00:00:00
Speaker 1: Bloomberg Audio Studios, Podcasts, radio News.
00:00:10
Speaker 2: Welcome to the Daybreak Asia podcast. I'm Doug Chrisner. It's a mixed picture for equities in the Asia Pacific markets are bracing for two key events this week. On Wednesday in the States, we'll have earnings from Nvidia after the bell. Then on Friday, FED shair Kevin Walsh will address the fed's annual Symposium in Jackson Hall, Wyoming. And it's there that Warsh is expected to clarify his views on how the FED should react to stubborn inflation. And that will coincide with attempts by the US Treasury to bring longer term yields lower through buybacks of long dated government bonds. And that's where we began our conversation with Dylan wu. Dylan is research strategist at Pepperstone. She spoke with Bloomberg TV host Heidi Stroud, Watts and Paul Allen.
00:00:56
Speaker 3: Dylan, I do want to start on what we're seeing in theory space at the moment. I mean, we've got yields climbing again. That bounce that we saw last week was very very short lived. We're also expecting to hear from the Trump administration. This week, I'm veiling a range of fiscal initiatives to address the problem at the core of this. What do you think is needed here?
00:01:22
Speaker 4: Well, I think the bob market is obviously head of the fat right now. That gap is the whole story. I think the third year at five point three percent ish is a nineteen year high fine. But what actually matters is this is't announced. He more than double the buy back program and the yields barely flinched, And that tells us is actually a term a term premium problem and is quite structural. And you've got inflation that won't come down to the target, a physical deficit that just printed is worth monthly member since twenty twenty one, and a trillion dollar a I corporate bonds issue and save competing with government paper for the same kind of buyers. So those three things don't go away because the Treasury buys back some bonds and bond set off I think would likely to continue to genuine physical discipline or demond destruction, but neither imminent, I think. And in a new term the long end treasury you will likely stay elevated.
00:02:27
Speaker 3: I think, Well, this is arguably making fed chick Kevin WASH's job somewhat more challenging, and we will be hearing from him at the end of the week at Jackson Hall. What do markets need to hear from the FED chair in terms of inflation targeting, communication about the Fed's next move and what kind of market reaction do you expect if it doesn't get it.
00:02:50
Speaker 4: Well. I think it would be obviously a really challenging speech work for Kevin Wash, and he has no good options, to be honest, wired and youths keep running, financial conditions tightened without a single rate hike, which is almost you know, like poetic is dysfunction, and also signal that he's okay with higher loan and yields, which some people think is actually his his bias or he stands and you you basically had the bond base exactly what they need and push that doubbishly, and you had the inflation hug a credibility argument. So actually, I think it would be a really challenging or we're hard task for Kevin Wash to balance the market expectations of a potential hike, and also you know, he need to consider about a sluggish labor market and also a sluggish retail self data back to July.
00:03:53
Speaker 5: Dylan.
00:03:54
Speaker 1: A lot at play here when it comes to the gains across the AI space has been due to the relentlessness of the momentum factor. Right as this begins to fade, it's certainly been challenged over the last couple of rounds of sell offs. Do you see more of a difficult certainly, more of a difficult environment for retail investors, but perhaps more opportunity if you're looking to be a little bit more picky and perhaps value oriented.
00:04:20
Speaker 4: Yes, I do think, you know, like everything goes up together is basically yesterday, and we really need to potentially find some selective opportunity in the AI trade. I mean, because the fundamental of the demand in AIS do quite intact. AI demod is quite strong Hyperscaler's capax commitment approaching seven billion dollars for twenty many six. It is real and a structural supply constraints through the middle of the of the decade. But the market is drawing a hardline between companies spending on AI and also companies earning from it. Alphabet delivered on monetization in the past Quota. Microsoft past was with flying Colors, but Meta was punished because you know their lack of AI spending discipline, so that divergence widened from here, I think in a new future, and so I think it's a selective story rather than everything goes up together recently. And we obviously need to look into Nvidia's report to be released on after market close on thirty twenty six of August. So if we are seeing solid chife a month and potentially more supply from the NVDA side, that it could be a potential boost to the AI trade.
00:05:53
Speaker 1: Dylan, that's just sposed focusing closely enough for looking at the repercussions enough of the feedba what we're seeing from what the bond markets are doing and the relentless pace of fundraising by hyperscalers and other AI players, Does this at some point come to be a confluence because you would imagine this ultimate early results in even more expensive levels when it comes to the AI build out.
00:06:21
Speaker 4: Yeah, I think that's a fair point, and I think the interaction effect between the bond market and AI capax is obviously something we need to monitor as well. And behavior scalers are claiming to issue roughly four hundred billion dollars in investment great bonds e twenty May seven to fund is AI infrastructure built out and well, the issue has to be a sword by the same bond market that's already under structural pressure from physical deficit and persistent inflation. And if the thirty year you'll say above say five percent, because of that, debt financing rises materially and it changes the return math when AI infrastructure in the investment in ways that they aren't yet reflected in tech valuations. So if we are still seeing the lack of physical discipline from the law and from the AI from the US debt market, then it would be a potential challenge to the mead to long term development in the AI trade. But in a new term, I think what can bring markets more volatility as to a VDS report.
00:07:40
Speaker 5: Dan.
00:07:41
Speaker 3: Just finally, copper miners are being performing very well in the story. Australia is home to a lot of copper miners and copper also occurs in similar are bodies to gold as well, which is also performing well thanks to the debasement trade. With that in mind, how did you like the earning story from miners and how do you play the Australian story at the moment.
00:08:02
Speaker 4: Well, I think the Australian outlook is genuinely missed, mixed and is suggested by the earning season and the motor speed economy theme I think is due playing out quite well in Australia. Resources, as we just mentioned are carrying the lord BAHP delivered impated of thirty percent when record corporate price is our biggest dividend in four years and real tinterer but are up twenty eight percent. Quality Australian names with global commodity exposures specifically are navigating this environment just fine. And the problem is basically everywhere else, non resources earnings are tracking around two point six percent growth against underlying inflation of a roughly three point six percent, and that's real contraction in purchasing power terms and banks are solid but not that's you know, the tackular we can incredit quality as well as concerns about a potential economic slowdown kept calling up across different reports, so that tells you the consumer is under some real pressure. And I think, you know it's basically we're looking into a multi speed. We're multi speed growth model in Australia. I think we are still looking a potential upside of all the energy and including corpor these kind of names, but we need to be more cautious about all the now energy and retail sectors.
00:09:40
Speaker 2: That was Dylan Wu, Research Strategistic Pepperstone speaking with Bloomberg TV host Heidi Stroud Watts and Paul Allen, bringing you their conversation here on the Daybreak Asia Podcast. Welcome back to the Daybreak Asia podcas I'm Doug Prisner. On Monday, in the US, Treasury Secretary Scott Besant is set to hold a media briefing on details of planned sanctions against Iran and its trading partners. Now. This move will put China in the spotlight since it is the largest purchaser of Iranian crude oil.
00:10:18
Speaker 5: Now.
00:10:18
Speaker 2: For its part, Beijing has said it continues to support a diplomatic end to the US Iran war. And that's where we begin our conversation with Christopher Smart. He is managing partner at our Breath Group. Chris spoke with Bloomberg TV host Heidi Stroudwatts and Paul Allen.
00:10:34
Speaker 1: Christopher, always a pleasure to have you with us, And as you asked, what are we going to talk about? Because we haven't heard a great deal of progress in terms of what's going on with this what feels like an increasingly intractable stalemate, this economic isolation plan that we're waiting for details on. What are you expecting given that, well, Iran is and has been for a long time economically isolated.
00:11:01
Speaker 6: Well, I think a lot of us are going to be interested to see what Secretary of Vesson has to say tomorrow.
00:11:05
Speaker 5: I think he wrote a piece over.
00:11:07
Speaker 6: The weekend that announces or describes what he's about to announces an economic d day of the beginning of a final assault on the Iranian economy. But it feels like, as you say, this is something we've been working on for more than a decade or maybe several decades now in terms of isolating and sanctioning the Iranian economy. I think a couple of things spring to mind right away is we really have very little sense of how bad things are within the Iranian economy right now. We know it's bad, but we're not really sure exactly where the pressure points are. And then secondly, this is a regime that is not popularly elected, not facing any midterms anytime soon, So even if the pain gets worse for the people of Iran, it's not clear how that's going to change their behavior or any of their negotiating positions.
00:11:57
Speaker 1: Does a great impact potentially come down to what Beijing and what Russia can be persuaded to do. And we do know that presides year is expected to head to Washington in September. Is there any leverage there for President Trump?
00:12:12
Speaker 6: Well, I mean, as you say, the biggest trading partners are China, and that we have a whole lot of other business to do with China beyond Iran. So I'm not sure what kind of leverage the President expects he can exert other than maybe tariffs or sanctions. But we also know that the Chinese aren't just going to stand and take it if those sorts of threats are raised, and so they have played their cards before, responding with both sanctions as well as blocking critical mineral exports, and so I'm not sure that's a game that the President wants to start playing.
00:12:50
Speaker 5: At this stage. You know, the other key players in the region.
00:12:54
Speaker 6: Afghanistan is on one border, Turkey and Russia are on northern borders. Not clear we have any relationship with either Afghanistan or Russia. Turkey might be able to help out, but it's not clear. That that's at the top of their list. I think the one encouraging point that the President and the Secretary Treasury Secretary can look to is the announcement earlier this week that the United Emirates was going to stop all of its economic relationships with Iran. That's been a key conduit of a lot of money in and out of the country. The question will be does the government is the government able to crack down on illicit and illegal flows back and forth.
00:13:38
Speaker 3: Christopher, part of the whole rationale for this conflict in the first place was to prevent Iran from getting a nuclear weapon. But a couple of thoughts here, it does this entire experience reinforce the Iranian desire for a nuclear weapon sort of prove their point to a degree, and in terms of economic isolation, exhibit a North Korea and due decades of economic isolation, got on nuke.
00:14:00
Speaker 6: Anyway, Yes, you know, you make excellent points all around.
00:14:07
Speaker 5: I think others have pointed that out as well.
00:14:12
Speaker 6: The attacks on Iran, as you say, reinforce the case of the hardliners within Iran that this is something that needs to be done now.
00:14:19
Speaker 5: Obviously, the bombings.
00:14:21
Speaker 6: Last year and then this year have done a lot to set back that program. But I think expecting to resume a course of negotiations that requires trust to be built on both sides and requires inspections and transparency and Iran to trust the fact that its security is not threatened have been delivered a big setback right now. The question, though, remains, I think what good does a nuclear weapon do for Iran?
00:14:51
Speaker 5: Maybe it.
00:14:53
Speaker 6: Helps it avoid another attack like this, But to be honest, I think what we've demonstrated all from from what's happened in the last six months is that attacks like this don't really work.
00:15:04
Speaker 5: They don't really change the behavior.
00:15:06
Speaker 6: Of the regime and the way you want to change it, and in fact has opened up these problems on the street that we're all dealing with.
00:15:14
Speaker 5: Well, the regime has.
00:15:15
Speaker 3: Been around since the nineteen eighties, President Trump, this term has been around for slightly under two years. You mentioned earlier, the Iranian regime doesn't have to face midterms, but the president does. Is that part of the play here to make things extremely uncomfortable for the US? Do you expect any retaliation from Iran in the hope that they might be dealing with a new regime a more sympathetic one in the United States a couple of years down the track.
00:15:42
Speaker 6: Well, two years is a long time for the difficulty of having lost their access to global oil markets.
00:15:49
Speaker 5: The street being closed is inflicting pain on them. I'm sure they would.
00:15:52
Speaker 6: Prefer not to have that blocked the way it is right now, and to expect that to go on another two years, I think is probably some they would love to avoid.
00:16:02
Speaker 5: But I think the real question is just the imbalance in.
00:16:06
Speaker 6: In uh In, I guess dead fastness for lack of a better word.
00:16:11
Speaker 5: I mean, Iran is defending its country. It's never going to give.
00:16:14
Speaker 6: Up on that, and the hope is that the US will either get distracted or realize that the costs of continuing this effort militarily as well as economically.
00:16:25
Speaker 5: Are are too high.
00:16:27
Speaker 6: And so it feels like we're still going to have to come to terms with some kind of agreement that neither side loves. But we're clearly not there yet, and we're going to have to see what the Secretary announces tomorrow. You know, I'll just say as an aside, he has had two big announcements in the last two weeks, with the Yen intervention and then with the buybacks of the US Treasury debt, you know, his credibility has been dented in the past couple of weeks, and so it's not clear that he's going to be, you know, restoring or reinforcing that reputation with whatever he's able to announce tomorrow, unless it's something completely surprising.
00:17:06
Speaker 2: That's Christopher Smart, managing partner at Our Birth Group, speaking with Bloomberg TV host Heidi Stroud Watts and Paul Allen bringing you their conversation here on the Daybreak Asia podcast. Thanks for listening to today's episode of the Bloomberg Daybreak Asia Edition podcast. Each weekday, we look at the story shaping markets, finance, and geopolitics in the Asia Pacific. You can find us on Apple, Spotify, the Bloomberg Podcast YouTube channel, or anywhere else you listen. Join us again tomorrow for insight on the market moves from Hong Kong to Singapore and Australia. I'm Doug Chrisner, and this is Bloomberg
Speaker 1: Bloomberg Audio Studios, Podcasts, radio News.
00:00:10
Speaker 2: Welcome to the Daybreak Asia podcast. I'm Doug Chrisner. It's a mixed picture for equities in the Asia Pacific markets are bracing for two key events this week. On Wednesday in the States, we'll have earnings from Nvidia after the bell. Then on Friday, FED shair Kevin Walsh will address the fed's annual Symposium in Jackson Hall, Wyoming. And it's there that Warsh is expected to clarify his views on how the FED should react to stubborn inflation. And that will coincide with attempts by the US Treasury to bring longer term yields lower through buybacks of long dated government bonds. And that's where we began our conversation with Dylan wu. Dylan is research strategist at Pepperstone. She spoke with Bloomberg TV host Heidi Stroud, Watts and Paul Allen.
00:00:56
Speaker 3: Dylan, I do want to start on what we're seeing in theory space at the moment. I mean, we've got yields climbing again. That bounce that we saw last week was very very short lived. We're also expecting to hear from the Trump administration. This week, I'm veiling a range of fiscal initiatives to address the problem at the core of this. What do you think is needed here?
00:01:22
Speaker 4: Well, I think the bob market is obviously head of the fat right now. That gap is the whole story. I think the third year at five point three percent ish is a nineteen year high fine. But what actually matters is this is't announced. He more than double the buy back program and the yields barely flinched, And that tells us is actually a term a term premium problem and is quite structural. And you've got inflation that won't come down to the target, a physical deficit that just printed is worth monthly member since twenty twenty one, and a trillion dollar a I corporate bonds issue and save competing with government paper for the same kind of buyers. So those three things don't go away because the Treasury buys back some bonds and bond set off I think would likely to continue to genuine physical discipline or demond destruction, but neither imminent, I think. And in a new term the long end treasury you will likely stay elevated.
00:02:27
Speaker 3: I think, Well, this is arguably making fed chick Kevin WASH's job somewhat more challenging, and we will be hearing from him at the end of the week at Jackson Hall. What do markets need to hear from the FED chair in terms of inflation targeting, communication about the Fed's next move and what kind of market reaction do you expect if it doesn't get it.
00:02:50
Speaker 4: Well. I think it would be obviously a really challenging speech work for Kevin Wash, and he has no good options, to be honest, wired and youths keep running, financial conditions tightened without a single rate hike, which is almost you know, like poetic is dysfunction, and also signal that he's okay with higher loan and yields, which some people think is actually his his bias or he stands and you you basically had the bond base exactly what they need and push that doubbishly, and you had the inflation hug a credibility argument. So actually, I think it would be a really challenging or we're hard task for Kevin Wash to balance the market expectations of a potential hike, and also you know, he need to consider about a sluggish labor market and also a sluggish retail self data back to July.
00:03:53
Speaker 5: Dylan.
00:03:54
Speaker 1: A lot at play here when it comes to the gains across the AI space has been due to the relentlessness of the momentum factor. Right as this begins to fade, it's certainly been challenged over the last couple of rounds of sell offs. Do you see more of a difficult certainly, more of a difficult environment for retail investors, but perhaps more opportunity if you're looking to be a little bit more picky and perhaps value oriented.
00:04:20
Speaker 4: Yes, I do think, you know, like everything goes up together is basically yesterday, and we really need to potentially find some selective opportunity in the AI trade. I mean, because the fundamental of the demand in AIS do quite intact. AI demod is quite strong Hyperscaler's capax commitment approaching seven billion dollars for twenty many six. It is real and a structural supply constraints through the middle of the of the decade. But the market is drawing a hardline between companies spending on AI and also companies earning from it. Alphabet delivered on monetization in the past Quota. Microsoft past was with flying Colors, but Meta was punished because you know their lack of AI spending discipline, so that divergence widened from here, I think in a new future, and so I think it's a selective story rather than everything goes up together recently. And we obviously need to look into Nvidia's report to be released on after market close on thirty twenty six of August. So if we are seeing solid chife a month and potentially more supply from the NVDA side, that it could be a potential boost to the AI trade.
00:05:53
Speaker 1: Dylan, that's just sposed focusing closely enough for looking at the repercussions enough of the feedba what we're seeing from what the bond markets are doing and the relentless pace of fundraising by hyperscalers and other AI players, Does this at some point come to be a confluence because you would imagine this ultimate early results in even more expensive levels when it comes to the AI build out.
00:06:21
Speaker 4: Yeah, I think that's a fair point, and I think the interaction effect between the bond market and AI capax is obviously something we need to monitor as well. And behavior scalers are claiming to issue roughly four hundred billion dollars in investment great bonds e twenty May seven to fund is AI infrastructure built out and well, the issue has to be a sword by the same bond market that's already under structural pressure from physical deficit and persistent inflation. And if the thirty year you'll say above say five percent, because of that, debt financing rises materially and it changes the return math when AI infrastructure in the investment in ways that they aren't yet reflected in tech valuations. So if we are still seeing the lack of physical discipline from the law and from the AI from the US debt market, then it would be a potential challenge to the mead to long term development in the AI trade. But in a new term, I think what can bring markets more volatility as to a VDS report.
00:07:40
Speaker 5: Dan.
00:07:41
Speaker 3: Just finally, copper miners are being performing very well in the story. Australia is home to a lot of copper miners and copper also occurs in similar are bodies to gold as well, which is also performing well thanks to the debasement trade. With that in mind, how did you like the earning story from miners and how do you play the Australian story at the moment.
00:08:02
Speaker 4: Well, I think the Australian outlook is genuinely missed, mixed and is suggested by the earning season and the motor speed economy theme I think is due playing out quite well in Australia. Resources, as we just mentioned are carrying the lord BAHP delivered impated of thirty percent when record corporate price is our biggest dividend in four years and real tinterer but are up twenty eight percent. Quality Australian names with global commodity exposures specifically are navigating this environment just fine. And the problem is basically everywhere else, non resources earnings are tracking around two point six percent growth against underlying inflation of a roughly three point six percent, and that's real contraction in purchasing power terms and banks are solid but not that's you know, the tackular we can incredit quality as well as concerns about a potential economic slowdown kept calling up across different reports, so that tells you the consumer is under some real pressure. And I think, you know it's basically we're looking into a multi speed. We're multi speed growth model in Australia. I think we are still looking a potential upside of all the energy and including corpor these kind of names, but we need to be more cautious about all the now energy and retail sectors.
00:09:40
Speaker 2: That was Dylan Wu, Research Strategistic Pepperstone speaking with Bloomberg TV host Heidi Stroud Watts and Paul Allen, bringing you their conversation here on the Daybreak Asia Podcast. Welcome back to the Daybreak Asia podcas I'm Doug Prisner. On Monday, in the US, Treasury Secretary Scott Besant is set to hold a media briefing on details of planned sanctions against Iran and its trading partners. Now. This move will put China in the spotlight since it is the largest purchaser of Iranian crude oil.
00:10:18
Speaker 5: Now.
00:10:18
Speaker 2: For its part, Beijing has said it continues to support a diplomatic end to the US Iran war. And that's where we begin our conversation with Christopher Smart. He is managing partner at our Breath Group. Chris spoke with Bloomberg TV host Heidi Stroudwatts and Paul Allen.
00:10:34
Speaker 1: Christopher, always a pleasure to have you with us, And as you asked, what are we going to talk about? Because we haven't heard a great deal of progress in terms of what's going on with this what feels like an increasingly intractable stalemate, this economic isolation plan that we're waiting for details on. What are you expecting given that, well, Iran is and has been for a long time economically isolated.
00:11:01
Speaker 6: Well, I think a lot of us are going to be interested to see what Secretary of Vesson has to say tomorrow.
00:11:05
Speaker 5: I think he wrote a piece over.
00:11:07
Speaker 6: The weekend that announces or describes what he's about to announces an economic d day of the beginning of a final assault on the Iranian economy. But it feels like, as you say, this is something we've been working on for more than a decade or maybe several decades now in terms of isolating and sanctioning the Iranian economy. I think a couple of things spring to mind right away is we really have very little sense of how bad things are within the Iranian economy right now. We know it's bad, but we're not really sure exactly where the pressure points are. And then secondly, this is a regime that is not popularly elected, not facing any midterms anytime soon, So even if the pain gets worse for the people of Iran, it's not clear how that's going to change their behavior or any of their negotiating positions.
00:11:57
Speaker 1: Does a great impact potentially come down to what Beijing and what Russia can be persuaded to do. And we do know that presides year is expected to head to Washington in September. Is there any leverage there for President Trump?
00:12:12
Speaker 6: Well, I mean, as you say, the biggest trading partners are China, and that we have a whole lot of other business to do with China beyond Iran. So I'm not sure what kind of leverage the President expects he can exert other than maybe tariffs or sanctions. But we also know that the Chinese aren't just going to stand and take it if those sorts of threats are raised, and so they have played their cards before, responding with both sanctions as well as blocking critical mineral exports, and so I'm not sure that's a game that the President wants to start playing.
00:12:50
Speaker 5: At this stage. You know, the other key players in the region.
00:12:54
Speaker 6: Afghanistan is on one border, Turkey and Russia are on northern borders. Not clear we have any relationship with either Afghanistan or Russia. Turkey might be able to help out, but it's not clear. That that's at the top of their list. I think the one encouraging point that the President and the Secretary Treasury Secretary can look to is the announcement earlier this week that the United Emirates was going to stop all of its economic relationships with Iran. That's been a key conduit of a lot of money in and out of the country. The question will be does the government is the government able to crack down on illicit and illegal flows back and forth.
00:13:38
Speaker 3: Christopher, part of the whole rationale for this conflict in the first place was to prevent Iran from getting a nuclear weapon. But a couple of thoughts here, it does this entire experience reinforce the Iranian desire for a nuclear weapon sort of prove their point to a degree, and in terms of economic isolation, exhibit a North Korea and due decades of economic isolation, got on nuke.
00:14:00
Speaker 6: Anyway, Yes, you know, you make excellent points all around.
00:14:07
Speaker 5: I think others have pointed that out as well.
00:14:12
Speaker 6: The attacks on Iran, as you say, reinforce the case of the hardliners within Iran that this is something that needs to be done now.
00:14:19
Speaker 5: Obviously, the bombings.
00:14:21
Speaker 6: Last year and then this year have done a lot to set back that program. But I think expecting to resume a course of negotiations that requires trust to be built on both sides and requires inspections and transparency and Iran to trust the fact that its security is not threatened have been delivered a big setback right now. The question, though, remains, I think what good does a nuclear weapon do for Iran?
00:14:51
Speaker 5: Maybe it.
00:14:53
Speaker 6: Helps it avoid another attack like this, But to be honest, I think what we've demonstrated all from from what's happened in the last six months is that attacks like this don't really work.
00:15:04
Speaker 5: They don't really change the behavior.
00:15:06
Speaker 6: Of the regime and the way you want to change it, and in fact has opened up these problems on the street that we're all dealing with.
00:15:14
Speaker 5: Well, the regime has.
00:15:15
Speaker 3: Been around since the nineteen eighties, President Trump, this term has been around for slightly under two years. You mentioned earlier, the Iranian regime doesn't have to face midterms, but the president does. Is that part of the play here to make things extremely uncomfortable for the US? Do you expect any retaliation from Iran in the hope that they might be dealing with a new regime a more sympathetic one in the United States a couple of years down the track.
00:15:42
Speaker 6: Well, two years is a long time for the difficulty of having lost their access to global oil markets.
00:15:49
Speaker 5: The street being closed is inflicting pain on them. I'm sure they would.
00:15:52
Speaker 6: Prefer not to have that blocked the way it is right now, and to expect that to go on another two years, I think is probably some they would love to avoid.
00:16:02
Speaker 5: But I think the real question is just the imbalance in.
00:16:06
Speaker 6: In uh In, I guess dead fastness for lack of a better word.
00:16:11
Speaker 5: I mean, Iran is defending its country. It's never going to give.
00:16:14
Speaker 6: Up on that, and the hope is that the US will either get distracted or realize that the costs of continuing this effort militarily as well as economically.
00:16:25
Speaker 5: Are are too high.
00:16:27
Speaker 6: And so it feels like we're still going to have to come to terms with some kind of agreement that neither side loves. But we're clearly not there yet, and we're going to have to see what the Secretary announces tomorrow. You know, I'll just say as an aside, he has had two big announcements in the last two weeks, with the Yen intervention and then with the buybacks of the US Treasury debt, you know, his credibility has been dented in the past couple of weeks, and so it's not clear that he's going to be, you know, restoring or reinforcing that reputation with whatever he's able to announce tomorrow, unless it's something completely surprising.
00:17:06
Speaker 2: That's Christopher Smart, managing partner at Our Birth Group, speaking with Bloomberg TV host Heidi Stroud Watts and Paul Allen bringing you their conversation here on the Daybreak Asia podcast. Thanks for listening to today's episode of the Bloomberg Daybreak Asia Edition podcast. Each weekday, we look at the story shaping markets, finance, and geopolitics in the Asia Pacific. You can find us on Apple, Spotify, the Bloomberg Podcast YouTube channel, or anywhere else you listen. Join us again tomorrow for insight on the market moves from Hong Kong to Singapore and Australia. I'm Doug Chrisner, and this is Bloomberg
