to ecb, not looking at confirmation of the pivot. paul: holding off to see what the fed does, conditions have been ripe for easing, but there was an inflation battle. got a market open to look at. haidi: cpi will be major, but let's get into the start of trading, stocks coming online. where we are sitting for the nikkei 225 and the positivity and a second consecutive week of weakness, not the case when it comes to the unstoppable equity rally.

as we see foreign buyers turning net sellers of equities conveyed as a positive for investors who see the timing as incorrect. dollar-yen 151. 152 is the level for intervention. prime minister kishida talking about the moves and the undesirability of one-way yen traits. not just the yen, and a lot of weakness for asian currencies that were close to the you to date low. the cosby online. chip stocks when it comes to this market which is heavily traded in ships. samsung, lg and kia are stocks

to watch in korea. we seen that buying by institutional investors at play. paul: daylight savings ended over the weekend so australia is opening at the same time as korea and japan. hard to get a read of things, but asx did finish up down half a percent on the week. softness continuing. weakness for the aussie dollar below the $.66 level. watching brent crude up gains. using below $90 a barrel but a lot of issues on the supply side. opec-plus production curbs and demand ramping up in the u.s. so the future direction of crude will be closely watched.

yields in australia are a little, let's look at how treasuries are trading. not a huge amount of change, but upward yields continuing in the question of the day's regarding the two year. closing in on 175. let's get to our next guest to seize opportunities for japanese markets. they are the asian equities and portfolio manager at evan jean investments in singapore. like japan across the board. do you see this rally moderating? when it comes to japan? >> good morning. fair question given the move we've seen. our view is long-term and we see

opportunities across sectors and liquidity profiles. earnings growth will be higher than anticipated. more buybacks, shareholders holdings being bought back. this should last for a while. paul: yet intervention is a rising conversation. presenting risks for japan going forward. >> in the short-term yes, earnings season kicked off with automation names and i'd like to get back to that. in general, it is business as usual navigating oil costs. that is all part of their daily

business and not an acute risk to the markets. haidi: you are saying this is a market that is investable. how cautious are you and what are you honing in on? >> paul was asking, we are selective in china. last year or the year before people were correlating underperformance or poor performance with in the stability. we seeing earnings growth in china but we see a corporate governance improving and the companies were looking at, greater attention to esg. factory automation, semi conductors and consumer space, even though domestic consumer is stretched, scars from covid have yet to heal, things are getting better.

got interesting data, japanese companies that sell into china are saying we're poised for a rebound in china. we seem to be passed the worst in important sectors. haidi: what we have seen is investors redirecting flows into india in japan, so more balanced, how are you feeling about india given how expensive it is? >> india, japan, china, we have implemented capital. india is expensive, but we think it is pricey given that is where earnings growth is. bloomberg has a fantastic article about how india could become the world's growth engine

by the end of this decade. worth reading. we have exposure to some companies in there and we see a lot of opportunities if you look at the strength of the consumer passed the election results which we believe the base case is status quo and infrastructure will come, opportunities across liquidity in market capital. paul: i want to get your thoughts on the next move from the fed because we have more upside surprises in the u.s. with strong jobs data in creation numbers. when you look at the u.s., you cannot say that is an economy in need of stimulus, so will there be repricing around cuts? >> when everyone believes one thing we question that and think should we believe the opposite?

it does not seem like interest rate cuts are necessary. as we extend the conversation, south korea will be impactful, it makes me think about japan. i had an opportunity to address the deputy finance minister and the seriousness which they are approaching this is worth paying attention to, it will be big. haidi: great to have you with us, asian equities portfolio manager at lng investments. early movers we are watching, chip and oil names in focus. a rally in korea, close to $90 a barrel.

reports give a better snapshot of supply and demand, brent crude -- closing at the highest level in five months. that is not translated to oil corporations seeing gains and higher markets. we're watching tsmc and chip related names. 60% of local procurement by 2030 was what tsmc told the prime minister they expect. by 2030 according to the ceo. qantas is a big one and we had a move to address anchor from the customer base. qantas soothing angry flyers. they will be offered on all international and domestic

routes. the ceo trying to appease passengers who have struggled to maintain loyalty. we are watching other names as well. report of a southwest plane making an emergency landing after a boeing engine cover came off. the plaintiff returned to denver on sunday with no injuries but the report was the cover came off during takeoff. watching airlines in asia. take a look at the roundup of the stories you needed to get your day going, you can find that on your terminal or on mobile. you can customize settings to just get the news that you care about. this is bloomberg. ♪

♪ haidi: janet yellen says relations between washington and beijing are more stable. they will meet with the pboc governor today. on sunday she sat down with the chinese premier. janet: as the world's two largest economies, we have a duty to our countries and the world, to manage our complex relationship and cooperate and show leadership addressing pressing global challenges. >> under the guidance of the two

presidents, china u.s. relationship is stabilizing and you are the first american cabinet member to visit china this year. your visit has drawn a lot of attention in society. haidi: let's bring in bloomberg's chris who joins us from beijing. we know there are areas of struggle between the superpowers that cannot be solved. in terms of what janet yellen has gotten out of the trip, does it meet the expectations that we hide? chris: i think so. they had one little announcement, i would not call it major, but they sprung announcement on saturday after she met with the vice premier. that is when they announced more talks, but specifically focus on this overcapacity as they talked

about head economic balancing. that is progress of a kind. in a greater sense we were not expecting big announcements. it is going to take time before we can gauge china's reaction to the quite severe criticism janet yellen gave them last friday. she had them over the head on the overcapacity issue. they did not fire back publicly or in the private meetings. they did not really hear any heated pushback, anything angry over janet yellen's comments. the chinese have decided to treat her politely, they've gone on through the ceremonial aspects of the visit. she met with the premier.

question that hangs over this is is her push moving the needle in terms of how they allocate capital? u.s. says they're putting too much into supply rather than demand but are the chinese going to consider this, i would say that is unlikely and we will not know for a while whether they might adjust or whether they are nodding politely are waiting to see what happens. paul: interesting point because i wonder to what degree has the respect janet yellen has enjoyed, a measure of personal respect she's used to have in china, what happens if this is her last visit? how does this relationship look

with janet yellen no longer there to sit around the table? chris: do the benefits only accrue to janet yellen? or the united states of america? if we had a change of administration, you will see big changes. no continuity. but if the biden administration carries on and there is a new treasury secretary, this will carry over. janet yellen is working hard to make sure that the ties with policymakers in china go deep. really work a day issues for financial stability and exchanging economic data. the u.s. does not have a good view, so it is fair to say that has a good chance of continuing. the highest level in terms of

influencing policymakers, the next treasury secretary may have to begin fresh. paul: bloomberg's chris with janet yellen in china. chinese developers says china construction is winding up a petition in hong kong. petition involves a financial obligation of more than 200 dollars. loretta chen joins us from hong kong. we are learning more about the company saying it will oppose it, so where do we had from here? loretta: good morning. they used to be a major developer in china, their facing trouble including a petition from china construction bank. we are seeing these petitions piling up in the past year for developers.

the most high-profile case we've seen is china evergrande which was liquidated. creditors are emboldened by the move of the hong kong court to liquidate and the risk of these companies getting a liquidation order is higher than ever. so what they were noting was that developers that have the most assets, sure mall has a lot of projects. hong kong and overseas. that makes it an easy target for creditors because they can -- the banks secure lending so they claim assets. on the other hand, two weeks ago was reported that they are in a tug-of-war with creditors, struggling to come up with a restructuring plan.

creditors are urging others to vote against its. so there are a lot of things going on and the petition comes at an inopportune time. haidi: in terms of these developers, are we seeing alleviation? sales are the weakest in almost a decade. are we careening toward a cash crunch? loretta: it seems people expects property sales continue to drop because we are not seeing a a lot of massive support measures from the government and despite loosening demand upon the demand front, we're not seeing a rebound in home sales sustained. that is a major problem for developers and for companies that have defaulted over two years ago, they are facing confidence crisis in the market

so even if homebuyers are able to buy, they will not buy from distressed companies. haidi: loretta chen in hong kong, bond and wound reporter. more to come on daybreak asia. this is bloomberg. ♪

♪ paul: former u.s. treasury secretary larry summers says the latest jobs report shows the neutral rate higher than estimates. he told us why the fed needs to reconsider expectations. larry: this was a hot report, jobs above 300,000. upwards revision, strong household survey, hours are up, payroll is up at nearly 10% annualized rates.

this was a hot report that suggested that if anything, the economy is re-accelerating. this is very different from what lots of people, most people i think, were expecting and it fits the thesis that the neutral rate is much higher than people supposed and tight money is less potent than people supposed. >> you said before that the fed should have at least some idea of the neutral rate. we heard from chair powell this week in stanford, where he said yes, we are strict in policy and yet he said he does not need to worry about where the neutral rate is for policy going forward. larry: that is like saying we don't need to know what the neutral rate is -- it's like saying you should drive your car on feel without looking at the

speedometer. it is just a mistake. you cannot know -- look, i don't know what the chairman said in full context and i want to be fair. but there is no way to judge what policy is without knowing what would be a neutral policy. my view is that the evidence is overwhelming. that the neutral rate is far higher than two and a half percent, 2.6% that the fed talks about. that evidence comes from four places. first, we have high interest rates and an economy that is growing faster than its long-run potential creating jobs as fast or faster than natural growth in the labor force allowing for

immigration. second, we have an economy with financial conditions that are extremely loose, actually looser than before the fed started the tightening process. if you look at credit spreads, the stock market, suggesting financial conditions actually have not been tightened in an appreciable way. third, if you look at the market estimate of the long run neutral rate as formed by looking at longer forward interest rates, the neutral rate is comfortably above 4%. fourth, if you look at the fundamental determinants of the neutral rate, we have surges in budget deficits that look to get worse given the political

process. big changes in resilience, and green investment, new investment, data centers. along with deglobalization which may limit capital inflows. whether you looked at the fundamentals, market estimates, financial conditions or the current strength of the economy, the evidence is overwhelming that the neutral rate is higher than the fed supposes. haidi: former treasury secretary larry summers speaking with david westin. we are hearing parliamentary testimony from the boj governor speaking in parliament in tokyo, commenting on super location of policy, the first year

responding to questions about economic settings and saying the economy's recovery enabled the move on policy when the po j off did for lift off. some, suggesting the next rate hike could, in the second half of 2024, the chances of meeting christ target are rising. her uncle's unhappy. i'm sensing an underlying issue. it's t-mobile. it started when we tried to get him under a new plan. but they they unexpectedly unraveled their “price lock” guarantee. which has made him, a bit... unruly. you called yourself the “un-carrier”. you sing about “price lock” on those commercials. “the price lock, the price lock...” so, if you could change the price, change the name! it's not a lock, i know a lock. so how can we undo the damage? we could all unsubscribe and switch to xfinity. their connection is unreal. and we could all un-experience this whole session. okay, that's uncalled for. hi, i'm janice, and i lost 172 pounds on golo. when i was a teenager i had some severe trauma

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income data should indicate that inflation is moving substantially toward our 2% goal . it will eventually become a perfect to gradually lower the federal funds rate to prevent policy from becoming overly restrictive. however, in my view, we are still not yet at the point where it is appropriate to lower the policy rate and i continue to

see a number of upside risks to inflation. >> when the economy is as strong as it is, it is hard to take rates down. or will you see strength of 350,000 jobs a month. >> that was the richmond fed president and the fed governor. we have been training here in us rather. we are seeing some again for the nikkei. a little bit of weakness for the kospi. we are modestly risk on. cannot mixture for the markets at the moment. we have some data here as well

leading to pensions. we are seeing the corporate pensions funded ratio. the second highest level since 2007. suggesting there might be less of a need for the wealth and pensions taking risks according to this that we are seeing here. quick thank you. jostling for business from used -- from a strong as pension funds, it is tokyo. the >> we have a system. there are other countries like australia that have a whole unit system whereby your contributing.

a number of senators and cognition are talking about rehabilitating our social security and contribute in a big block of money into it. quit joining us in the deputy chief executive. great to talk with you as always. it is very nice thing to draw attention to our system. of course, the issue is where it will be deployed. talk us through some of the structural opportunities you're seeing? >> yes. morning. this is the most cash positive. we are taking this opportunity is to deploy money into private markets. even some private debt. the pricing has not gone up as much as listed markets.

quickly see data that shows nearly 50% of assets offshore. during the pandemic he spoke about opportunities use have seen in china. a lot has changed since then. do you see that sort of percentage growing even further and where abroad are you looking most -- with the most interest at? >> we have roughly half the people who follow our account invested overseas. we think going for every new cash flow could be two thirds invested overseas and one third invested in australia. this has been quiet large for the us really market place. opportunities are pre-much across the globe in the u.s.. they are still in pretty good condition if you look at these large companies. the level of fixed interest have

not given rights and reason here. and our other markets as well. -- and there are other markets as well. >> you opened offices in new york, london as well to create offshore growth. are there other deals coming your way? what yes. we have two big offices in london and new york. london is our biggest office with about 120 staff. new york is just under 40 staff. the strategies for both offices differ. we do fixed income already. roughly two thirds of our dealing is done through london.

in the letter office, -- in new york, it is pre-must focused on if a structure, private debt and private equity. that has been a key area of growth in recent years. is that still the case? is there still where you see the best growth in the best opportunities? >> we think that now is a better chance to put money into the private market than two or three years ago. there was a massive amount of capital going in.

that is a much better time to invest. you're moving at a pretty glacial pace. chris we had our then, soft landing and now potentially no landing which keeps on going. people will just to the expectations. inflation is falling. growth has held up much better than people anticipated. i think central banks are starting to eat.

there were the policy may be too tight. it will be dictated as always by what the data is. senator vance will delay easing. we are very much data-driven. probably had more than two or three months. quick the outlier would be the pboc and china. where are you seeing opportunities? do feel that some of the data recently has been more positive? does it give you more optimism that we turned a corner? >> we have not been as pessimistic around china. i visited china for a week in september. it looks as if earlier this year the stimulus is starting to feed into the economy.

when talking about housing an increase in the budget deficit, i think china is on the turn. the last pmi was after. but it is a pickup within the environment structural slowdown. this is all fairly weak. floorspace is down almost 30% of the peak. but the structural adjustments are leveraging on housing. in the short-term i think there will be a decent recovery. the structural tend is still for china over the medium term. >> here in us really we had a big fight between orange energy and brookfield. just wondering if australia has taken any lessons from that battle and if we can expect australia to soon be a stronger voice in the room. >> a very interesting question.

what i take out of it, when i reflect about this is we had a very clear view on all of this, we were a long-term shareholder. the share price is at or about three pricing. lesson i take out of that is understanding our investors really well and having a really fun fundamental view. >> in some anyways, business is about future proofing and i wonder how some of the matters we have seen in the investment community, how do you approach putting money into ai enter permitted sectors? how do you approach investing in the energy transition? >> it is a really big question.

it is probably the most interesting question i've heard in the last six months or so. what strikes me is how the digital transformation has happened in this environment. you don't quick get an idea of how dramatic it is. when you look at his big top seven stocks, have a look at what their businesses are. what is interesting is they are disrupting fiduciary sectors. at alphabet it was essentially advertising businesses. you see the same thing happening in cloud computing versus conventional computing. what you're seeing is digital approaches and technology being used in existing sectors. the washtub is -- to watch above that is the earnings are really spectacular. when you look at the market

share new business models have for advertising or for retail or computing or whatever, it is stop -- still interesting relative to the conventional business models. i think digital disruption is the biggest and most dominant thing and then there is the energy transition. thank you for joining us. you can watch us live. you can also dive into any of the bloomberg security functions that we talk about and you can be part of the conversation as well by sending us instant messages during our shows. this is for bloomberg subscribers only and you can check it out on tv . this is bloomberg.

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>> you are watching daybreak out of southern gaza as hamas passes the six month mark. end been it not who says israel is one step away from victory. they will be no cease-fire

without the return of hostages. iran says it has asked to the u.s. to step aside as he prepares a response to a suspected israeli attack on syria. the strength killed iranian military officials. the u.s. has not commented on such message. the u.s. has said that china has stepped up support for russia in his war against ukraine. sources say aging has provided some of this military purposes. russia's use of north korean missiles in ukraine is giving pyongyang a rich chance to test weapons and combat. they made the comment at

u.s.-based 80 kilometers south of seoul. the quick southern jupiter tensions are also moving the crude market. looking to or sprinkle each $100 per barrel for the first time in almost two years. all that depends on some of the reports that we are talking about. we are taking a little bit of a breather for now. >> to keep backdrops of what is going on as well -- the economies around the globe almost universally are coming in better than expected. globally it is a special looking good. in the u.s.. china has had the turnaround so that means the demand picture is remaining resilient.

it has not faded away. that was part of the picture for a while. the other thing that has happened is the picture has become much more cloudy. we have mexico decided it doesn't want to export oil. that means u.s. refiners have to use more u.s. oil. that has an obvious read through . you have ongoing difficult is about russian crude supplies. you have venezuelan supplies. opec-plus is seeking to curb production.

you have all of those dynamics that are reducing supply and raising the potential for further reduction in supply. demand is stronger than expected. it is what keeps on climbing. we are trying to get to the bottom of the mystery here. you have been buying gold on the down low. somebody has. >> probably more than one somebody has. i would through the finger at central banks who have been persistently interested in gold in the last couple of years. how the u.s. responded to russia by seizing and or blocking russian preserves. that is to say we want more gold. central bank have a much greater

amount in coal reserves then they've had for a long time. especially if you have a look at the value, not just the size of the holdings. they keep buying despite the price. then you have some of the other buyers -- it is very weird because real yields are high. gold is not rise when real yields are high because it shows inflation hedge but only if yields are under inflation. if yields are about inflation you buy bonds instead of gold. because old is not give you any interest payments. that is a bit of a puzzle and you can kind of toss a coin, probably a gold one. on which you think is the biggest driver. there are people thinking there will be harder than -- if there

is a hard landing, they will cut interest rates massively. that will make gold more attractive. the other alternative is that central banks have moved towards a far easier approach. they are not trumping the inflation in the way they were. the fed boosted its gdp. that definitely raises the potential for a fresh inflation breakout. that is also the sort of thing that gold will be excited to do. you have a range of dynamics. some of which are contradictory. quick thinking for joining us. the prices backing off a little bit of moment. uber gives can interact with charts.

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china's government says they

shared more than 100 anti-milling of chinese people travel for the holidays. japan, thailand, south korea and hong kong were some of the most popular destinations. let's bring in our asian stocks reporter. she spoke with them after says accommodations with the servers editors earlier in wenzhou. do expect any kind of market reaction?

as the solar module makers and eb's as well as battery makers. there are some of the sectors where yellen had said there is an over capacity of some of the cheaper chinese goods. if we look at the sectors where biden has been targeting to boost in the u.s., we are mostly -- they're most coinciding with xi jinping.

>> we have been sick of that geopolitical risk ramping up. that is when we look at tech and audio tech. some of the other sectors -- women look at tech, we have seen the tiktok saga, iraq -- the u.s. trying to have more of that scrutiny on chinese companies that are doing business in the u.s.. we have also seen the biotech companies and there is a bipartisan bill in the u.s. trying to block these companies. the other businesses that chinese companies had in washington. but here, the key is ahead of

the election we will be seeing more of that. >> all right. that was your stocks reporter. >> reopening stocks invokes including sampson and china chores and group. more to come. is bloomberg. ♪

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>> we are halfway from the open and hong kong. asian stocks are rising. bonds are under pressure following that u.s. jobs report. tengion now turning to this uscp i print for the fed. after the currency slipped close to deliver its trading range.