC ON THE ROLE OF THE BANK OF JAPAN. THEY HAVE SHORTENED THE TIMEFRAME FOR RAISING INTEREST RATES. THAT'S POSITIVE FOR THE LONG INTO THE CAR. THE BANK OF JAPAN IS GETTING SERIOUS ABOUT DOING SOMETHING ABOUT GETTING ON TO THE INFLATION SITUATION. IT'S NOT PERFECT BUT IT'S A HUGE IMPROVEMENT FROM WHERE THEY WERE A COUPLE OF YEARS AGO. SO WE ARE LOOKING FOR ANOTHER RATE HIKE IN DECEMBER WHICH WILL MEAN THREE MONTHS BETWEEN HIKES. THAT'S A QUICKER PACE THAN WE ARE USED TO. WE ARE GETTING CLOSER TO THE NEUTRAL LEVEL. ON A RELATIVE BASIS ON THE LONG END OF THE JAPANESE CARVE, THEY ARE NOT UNDER TRACK THE WORLD. FOR JAPANESE MASTIC INVESTORS, IF YOU GET 3% IN THE 10, THAT'S PRETTY GOOD. ESPECIALLY ABOUT THE STANDARDS OF THE PAST TWO DECADES. THERE IS A TRADE-OFF. IF YOU LOOK AT JAPAN COMPARED TO FRANCE, U.K., UNITED STATES, IT'S NOT IN SUCH A BAD SITUATION AS IT WAS 10 YEARS AGO. AT THAT TIME JAPAN STOOD OUT FOR BEING A WEAKLING. IT IS NO LONGER, WHEN YOU COMPARE IT TO ITS G10 PEERS, IT'S NOT IN SUCH A BAD POSITION. ALL OF THAT IS RELATIVELY POSITIVE FOR WHAT YOU SEE IN THE JAPANESE BOND MARKET. IT'S POSITIVE FOR THE EQUITY MARKET ALSO. AVRIL: LET'S TALK HAIDI: -- LET'S TALK MORE ABOUT PROSPECTS FOR EQUITIES. ASIA ISN'T CLEAR WITH ITS IDIOSYNCRATIC ISSUE WITH HYNEK'S. ANTHONY: THAT WAS A VERY INTERESTING U.S. SESSION COMING INTO ASIA BECAUSE IT DID NOT LEAVE US WITH MUCH UPSET. THE FIRST THING TO NOTE ABOUT THE U.S. SESSION WAS HOW DOMESTICALLY DRIVEN THE AI STORY WAS. IT WAS VERY MUCH LED BY U.S. HYPER-SCALERS AND ESPECIALLY THE ENERGY BUILDOUT IN THE U.S., WE HAD THAT BIG DEAL WITH GOOGLE THAT PUSHED CONSTELLATION ENERGY VERY HIGH. ALSO WE HAD OTHER PLAYERS IN THE U.S. RALLY, SO THE DOMESTIC CONSENSUS THE AI BUILDOUT IS GOING TO BE A KEY GROWTH DRIVER FOR THE U.S. DOMESTIC MARKET IS CATCHING EYES AND MAYBE ATTRACTING ATTENTION AWAY FROM ASIA. WHILE THERE WERE PLENTY OF TECH STOCKS IN THE U.S. THAT WERE STRONG, OF COURSE THE HYPER-SCALERS HAD STRONG GUIDANCE AND WE ALSO HAD UNHELPFUL NEWS FROM THE U.S. STOCK SPACE. MICRON WILL IMPACT KOREA AND HAS BEEN DOWN FOR THREE DAYS STRAIGHT. AND INTEL WILL AFFECT THE TAIWAN STORY. WE SAW DSM SEE AND HYNEK'S ALSO PULL OFF. HUNTING'S ADR WILL BE PIVOTAL PRICING DECISION IN THE COMING DAYS. HAIDI: IN TERMS OF SOME OF THE DRIVERS ACROSS ENERGY, IS THAT WHERE THE SHIFT IN INTEREST IS STARTING TO GO IN THE U.S.? I'M WONDERING IF THERE'S ANY TAKEAWAYS FOR ASIA? ANTHONY: THE FOCUS ON NUCLEAR IS POTENTIALLY EXCITING FOR KOREA AND JAPAN, COUNTRIES THAT HAVE A LOT OF ENGINEERING EXPERTISE IN THAT SPACE. THESE ARE TWO COUNTRIES THAT HAVE PUT THEIR WEIGHT BEHIND THE TECHNOLOGY. ALSO INDIA AND CHINA HAS A NEW -- AN AGGRESSIVE NUCLEAR BUILDOUT TARGET. SO IT'S COALESCING IS ONE OF THE WAYS TO POWER THE AI BUILDOUT. THE ENERGY MIX AT A TIME OF INCREDIBLE STRESS IN THE BOND MARKET IS MOVING TO SOMETHING DEFINITELY THAT PEOPLE ARE WATCHING. THERE'S A LOT OF INTEREST IN THE NEW U.S. AROUND IT -- IN THE U.S. ABOUT MAKING NUCLEAR EASIER TO BUILD. HAIDI: LET'S TALK ABOUT THE PARTICULAR HYNIX ISSUE. IS THAT GOING TO BE HEADING FOR KOREA? ANTHONY: THE HYNUIX ADR IS TRADING AT A 20% PREMIUM TO THE LOCAL. GIVEN THAT ADR HASN'T MOVED ALL THAT MUCH. YOU WILL GET SOME KIND OF BLOCK OR POTENTIALLY NOTHING AT ALL. BUT THE SPECULATION IS THAT THERE WILL BE AN UNWINDING EVENT AND THE HEDGING AND PRE-EXISTING FOR THAT EVENT BECAUSE A LOT OF NEWS IN THE U.S. AND COULD'VE CONTRIBUTED TO THE MICRON DROP. AND KOREAN FUTURES ARE STANDING UP COMING INTO TODAY. HAIDI: OUR MARKETS REPORTER ANTHONY STEPHENS. DESPITE THAT RECORD HIGH FOR THE S&P 500 WE COULD SEE A FEW -- FEWER INCENTIVES FOR HIGHER TRADE IN ASIA. COMING UP NEXT, LOOKING AT APPLE, MAKING A BIGGER PUSH INTO SMART HOMES WITH NEW LG DEVELOPED DEVICES. WHETHER DOORBELLS CAN DEEPEN THE ECOSYSTEM BEYOND THE IPHONE. PLUS THE FORMER CANADIAN TRADE MINISTER JOINS US TO DISCUSS NAVIGATING AN INCREASINGLY THAT COMMITTED -- FRAGMENTED BUBBLE ECONOMY. MUCH MORE AHEAD. THIS IS BLOOMBERG. >> YOU CAN'T BORROW AND SPEND ENDLESSLY. IS BEEN GOING ON FOR A LONG TIME. THE BUILDUP OF DEBT AROUND THE WORLD. AMERICA HAS GONE FROM 50 PERCENT OF GDP TO 100%. COUNTRIES AROUND THE WORLD ARE BORROWING MONEY. THERE WILL BE A POINT WHERE THE MARKET WILL ASK FOR MORE AND MORE AND MORE. HAIDI: JAMIE DIMON SPEAKING EXCLUSIVELY WITH BLOOMBERG. TAKE A LOOK AT THE BOND YIELDS STORY AS WE CONTINUE TO SEE THAT RESURGENCE IN OIL PRICES FEEDING THROUGH TO POTENTIALLY HARDER GLOBAL INFLATION, FEEDING ROOF TO HIGHER RATES FOR LONGER AS WELL. WE LOOK ACROSS OUR SEALS, KIWI BONDS ARE STILL IN FOCUS AS WELL. AND SOME INTERNAL RECENT RBA DOCUMENTS TALKING ABOUT THE POTENTIAL AI STOCKS SLUMP THAT COULD BE SOMETHING ELSE WE SEE WEIGHING ACROSS OUR STRIKING ASSETS IN PARTICULAR BONDS. JOINING US IS THE CHIEF INVESTMENT STRATEGIST FOR FIXED INCOME, GOOD TO HAVE YOU IN TOWN WITH US. WISH WE HAD A BETTER DAY FOR YOU HERE IN SYDNEY. TALK TO US ABOUT THE OPPORTUNITIES YOU SEEING AT THE MOMENT ACROSS BOND MARKETS. FOR SOME PEOPLE THIS COULD BE THE BEST CHANCE IN DECADES. >> YIELDS ARE CERTAINLY ELEVATED. FROM A VALUE PERSPECTIVE IT IS A GREAT CHANCE. YIELDS ARE HIGH, REAL YIELDS ARE HIGH, MOST IMPORTANTLY. MEANING THE BIT YOU GET AFTER INFLATION IS PRETTY GENEROUS, 500 BASIS POINTS ABOVE INFLATIONARY RATES ARE FIXED INCOME IS SORT OF THE VALUE TRADE, IF YOU WILL. WE LOOK AT BONDS, IT'S MORE AN OPPORTUNITY FOR BOND INVESTORS. IS A GREAT TIME TO BE A LENDER. I THINK THAT'S VERY MUCH TRUE BECAUSE YOU JUST HEARD JAMIE DIMON TALKING ABOUT U.S. GOVERNMENT, WE CAN TALK ABOUT GOVERNMENTS ALL AROUND THE WORLD, WE CAN TALK ABOUT CORPORATIONS, BUT THE DEMAND FOR BORROWED FUNDS IS VERY HIGH. WHICH IS FINE YIELDS OR WHY -- ARE HIGH. AS A LENDER, WE CAN PICK OUR SPOTS. WE CAN FIGURE WHERE WE NEED TO BE AND WANT TO BE AND WHERE THE BEST VALUE IS AND SET UP THOSE COUPONS TO REALLY ALLOW YOUR PORTFOLIO TO COMPOUND AT A VERY GENEROUS RATE OVER THE NEXT 5, 10, OR EVEN LONGER IN TERMS OF YEARS. HAIDI: WE ARE AT A TIME WHEN WE ARE SEEING NVIDIA NEAR THE $6 TRILLION MARKET CAP. THERE'S A LOT OF CIRCULAR FINANCING AND FUNDING MECHANISMS GOING ON WITH A LOT OF EXUBERANCE. HOW IS THE AI TRADE, WHAT'S GOING ON BROADER EQUITIES AS WELL AS THE PRIVATE MARKETS IMPACTING POTENTIALLY AND DISLOCATING THE COST OF FINANCING? >> THE UPRISING, THE SURGEON BORROWING DEMAND FOR THE BUILDOUT OF AI IS US IF WE HAVE MINTED A NEW TOP 10 GOVERNMENT IN THE WORLD. GIVEN THE MAGNITUDE, THE ORDER OF MAGNITUDE THAT THE BORROWING HAS REQUIRED, THE FINANCING REQUIRED TO BUILD OUT THE INFRASTRUCTURE. SO WE HAVE ANOTHER COMPETITIVE BORROWER IN THE SYSTEM WHICH DOES PUT PRESSURE ON OTHERS. BUT IT IS DONE MOST RECENTLY IS EFFECTIVELY SETS THE BORROWING RATE FOR NONGOVERNMENT BORROWERS. SO I HAVE A CHOICE, I COULD LEND TO ONE OF THE HYPER-SCALERS AT SIX PLUS PERCENT OR I COULD LEND TO THE GOVERNMENT AT 5.38, OR I COULD LEND TO A HIGH-QUALITY CORPORATE AT 5.5%. THESE ARE ALL IN U.S. DOLLAR TERMS BUT IT HAS SET THE BAR, IF YOU WILL. THEY ARE WILLING TO BORROW AT A CERTAIN RATE AND THAT DOES START TO CROWD OUT OTHERS. WE ARE IN AN ENVIRONMENT WHERE THAT COMPETITIVE BORROWING IS REAL AND IT IS GETTING BIGGER, NOT SMALLER. A GOOD TIME TO BE A LENDER, NOT THE BEST TIME TO BE A BORROWER. IT'S FUN COMPANIES LIKE SOFTBANK HAD TO BORROW AT 9.5% LAST WEEK. HUGE BORROWING COSTS FOR A COMPANY THAT IS PRETTY GOOD FROM A CREDIT QUALITY STANDPOINT BUT A LOT OF THIS SIMPLY HAS TO DO WITH THE DEMAND FOR FUNDING. HAIDI: THAT SURELY ONLY GOING TO WORSEN IS YOU SEE MORE TIGHTENING FROM CENTRAL GLOBAL BANKS. >> IT CERTAINLY PUTS UPWARD PRESSURE ON YIELDS. AS A BOND INVESTOR, THERE ARE CERTAIN THINGS WE WOULD LOOK FOR THAT ARE BOND FRIENDLY. PROACTIVE CENTRAL BANK HELPS TREMENDOUSLY. KIND OF HELPING TO TRYING CONTAIN INFLATION AS WE MOVE THROUGH TIME. THERE'S ALWAYS THE BET WILL THEY GET THERE FAST ENOUGH, ARE THEY ABLE TO DO IT? THE REALITY IS WHEN THE CENTRAL BANKS RAISE RATES, IN THE NEAR TERM IT PUSHES UP YIELDS BUT OVER SLIGHTLY LONGER TIME. -- TIME PERIOD, THEY ARE TIGHTENING UP CREDIT CONDITIONS WHICH WILL HELP CONTAIN INFLATION AND POSSIBLY SLOW GROWTH. IT'S GOOD FOR BONDHOLDERS, NOT GREAT FOR EQUITYHOLDERS OR OTHER PARTS OF THE MARKET BUT WITH A SELFISH STANDPOINT IS GOOD FOR BOND INVESTORS. ALSO HIGHER YIELDS HAS A SIMILAR EFFECT. THE COMBINATION OF HIGHER FRONT END YIELDS, HIGHER LONGER IN HEELS, FLATTER YIELD CURVE, ALL THAT TIGHTENS THINGS UP A BIT. IN THE NEAR TERM, NOT GREAT. IF I LOOK OUT OVER TWO OR THREE YEARS, THE LACK EFFECT OF THOSE TIGHTER FINANCING CONDITIONS BECOMES VERY BOND POSITIVE. IN OUR PORTFOLIOS RIGHT NOW WE ARE ADDING DURATION, GLOBAL DURATION. DIFFERENT MARKETS AROUND THE WORLD LOOK ATTRACTIVE. VERY PROACTIVE CENTRAL BANKS, ELEVATED COST OF FINANCING. TODAY IS NOT CONSTRAINING MUCH BUT WE THINK IT WILL GOING FORWARD. THE EXTRA DURATION YOU HAVE IN YOUR PORTFOLIO CAN WORK NICELY FOR YOU OVER THE COMING MONTHS AND YEARS. >> ARE AUSSIE BONDS COMPELLING FOR YOU? >> TWO THINGS, ONE, AUSTRALIA, IS FISCAL POSITION IS STRONGER THAN COUNTRIES LIKE THE U.S., LOWER DEBT TO GDP, BETTER FINANCING, BETTER CURRENT FISCAL CONDITIONS, AND THE RBA HAS BEEN MORE PROACTIVE AND HAS BEEN RAISING RATES THIS YEAR RATHER THAN JUST STARTING TO RAISE RATES. BOND YIELDS HAVE GONE UP IN AUSTRALIA BUT AT A MUCH SLOWER PACE VERSUS THE U.S. AND EVEN VERSUS EUROPE AND IN SOME SPOTS ALONG THE JAPANESE YIELD CURVE AS WELL. AUSTRALIA, BONDHOLDERS PERSPECTIVE ACTUALLY LOOKS VERY ATTRACTIVE. THE FUNDAMENTALS LOOK GOOD. THE VALUE IS STARTING TO GET A LITTLE RICH RELATIVE TO OTHERS BECAUSE OF THE OUTPERFORMANCE. BUT IF WE JUST FOCUS ALMOST FUNDAMENTALS, IT'S STILL A GOOD STORY. HAIDI: THE 10 YEAR JGB AUCTION WAS PROBABLY A SIGH OF RELIEF ACROSS THE MARKETS. HOW WORRIED ABOUT FRANCE ARGUE? >> I WOULD SAY WE ARE CONCERNED. THERE'S A COUPLE OF FACTORS, WITH HEAVILY INDEBTED COUNTRIES, WHAT IS THE CATALYST FOR IMPROVEMENT? CAN THEY CONSTRAIN SPENDING? WE'VE SEEN IT IN BRAZIL MOST RECENTLY. CAN SEE THAT IN FRANCE. WITH THE UPCOMING ELECTION, WHAT ARE THE POLICIES THAT WILL BE PROPOSED AND IS THERE A WILLINGNESS TO IMPLEMENT A SLOWER TRAJECTORY OF GROWTH? WHETHER IT'S THE U.S., FRANCE, OR OTHER HEAVILY INDEBTED COUNTRIES, THE ABILITY TO PROJECT A SLOWDOWN, EVEN JUST A MODEST SLOWDOWN IN SPENDING WOULD BE VERY WELL REWARDED BY BOND MARKETS. THE COUNTRY OF FRANCE HAS THE CAPACITY TODAY, THAT'S ON THE QUESTION. IT'S REALLY THE TRAJECTORY OF SPENDING, THE CONSTRAINTS THEY NEED TO ABIDE BY TO BE PART OF THE EUROPEAN UNION, AND KIND OF HOW MUCH IS THE POPULATION WILLING TO FINANCE THAT, INTEREST COSTS GET PRETTY EXPENSIVE AS YOU MOVE THROUGH TIME. THERE SOME OPPORTUNITIES THERE AS WE SEE THE TWO YEAR YIELD GO UP. WE'VE TAKEN SOME TACTICAL OPPORTUNITIES, A LITTLE FURTHER OUT THE CURVE WE'VE BEEN A LITTLE BIT MORE CAUTIOUS BECAUSE THIS IS NOT RUN ITS COURSE YET. SO THERE STILL A LOT OF TECHNICAL PRESSURE. BUT SLOWER SPINNING AND MORE CONSTRAINED BUDGETS WOULD BE A STRONG POSITIVE FOR BOND INVESTORS. HAIDI: GREAT TO HAVE YOU WITH THIS, WE APPRECIATE YOUR TIME. LATER TODAY INSIGHTS WITH HASLINDA AMIN WILL DISCUSS THE GLOBAL GROWTH IN TRADE TENSIONS. MORE AHEAD HERE ON "THE ASIA TRADE." THIS IS BLOOMBERG. SHERY: JAMIE DIMON SAYS CYBERSECURITY REMAINS THE BIGGEST CONCERN AS ARTIFICIAL INTELLIGENCE CREATES NEW RISKS AND VULNERABILITIES. SPEAKING EXCLUSIVELY BLOOMBERG, HE ALSO WEIGHED IN ON THE GROWING TENSIONS SURROUNDING DATA CENTER EXPANSION. >> HALF THE NEW ONES ARE IN TEXAS AND VIRGINIA AND YOU'RE NOT GOING TO WIN. A LOT OF STATES HAVE ACCESS TO POWER AND ANY BIG COMPANY HAS TO BE A GOOD COMMUNITY CITIZEN. THEY ARE HELPING THE COMMUNITY GET THE RIGHTS, IT'S JUST THINGS LIKE THAT. AND I HAS HUGE POSITIVE EFFECTS. I THINK IT WILL CURE A LOT OF DISEASES AND MAKE LIFE UNBELIEVABLE FOR PEOPLE. THE DOWNSIDE IS OBVIOUSLY WHEN YOU READ ABOUT MYTHOS AND ALL THESE THINGS, IT'S A LEGITIMATE CONCERN. I'M NOT GETTING HYSTERICAL OVER IS IT EXISTENTIAL OR NOT. THE BANKS HAVE ALWAYS HAD A SYSTEM IN PLACE WHERE WE HELP EACH OTHER. STARTING WITH 50 COMPANIES, IT STARTED IN THE U.S., IT'S ACROSS SIX INDUSTRIES. TECH, FINANCIAL SERVICES, WATER, TRANSPORT. EVENTUALLY IT SHOULD EXTEND TO HEALTH CARE, PHARMA, AGRICULTURAL, EVERY INDUSTRY IS CRITICAL AND WE NEED TO HELP THE SMALLER COMPANIES TOO. YOU HAVE VENDORS WITH DIFFERENT NEEDS. THERE'S A LOT OF WORK AND WE SIMPLY HAVE TO DO IT. AI CREATED VULNERABILITIES THAT WE DIDN'T KNOW ABOUT. >> AND YOU HAVE THOUGHT ABOUT CYBER RISKS FOR A LONG TIME. THIS AI MAKE CYBER SYSTEMIC RISKS MORE LIKELY? >> YES. THAT'S WHAT I'M SAYING. WITH THOSE, WHATEVER YOU THOUGHT IT WAS BEFORE, I WOULD SAY WENT UP TENFOLD AFTER MYTHOS. SHERY: JAMIE DIMON WITH BLOOMBERG'S, THE FORMER CANADIAN TRADE MINISTER JOINS US FROM THE MILKEN ASIA SUMMIT, HELPING BUSINESSES NAVIGATE GEOPOLITICAL CHALLENGES. THIS IS BLOOMBERG. SHERY: WE HAVE BREAKING NEWS HERE IN JAPAN. READ GETTING THE WAGE DATA, GROWTH OF 3.8% FOR THE MONTH OF AUGUST COMING IN ABOVE ECONOMISTS EXPECTATIONS. BUT STILL A SLOWDOWN FROM THE PREVIOUS MONTH. A LOT TO DO PERHAPS WITH THE BASE COMING FROM THE MONTH OF JULY, WE HAD ALLOWED HER SUMMER BONUS IS TO NORMALIZE. REAL CASH EARNINGS COMING IN AT 1.5% GROWTH, SLOWDOWN FROM THE PREVIOUS MONTH. STILL IN LINE WITH EXPECTATIONS. RIGHT NOW WE ARE STILL SEEING IF YOU STRIP OUT THE BONUSES AND THOSE VARIABLES YOU CAN ACTUALLY SEE THE WAGE TREND IS STILL STAYING PRETTY STRONG. BLOOMBERG ECONOMICS SAYS THIS IS KEEPING THE BOJ ON TRACK FOR DECEMBER RATE HIKES. IS THAT BOJ RISK? WHAT IS? AFFECTING THE BOND SPACE WE'VE SEEN MULTIYEAR HIGHS FOR JGB YIELDS AND THAT YIELD AT THE 10 YEAR PAST RE-PERCENT NOW ATTRACTING BUYERS. SO WE HAD A SOLID 10 YEAR OPTION JUST YESTERDAY HAIDI:. THAT PROVIDE SOME RELIEF IN TERMS OF SENTIMENT. TAKE A LOOK AT OVERSEEING, SENTIMENT WHEN IT COMES TO EQUITIES IN JAPAN. IT MIGHT BE ONE OF THE MARKETS ACROSS ASIA THAT DOES GET THAT NICE FOLLOW-THROUGH FROM THE U.S. SESSION WHERE WE SAW THE FIRST RECORD HIGH FOR THE S&P 500 SINCE AUGUST. INVESTORS WILL BE LOOKING AT THE TOPIX AS WELL, THAT HIGH ALSO BEING HIT AS WELL FROM THE HIGHS WE SAW FOR JAPANESE EQUITIES THAT CAN AUGUST AS WELL. PRETTY GOOD POSITIONING WHEN IT COMES TO TRADERS ARE AT THE MOMENT. WE COULD SEE SOME MOMENTUM PLACE COMING ON BOARD ONCE WE GET THE RANGE FOR THAT MARKET. IN THE MEANTIME WE HAVE AUSTRIA TRADING ABOUT POINTING PERCENT HIGHER OF THE LAST 30 MINUTES. S&P FUTURES -- ABOUT .10% THE MILKEN INSTITUTE ASIA SUMMIT IS GETTING UNDERWAY IN SINGAPORE WITH BUSINESS LEADERS, POLICYMAKERS AND INVESTORS GATHERING TO TALK ABOUT THE GLOBAL ECONOMIC OUTLOOK AND THE IMPACT OF AI. AVRIL HONG IS STANDING BY WITH OUR NEXT GUEST. AVRIL: THAT'S RIGHT, GEOPOLITICS CONTINUES TO DOMINATE CONVERSATION BUT COUNTRIES HAVE BEEN DIVERSIFYING. THE SENIOR FELLOW AT THE MILKEN INSTITUTE JOINS ME. SHE PREVIOUSLY SERVED AS THE CANADIAN INDUSTRY OF INTERNATIONAL TRADE. GREAT TO HAVE YOU WITH US. >> IS TERRIFIC TO BE HERE AT THE MILKEN ASIA SUMMIT AND TALK TO BLOOMBERG OF COURSE. AVRIL: WE'VE SEEN TIT-FOR-TAT TARIFFS, THE U.S. MOVING IN WITH THE IMPORT BANS AS WELL. HOW ARE YOU VIEWING THE CANADIAN TRADE RELATIONSHIP WITH THE U.S. RIGHT NOW? >> IT'S NOT WHERE IT SHOULD BE, CONSIDERING IT IS A RELATIONSHIP THAT HAS STOOD WELL FOR MANY DECADES WITH A VERY INTEGRATED ECONOMY. I DO THINK CANADA AND THE U.S. WILL HAVE TO FIND THEIR WAY BACK TO THE TABLE AND FIND THE RIGHT CONDITIONS TO DO THAT. I KNOW SPEAKING AS A CANADIAN, THINK IT'S REALLY IMPORTANT THAT YOU ALWAYS HAVE A DEAL THAT IS A REALLY GOOD DEAL FOR THE PEOPLE AND FOR THE INDUSTRIES OF CANADA AND I KNOW THE PRIME MINISTER AND HIS TEAM ARE HARD AT WORK AT THAT. CANADIANS EXPECT OUT OF HIM. AT THE SAME TIME THE U.S. IS CANADA'S LARGEST TRADING PARTNER. IT IS A NEIGHBOR AND ALLY. I DO THINK THAT WORK HAS TO CONTINUE AND THEY WILL FIND THE CONDITIONS TO GET BACK TO THE TABLE. HAIDI: WHAT WOULD A GOOD TRADE DEAL -- AVRIL: WHAT WOULD GOOD TRADE DEAL FOR CANADA LOOK LIKE? MARY: I ALWAYS SAY TO THE AMERICANS, THE BIGGEST CUSTOMER FOR YOU, OVER 30 STATES COUNT CANADA AS THEIR TOP CUSTOMER. THEREFORE NOT BEING ABLE TO WORK SOMETHING OUT DOES NOT JUST AFFECT CANADA, IT ACTUALLY AFFECTS THE 90 SITES AND THEIR WORKERS AND INDUSTRIES AS WELL. BUT CANADA CAN HAVE A TRADE DEAL THAT IS GOING TO SEE HIGH TARIFFS ON ITS SECTORS, SO I THINK THEY WILL HAVE TO FIND SOME COMMON GROUND. BUT THOSE CONDITIONS WILL NEED TO BE THERE, FOR CANADIANS BEFORE THEY GET BACK TO THE TABLE. AVRIL: THE CANADIAN ADMINISTRATION SEEMS TO -- SEEMS TO BE QUITE DETERMINED TO SEND A MESSAGE TO THE U.S. EVEN IF IT COMES TO AN ECONOMIC COST. WHAT WILL IT TAKE THEM TO RETURN TO THE NEGOTIATING TABLE? MARY: I THINK THEY WILL BOTH HAVE TO FIND COMMON GROUND ON A NUMBER OF ISSUES, PARTICULARLY AROUND THE TARIFFS. CANADA CERTAINLY IS GOING TO WANT TO ENSURE THAT ITS SOVEREIGNTY IS PROTECTED AND THOSE ARE JUST SOME OF THE ISSUES THEY WILL HAVE TO FIND SOME COMMON GROUND BEFORE THEY GET TO THE TABLE. AVRIL: CANADA HAS BEEN DIVERSIFYING IN TERMS OF TRADE TO ASIA ESPECIALLY. HOW MUCH QUICKER YOU THINK WE CAN SEE KEY SECTORS LIKE CRITICAL MINERALS? MARY: CANADA HAS ACCESS TO THIS PART OF ASIA THROUGH THE CPTPP. THE LAST AGREEMENTS I CONCLUDE AS TRADE MINISTER WITH'S -- WAS WITH INDONESIA. THEY ARE WELL ON THEIR WAY WITH NEGOTIATIONS TO THE PHILIPPINES AND THEASEAN AS A WHOLE. CANADA HAS ACCESS TO 1.5 BILLION CUSTOMERS. PRIME MINISTER CARNEY SEES INCREASE TO 3 BILLION. THERE ARE NEGOTIATIONS UNDERWAY WITH INDIA. AND WAS SOUTH AMERICAN COUNTRIES. THERE IS A LOT OF THAT WORK THAT IS TAKING PLACE BUT LAST WEEK THE GOVERNMENT ANNOUNCED A NEW LNG PROJECT THAT IS REALLY IMPORTANT BECAUSE THAT IS ANOTHER MODALITY TO GET CANADIAN ENERGY INTO THE ASIAN MARKET WHICH OUR ASIAN COLLEAGUES AND ALLIES ARE LOOKING FOR, WHETHER IT'S JAPAN OR KOREA OR SOUTHEAST ASIA, OR HERE IN SINGAPORE OR MALAYSIA. THAT WORK IS ACCELERATING SO I THINK THERE IS THE AMBITION, THE INVESTMENTS ARE KEEN ON CANADA AND THERE IS A REAL WILL TO DO THAT. WE HAVE MARKETS AND WE HAVE SOMETHING TO SELL. I FEEL LIKE WE ARE VERY MUCH ON THE SAME PAGE AND CANADA ALONG WITH ITS CUSTOMERS HERE IN ASIA. AVRIL: WHAT DOES IT MEAN IN TERMS OF EXPORT GROWTH, PARTICULAR FOR ENERGY AS WELL AS CRITICAL MINERALS? MARY: IT BODES WELL FOR EXPORT GROWTH. IT MEANS DIVERSIFYING IN THE MARKET AND HAVING A MARKET LIKE THAT HERE IN ASIA THAT IS SIGNIFICANT AND LARGE. INCREASES THE VOLUME OF OUR ENERGY PRODUCTS COMING TO THIS PART OF THE WORLD AT PRICES THAT THE CUSTOMER IS WILLING TO PAY AND THAT'S GOOD FOR THE CANADIAN ECONOMY. IN ADDITION TO ENERGY OR INFRASTRUCTURE AND AGRICULTURE, CANADA IS A LEADER IN TECHNOLOGY, IN AI, AND I KNOW I AM SEEING MIDMARKET COMPANIES REALLY ACCELERATING THEIR AMBITIONS TO GROW IN THIS MARKET. AVRIL: WHAT ABOUT TRADE WITH CHINA? WE BEEN SEEING A PRAGMATIC RESET. HOW FAR DO YOU THINK CANADA IS WILLING TO GO? MARY: HE HAS BEEN ENCOURAGING TO SEE THAT THE TWO COUNTRIES ARE HAVING A RELATIONSHIP WHERE THEY ARE FINDING SORT OF ALIGNMENT. IT CERTAINLY IS NOT GOOD -- GOOD FOR CANADA'S AGRICULTURE SECTOR TO TAKE ON TARIFFS OR ACTIONS OF ANY SORT. CHINA IS AN IMPORTANT MARKET, SO IT'S GOOD THAT THE TWO COUNTRIES ARE LOOKING AT EACH OTHER AND WORKING TO FIND THOSE AREAS WHERE THERE IS ALIGNMENT TO BE ABLE TO DO THINGS THAT ARE GOOD FOR BOTH ECONOMIES. AVRIL: WE'VE SEEN RECENTLY THE CANADA INVESTMENT SUMMIT DRAWING A LOT OF ATTENTION. WHAT ARE YOU SEEING IN TERMS OF THE INCREASE IN CAPITAL THAT HAS BEEN COMMITTED TO THE COUNTRY? MARY: WE DID THAT MILK AND CANADA LAUNCH IN CANADA ALONGSIDE THE PRIME MINISTER'S INVESTMENT SUMMIT, IT WAS REALLY ENCOURAGING TO SEE THE LEVEL OF INTEREST OF GLOBAL INVESTORS COMING TO CANADA. THE PRIME MINISTER INDICATED HE WANTED TO ATTRACT TRUE AND DOLLARS WORTH OF CAPITAL. IT HAS COMMITTED 500 BILLION AS PART OF THE SUMMIT, THE GOVERNMENT OF CANADA PUT OUT A PERSPECTIVE WHICH IS AN INVESTMENT DEAL BOOK. WE HAVE PUT ON THE TABLE ARRANGE OF INVESTMENTS FROM ENERGY TO TRANSPORTATION TO INFRASTRUCTURE TO TECHNOLOGY THAT HAS VERY INVESTABLE PROJECTS IN CANADA. THE GOVERNMENT OF CANADA ALSTOM -- ALSO STANDS BEHIND IT. I'M SEEING A LOT OF MOMENTUM AND OF SEEING IT THROUGH MILK ON -- MILKEN AND THE INVESTMENT SUMMIT. BEING IN CANADA AND ALSO ASIA, IN THE MIDDLE EAST AND MEXICO AND SO FORTH ALLOWS US TO DO SOME OF THAT, FOR ME AS A SENIOR FELLOW IT'S WONDERFUL BECAUSE I GET TO DO SOME OF THAT FOLLOW-UP FROM CANADA RIGHT HERE INTO ASIA AND THEN BEYOND. AVRIL: IT'S PROMISING, BUT WHAT ARE YOU HEARING IN TERMS OF POTENTIAL INVESTOR SLIGHTLY HOLDING THEM BACK? SOME TALK ABOUT HOW CANADA NEEDS TO MAKE THINGS A BIT MORE ATTRACTIVE IN TERMS OF MORE COMPETITIVE TAX POLICIES, FOR EXAMPLE. MARY: THE PROMINENCE ARE HAS JUST ON THAT AS WELL ON THE MARGINS OF THE SUMMIT. HE HAS CREATED THE RIGHT CONDITIONS. WHAT THEY HAVE DONE, WHETHER IT'S THE PROVINCES AND THE FEDERAL GOVERNMENT WORKING TOGETHER TO REMOVE SOME OF THE BARRIERS THAT MIGHT EXIST, REGULATORY BARRIERS OF THESE PROJECTS CAN GET DONE AT A SPEED THAT INVESTORS ARE LOOKING AT. THAT IS TERRIFIC AND YOU ARE SEEING THAT HAPPEN IN CANADA AS WELL. I THINK THERE'S A LOT OF MOMENTUM THAT IS CREATED AND A LOT OF INVESTORS HAVE SAID WE WANT TO INVEST IN CANADA, BUT WHAT DO WE INVEST IN? REMEMBER, CANADA IS A PREDICTABLE, RULES-BASED COMPANY AND BUBBLE INVESTORS ARE LOOKING FOR ONE THING, PREDICTABILITY, RULE OF LAW, ANY JURISDICTION LIKE CANADA THAT CAN MEET THOSE NEEDS. SO I'M EXCITED. AVRIL: SEARCHING FOR RELIABLE PARTNERS. GREAT TO CHAT WITH YOU, THANK YOU SO MUCH FOR THE TIME. THE FORMER CANADIAN MINISTER OF INTERNATIONAL TRADE. HAIDI: AVRIL HONG THERE IN SINGAPORE. WE HAVE MORE HEAD THE MILKEN ASIA SUMMIT. NEXT, HOW THE GLOBAL MARKET TURMOIL IS AFFECTING REAL ESTATE MARKETS. LET'S GET YOU CAUGHT UP WITH TOP GLOBAL HEADLINES WERE FOLLOWING. PRESIDENT TRUMP SAYS HE WILL SPEAK SOON WITH THE RUSSIAN PRESIDENT VLADIMIR PUTIN TO DISCUSS A SUSPECTED CASE OF PLAGUE. INTERNATIONAL CONCERNS ARE GROWING OVER THE DEATH OF A WORKER AT AN INFECTIOUS DISEASES CENTER WHO DIED AFTER DEVELOPING SEVERE PNEUMONIA WITH ALMOST 200 CONTACTS REPORTEDLY PLACED UNDER OBSERVATION. GLEASON NEW DELHI ATTAINED -- POLICE DETAINED IT -- A LEADER DURING A PROTEST. OPPOSITION GROUPS ON HIM TO RESIGN AFTER MORE THAN 130 MILLION NAMES WERE REMOVED FROM ELECTORAL ROLES. IT'S A LATEST CHALLENGE FOR NARENDRA MODI'S GOVERNMENT AFTER STUDENTS REPORTS THE -- FORCE THE EDUCATION MINISTER TO RESIGN IN JULY. MORE AHEAD HERE ON "THE ASIA TRADE." THIS IS BLOOMBERG. SHERY: BLOOMBERG HAS LEARNED THAT APPLE'S UPCOMING PUSH INTO SMART HOME DEVICES WILL INCLUDE A DOORBELL THERMOSTAT AND OTHER ACCESSORIES DEVELOP FROM A NEUTRAL PARTNERSHIP WITH SOUTH KOREA'S LG ELECTRONICS. LET'S GET THE DETAILS OF THEIR SENIOR TECH EDITOR NICK TURNER PRIVATE HOW UNUSUAL IS SUCH A PARTNERSHIP FOR APPLE TO DO IT WITH THE SECOND PARTY LIKE LG AND WHAT IS IT TELL US ABOUT FUTURE STRATEGY AS WELL? NICK: WHEN THEY DO WITH THE CALL A SECOND PARTY DEAL, IS SIMILAR TO WHAT THEY'VE DONE WITH BELKIN BEFORE AND SOME OTHER COMPANIES. BUT IT'S FAIRLY RARE FOR THEM. IT'S A LITTLE CLOSER THAN A THIRD PARTY DEAL PERSIMMON IS JUST SELLING APPLE ACCESSORIES, THAT WORK WITH APPLE OBVIOUSLY BUT THEY ARE NOT CLOSELY LINKED TO THE COMPANY. IN THIS CASE THEY REALLY WORKED WITH LG TO DEVELOP THESE PRODUCTS. THEY WILL HAVE THE LG NAME ON THE PRODUCTS BUT THEY ARE SORT OF IN THE BACKGROUND. APPLE HAD A BIGGER HAND IN DEVELOPING THEM. SHERY: OF COURSE WE HAVE MORE ESTABLISHED HOME DEVICE PLAYERS LIKE RING AND NAST. HOW WILL THESE DEVICES FIT IN THERE AND HOW COMPETITIVE THEY BE? NICK:NICK: THAT'S THE BIG QUESTION, FOR APPLE TO PUSH INTO THE SMART HOME IS KIND OF A BIG BET FOR THEM. THEY'VE OBVIOUSLY HAD SOME PRODUCTS IN THIS AREA BEFORE. THEY HAD THE APPLE TV SET TOP BOX, THEY HAVE THE HOME POD WHICH IS SIMILAR TO SOME OF AMAZON'S ALEXA-BASED AND GOOGLE DEVICES. BUT THEY HAVEN'T HAD A BREAKTHROUGH IN THIS MARKET AND IF THEY REALLY WANT TO MAKE A NAME FOR THEMSELVES HERE, THEY WILL HAVE TO HAVE AN ECOSYSTEM OF DEVICES AND MAKE PRODUCTS THAT APPLE ITSELF CELLS. IN THIS CASE SOME ARE SOLD WITH THE LG BRAND AND MAYBE SOME THAT ARE MORE OF A THIRD-PARTY ARRANGEMENT RELIGIOUS WORK WITH APPLE'S PLATFORM. WHAT YOU WILL SEE IS LATER THIS MONTH, APPLE WILL RELEASE THE CRUX OF THE WHOLE PUSH. IF THAT IS SUCCESSFUL IT WILL HELP LAY THE GROUNDWORK FOR BEING SUCCESSFUL IN THIS MARKET OVERALL. SHERY: HOW IMPORTANT IS THE SMART HOME MARKET? IS IT JUST ABOUT A HARDWARE PUSH, OR IS IT SOMETHING MORE? NICK: AS WITH EVERYTHING APPLE DOES, YOU KIND OF WANT TO SELL HARDWARE OBVIOUSLY AND I DO THINK THAT HOPE TO SELL A LOT OF THESE SMART HOME HUGS WHICH ARE BASICALLY LIKE A SQUARE SCREEN THAT YOU MIGHT HANG ON YOUR WALL OR PUT ON A DESK. THEY ESSENTIALLY WANT TO SELL MULTIPLE OF THESE PER HOUSEHOLD. IT COULD POTENTIALLY BE SIGNIFICANT FROM HARDWARE THERE'S ALSO THE SERVICES THAT SURROUND IT. THIS KIND OF VIRTUOUS CYCLE IN THE APPLE ECOSYSTEM, MAYBE YOU'RE MORE LIKELY TO BUY OTHER PRODUCTS LIKE AN IPHONE OR WHATEVER BECAUSE YOU HAVE APPLE DEVICES IN YOUR HOME. I THINK THAT IS ALWAYS IN THE BACK OF THEIR MIND. BUT CERTAINLY GETTING APPLE PRODUCTS IN PLACES THAT CURRENTLY AMAZON OR GOOGLE PRODUCTS OR RESIDING IS A BIG PART OF IT. SHERY: NICK TURNER THERE, AS WERE SEEING LG ELECTRONICS STOCK THIS WEEK SEE A LOT OF UPSIDE. TICKLING IT -- TAKING A LOOK AT KOSPI FUTURE, LOSING ABOUT 1%. WE HAD SEEN A CATCH UP AFTER COMING BACK FROM THE HOLIDAYS. RIGHT NOW WE ARE GIVING UP SOME OF THOSE GAINS AT THE MOMENT. WE WILL BE WATCHING SK HYNIX, DOWNSIDE OF MORE THAN 6% IN THE OVERNIGHT SESSION, A LOT TO DO WITH SAMSUNG AND SK HYNIX, BOTH HAVE LAGGED THE U.S. TECH REBOUND WE'VE SEEN THE PAST FEW WEEKS. WE WILL HAVE MORE CATALYSTS THIS WEEK. SAMSUNG EXPECTED TO REPORT'S LARGEST EVER COURTLY PROFIT ON THURSDAY. LOT NUMBERS ALONE MAY NOT BE ENOUGH TO REASSURE INVESTORS ABOUT HIS LONG-TERM OUTLOOK. OUR ASIA STOCKS REPORTER JOINS US NOW. IF WRECKING BREAKING -- RECORD-BREAKING NUMBERS DON'T DO IT FOR INVESTORS ANYMORE, WHAT WILL THEY BE WATCHING IN THESE PRELIMINARY NUMBERS? >> TOMORROW INVESTORS ARE EXPECTING RECORD HIGH PROFITS FOR THE THIRD QUARTER AND SAMSUNG JUST GIVE TWO FIGURES. THIRD QUARTER PROFITING -- PROFIT ESTIMATE AND THIRD-QUARTER REVENUE. MUCH OF IT IS INFECTED BE FROM THE CHIP DIVISION. WE WON'T HAVE THE ORIGINAL BREAKDOWN TOMORROW BUT WHAT INVESTORS ARE LOOKING FOR IS IF THEY WILL HAVE STAYING POWER CARRYING INTO NEXT YEAR. LAST WEEK WE SAW MICRON GIVING A BULLISH FORECAST FOR NEXT YEAR SUPPLY AND DEMAND CONDITIONS BUT THEY DID NOT MOVE THE MICRON SHARES THAT MUCH. INVESTORS ARE LOOKING FOR ANSWERS IF THE PROFIT AND WILL HAVE STAYING POWER. ONE INVESTOR I SPOKE TO DENSMORE ABOUT DURABILITY OF THE EARNINGS RATHER THAN THE MAGNITUDE OF THE EARNINGS THAT INVESTORS CARE ABOUT. INVESTORS ARE LOOKING FOR REASSURANCE THAT IT IS DURABLE. SHERY:? WHAT ABOUT VALUATION? WE CONTINUE TO HEAR THAT THESE STOCKS ARE CHEAP COMPARED TO THEIR U.S. PEERS. WHAT CAN WE EXPECT IN TERMS OF THAT. PERFORMANCE, AS YOU SAID IT HAS REMAIN PRETTY LACKLUSTER SO FAR. >> THE MEMORY CHIPMAKERS HAVE BEEN LAGGING BEHIND THE U.S. CHIP REBOUND IN RECENT QUARTERS. WITH THE BOOM AND BUST CYCLE FOR DECADES, WHETHER SUCH A EARNINGS MOMENTUM WILL CARRY INTO 2027 AND 2028. ANOTHER KEY ISSUE IS THE SAMSUNG BUYBACK, SO IT THAT'S WHETHER AN INVESTOR WILL START BUYING SAMSUNG AGAIN AFTER THIS BUYBACK WHEN IT FINISHES, THAT WILL BE A KEY TO THE FUTURE OF SHARE PERFORMANCE FOR SAMSUNG. SHERY: OUR ASIA STOCKS REPORTER THERE AHEAD OF THE SOUTH KOREA OPEN IN ABOUT 10 MINUTES. WE HAVE MORE AHEAD ON THE ASIA TRADE. STAY WITH US ON BLOOMBERG. ♪ HAIDI: THE RESERVE BANK OF AUSTRALIA'S MORNING THAT A CORRECTION AND ABLATE SOCKS THAT INTO HOUSEHOLD SPENDING AND PROVIDE RISK TO THE BROADER ECONOMY. THIS IS A CALCULATION IN TERMS OF TRYING TO FIGURE OUT WHAT AUSSIE HOUSEHOLDS HAVE IN TERMS OF THAT EXPOSURE TO AI COMPANIES. >> THE DOCUMENT IS SORT OF AN INTERNAL ONE, BUT THE ESTIMATE 5.4% OF HOUSEHOLDS HAVE EXPOSURE TO AI SHARES AND SOCKS AND THAT SORT OF THING. 1.7% OF THAT IS ACTUAL HOUSEHOLDS AND THE OTHER THREE POINT SEVEN PERCENTAGE POINTS IS THROUGH SUPERANNUATION. BUT IT IS INTERESTING THAT THEY ARE LOOKING AT THE VOLATILITY OF THE SECTOR AND THE POTENTIAL FOR THAT TO SPILL BACK. PART OF THIS IS TIED UP WITH THE INCREASING POPULARITY ALSO OF OUR STRAIN INVESTORS TO BUY OFFSHORE. THAT SORT OF SAYING IF THERE WAS TO BE A CORRECTION IN AI THAT IT COULD CUT CONSUMPTION ON STRIKE BY .7%. COULD BE AS MUCH IS 2.4% WHICH IS A SERIOUS AMOUNT OF DEMAND BASICALLY IN THE ECONOMY. SO THAT IS AN INTERESTING ONE. HAIDI: YOU WANT TO BRING EVERYTHING BACK TO THE PROPERTY MARKET WHICH IS GOING THROUGH WHAT LOOKS LIKE AN EXTENDED DOWNTURN. THE RBA HAS ALREADY MADE REFERENCES TO WHAT THE WORLD IMPACT WOULD BE FROM THE PROPERTY MARKET AND THIS WOULD JUST EXACERBATE THAT. >> WE DO HAVE DOCUMENTS THAT MENTION THAT AS WELL. IT HAS CONTINUED INTO OCTOBER AND BLOOMBERG ECONOMICS RECKONS IT'S A BIT OVER HAVE TO ROGAN DOLLARS AUSTRALIAN FOR THE MARKET. THAT WILL WEIGH ON SPENDING AND THERE IS A $50 BILLION HEADWIND FOR CONSUMPTION INTO THE FOURTH QUARTER AND EARLY NEXT YEAR. IF YOU BRING THOSE TWO THINGS TOGETHER IS SOURCE TO BECOME MORE WORRYING. IT'S CURIOUS, THE RBA PLAY DOWN A LITTLE BIT THE IMPACT OF THE HOUSING DOWNTURN ON CONSUMPTION, COMPARED TO WHAT IT HAS DONE IN THE PAST. HAIDI: AND THERE'S PLENTY OF EXPECTATIONS THEY WILL HAVE TO GO AGAIN. >> THIS IS THE GREAT DEBATE THAT HAS BEEN GOING ON THAT THE RBA WOULD HIKE IN SEPTEMBER. I GUESS WE ARE ALL JUST WAITING TO SEE WHAT THE DATA AND INFLATION TELLS US ABOUT THAT, BUT IT IS THE POSSIBILITY. HAIDI: WE ARE COMING UP IN THE NEXT HOUR FROM SINGAPORE, GATHERING TO TAKE STOCK OF THE NEXT PHASE OF DIGITAL APPLICATIONS. THAT IS COMING UP. IN THE MEANTIME THE MARKET OPENS IN TOKYO AND SEOUL OR NEXT. THIS IS BLOOMBERG. SHERY: WE'RE COUNTING DOWN TO ASIA'S MAJOR MARKET OPENS. CHINA STILL AWAY ON HOLIDAY, MISSING OUT ON THE TECH RALLY RESELLING THE OVERNIGHT SESSION. WE SAW THE S&P 500 AND THE NASDAQ 100 REACH RECORD HIGHS. WE WILL SEE THAT TRANSLATES INTO THE ASIAN SESSION BUT INVESTORS HERE ALSO HAVE TO DIGEST THE RBIS RATE DECISION AS WELL. HAIDI: THAT'S RIGHT. PERHAPS SOME OF THAT MIGHT GET LOST IN TRANSLATION WHEN IT COMES TO KOREAN MARKETS. ONE PARTICULAR MAJOR COMPANY CAUSING CONSTERNATION THE MOMENT. FROM JAPAN WE COULD SEE THAT RECORD AUGUST HIGH FOR THE TOPICS. SHERY: WE SEEN THE NIKKEI GAIN GROUND THE LAST TWO SESSIONS SO WE WILL WATCH THE OPEN AS WE WATCH THOSE TECH NAMES AND GAINS WE SAW IN THE OVERNIGHT SESSION. THE JAPANESE YEN STILL PRETTY WEAK AGAINST THE U.S. DOLLAR. LOSING MORE GROUND WITH THE ALREADY MORNING SESSION BUT A LITTLE BIT OF DOWNSIDE PRESSURE AS WE CAN SEE RIGHT THERE. JGB'S, 10-YEAR YIELD STILL ABOUT 3% LEVEL AFTER WE TOUCHED ON 1996 HIGHS. VERY IMPORTANT BECAUSE THE DEMAND COMING TO THE 10 YEAR OPTION SIDE OF THINGS GIVEN HOW HIGH YIELD ARE. WE DO HAVE THE 30 YEAR JGB OPTION WHICH WILL BE MORE IMPORTANT LATER THIS WEEK. THAT WILL GIVE A TEST OF DEMAND WHEN IT COMES TO THE LONG END. OF COURSE WE HAVE FISCAL CONCERNS AND BOJ RISK AS WELL, TALKING ABOUT THE BOJ, BLOOMBERG ECONOMICS NOW EXPECTING A RATE HIKE IN DECEMBER. A LITTLE BIT OF A SLOWDOWN FOR THE MONTH OF AUGUST THAT'S TO DO WITH THE BASE COMING FROM JULY BECAUSE OF SEVERAL BONUSES NORMALIZING IN AUGUST. LOOKING AT SOUTH KOREA, WATCHING LG BECAUSE THEY HAD A HUGE RALLY YESTERDAY. WE ARE HEARING APPLE AND LG ARE PARTNERING TO MAKE THESE HOME DEVICES AND IT WILL INCLUDE DOORBELLS AND THERMOSTATS AS WELL. A LITTLE BIT OF UPSIDE THERE, NOT TOO MUCH. PRELIMINARY EARNINGS COMING OUT TOMORROW, EQUITATION'S FOR ANOTHER RECORD BUT THE STOCK HAS BEEN LIGHT -- LAGGING. THE KOSPI DOWN ABOUT 1%. WE CONTINUE TO WATCH THE KOREAN WON, SO AN ISSUE IN THIS MARKET. HAIDI: LET'S LOOK AT HOW ARE FARING WHEN IT COMES TO AUSTRALIA WHICH IS BEEN TRADING FOR ABOUT AN HOUR NOW. WE ARE SEEING PRETTY MUTED PRICE ACTION WHEN IT COMES TO THIS BROADER MARKET BUT ENERGY COMPLEX IN PARTICULAR UP BY .4 PERCENT, BENEFITING AS WE CONTINUE TO SEE THAT STUDYING TO THE UPSIDE WITH OIL PRICES. THE FOCUS REMAINS WHEN IT COMES TO HOW MANY SHIPMENTS ARE GETTING THROUGH THE STRAIT OF HORMUZ BUT INCREASED FLOWS ARE BEING OUTWEIGHED BY THE PICKUP IN ATTACKS AGAINST THESE VESSELS US WELL. WE HEARD FROM JD VANCE THAT TEHRAN WAS HITTING SOME SHIPS BUT PERHAPS NOT THE NOT -- ENOUGH TO STOP THE FLOW OF ALL AND GAS. WASHINGTON REMAINS OPEN TO TALKS BUT THERE HASN'T BEEN MUST -- MUCH PROGRESS IN TERMS OF A LONGER LASTING PEACE AGREEMENT. IAEA DO TO HOLD ADDITIONAL CHATS ON PLANNING FOR AN EMERGENCY RELEASE OF ON HUNDRED MILLION BEARERS OF DIESEL AND CRUDE. PRETTY STEADY BUT A BIT TO THE UPSIDE ABOVE THE $100 LEVEL AS WELL. TREASURIES, WE CONTINUE TO SEE THE IMPACT ON BAR EQUITY SENTIMENT. PAUL DOBSON JOINS US NOW. WE SAW THAT WILLINGNESS TO CONTINUE PUSHING UP THE MAJOR AI TRADE, THE WILLINGNESS TO TURN ATTENTION TO EARNINGS PROSPECTS AS WELL. THE FEEDTHROUGH SEEMS TO BE A LITTLE BIT SOFTER FOR ASIA. PAUL: GOOD MORNING. I THINK THAT'S RIGHT. IT'S NOT COMPLETELY TRANSFERRING INTO OUR MARKETS JUST YET. ONE OF THE REASONS CITED FOR THE STRONGER INFLUENCE IN THE U.S. MARKET IS THE RESILIENCE OF THE U.S. ECONOMY AND THE U.S. CONSUMER. FROM THAT PERSPECTIVE, THERE IS LITTLE MORE OF AN AMERICA FIRST NARRATIVE IN THE MARKETS AS WE GET READY FOR THE EARNINGS SEASON. THE THING WE SAW IN THE U.S. SESSION THAT MAY COUNT AGAINST ASIA WEST THE MEMBER CHIPMAKERS WITH THE UNDERPERFORMERS THERE. WHAT INVESTORS ARE LOOKING FOR FROM THOSE THINGS IS THE SUSTAINABILITY OF THE MEMORY CHIP. WE SEEN THE MANUFACTURERS TURN OUT SOME OF THEIR OFFERINGS WITH LONG-TERM SUPPLY ARRANGEMENTS. BUT ARE WE HEADED FOR ANOTHER BOOM AND BUST CYCLE? CAN WE REALLY CONTINUE TO SEE THAT GROWTH? THAT'S WHAT INVESTORS ARE HAVING SECOND THOUGHTS ABOUT A LITTLE BIT AT THE MOMENT. SOME OF THE WEAKNESS IN THE ASIAN MARKET, WITH THE AMERICAS YESTERDAY. THE OTHER THING YOU HAVE TO KEEP IN MIND AS WELL IS WE'VE SEEN OVER THE PAST COUPLE OF DAYS A HUGE AMOUNT OF ANNOUNCEMENTS IN IPO'S OR FUNDING OR PEOPLE COMING TO THE MARKET. THERE'S A LOT OF SUPPLY OUT THERE AT THE MOMENT IN THE ASIA SPACE AND THAT'S ONE MORE THING THAT MAY BE HOLDING THE MARKET BACK A LITTLE BIT GETTING TOO EXCITED AND ZOOMING HIGHER RIGHT AT THIS MOMENT. HAIDI: I WAS JUST READING THROUGH WHAT WE HEARD FROM BANK OF AMERICA LOOKING AT THE CALL OPTIONS IT COULD BE POSSIBLE IN TERMS OF THE GROWING WARINESS OF THE BIG CAPS. IT DOESN'T STOP UNTIL THE BUBBLES POP WHICH IS WHAT WE HEARD FROM THE STRATEGIST THIS WEEK. IF YOU TAKE THAT WEARINESS AND COMMENDATION WITH PERHAPS WARNING SIGNS WE ARE STILL SEEING FROM BOND MARKETS, WHAT DOES THAT TELL YOU GOING FORWARD? PAUL: THE LOGICAL THING TO DO IF YOU SEE A BUBBLE FORMING IS NOT TO RUN FOR THE HILLS THE MOMENT YOU SEE IT, YOU CAN EXPECT THE PRICES WILL CONTINUE TO RISE UNTIL SOMETHING BREAKS. BUT THERE MAY BE SIGNIFICANT OPPORTUNITIES FOR FURTHER GAINS BEFORE YOU GET THERE. SO THE B OF A ADVICE TALKING ABOUT THE IDEA OF BUYING CALL OPTIONS BECAUSE YOU THINK THERE'S A REASONABLE OPPORTUNITY OR CHANCE THE PRICES WILL GO CONSIDERABLY HIGHER FROM HERE. ALSO IF THERE'S A TURNAROUND OR SOMETHING GOES WRONG YOU ARE LITTLE MORE PROTECTED RELATIVE TO ACTUALLY BUYING THE INDEXES OUTRIGHT. THE MARKET HAS BEEN SELF QUESTION ALREADY FOR 6-9 MONTHS MAP. ARE WE IN A BUBBLE? IS THERE SOMETHING THAT COULD GO WRONG OUT THERE? WHAT YOU ARE SEEING IN THE BOND SPACE AT THE MOMENT IS NOT NECESSARILY A HUGE AMOUNT OF PEOPLE GETTING MORE CONCERNED BUT IT'S ADJUSTING TO THE HIGHER GROWTH INTEREST RATE ENVIRONMENT WE ARE IN RIGHT NOW. WE KNOW THE FED WOULD LIKE TO COOL THE U.S. ECONOMY AND U.S. INFLATION. EVEN WITH INTEREST RATES WHERE THEY ARE AT THE MOMENT, THE U.S. ECONOMY IS STILL GOING GANGBUSTERS. WE HEARD FROM SCOTT BESSENT THAT THEY ARE LOOKING FOR 3% GROWTH. THE U.S. ECONOMY SEEMS TO BE ABLE TO TOLERATE HIGHER INTEREST RATES AND ALL THINGS BEING EQUAL, THAT TRANSLATES TO HIGHER BONDS. IF THE BOND MARKET WERE TO START TO GO INTO A TAILSPIN I THE RAPID RISE HIGHER AND THE BORROWING COSTS, THAT COULD BE SOMETHING THAT WOULD SLAM ON THE BRAKES A LITTLE BIT HARDER. ALL THINGS BEING EQUAL, IN THE RUN TO EARNINGS SEASON PEOPLE EXPECTING MORE BLOWOUT ANNOUNCEMENTS FROM THE COMPANIES. THERE'S A CHANCE PEOPLE WILL SEE THIS AS, OK, JUST ANOTHER MOMENT OF BILL TOM'S RATHER THAN A BUBBLE ABOUT TO BLOW UP. SHERY: PAUL DOBSON THERE. MARKETS HAVE BEEN QUESTIONING THE SAFETY AROUND ARTIFICIAL INTELLIGENCE. JP MORGAN CP OWED JAMIE DIMON SAYS CYBERSECURITY REMAINS HIS BIGGEST CONCERN AS AI CREATES NEW RISKS AND VULNERABILITIES. SPEAKING EXCLUSIVELY WITH BLOOMBERG, HE WEIGHED IN ON THE GROWING TENSIONS AROUND DATA CENTER EXPANSION. >> DATA CENTERS, YOU BILL THEM WHERE THEY ARE WANTED. HALF THE NEW ONES ARE IN TEXAS AND VIRGINIA. IF PEOPLE DON'T WANT THEM THERE, YOU ARE NOT GOING TO WIN. OF COURSE ANY BIG COMPANY HAS TO BE A GOOD COMMUNITY CITIZEN. A LOT OF PEOPLE ARE GOING INTO TOWN, BEING PART OF THE COMMUNITY, HELPING THEIR COMMUNITY GET RIGHTS AND EVEN MAKE COMMITMENTS THAT WILL RAISE CONSUMER ELECTRICITY COSTS AND THINGS LIKE THAT. AI HAS HUGE POSITIVE EFFECTS. IT WILL MAKE LIFE UNBELIEVABLE FOR PEOPLE. THE DOWNSIDE IS OBVIOUSLY WHAT YOU READ ABOUT, WITH THE AGENTS AND MYTHOS AND ALL THESE THINGS CONNECTING -- THAT IS A LEGITIMATE CONCERN. IT'S A REAL THING. I'M NOT GOING TO GET HYSTERICAL OVER IS IT EXISTENTIAL OR NOT? WE ARE GOING TO WORK TO FIX IT. THE BANKS ABOUT WAS HAVE A SYSTEM IN PLACE, WE HELP EACH OTHER. WE HAVE THE ALLIANCE FOR CRITICAL INFRASTRUCTURE THAT STARTED WITH 50 COMPANIES. IT STARTED IN THE U.S., IT IS ACROSS SIX INDUSTRIES. FINANCIAL SERVICES, WATER, TRANSPORT, INDUSTRIES THE GOVERNMENT POINTS U.S. A LIFELINE. EVENTUALLY IT SHOULD EXPAND TO HEALTH CARE, PHARMA, AGRICULTURE. EVERY INDUSTRY IS CRITICAL AND SHOULD WEED OUT THE SMALLER COMPANIES TOO BECAUSE THEY HAVE VENDORS WITH DIFFERENT NEEDS. THERE'S A LOT OF WORK, WE SIMPLY HAVE TO DO IT. AT CREATED VULNERABILITIES WE DID KNOW ABOUT. >> AND YOU HAVE THOUGHT ABOUT CYBER RISK FOR A LONG TIME. THIS AI MAKE CYBER SYSTEMIC RISK MORE LIKELY? >> THAT'S WHAT I'M SAYING, MYTHOS, WHATEVER YOU THOUGHT IT WAS BEFORE, I SAID CYBER IS OUR BIGGEST RISK, AND I WOULD SAY WENT UP TENFOLD AFTER MYTHOS. HAIDI: JAMIE DIMON THERE WITH BLOOMBERG'S TOM MACKENZIE. WE ARE LIVE IN SINGAPORE AT THE MILKEN ASIA SUMMIT IS TAKING PLACE. THE SPRING IN AVRIL HONG AND HASLINDA AMIN. SO MUCH MORE ON THE AGENDA. AVRIL: HE SPOKE ABOUT INTERNATIONAL TRADE PARTICULARLY FOR CANADA AND HEALTHY COUNTRY HAS BEEN DIVERSIFYING INCREASINGLY TO ASIA AS TRADE RELATIONS CYBER WITH THE U.S. WHAT ELSE IS ON THE AGENDA, GIVEN THE CONCERNS AND THE BACKDROP OF ELEVATED GLOBAL YIELDS. HOW IS THIS AFFECTING ESTATE POSITIONING? THIS IS AN EVENT THAT TYPICALLY GATHERS GLOBAL ALLOCATORS OF CAPITAL AND POLICYMAKERS BUT ALSO AI INNOVATORS. WE WILL SPEAK TO THE CEO OVER WEARABLES. HASLINDA: IT IS PARTY CENTRAL, AT ED :00 A.M. IT'S ABOUT 35,000 MOVERS AND SHAKERS COMPETING AT A TIME WHEN BITCOIN IS SURGING ABOVE 80,000 DOLLARS. REMEMBER IT WAS JUST $50,000 BACK IN JUNE. WE WILL SPEAK WITH THE LIKES OF ROBINHOOD, COINBASE, DRAGONFLY, WE WILL TALK ABOUT THE MOOD AND REGULATION WHICH IS BEEN FRAGMENTED. AND HOW STABLECOIN HAS BECOME THE BACKBONE OF DIGITAL ASSETS. SO DON'T MISS THAT CONVERSATION. HANDING IT BACK TO YOU. SHERY: WE WILL BE LOOKING FORWARD TO THOSE INTERVIEWS AND PLENTY MORE TO COME FROM SINGAPORE. YOU ARE WATCHING "THE ASIA TRADE." THIS IS BLOOMBERG. SHERY: THE TOPICS HERE AND ACTION PENETRATING ABOVE RECORD-BREAKING LEVELS LEVELS WE SAW BACK IN AUGUST. WE HAVEN'T TRADED AT THIS LEVEL SINCE AUGUST 14. IF WE CLOSE AT THESE LEVELS WE WOULD'VE FINISHED AT ANOTHER LETTER -- RECORD HIGH FOR THE TOPICS WHICH IS BEING LED HIGHER BY THE LIKES OF INDUSTRIALS, REAL ESTATE AND UTILITIES. A WEAKER JAPANESE YEN IS PROPELLING THOSE EXPORTERS. THE ONLY SECTOR IN THE RED IS INFORMATION TECH AND HEALTH CARE. A LITTLE BIT UNCHANGED AT THE MOMENT BUT REALLY THE CONTRAST TO THE KOSPI, THE KOSPI DOWN .3%. PLENTY TO DISCUSS FOR INVESTORS AT THE OPEN INSTITUTE ASIA SUMMIT IN SINGAPORE. THAT'S HAD BACK TO THE EVENT WHERE AVRIL HONG IS WITH OUR NEXT GUEST. AVRIL: JOIN US NOW IS DAVID STEINBACK, CIO AT HEINZ. AGAINST THE BACKDROP ABOVE ELEVATED DEALS RAISING CONCERNS, ABOVE FIVE IN THE U.S. TREASURY MARKET ON THE 10-YEAR ARE EVEN LESS, HOW IS THAT AFFECTING REAL ESTATE INVESTOR POSITIONING? >> CERTAINLY THE HIGHER YIELDS INTEREST RATE THAT HAPPENED RECENTLY IS ON INVESTORS MONTH RIGHT NOW. INVESTORS ARE RIGHTLY LOOKING AT THE RELATIVE RISK AND REWARD ACROSS THE MARKET. I THINK WHAT THEY'RE MISSING RIGHT NOW AND WHAT ARE INVESTORS ARE TELLING US IS THEY ARE INCREASINGLY LOOKING AT FUNDAMENTALS VERSUS SOMEBODY -- INTEREST RATES. IN REAL ESTATE THE FUNDAMENTALS ARE INCREASINGLY IMPROVING AGAINST THE WORLD RIGHT NOW. THAT GROWTH CURVE IS WHAT INVESTORS ARE NOW MORE FOCUSED ON. AVRIL: DOESN'T IT WORRY YOU WHEN YOU SEE YIELDS RISING IN THIS MANNER AND AFFECTING MORTGAGE RATES IN THE U.S. AS WELL? DOES IT ALSO COMPOUND THE TROUBLES IN THE HOUSING MARKET? DAVID: FOR EXAMPLE, TAKE MORTGAGES RIGHT NOW IN THE U.S., IT'S DRIVING MORE PEOPLE TO RENT THEN BY. AND FOR A LOT OF INVESTORS THAT IS OPPORTUNITY. AT THE SAME TIME, WHILE THERE IS AN UNDERSUPPLIED HOUSING, THERE'S NOT ENOUGH HOUSING BEING BUILT CURRENTLY. SO THERE IS NO OVERSUPPLY HANG LIKE WE HAD IN PREVIOUS CYCLES. THAT MEANS JUST IN THE COMING YEARS THERE WILL BE EVEN MORE RENTALS COMING THROUGH THE SYSTEM BECAUSE WE ARE NOT BUILDING ENOUGH TODAY. AVRIL: WHAT ASSUMPTIONS ARE YOU MAKING ABOUT THE FED'S TRAJECTORY AND HOW IS THAT AFFECTING REAL ESTATE VALUATIONS? DAVID: WE SEE RATES AS ROUGHLY CLOSE TO EQUILIBRIUM OR THEY WILL PROBABLY BE FOR A BIT. WE ARE THINKING THERE IS LIKELY TO BE ANOTHER HIKE BUT THAT IS GETTING PRICED IN TODAY IN MANY WAYS IN THE MARKET. THAT'S NOT REALLY TOO MUCH OF A CONCERN BECAUSE WE'VE SEEN THAT COMING. THAT'S WHAT THE FED IS TRYING TO DO, EXPRESS THAT INTENT. BUT WHAT IT IS DOING IN THE MARKET IS CUTTING OFF NEW SUPPLY THAT CUT OFF OF NEW SUPPLY IS REALLY AROUND THE WORLD, NOT JUST THE UNITED STATES. THAT'S WHERE WE SEE THE OPPORTUNITY. AVRIL: WHAT ARE YOU LIKING IN ASIA? DAVID: IT'S GOING TO BE A GREAT TIME WITH OUR INVESTORS AND PARTNERS. IS IMPORTANT TO REMEMBER THAT ASIA IS NOT ONE MARKET. IT IS MANY BIG MARKETS. WE ARE SPENDING A LOT OF TIME FOCUSED ON JAPAN, SPECIFICALLY TOKYO, ESPECIALLY IN THE HOUSING SECTOR. WE ARE SEEING RENT GROWTH COME THROUGH THERE. OR STRAIGHT HAS BEEN INTERESTING, REPRICING IS HAPPENING IN AUSTRALIA AND THAT IS CREATING POINTS IN THE MARKET. OTHER PLACES LIKE KOREA AND SINGAPORE ARE THERE IS A LOT OF SCARCITY, FINDING THE RIGHT PRODUCT WILL HELP IN A MARKET LIKE THIS. AVRIL: SOME OF IT IS STRUCTURAL IN TERMS OF DEGLOBALIZATION AND HOW THAT IS POTENTIALLY DRIVING DEMAND FOR LOGISTICS. DAVID: THAT IS THE THEME WE ARE SEEING EVERYWHERE. IT IS CAUSING NEW SUPPLY CHAINS TO GET BILL PRIVATE RESILIENCY, REDUNDANCY, ALL THE THINGS THE MARKETS HAVE BEEN TALKING ABOUT FOR SEVERAL YEARS NOW, PLUS COVID. THAT CONTINUES TO PLAY THROUGH AND IS CREATING NEW WAVES OF CAPITAL. GOVERNMENT-SPONSORED CAPITAL AS WELL AS COMING INTO THE MARKET. NEEDING TO BILL RESILIENCY AROUND SHIPS AND OTHER THINGS FOR DIFFERENT NATIONAL ECONOMIES. AVRIL: WHAT ABOUT DATACENTER INVESTMENTS? WHAT ARE THE RISKS SURROUNDING THAT? DAVID: WE WILL BE DOING MORE IN THE COMING QUARTERS. IT IS GETTING HARDER TO DELIVER ON DATA CENTERS. IT'S GETTING HARDER BECAUSE OF POWER SCARCITY AS WELL AS NIMBY ISM, PEOPLE NOT WANTING THEM IN THEIR BACKYARD. IT'S ALWAYS BEEN HARD TO BUILD THINGS, IT'S ALWAYS DIFFICULT TO DELIVER. SO WE SEE THAT IS A MARKET OPPORTUNITY. AVRIL: ARE YOU SEEING IT SURROUNDING SMALLER PLAYERS THAT CANNOT GET AS ATTRACTIVE TERMS AND THAT COULD ALSO POSE A RISK? DAVID: 100%. WE ARE SEEING THIS THROUGHOUT THE MARKET IN MANY WAYS. THE SCALES ARE GOING TO GET MUCH BIGGER AND THERE WILL BE ROOM FOR NICHE PLAYERS, BUT THAT MIDDLE AREA WILL GET REALLY SQUEEZED. MARKET PARTICIPANTS ARE HAVING TO GO ONE WAY OR THE OTHER IN TERMS OF HOW THEY PLAY. AVRIL: IN TERMS OF THE CLIENTS THAT YOU HELP, WHAT ARE RETAIL INVESTORS LOOKING AT? IS THERE PREFERENCE FOR A LEASE DURATIONS AND WHAT ABOUT HIGH NET WORTH INDIVIDUALS, WHAT ARE THEY LOOKING AT? DAVID: ARE INVESTORS THAT WE ARE WORKING WITH SEE THIS AS A MARKET OPPORTUNITY TO BUY. AND BUY VERSUS BUILD. THEY ARE RIGHT NOW REALLY FOCUSED ON INCOME AND LOOKING ON THE CREDIT SIDE, RELYING ON CASH FLOW. THAT'S SOMETHING REALLY RESONATING WITH INVESTORS RIGHT NOW. THEY ARE BEING VERY SELECTIVE ON THE UPPER ENDS OF THE RISK SPECTRUM. MORE VALUE-ADDED OPPORTUNITIES, THEY ARE VERY SELECTIVE. THAT'S HOW THE MARKET RIGHT NOW IS PRICING. AVRIL: DAVID, THANK YOU SO MUCH. GLOBAL CIO AT HEINZ. HAIDI: WE HAVE MUCH MORE AHEAD FROM THE MILKEN INSTITUTE ASIA SUMMIT. WE'LL TALK ABOUT EXTENDED REALITY TECHNOLOGY WITH THE CEO OF SAN FRANCISCO BASED HARDWARE MAKER VITRO. WE HAVE PLENTY MORE AHEAD ON "THE ASIA TRADE." THIS IS BLOOMBERG. SHERY: TAKE A LOOK AT HOW OIL IS TRADING, A SECOND SESSION OF GAINS WITH DIESEL WITH BRENT STILL ABOVE THE $100 A BARREL LEVEL. WE CONTINUE TO SEE ATTACKS AROUND THE STRAIT OF HORMUZ, LEADING TO THE UPSIDE. AND CONCERNS AROUND SUPPLY. WE'VE HEARD FROM MAJOR ENERGY LEADERS LIKE THE SHELL CEO BUT THERE IS SO MUCH THEY CAN CONTINUE TO DO TO SOFTEN THE IMPACT OF THE IRAN CRISIS. WE HAVE CONTINUED TO WATCH GAS PRICES, SUPPLIES HAVE INCREASED WHEN IT COMES TO RELEASE CRUDE, MAJOR COMMODITY TRADERS NOW SAYING WE'RE AT AROUND 80% OF PREWAR LEVELS WHEN IT COMES TO LNG. DIESEL PRICES IN THE U.S. FOR EXAMPLE ABOVE SIX DOLLARS 50 SIN, LEADING TO POLITICAL CONCERNS. LET'S DISCUSS WHAT IS HAPPENING IN IRAN AND BRING IN JILL. WHAT ARE WE SEEING IN TERMS OF ACTUAL VIOLENCE AND SECURITY AROUND THE STRAIT OF HORMUZ? JOE: GOOD MORNING. -- JILL: OFFICIALS HAVE SAID IS NOT YET CLEAR HOW MUCH THE ESCALATION OF ATTACKS FROM IRAN IN THE STRAIT OF HORMUZ IS ULTIMATE GOING TO AFFECT THE SUPPLY FLOW. AT THIS POINT WHAT OFFICIALS HAVE SAID IS THAT WE'VE SEEN NINE ATTACK FROM IRAN JUST IN THIS MONTH. WE ARE ONLY A FEW DAYS INTO OCTOBER AND IT'S ALREADY HALF AS MANY AS WE SAW IN THE ENTIRETY OF THE MONTH OF SEPTEMBER. SO THAT IS RAISING CONCERNS ABOUT WHAT SECURITY AND SAFETY IS GOING TO LOOK LIKE IN THE STRAIT OF HORMUZ. IT DOES RAISE THE QUESTION OF WHETHER OR NOT IS GOING TO ULTIMATELY AFFECT CRUDE EXPORTS IN THE REGION THROUGHOUT OCTOBER. THE OTHER FRONTS WE CONTINUE TO LOOK OUT FOR IS IN YEMEN WHERE THE GOVERNMENT BACKED OFFICIALS HAVE LAUNCHER MILITARY CAMPAIGN AGAINST THE HOUTHI WHO HAD SECURED SOME STRATEGIC SPOTS IN YEMEN. IT HAS BEEN A BYPASS AREA FOR SOME CRUDE EXPORTS IN THE REGION THERE. JUST ANOTHER ONE TO LOOK OUT FOR AND IT DOES OPEN UP THE IDEA THAT THERE'S CONCERNS AROUND ESCALATION FIGHTING WITHIN THE REGION THAT OBVIOUSLY COULD AFFECT THESE CRITICAL WATERWAYS. SHERY: WHAT ARE WE SEEING IN TERMS OF DIPLOMATIC CHANNELS? ANY UPDATES ON WHEN THAT COULD RESUME? IS BECOMING A REAL TEST WHEN IT COMES TO THIS WAR. JILL: THIS IS STILL REALLY OPEN QUESTION. WE ACTUALLY DID JUST GET SOME COMMENTS FROM U.S. VICE PRESIDENT JD VANCE SUGGESTING THAT IDEAS AROUND NUCLEAR CAPABILITIES IS SOMETHING THAT WOULD HAVE TO BE PART OF ANY NEGOTIATIONS WITH IRAN. THIS HAS JUST BEEN A STICKING POINT BETWEEN THE U.S. AND IRAN OVER NEGOTIATIONS FOR MANY MONTHS NOW. SO IT REALLY SEEM LIKELY THAT SOMETHING THAT IRAN WOULD WANT TO OPEN UP TO. SO IT LEAVES AN OPEN QUESTION ABOUT WHAT EXACTLY WE ARE LOOKING AT IN TERMS OF WHAT WOULD ACTUALLY GET U.S.-IRAN PEACE AGREEMENTS RESTARTED AGAIN IN A MEANINGFUL CAPACITY. THE OTHER THING WE ARE HEARING IS THE IDEA THAT THE U.S. HAS BEEN RELUCTANT TO BACK SAUDI ARABIA IN ITS CAMPAIGN, ITS BACKING OF YEMEN IN ITS FIGHT AGAINST THE HOUTHI AND YEMEN AROUND THOSE CRITICAL WATERWAYS. ERASES QUESTION ABOUT HOW MUCH U.S. INVOLVEMENT WE'RE EXPECTED TO SEE AS WE WATCH OUT FOR SOME OF THESE ESCALATIONS OF ATTACKS. HAIDI: TAKING A LOOK AT ANOTHER STORY WE ARE FOLLOWING TODAY, HUNDREDS OF FRENCH HIGH SCHOOLS WERE CLOSED AS TEACHING UNIONS GOING TO STUDENT LED MOVEMENT DEMANDING THAT A RESOURCES FOR EDUCATION. THE INTERIOR MINISTRY SAYS AROUND 250 6000 PEOPLE JOIN DEMONSTRATIONS INCLUDING 56,000 IN PARIS. POLICE USED TEAR GAS TO DISPERSE SOME CROWDS. NEARLY 500 PEOPLE WERE ARRESTED. THE PROTESTER CALLING FOR EDUCATION REFORM THAT IS SPREAD NATIONWIDE SINCE BEGINNING OF LAST MONTH IN PARIS. A TURBULENT TIME AND IT COMES TO THE FRENCH ECONOMY. THAT'S A GOOD HOW EUROPEAN FUTURES ARE OPENING AT THE MOMENT AS WE GET THE PUSH THROUGH FROM THE OPTIMISM IN THE U.S. OVERNIGHT. HERE IN ASIA, JAPAN AND KOREA, WE'RE SEEING EXTENDED WEAKNESS IN THE EURO AS WELL AS WATCHING OUT FOR BOND FUTURES AS WELL AFTER THE BIGGEST JUMP IN SIX MONTHS. LATER TODAY THE IMF CHIEF JOINS HASLINDA AMIN TO DISCUSS THE GLOBAL GROWTH OUTLOOK, TRADE TENSIONS, THE RATE CUT AHEAD, AND THAT INTERVIEW WILL HAPPEN AT THE TIMES ON YOUR SCREEN. SHERY: TAKE A LOOK AT HOW WE ARE FARING WHEN IT COMES TO MARKETS AT THE MOMENT. WE ARE SEEING THAT PUSHED HER WHEN IT COMES TO THE KOSPI IN PARTICULAR. THE NIKKEI UP ABOUT .25%, BUT WE SEE THE BACK OF THE LEAD FROM WALL STREET COME A PRETTY GOOD POSITIONING FROM TRADERS AT THE MOMENT. WE ARE SEEING SOME MOMENTUM ON BOARD AS YOU GET THE EXTENSION OF THE LONGER-RANGE AS WELL. THE REPORT THAT SPACEX IS LOOKING TO RAISE MONEY TO BUY NVIDIA CHIPS ADDING A BIT MORE TO THE TECH AND AI TRADE IN ASIA. JAPAN HAS BEEN A BENEFICIARY IN THIS SESSION COMPARED TO KOREA AT THE MOMENT. DRAG TO BE MEMORY, A LOT OF MEMORY HEAVYWEIGHTS, SK HYNIX AND SAMSUNG TRACKING THAT OVERNIGHT WEAKNESS. IDIOSYNCRATIC STORY WHEN IT COMES TO HEIGHT X AT LEAST FOR A COUPLE OF -- HYNIX, AT LEAST FOR A COUPLE OF SESSIONS. IN AUSTRALIA, A LITTLE BIT OF WEAKNESS, .3%, OIL MAJORS GAINING ON THE BACK A BIT MORE IN THAT ENERGY AT THE MOMENT. SHERY: HAIDI, TAKE A LOOK AT HOW CRYPTO ASSETS ARE TRADING AT THE MOMENT, EARLY DOWNSIDE IN THE ASIAN SESSION WHEN IT COMES TO BITCOIN, STRUGGLING TO PASS THAT $87,000 LEVEL. WE HAVE TREASURY YIELDS, OF COURSE, HIGHER, WEIGHING DOWN SPECULATIVE ASSETS LIKE CRYPTO ASSETS. BITCOIN HAS BEEN DOWN. BUT GIVEN THAT WE ARE COMING FROM 58,000 AT THE END OF JUNE AND NOW WE ARE PAST 85,000, THERE'S A LOT OF OPTIMISM THAT PERHAPS WE COULD SEE ANOTHER BULL MARKET. INVESTORS WILL HAVE PLENTY TO DISCUSS, AS ONE OF THE WORLD'S LARGEST CRYPTO EVENTS IN SINGAPORE TODAY COULD INVESTORS, GLOBAL LEADERS HELPING TO SHAPE THE FUTURE OF DIGITAL ASSETS GATHERING, WHERE INSIGHT ANCHOR HASLINDA AMIN IS WITH OUR NEXT GUEST. HASLINDA: SHERY, YOU ARE RIGHT, A LOT OF OPTIMISM. JOINING US NOW, JOHANN KERBRAT, SENIOR VICE PRESIDENT AND GENERAL MANAGER OF CRYPTO AT ROBINHOOD. TELL US ABOUT THE MOOD. IT'S DIFFERENT FROM BACK IN JUNE. JOHANN: YES, I THINK IT REALLY SHOWS THAT CUSTOMERS ARE SUPER AGAIN. HASLINDA: YOU TALK ABOUT SEEING A LOT MORE, HOW MUCH MORE? IN TERMS OF DEMAND, VOLUME? WHAT ARE YOU SEEING? JOHANN: WELL, WE ARE SEEING MORE DIMINISHED TRADING VOLUME ON THE CRYPTO ASSET, BUT ALSO WE ARE SEEING A LOT OF ACTIVITY. WE SEE A LOT INTERACTING WITH DIFFERENT CHAINS AND ASSETS, IN ORDER ON THE REVENUE CHAINS, WHICH LAUNCHED THE MARKET. HASLINDA: AND, OF COURSE, ROBINHOOD IS PUSHING FOR 24/7 TRADING. IS IT IN THE CARDS? WHERE ARE YOU WITH THAT? JOHANN: YES, A FEW MONTHS AGO, WE ARE SEEING MORE THAN 17% OF THE ACTIVITY IS HAPPENING OVERNIGHT COME UP WHEN THEY ARE CLOSED, OR DURING THE WEEKEND. I THINK IT SHOWS THE WORLD DOES NOT STOP TURNING ON FRIDAY NIGHT. A LOT OF NEWS ARE HAPPENING ON FRIDAYS, SATURDAYS, AND ON THE WEEKEND. PEOPLE WANT TO CHANGE THEIR PORTFOLIOS, THEY WANT TO BE ABLE TO HEDGE THEIR STRATEGIES, AND THIS IS SOMETHING WE WILL BE ABLE TO OFFER FOR THEM. HASLINDA: THE WORLD DOES NOT STOP TURNING, BUT IT DOES SLOW DOWN OVER THE WEEKEND. SOME SAY IT MAY BECOME EVEN MORE VOLATILE FOR INVESTORS BECAUSE THE VOLUME IS SPINNING. HOW DO YOU PROTECT RETAIL INVESTORS ON THE BACK OF SUCH A SCENARIO? JOHANN: YEAH. IT WILL BE TWOFOLD, ONE, TO MAKE SURE WE HAVE ENOUGH MARKET MAKERS AROUND THESE ASSETS. THE SECOND PART IS REUNIFICATION, WE WANT TO MAKE SURE THE CUSTOMER UNDERSTANDS THIS POINT, BUT ALSO FOR THEM TO DECIDE IF THEY WANT TO TRADE OVER THE WEEKEND. HASLINDA: WHAT KIND OF VOLUMES ARE YOU ANTICIPATING? WHAT KIND OF GROWTH WHAT WE SEE TO, THREE YEARS DOWN THE GROWTH? -- DOWN THE ROAD? JOHANN: I THINK WE WILL BE THE FIRST TO OFFER IT REALLY, SO WE WILL DISCOVER THAT WITH THE WORLD, BUT AT THE END OF THE DAY, WHEN WE SEE ALL THE FLOWING ON ALL THESE CYCLES, WE SEE A LOT POTENTIALLY. HASLINDA: WE KNOW YOU'VE BEEN EXPANDING. TALK TO US ABOUT YOUR EXPANSION PLAN. HOW MUCH OF THAT IS IT IN REGULATION, A LOT OF IT IS SEGMENTED RIGHT NOW IN THE U.S., DESPITE HAVING A PRO CRYPTO PRESIDENT, REGULATION HAS BEEN VERY SLOW. JOHANN: YEAH. ON THE CRYPTO ASSETS, WE DO BELIEVE REGULATION COULD BE BETTER IN THE U.S. WE WERE EXPECTING A LOT MORE, BUT WE ALSO SEE THE AGENCY SETTING UP, BOTH THE FTC AND SEC HAVE GIVEN GUIDELINES ON HELPING US EXIST IN THE SPACE. WE ARE HOPING THE U.S. WILL COME BACK TO GET IN THE POSITION WE SHOULD BE IN. FOR ROBINHOOD, WE ARE STILL GOING TO EXPAND. . WE RECENTLY LAUNCHED CRYPTO IN THE U.K., SO NOW YOU HAVE ONE OUT FOR A CUSTOMER MANAGE RETIREMENT, WORKERS ASSETS, AND FUTURE ASSETS. WE ALSO HAVE A SINGAPORE ENTITY HERE, WHERE WE JUST GOT THE LICENSE FOR CAPITAL MARKETS. AND IT IS SOMETHING THAT WE ARE JUST AT THE BEGINNING. WE HAVE 28 MILLION ACCOUNTS WITH ROBIN IF YOU'RE 27 MILLION ARE IN THE U.S. WE HAVE WORK TO DO INTERNATIONALLY. HASLINDA: HOW IS THAT SHAPING THE WAY YOU EXPAND? WHEN IT COMES TO EXPANSION, EUROPE SEEMS TO BE LEAVING, HONG KONG NOT FAR BEHIND, SINGAPORE, THAT MUST BE HELPFUL IN THE WAY YOU THINK ABOUT EXPANSION. JOHANN: ABSOLUTELY. WE THINK THAT IS ONE OF THE MAIN VALUE OF ROBINHOOD, TO HAVE ONE APPLICATION, STOCKS, CRYPTO ASSETS. SO TO BUILD THIS TYPE OF PRODUCT, EVERYTHING THAT WE BUILD ON CHAIN, IT IS SOMETHING WE WANT TO BE ABLE TO BRING TO MORE AND MORE COUNTRIES. HASLINDA: TOKENIZATION A BIG THEME RECENTLY. THE CEO I GUESS TOOK ARMS WITH HOW ROBINHOOD TOKENIZED IS SHARES, AND THE SEC COMING OUT TO SAY THAT PERHAPS THERE SHOULD BE A PERIOD OF 30 DAYS THAT COMPANIES CAN OPT OUT OF IT. WHAT DO YOU MAKE OF THAT ARRANGEMENT? JOHANN: WELL, OVERALL, WE THINK PEOPLE SHOULD HAVE MORE AND MORE ACCESS TO MORE ASSETS. I WILL START BY ACTUALLY A GOOD THING FOR THESE COMPANIES, EVERY TIME WE NEED TO BOOKEND, WE BUY ONE SHARE OF THIS COMPANY AND HOLD IT IN THE ACCOUNT. WE REALLY THINK THIS IS GIVING MORE ACCESS TO LIQUIDITY AND TO OUR CUSTOMERS. AT THE END OF THE DAY, WE WILL FOLLOW THE RULES THAT THE SEC HAS LAUNCHED, BUT WE THINK THAT, LIKE, OPTIONS WERE ETF'S THAT DOES NOT REQUIRE A SHARE, TOKENIZATION SHOULD BE THE SAME. HASLINDA: DO YOU THINK THERE WOULD BE MORE ISSUES? WOULD YOU BE ENCOUNTERING FURTHER RESISTANCE FROM MORE COMPANIES? JOHANN: WE'VE SEEN A LOT OF DEMAND FROM THE CEO'S, PUBLIC COMPANIES ARE REACHING OUT TO US, ASKING TO TOKENIZE. A LOT OF PEOPLE UNDERSTAND THE ASPECT OF TOKENIZATION. HASLINDA: WHAT IS THE POTENTIAL HERE? JOHANN: WE REALLY THINK THAT THERE'S BILLIONS OF PEOPLE ACROSS THE WORLD THAT DO NOT HAVE ACCESS TO THE ACCOUNT RIGHT NOW, OR IF THEY DO ACCESS, THEY HAVE A LOT OF FEES AND A LOT OF HOOPS TO GET INTO EARNING SOME OF THESE ASSETS. SO WE ARE GIVING THEM AWAY TO OUR ASSETS, TO THE EXPOSURE OF THESE ASSETS WITH JUST A PHONE AND INTERNET CONNECTION. HASLINDA: BEFORE WE LET YOU GO, I WANT TO TALK YOUR REVENUE, BECAUSE THERE'S MORE PLANS OF GETTING MORE REVENUE OUTSIDE THE U.S. BY THE END OF 2026 PIT WHERE ARE YOU WITH THAT? WHAT THAT REALISTIC? JOHANN: WE ARE HIGHLY DIVERSIFIED. IT IS SOMETHING THAT WE ARE GOING TO KEEP PUSHING ON, BECAUSE IT IS REALLY IMPORTANT FOR US TO BE ABLE TO EXECUTE WELL, NO MATTER THE MARKET CONDITIONS AND INTERNATIONAL IS BECOMING A STRONGER AND STRONGER BUSINESS LINE. DIFFERENT ACQUISITIONS THAT WE'VE DONE, FRANCE, CANADA, FOR EXAMPLE, THAT IMPROVE THE REVENUE. HASLINDA: GREAT STUFF, JOHANN, JOHANN KERBRAT, VICE PRESIDENT AND GENERAL MANAGER OF CRYPTO AND INTERNATIONAL AD ROBINHOOD. HAIDI? HAIDI: ENJOY THE VIBES. BLOOMBERG'S HASLINDA MAN FROM SINGAPORE. COMING UP, WE WILL BE SPEAKING WITH DRAGONFLY, COINBASE, ON DIGITAL ASSETS, LATER, FRANKLIN TEMPLETON ON WHAT IS NEXT FOR CRYPTO INVESTORS. MORE AHEAD ON "THE ASIA TRADE." THIS IS BLOOMBERG. ♪ >> WE ALL KNOW THAT A MEMORY AS OVERALL SUPPLY CONSTRAINT IN THE MARKET. FROM OUR STANDPOINT, WE WANT TO ENSURE THERE'S ENOUGH MEMORY FOR HIGH BANDWIDTH MEMORY FOR AI SERVERS AS WELL AS ALL THE MEMORY FOR CPU'S AS WELL AS FOR THE MARKET. SO WE ARE WORKING WITH OUR MEMORY SUPPLIERS TO PLAN VERY CAREFULLY WITH OUR LEADERS TODAY. SHERY: AMD CHAIRMAN AND CEO LISA SU SPEAKING TO REPORTERS IN TAIPEI, WHERE, OF COURSE, THE CHIP INDUSTRY, THE AI BOOM HAS REALLY HELPED REPORT THAT ECONOMY. TODAY IN TAIWAN, WE GET THE INFLATION NUMBER THAT IS EXPECTED TO COME ABOVE 2%. WE HAVE SOME HOLIDAY-RELATED PRICE STRUCTURES. TSMC COME OF THOSE GAINS. FUTURES LOOKING NOT CHANGE, NOT MUCH AT THE MOMENT. THIS AFTER MORE THAN 70% GAINS JUST THIS YEAR. IN FACT, THE TAIWANESE BENCHMARK STOCK INDEX HAS OVERTAKEN SOUTH KOREA'S KOSPI AS THE WORLD'S DESPITE THE FACT THAT THEY ARE BOTH BEING TRADED AS KEY BENEFICIARIES OF ARTIFICIAL INTELLIGENCE. FOR MORE ON WHAT IS DRIVING THIS DIVERSIONS, WE ARE JOINED BY ASIAN EQUITIES REPORTER WINNIE HSU. IS NOT JUST THAT THEY TRADE ON THE AI BOOM, BUT KOREA IS MUCH CHEAPER THAN TAIWAN, RIGHT? WHAT IS DRIVING THIS COMPANIES OUTPERFORMANCE? WINNIE: GOOD MORNING, SHERY . IT IS INTERESTING TO SEE HOW THE GAUGE HAS PERFORMED GLOBALLY IN THE PAST FEW WEEKS NOW. YOU ARE TALKING ABOUT HIGH TAIWAN IS NOT THE TOP -- AND NOW THE TOP PERFORMER. TAIWAN REALLY HAS A BIT MORE OF A DIVERSE EXPOSURE WHEN IT COMES TO THE AI SUPPLY CHAIN, WHERE KOREA SEEMS TO BE MORE CONCENTRATED WHEN IT COMES TO THE EXPOSURE TO MEMORY. WHEN YOU LOOK AT HOW INVESTORS ARE LOOKING AT IT, RIGHT? THE EARNINGS UPSIDE REALLY SHOWS A LOT ABOUT THAT, BECAUSE THIS TIME AROUND, WE ARE SEEING TAIWAN'S OF WORD EARNINGS REVISION -- UPWARDS EARNINGS OR VISION ON A QUARTERLY BASIS CAUGHT SOUTH KOREA FOR THE VERY FIRST TIME SINCE 2025 IN MARCH. SO GOING FORWARD, INVESTORS SEEING MORE OPPORTUNITY AND MORE GROWTH WHEN IT COMES TO THE NAMES IN TAIWAN, AND THAT IS PERHAPS WHY YOU ARE SEEING THIS BIG DIVERGENCE IN PERFORMANCE. WE ARE ALSO TALKING ABOUT WHEN IT COMES TO QUARTERLY OUTPERFORMANCE OF TAIWAN OVER KOREA, THIS IS THE BIGGEST GAP WE ARE SEEING SINCE THE YEAR 2000. SHERY: YEAH. I MEAN, WHEN I DO THINK ABOUT THE KOSPI, I DO THINK MOSTLY SAMSUNG, SK HYNIX, SOMETIMES LG BUT, VERY CONCENTRATED, RIGHT? WHEN IT COMES TAIWAN, I UNDERSTAND THE OPTIMISM, BUT HOW MUCH HIGHER CAN YOU GO, ESPECIALLY WHEN YOUR VALUATION IS NOW GETTING SLIGHTLY EXPENSIVE, RELATIVE TO OTHER ASIAN NAMES. WINNIE: YEAH. SO, INVESTORS RIGHT NOW ARE STILL QUITE OPTIMISTIC ABOUT THE FURTHER UPSIDE WHEN IT COMES TO THE CHINESE MARKET. A BIG PART OF IT IS BECAUSE THEY HAVE NOT SEEN MUCH OF A SLOWDOWN WHEN IT COMES TO ALL THESE DIFFERENT BOTTLENECKS UP ALONG THE AI SUPPLY CHAIN. WE JUST TALKED ABOUT THE DIVERSE, THAT OFFERING OF THE TAIWANESE COMPANIES ALONG THE AI SUPPLY CHAIN. WE ARE TALKING ABOUT, FOR EXAMPLE, HOW YOU REMEMBER THE OTHER DAY WE HAD A BLOOMBERG REPORT ABOUT THESE SURPRISING BILLIONAIRES OUT OF THE AI TRAIT. ONE OF IT IS THE FOUNDER OF THE COMPANY, A COMPANY THAT PROVIDES THE REL TAG FOR THE AI DATA CENTERS. THE COMPANY IS UP ABOUT 250%. TAIWAN, WE SEE SO MANY COMPANIES THAT PROVIDE LOTS OF THESE SMALL COMPONENTS, MATERIALS THAT MIGHT SEEM A LITTLE BORING BUT ARE JUST INDISPENSABLE FOR THE AI TRADE. AND BECAUSE OF THE TREND COME OF REALLY CHANGING FROM HOW IN THE PAST IT'S THIS BIG CUSTOMER, NVIDIA, AND NOW ALL THESE U.S. HYPERSCALERS, WHETHER IT IS META, GOOGLE, THEY ARE ALL AGGRESSIVELY BUILDING OUT THEIR OWN ECOSYSTEM. SO WHAT YOU NEED ACROSS THE ECOSYSTEM, FROM CPU'S TO COOLING SYSTEMS TO CIRCUIT BOARDS, THESE ARE ALL BEING OFFERED IN TAIWAN. WHEN BANK OF AMERICA'S HEAD OF RESEARCH IN TAIWAN, HE'S TELLING US THERE'S NOT MUCH OF A TOP WHEN IT COMES TO SLOW IN THESE DEMANDS, AND FOR NOW, WE ARE SEEING INVESTORS PREFERRING TAIWAN OVER SOUTH KOREA, DESPITE VALUATIONS LOOKING A BIT MORE ABSTRACT COMPARED TO KOREA AT THIS POINT. HAIDI: OUR ASIAN EQUITIES REPORTER WINNIE HSU THERE WITH US. TAKING A LOOK AT WHAT LIES IN STORE, YOU GOT THE CHINA MARKET STILL A FOR HOLIDAY. MISSING OUT. PERHAPS WE WILL SEE A REBALANCING OF THE TRADE WHEN THEY DO COME ONLINE. THERE ARE SOME CHINESE STOCKS WE HAVE BEEN WATCHING IN THE U.S. SESSION, LIKE THE LIKES OF ALIBABA, FOR EXAMPLE, WE ARE ALSO WATCHING SOME OF THE AI NEWS FLOW, MOONSHOT, LOOKING AT THE EARLY 2027 IPO AFTER THE RALLY OF THE $50 BILLION PAID HONG KONG FUTURES AT THE MOMENT, WHEN IT COMES TO BTECH COMPONENT IN PARTICULAR, ALSO NOT MOVING TOO MUCH, DESPITE A RELATIVELY STRONGLY FROM THE GOLDEN DRAGON INDEX OVERNIGHT. DEEPSEEK JOINING MOONSHOT AND RAISING CAPITAL AHEAD OF THE PLANNED IPO. OUR MARKETS REPORTER ANTHONY STEPHENS IS BACK ON THIS PARTICULAR THEME. CONTRACTED BOND IN ASIA. ANTHONY: YEAH. IN THE EQUITY PRIMARY SPACE, YOU CONTINUE TO SEE THE EXCITEMENT AROUND SOME OF THESE LLM-LED MOONSHOT, LOOKING FOR EARLY 2027 FIT WE HAD DEEPSEEK LOOKING TO RAISE AROUND $12 BILLION. WHAT IS INTERESTING IS THE PEDIGREE OF THE FUNDS THAT ARE INVOLVED IN SOME OF THE FUNDRAISING. TENCENT AND CATL IN THE DEEPSEEK ROUND. THAT WILL GIVE THE ECOSYSTEM THAT RESEMBLES THE U.S., WHERE, YOU KNOW, EXISTING CASH COMPANIES ARE DEPLOYING THEIR CAPITAL IN THESE PARTS. A LITTLE BIT OF A MORE SUSTAINABLE KICK TO IT. IT'S INTERESTING THAT DEEPSEEK IS LOOKING FOR THIS MONEY IN THE FIRST PLACE. THEY'VE BEEN RUNNING ON A RELATIVELY CAPITAL LIGHT MODEL UNTIL NOW, BUT NOW THE COST OF COMPUTER HAS GONE UP SO SIGNIFICANTLY, YOU KNOW, RELATED TO SOME OF THE POINTS ON TAIWAN THAT WINNIE WAS TALKING ABOUT, THAT THEY NEED TO INCREASE THEIR CAPITAL RAISING. SO VERY HEALTHY MARKET ON THE PRIMARY SIDE. WE ALSO HAVE HEADLINES THAT CLEAN, WHICH IS KIND OF A VIDEO AI NAME, THAT MAY LEAD 2027 AS WELL. SO IT IS ALL COMING TOGETHER FOR THE CHINESE LISTED AI NAMES, BUT IT IS GOING TO IMPACT POTENTIALLY THE NAMES THAT HAVE ALREADY BEEN LISTED, A SHARP PERFORMANCE OF LLM, MOST NOTABLY ZEDD.AI AND MINI MAX. HAIDI: IT'S AN INTERESTING CONFLUENCE OF FACTORS AT THE MOMENT, RIGHT? YOU HAVE 13 YIELDS ON DEBT FINANCING, SO MUCH ENTHUSIASM WHEN IT COMES TO BORROWING FOR THIS AI THEME. AT THE SAME TIME, WE WERE TALKING EARLIER ABOUT THE COMMENTARY, STRATEGISTS TALKING ABOUT THEM AT WHICH POINT WE HAD IN TERMS OF THE BUILDING OF THIS BUBBLE. ARE THE RISKS ALSO BUILDING? ANTHONY: IT IS BUILDING AT THE MARGIN, RIGHT? WE SEE CREDIT SPREADS ON ASIA, DOLLAR BONDS, THE AMOUNT OF FLOW THAT IS COMING THROUGH. WE SEE DOLLAR BOND ISSUANCE IN ASIA LAGGING THAT OF THE U.S., RIGHT? AND ONE OF THE REASONS FOR THAT, THOUGH, COULD BE THE FACT THAT IT'S EASIER TO RAISE MONEY IN ASIA FROM OTHER AVENUES THAT ARE FIXED INCOME ADJACENT. THE FIRST IS ONSHORE CHINESE MARKET. RATES IN CHINA ARE VERY LOW, SO I'M SURE CHINA MIGHT BE EASIER TO RAISE MONEY THAN THE DOLLAR BOND MARKET. . THE SECOND OPTION DISCUSSED IS CONVERTIBLE BONDS. EQUITY PERFORMANCE VERY STRONG FOR CHINA ONSHORE VERY WEAK. FOR A CONVERTIBLE BOND ISSUANCE, THAT IS NICE. WE SEE A LOT FROM BOTH THE CHINESE AND INCREASINGLY THE TAIWANESE. YOU HAD A BIG DEAL FROM THE U.S., SO IT IS A LITTLE BIT MORE OF A BIFURCATED PICTURE IN ASIA VA POTENTIALLY IN OTHER PARTS OF THE WOR -- IN ASIA THAN POTENTIALLY IN OTHER PARTS OF THE WORLD, BUT YOU SEE THE RISK IN CAPITAL RAISING GOING FORWARD. HAIDI: OUR MARKETS REPORTER ANTHONY STEPHENS IN HONG KONG. LET'S GET YOU THE TOP CORPORATE STORIES. SPACEX LOOKING TO RAISE $40 BILLION TO BUY NVIDIA CHIPS. THE "FINANCIAL TIMES" SAYING 10 BILLION DOLLARS OF THAT WILL BE BANK LOANS. APOLLO IS EXPECTED TO LEAVE THAT DEAL, THAT IS EXPECTED TO CLOSE THAT DEAL. LEADING THE DEMAND AMONG AI DEVELOPERS FOR MORE COMPUTING POWER. AMBANI'S JIO SAID TO SEEK ABOUT 100 $14 BILLION VALUATION IN IPO. IT'S HOPING FOR A MARKET DAY VIEW BEFORE THE END OF OCTOBER, EVALUATION IMPACTING LIKELY TO BE AGAIN THIS WEEK. EXPECTING TO HIT AN ALL-TIME HIGH WAS TRADING AND INVESTMENT BANKING FIRMS WITH EARNINGS. ANNUAL PROFIT IS UNPLACED TO RECEIVE $90 BILLION, COMFORTABLY TOPPING LAST YEAR'S RECORD OF ABOUT $65 BILLION. MAJOR WALL STREET FIRMS HAVE ALREADY SIGNALED RECORD REVENUE, AIDED BY A MARKET VOLATILITY AND CONFIDENCE IN DEALMAKING. MORE AHEAD HERE ON "THE ASIA TRADE." THIS IS BLOOMBERG. ♪ SHERY: PARAMOUNT HAS CLOSED ITS $110 BILLION ACQUISITION OF WARNER BROTHERS, COMPLETING ONE OF THE BIGGEST MEDIA MERGERS OF ALL TIMES AND CEMENTING DAVID ELLISON'S PLACE AS A HOLLYWOOD MOBILE. CHRIS LEADS OUR MEDIA COVERAGE. ELLISON OWNS TWO OF THE MAJOR HOLLYWOOD STUDIOS. HE WON THIS INCREDIBLE BATTLE FOR WARNER BROS.. HOW MUCH IS IT FOR HIM TO DELIVER FINANCIALLY GIVEN HOW MUCH OF DEBT HE TOOK AS WELL CHRIS: WELL, RIGHT, IT'S $80 BILLION OF DEBT, AND THEY PERSONALLY PUT IN BILLIONS OF DOLLARS. WE DON'T EVEN KNOW THE AMOUNT OTHERS HAVE PUT AN. BUT THEY AND THEIR PARTNERS HAVE PUT IN $47 BILLION IN NEW EQUITY, INCLUDING THE KOREAN DEPARTMENT STORE CHAIN. A LOT OF MONEY IS RIDING ON THIS DEAL. THERE'S A LOT OF MOBILE ASSETS BETWEEN THESE BUSINESSES. THEY WILL DEFINITELY CUT EXPENSES, SOMETHING ON THE ORDER OF $6 BILLION A YEAR. BUT THEY ALSO PROMISED TO REALLY INCREASE IN PRODUCTION, TV PRODUCTION, AND THEY SAY THEY WILL BE SPENDING MORE THAN NETFLIX AND DISNEY ON MOVIES AND TV SHOWS. ALL OF THAT REMAINS TO BE SEEN. SHERY: WAIT, SO YES, WE HEARD THEY WILL BE RELEASING, WHY, 30 FILMS EVERY YEAR OR SO, BUT AT THE SAME TIME, THEY PROMISED TO CUT COSTS OF MORE THAN $6 BILLION? ISN'T THAT PULLING OFF OF THE DIRECTORS AT THIS POINT? CHRIS: IT SURE IS. ONE OF THE PLACES THEY WILL CUT IS THE CABLE TV CHANNELS. THEY NOW HAVE ONE OF THE LARGEST COLLECTIONS OF TV CHANNELS IN THE WORLD. IT IS OVER 50 CHANNELS, EVERYTHING FROM MTV, NICKELODEON, CARTOON NETWORK, TNT, TBS, AND SO THAT IS A BUSINESS THAT IS STRUGGLING. PEOPLE ARE CANCELING CABLE TV AND SATELLITE TV. ADVERTISING IS DOWN. VIEWERS ARE DOWN. THE ONLY WAY TO INCREASE PROFITS IN THAT BUSINESS IS TO CUT, CUT, CUT, SO THEY WILL BE MERGING THOSE TWO DIVISIONS AND LIKELY GET A LOT OF CASH OUT OF THAT. SHERY: HOW MUCH CONCERNED ABOUT EDITORIAL INDEPENDENCE OF CBS AND CNN AT THIS POINT? CHRIS: IT HAS BEEN A BIG CONCERN. DAVID ELLISON, THE CO-CEO OF THIS NEW COMPANY, SKY DANCE, HAD AN EVENT ON THE PARAMOUNT LOT TONIGHT. HE PROMISED THAT THE NEWS DIVISION WILL RUN INDEPENDENTLY. HE KEPT THE CEO OF CNN IN PLACE IN A SEPARATE EDITOR IN CHIEF AT CBS PIT ALSO AS PART OF A SETTLEMENT WITH THE STATE ATTORNEY GENERAL, HE AGREED TO PUT AN EDITORIAL BOARD IN PLACE THAT WOULD OVERSTATE BOTH NEWS ORGANIZATIONS WITH FIVE JOURNALISTS, WHO WOULD BE REVIEWING CONTENT THERE. SHERY: OUR BLOOMBERG EDITOR CHRIS PALMERI, WHO LEADS OUR MEDIA AND ENTERTAINMENT COVERAGE. LET'S GET YOU A QUICK CHECK OF HOW MARKETS ARE TRADING AS WE HEAD INTO THE NEXT HOUR. LOOKING AHEAD TO TRADING ACROSS HONG KONG MARKETS, AS THEY GET ONLINE AT THE BOTTOM OF THE NEXT HOUR. OFF BY ABOUT A QUARTER OF 1%, BENEFITING FROM SOME OF THE UPSURGE WE SAW EARLIER IN THE TOPIC THERE, REALLY BEING SET UP AS WE SAW A RECORD HIGHS, FOR THE S&P 500 THAT WE SAW OVERNIGHT FROM WALL STREET. THE KOSPI IS HOLDING HIS HEAD ABOVE WATER, ABOUT .1% HIGHER COME OF THAT MEMORY CHIP DRAG GAINS ACROSS IN JAPAN AS WELL ALSO PROVING TO BE A BIT OF DOWNSIDE. THIS IS BLOOMBERG. ♪