Trump Announces $5,000 to US Adults if GOP Wins Midterms

Not have in Shanghai, Shenzhen and here in Hong Kong, you're watching the China show. I'm Yvonne Man with David and Glenn. Good morning. We're counting down to the open of markets in Greater China. Let's get to your top stories today. Brent crude surging past $100 a barrel with Iran saying it's ready to escalate the war with the U.S. bond yields are rising after the Treasury announced details of its next debt buyback plan. Beijing defends distillation as standard practice in training AI models, rejecting U.S. allegations that Chinese labs cheat to compete with anthropic and OpenAI, and a new era unfolding at Apple as the new CEO unveils the first foldable iPhone entering a market dominated by Samsung and far away. And Donald Trump headlines the RNC convention in Dallas as the president seeks to rally voters and donors ahead of this year's midterms. And we are waiting for President Trump to take the stage there in Dallas for the RNC. And certainly that's one thing we're watching and taking a close look into that speech as well. But certainly before that, we spoke and we heard from Mr. Bissonette as well. Um, you know, he basically said, don't bet against me. And it seems like markets have done just that. Yeah. They were left wanting. Yeah. On the Treasury side of things. Calling his boss. Yeah, I think 4.84. We took that out on the ten year yield. We are still seeing some pressure across the Treasury markets, which actually doesn't bode well because we do have a ten year bond auction coming through, uh, within the next let's call it what, 14 hours or so. So I mean, let's see let's see whether or not this is value for investors. I think if if what we're seeing in Japan is any indication at multi-decade highs, at least in Japan's case, we do see some think coming through. This is of course front and center for markets right now, given, of course, some of the inflationary concerns, energy prices. We talked about oil 101, uh, 80 bucks. Um, European gas. Uh, we're near 14,000 separately on copper when it pertains to of course, when you are in copper prices 15,000 rather. And of course, that goes into as well the ECB rate decision that comes out today as well. And don't forget about that. We are expecting them to hike interest rates as well. So all of this against the backdrop of rising yields and an equity market, which at least just for today, seems to be struggling for any traction, despite the fact that you are getting still some positive news flow around the EI story. Whether that's the macro data points around Taiwan and record exports. There are some of these deals coming through OpenAI and Samsung. S&P futures are steady, but as you can see, we're playing some catch down in the Asia-Pacific. Taiwan is coming in by 8/10 of 1%. Goes into the China Open today A50 futures coming up. We are in the window for some credit data and specifically on the fix today. Yesterday we kind of broke trend with a stronger fix relative to the previous days was the strongest since 2023. Let's see if they lean against the dollar weakness or they let the winds of markets take this one. Uh, by the horns. We'll see. Yeah. Uh, we'll continue to watch, of course. Right. Just given the dollar weakness that we've seen. Um, certainly there's been a lot of talk about the export side of things. Can they remain robust? Yeah. If the renminbi remains at these levels. So, uh, we're not just watching if you're also watching those yields and what we've been seeing in particular with that ten year Treasury yield, you know, after that big buyback announcement, I mean, we've not big enough. Big enough. Bigger but not big enough. It was nearly triple the amount that they were going to lay out, uh, last month, but still not enough to satisfy the market. That's for more. Let's bring in Bloomberg's study. Banga, joining us now. Uh, right now, um, it's certainly interesting right? When you hear such tough talk from the Treasury secretary. Not enough to really, uh, change what market the market narrative is right now. Uh, what's your team watching out for here today? Um, yeah, absolutely. It does feel like Scott Bisson forgot to load the bazooka. Um, and that sort of reflected in the price action in ten year or just across the whole Treasury curve. Um, and obviously with the oil price also moving to recent highs, it's also just weighing on sentiment, um, particularly in Asia. Um, India has been the weak, one of the weaker markets where the nifty has been quite weakened and almost an inverse price action of crude oil. Um, and then, broadly speaking, you know, there has been sort of nervousness around the region and the bright spots really being the semi complex and, and that specifically being the memory stocks. Um, off the back of, you know, positive sentiment out of the open I announcement from last week. So it does seem there is a more than noticeable sunny risk off tone across these equity markets today. Anything on the agenda today that you see could change the course of trading today? Or is this is this Thursday for us? Pretty much. Yeah. I mean I think the the key thing will be, uh, you know, how does the, uh, supply chain for Apple respond today to the launch of the phone? I mean, it's still very early to tell whether this is going to result in a large, you know, replacement or, you know, upgrade cycle. Um, for the iPhone. Uh, nonetheless, I think the last few sessions have been very narrow, um, in Asia, very directed towards, um, Crosby relevant trades. There's been a return in foreign buying in the Crosby and corporates in Korea also buying back their stock. But I think the key risks now head towards the US PPI figures for today. And then on Friday um which is really what the market is, um, really glued on, because that's really going to give us much more direction over the next coming weeks where CPI learns. What does that say? Fantastic. Thank you so much. As we countdown to reopen to trade in Greater China, at least here about 24 minutes away, right up from Sydney, and will take us straight now to Dallas and we're live there, of course, for President Trump is scheduled to headline the midterm Republican convention. We are just waiting, of course, for the US president to take the stage and give his remarks there ahead of the upcoming midterms on on your screens, of course, RFK Jr to vice president on your screens as well. Just to the left, just out of shot at the moment is the U.S. Treasury secretary that we just talked about there. So we'll see, of course, uh, what is in store for us? In fact, let's head straight now, in fact, to the venue, uh, in Dallas, and we're joined by Eric Watson, our Bloomberg congressional reporter. He's in the venue for us. Eric, good morning from Hong Kong. Thank you for I know it's perhaps getting quite noisy already where you are. What are we expecting to hear from the U.S. president today? You know, a lot of the messaging so far today has really been doubling down on the Republican rhetoric that Democrats have become a party of socialism and communism, that only the Republicans can stop them from taking over the United States and threatening our security and rolling back the Trump tax cuts. We're expecting the president to talk about jobs numbers, talk about employment, a manufacturing renaissance, and to steer away from issues of inflation and affordability that are really bedeviling American voters and the centerpiece of their Democratic campaign. So we're expecting him to try to rally his base here. It's really a strategy to hope that, you know, Republicans who normally aren't really coming out to vote when Trump is not on the ballot will actually get enthused and come out. I talked to some Republican strategist. They think it'll be a wash. Trump's popularity is very low in some of the swing states is in the low 30s, and it could actually be heard some of these candidates, uh, who are running in places like Maine and Ohio, uh, and North Carolina. Help us, walk us through from now until the midterms. What, what the strategy is going to be moving forward for the Republican Party and for for Trump as well, and kind of for global viewers. Walk us through the importance really of of maybe the speech or even this RNC. Well, you know, the real thing that they're trying to do is get Trump's MAGA Inc, his, uh, $400 million off the sidelines. Trump has really not been throwing money into these races that they're hoping that, you know, especially those, uh, Republicans who showed up and went on stage here will benefit from this enormous amount of cash. Uh, just now, Labor Day after Labor Day in the United States. That's where the money in the ads really start going up, uh, on the air and hoping to reverse this possible blue wave that we're seeing. Uh, you know, most Republicans are thinking that the House will be lost to them, and they're emphasizing to their donors and others that the Senate is really the bulwark against a complete Democratic and challenge to the president investigation and possible impeachment. So we're really starting to shake the money tree here in Dallas, the oil industry, defense industry, and really trying to rally the base to save the Senate for Republicans. Eric, we're gonna leave it there is getting loud where you are. Eric wasn't there at the Republican National Committee convention in Dallas. We'll bring you those live pictures once we do see President Trump there on stage coming up. We are live from Seoul from the KB financial Group Korea conference will be hearing from upstage, the last remaining startup in South Korea, so-called eye squid Game, in just a few minutes. And we're also counting down to the opening of trade in Shanghai, Shenzhen and Hong Kong. And we talked about how it could be a bit of a risk off day across these markets, just given a sell for see across global bonds. Once again futures are in the red this morning. This is the China show. All right. Good morning. From the Asia Pacific, where it is mid-morning. We're approaching the opening bell just to tell you about, of course, uh, a major event taking place in Dallas. There you go. That's the U.S. president. He is just beginning his speech at the Republican convention, of course, ahead of the midterms. Uh, once he once we do see, of course. But he says. And any relevant information, of course we will bring that to you. Uh, in the meantime, though, we will dip out of that, uh, take you straight back to markets where we are set to open lower, uh, on your screens, A50 futures are down, uh, alongside, of course, cash markets up and running. We're down about 2% on the cost. Be index Taiwan coming online about 1% to the downside MF x given oil is 1 to 1. We're nearing a year to date highs actually on the yen could have that separate conversation and that as well. The one continues to strengthen amidst this. But as you can see pressure coming through in light of the past. So very, uh, open, uh, to what we're seeing as far as oil prices go, very negatively correlated as far as some M currencies are concerned, which takes us nicely into the agenda for today. Yeah. When you take a look at when it comes to it's not just the Apple story. We're watching the entire supply chain, as I mentioned earlier here, um, whether this is really going to spark some sort of upcycle given these new models as first time foldable phone, I will do a bit of a briefing there with Ed Ludlow. When he was there at the unveiling of the futures up. He talked about it under pressure here today. So we're also watching copper miners, right, Jim, in the fact that we have hit those fresh all time highs in the contracts in New York and London overnight chips might be still the favorite here today. We'll see. Um, but right now we are seeing quite a bit of pressure when it comes to Korea and Japan as well as Taiwan now. Energy obviously is still key. Something high comes up with earnings on Huawei as well. We're watching very closely. Is it also because the Apple story renminbi and infects. Also there's that U.S. criminal trial that starts in Brooklyn and renminbi affects right. Just given what you've been seeing with the strength of the currency of late and what the fix has suggested there as well. And of course, we're reaching some technical levels on the sky. Yeah, the downside that's the next support level was here. And so that's a level where we've traded above for the better part the last few weeks or so. The fix is what's the strongest in three and a half years. We should be getting that at any moment now. And of course just we started out the segment by having a look at where you are with Donald Trump ahead of the midterms. Of course, the other big one on his plate are these conversations coming in the next few weeks with that meeting. But the Chinese president now, on that note, China is says, is willing, in fact, to hold talks with the US on I even as it rejects, uh, American accusations that some of its leading AI companies improperly extracted knowledge from you as models. You take the work on the. We always believe that all countries should work together to strengthen cooperation, to promote the open and inclusive development of I for good and for all. We hope the U.S. will earnestly implement the important consensus reached by the two leaders, and not make unfounded accusations and smear against China. Both China and the US are major eye powers and should strengthen cooperation for more. Let's bring in our China economy and government. Reporter are gone. She joins us now. So what have we heard from Beijing so far? Right, Yvonne? So, um, Beijing's Commerce Ministry issued a statement late last night, and this is so far the strongest and most forceful response from China to U.S. accusations of, you know, this technique called distillation, where, um, the U.S. has accused Chinese companies of aggressively, um, stealing, you know, the capabilities and information from top U.S. models to train China's own models. So this is a technique that's used widely in the industry. But the point that the US has been making is that China's doing it at so-called industrial scale. And what we see as a result is, you know, the summary, there's a succession of Chinese models that have been released that are really catching up with the top U.S. offerings in terms of, uh, ability, but at a fraction of the cost. So we are seeing the U.S. there's an urgency in, you know, the U.S. concerns about China's so-called distillation campaign. And what China has said in a statement is that it's going to take resolute countermeasures if the US take any action to contain or suppress Chinese companies. But it also signals its willingness to continue to talk to the US. We've seen the both leaders during the summit in May in Beijing agreed to establish this inter-governmental dialogue on AI. But now the, um, The two leaders are scheduled to meet in about two weeks in D.C., but with not really any official information on when that dialogue is going to take place. Right. There's this Reuters report saying it might happen in mid-September, but neither side have announced dates for it. We don't really know what's on the agenda, but what's clear is for the U.S. side, the front and center of the issue is distillation. And what China cares about is, you know, export controls regulate the mix to make sure that the U.S. doesn't, um, release, tighten further, tighten its access to events, chips and chip making machines, and possibly crack down on, you know, um, the remote access, um, in overseas data centers. So we can see both sides have very different concerns and they really diverge here. And expectations for any substantial deliveries are very low. And, you know, you mentioned, of course, the discussions in May around AI, specifically a framework through which they can discuss specific issues there. We are in the middle of a trade truce, and we have this upcoming meeting. To your point. Should we expect the spat around AI models to affect the latter? These upcoming talks specifically between the two presidents? Yeah, that's an excellent question, but I like what we've seen so far, is that there has been this very fragile stability, if you will, that that has prevailed in a relationship for about a year. And now we've seen both sides issuing all kinds of policies targeting each other, but not to the threshold to derail the truce. So the key question is what what you know, where the red line lines for for both sides. And so far we're seeing a lot of rhetorical sort of back and forth, but with not seeing actual action taken by the US government to target, um, Chinese company AI companies. And that's what Beijing is trying to prevent. But in the meantime, like we saw, there's, you know, the trade war has really evolved into a supply chain war and attack, broader tech competition. We've seen the U.S. FCC effectively banning, you know, China's humanoid robots from entering the U.S. market over the summer. So there are a lot of policies that are, you know, drawing response from China, but they have not yet reached a point to completely disrupt the truce. All right, Nektar, thank you, Doctor John. There. Our China economy and government reporter markets here right now. We talked about how we are see a bit of aversion when it comes to risk here today. Futures are still in the red here this morning a really kind of joining the tunes that we're seeing when it comes to Tokyo and Seoul. We're just below that 7000 level. Uh, when it comes with 6900 level, they're approaching for cost. Be here right now. Uh, and we are seeing here when it comes to Taiwan, I mean, we'll see how the Apple supply chain, uh, fares here, but so far, uh, pretty, uh, some some pressure here today when it comes to equities. Yeah. Um, needs the. It seems we'll need to wait a couple of more days. Likely won't happen today. Of course. You know, we were very close to topping all time highs again on the VIX index. Right. So we are, Um. Well, patience is a virtue, as they say. Okay, uh, let's take you straight now and leave you with a look. Uh, this, uh, Donald Trump, the U.S. president, is speaking, of course, a bit of banter, I would imagine, given the visuals coming out there as well. He's been speaking for about, give or take five minutes now at the RNC convention taking place currently in Dallas. We will be back shortly. This is the China show, everything else because, you know, whatever it is, I was on the ticket. People came and they did tremendously with the senators and with the congressman. But for some reason, when a president wins, even if he's really a good president or a great president, there are too many of them. They don't win the midterms and nobody quite knows why. It's two. iPhone duo brings in an entirely new design while preserving everything you love and expect from my phone. It gives you the largest display ever on an iPhone while still fitting easily in your pocket. It reflects extraordinarily complex engineering, yet feels effortless to use, and it makes new experiences possible. There you go. Apple's new CEO, John Turner, is there, making his keynote debut and unveiling the tech giant's first foldable smartphone called the iPhone duo. Yeah, we were just talking about 7.6in screen, right? It feels like you're holding a passport in some ways. Yeah. That's true. That's true. That's a good way to put it, actually. Yeah, but it's, um. It's interesting. Right? I mean, the design, everything, I think, you know, is this really going to freshen up the whole iPhone product line up, this big revamp that they're saying, is it going to spark some sort of a upcycle there when it comes to people upgrading their phones at a time when there's a lot of competition in this space too? Yeah. At this very, very high price point. Right. And I think the point that and you'll hear from Ed Ludlow in a moment, you know, the point that they were making was given the constraints around some of the cost components, like memory. Yeah. What portion of the the price is actually Apple taking some of that cost in? And how much can they actually pass on to the consumer, given it is a fairly crowded space at this point in time? And, you know, it's it's a relatively new segment that, uh, the consumers are still trying to figure out what's an in between, between where you are with the handset and of course, the tablet. Uh, and it's well, he, he's, he talked about the other rivals out there is like your, your two putting two phones awkwardly together. Awkward. Yes. Whereas they think theirs is a bit more seamless with that. But let's hear from Matt Ludlow. What is what does he say. He was at Apple Park later today. Earlier today, Apple just unveiled its first foldable iPhone, the iPhone duo $1,999 with Apple's A20 Pro chip improve processing and compute power. And for John Turner's, the new CEO, he saved it for a one more thing moment right at the end of the presentation. We knew that this was coming. Folded a 5.4in screen opened up 7.6in, but they've worked really hard on the durability, the marginal crease, or lack of it. When it opens up. It's much more like an iPad product. When it's at full unfold, full display. It has a really big space premium over even the iPhone 18 Pro Max, and a lot of that work from Apple. Yes, they might be late to the foldables market, but they took their time on the components, the supply chain, and here we are. The other big piece of news was on the iPhone 18 Pro and 18 Pro Max, $1,199 for the Pro, $1,299 for the Pro Max, both $100 more expensive than the prior generation Pro models. We know about Apple's calculations, right? How much of the cost do they eat with high memory prices? How much do they pass on to the consumer? This is where they netted out otherwise from John Turner's, who's just eight days into the CEO role. This was all about I and the way that he framed it is that for the iPhone, it represents what they call the intelligence personal hub. His pitch is that the iPhone has the cameras, it has the apps, it has the connectivity. And now the on device can be cute to become the center of your personal eye. And then along with that one more thing moment with the foldable iPhone, it march what was regarded as a pretty successful first full keynote as CEO for John Turners. I met Ludlow live at Apple Park in two. Patino for Bloomberg. All right. That was at Ludlow there. Uh, as at where we were looking at that, we were seeing some lines here crossing here when it comes to CCTV. So they are, uh, now reporting that China did hold a roundtable with some U.S. firms, including the likes of Ovidia and Dell. Interesting. Yeah, not a lot of detail so far. Once we have more information on this, on the headline basis itself seems very consequential. We'll have more on this. Plus the opening bell coming up next. This is the China show. Okay, uh, we'll take you straight now, these are live pictures coming through where U.S. President Donald Trump is speaking at the Republican convention, of course, ahead of the midterms. Uh, he is about 15 minutes into his into his speech. We will table that for now. Separately, we are also hearing, uh, from CCTV that China, uh, China's NDCs specifically, that's the economic planner is holding or holds a roundtable with U.S. firms, including the likes of Nvidia and also Delhi. That's all we know so far. Not a lot of detail so far on this. Yeah, it could be quite interesting what comes out of this meeting. And of course, this is of just weeks before Trump and she were supposed to meet in D.C. so are they lays groundwork of what, you know, advanced manufacturing where these chips and video chips can, uh, gain access to the China market. I mean, is there any sort of breakthrough in that, given the fact that, you know, the U.S. and President Trump has allowed for that, uh, 200 trips to get to China? But then again, China has encouraged, of course, their coverage to go at domestic. Right. So is there any sort of clarity on what the China strategy is, or is that changed in any way? But and again, uh, there is that roundtable that is ongoing as we hear right now. We'll see if there's any sort of readout on that on what came out. In the meantime, though, we talk about here, China really joining on the fray when it comes to this, uh, risk off day. Right. You see the China there? We're down by 1.25%. Sorry. 50 is also down 8/10 of 1%. Uh, it really is that what we're seeing in the global bond market? Right. So despite what Scott Besson had said about, you know, nearly tripling the amount of bonds that are going to buy him along and hear from what they said last month, it wasn't enough to satisfy the market. And really that actually set yields higher, as opposed to what Scott Besson wanted to say. Really, all these kind of what I've talked about don't bet against me. It seems like markets are calling his bluff this morning. That really is kind of roiling the equity trade here this morning, and really just risk aversion across the board to take a look at what the dollar is doing as well. And we're still seeing a bit of weakness here today. Look at the Hong Kong side of things. And we're watching the likes of Asia's tech as well. Um, you know obviously the Apple supply chain is the one story that watch. But we're seeing more than 1% losses here for all of the major benchmarks as well. Uh, take a look at what it comes to the Apple supply chain. Right. You know, just given what we saw, this big unveiling of this first ever foldable phone iPhone doesn't seem like it's really doing much for the Apple supply chain, either today, in fact. Luxury precision is down and leading the charge lower, where two and a half 2% losses. Right now. Copper might be the bright spot though, and what these miners are doing just give them. We saw, uh, fresh records really being hit, uh, when it came to what happened in LME contract with what happened in New York overnight as well. Some most are higher today. Dave. Yeah, that's about I think we're about 11. 4% away from hitting at 15,000. Nice round number. Uh, at the next milestone there for copper. I just also mentioned here at the open. So Hang Seng China's down about 1.5% gap lower today. The index is now at the lowest level in about two months. And it did open below say it broke below its 50 day moving average. And will you know, we'll see whether or not we are able to claw that back, uh, to the upside by the end of the session today. Anyway, that's the Chinese Open today. Let's take you straight back now from here in Hong Kong, we'll take it right straight back to Seoul, where we are still continuing our coverage. We have the KB financial Group Korea conference, uh, this time looking at a Korean company called upstage, the last remaining start up in this three horse race in South Korea is so-called eye squid Game. Stephen Engle, as you can see on your screens. Is there for us? Steve, you have the company's co-founder with you there? Yeah, we sure do. Yesterday we talked with Mango Boost in the AI space here in Korea. Today we're talking to the upstage co-founder and CTO Lee. Thanks so much for joining us. Well, David, our anchor in Hong Kong just mentioned that you're in this so-called Squid Game competition in South Korea. There were originally 15 companies that were put forward into this competition for the government to identify companies that will really lead the sovereign AI initiative that become national champions. Don't want to be reliant on overseas players, right. So opening up a new front in the the AI battle, if you will. You are now one of the last three. They're going to boil it down in the next six months to two. What do you still need to do to win that government contract, which will open up a lot of doors for you. Yeah. So, uh, our major milestone is to is that of stage advanced to the final three team in sovereign I, uh, Foundation model project. And we are the only startup. And the other two are industrial giants. Yeah. So we are competing with LG AI research and SK Telecom with government support such as large scale GPU infrastructure. And in order to win this, um, competition. So what we believe is we should move fast and move fast means we should follow the, you know, technical trend in a global way. So what we trying to do is, uh, we want we try to, uh, increase the number of a parameter, the model size and, um, uh, expand language support to include the South East Asian languages for, you know, global business and in enhanced the capabilities like a multi ton, multi ton um reasoning and uh tool called usage and so on. Where are you in the evolution. I mean the goal is for South Korea to identify national champions. Yeah. Uh, to be on par if not surpass the frontier models like ChatGPT and others. Yeah. How far away from that? Yeah. So. And it's honestly speaking, it's very hard to win, you know, nowadays race so. Well, what we believe is our strength in South Korea is, you know, full stack, uh, sovereign I so, for example, we are working with, uh, video I which is uh, semiconductor startup uh, focused on NPU for efficient, um, I inference. So, um, we try to build a, uh, full Korean eye, uh, submarine stack. So, for example, um, previous that, I runs our LLN on their chip and our M powered the you know B to C service, which is a kind of a full stack AI example. So this connects infrastructure model and customer service with domestic technology. So what do you what do you still need to do to meet the criteria that the government is looking for. As you said, you're the last startup. Yeah. Um, unicorn status really your valuation is up there. But what's still to do? You need to add he recently bought, uh, I think from Kakao Down, you know, which was a traditional internet portal. Yeah. You're combining the internet search with your AI capabilities. Is that one of the requirements, essentially, to have more of a public facing, um, application for I. Yeah, to be a national champion. Yeah, that is a good question. So government wants us to build and contribute Korea Ecosystem entirely. So one of our solution is to acquire the town porter. So the biggest W of palm acquisition is that we can bring our technology directly into, uh, large scale consumer service so our technology can be tested, uh, at real scale. So that is, uh, the biggest thing for us because it can give us the user feedback so we can build our model, but we should test it, um, for the various, um, aspects because we want to improve it. So consumer service is a really good, you know, big things for us. So one of your partners is AMD. Yeah. And I believe in equity partner as well. Have they. They've invested in both. I know you guys have been talking quite regularly and frequently with Lisa too. Yeah. Essentially uh, your CEO has talked about wanting more GPUs from AMD. Be less reliant on the Big gear guy in a video. So where are you in that partnership with AMD and have you secured AMD GPUs? Yeah. How many too? Yeah. So um, partnership with AMD keeps expanding now. Uh, since, uh, AMD's strategy investment in 2025, we have deepened our technical collaboration. For example, our Solar Pro for our latest model handles, uh, large scale production traffic on AMD GPUs. Working closely with AMD, we improved, um, inference throughput by 25%, uh, which helped Solar Pro force kill up to more than 100 billion tokens processed per day. So today's big things. So where do you still need to improve? I guess on the top line is is is okay. But bottom line has been from what we're hearing, you've been losing money. Quite. Yeah. Quite a bit. Yeah. What kind of fundraising. What kind of stop gaps. Do you still need to stop that bleeding. Yeah. Of losses. Yeah. That's a good question. Um, recently we closed, uh, 560 billion won this year round and including, um, 108 billion won, uh, funds from Korea, uh, uh, growth Korea National Growth Fund. Yeah. We see that we are seeing as a clear signal that our growth and, uh, technology are receiving support from national level skill. So that is the one thing. And, uh. But when you say profitability, I mean, I know that's maybe on a distant horizon, but yeah, we're seeing that the losses year after year of the sort of piling up. Yeah. So what we're trying to do is, um, you know, definitely optimize the inference costs. So one example was collaboration with the NPU or AMD. That is the one thing. And uh, another thing is that we try to invent our own, you know, modal structure to minimize the, uh, cost when we use it for agent use cases. So that is the second thing. And the big question to is IPO. I'm sure that's an exit strategy as well. Where are you in that process right now. Yeah. So we are reviewing several capital market options including an IPO. But there's no fixed fixed timeline with our site again. We are also uh considering a pre IPO round, but uh nothing has been finalized yet. Can you give an indication of how large of funding you would need right now as a city where I need them more and building as many as possible, though, so are the number. You probably need to talk to your CEO, Sun Kim. Yeah. Um, where are you going to find. I mean, I already know the CEO, Sun Kim, has already dismissed those allegations that maybe you were, um, gleaning, uh, technology from the likes of Deep Sea. Yeah, in China. Right? Uh, whether that's through a distillation or others. What what can you learn from what the deep seek moment in China had did? Yeah. Uh, for fundraising, for technology quickly advancement and also a lower cost open wait. Right. Open source model. Yeah. So we have learned a lot from tip six. Definitely. So the biggest thing was um, the whole the whole means we can do also. So um, after we have having the hope we try to prove ourself in the global market. So our latest model solar profiler, is, um, seeing, uh, strong global adoption. So actually, it is the first Korean model model, uh, to be listed as official provider on open model, open out. It is a global atom API routing platform. And, uh, the weekly usage is close to over 1.3 trillion tokens, putting it, uh, among top 20 models on the platform on a whole models. So we see we can do it. So all right, there was a could you know who signed for us when we made it because before dipstick. So we we were also told we can do it or not. Classically upstage co-founder and CTO thanks so much. Good luck in your Squid Game competition. Yeah, another few more months to thank you for having me. All right. Uh, that's our conversation with upstage. More to come here from the CWB summit here in Seoul. Great conversation there, Steve. Of course. We'll talk to you more and talk to you soon. More voices from the Cab financial Group conference in the next hour is going to be talking to Interactive Brokers regional head David Freeland, talking about trends and investor behavior in the Korean market, followed by Tuttle Capital CEO Matthew Tuttle, who elaborates on the demand for Asian AI companies among U.S. investors. Okay. Just separately, as Steve was conducting that conversation in Seoul, over in Japan, we're hearing from a board member this is a speech that's come through. We knew the speech was coming. Uh, and so the incremental piece of information here, it seems, because we are expecting a hike anyway for next week, is that we're looking at multiple hikes now in order to complete this normalization process of monetary policy. So the management of expectations to keep raising rates given still not restrictive financial conditions and easy financial conditions. We are looking at yields. Not much reaction there. Let's call it slightly steeper. The two year flat for 30 years on the way up perhaps reflected really off the bigger move overnight in long and yields. Um and certainly inflation expectations. We're talking about the Middle East now given of course where we are there on headline inflation. So expect not just one but perhaps more than one interest rate hike over uh, in Japan. Lots more ahead. This is the China show. All right. Good morning and welcome back. You're watching the China show. We're still, of course, covering. And as you can see on your screen, these are live pictures out of Dallas where the U.S. president is speaking. He's about up 30 minutes into his keynote there at the, uh, Republican convention ahead of the midterms. Here, a couple of things that we're discussing, uh, Iran and Oil. Um, he's discussing also the, uh, the stock market, I believe, a few minutes back. Uh, but one thing really standing out and very obvious that as expect that, uh, he's discussing or bringing up the idea that they should rename the Strait of Hormuz to the Trump Strait. Um, anyway, uh, we will table that maybe that idea, um, for now, and we will, of course, revisit the US president's speech, uh, once we have, of course, more information from that. Brent crude, of course, is the underlying concerns there. You know what people are. Yeah. They focus on it's really not so much what we call the straight, but whether or not we are getting a sort of straightforward flow of goods and services. The president also didn't talk about oil prices. Obviously, this is going to be a key sort of point of contention when it comes to the midterms here, affordability and rising oil prices. And he says oil prices will be going down as soon as we win the war with Iran, which is taking place. You take a look at how markets are now at one on one when it comes to Brent, certainly that is still the key uncertainty out there. Uh, tech as well. We are seeing quite pronounced moves to the downside here today with Alibaba, Mae, Taiwan and Baidu all falling more than 2% and really dragging down it. Just take care of this morning. There's a great piece from our equities team about Chinese AI firms as well are tapping equity markets at the fastest pace in years to fund their ambitions, with proceeds from additional share sales set to hit a six year high. But the trend is fueling concerns about dilution now and posing fresh challenges for tech investors. Let's bring in Jeannie, you, our Asia stocks reporter, to talk us through this. And of course, it's unsurprising. Of course they have really big funding needs. What do we know about this. Yes I think it's not surprising that they have very big funding. It's I think a little bit like when we do the data crunching, I think the most surprising is like actually actually the total value of their equity fund raising has already exceeded their funds. They have tapped in the bond market, which is quite a big contrast if you think about the American peers, like how they are going to, you know, bankroll their eye plans. I think most of them, um, they are actually trying to raise funds from the bond market because that's the way to, you know, minimize the impact on their return on equity. And on the other hands. Um, I think this is one of the like one of the thing to keep their credit rating. Um, so I think that's, um, it's a little bit surprising for me to see like Chinese companies, they actually chose the equity market as their most preferred place to raise their funds. Um, and, um, when we talk to investors, this is indeed a concern because after seeing what's what happened to Alibaba, you know, they can raise 10 billion over a weekend. Um, which shows like how deep the market is, you know, how quick they can raise funds from the equity markets. So, um, when we talk to people that do see that this is as a potential, you know, a potential risk for their share performance, because indeed, the if the, if more company, they're going to announce additional sell, share sell, that's going to be a big projection for their earnings, it's going to be like that avoidable dilution factor, you know for their EPs. Um, so it's an interesting trend to watch I think. And I would like to see more I mean what's the concern now besides just a dilution. Is it that they might have to do more of these share sales or they can do more of these share sales just because they just because they can't? Yes. I think one of the feedback is like, if you see how quick, you know, Alibaba has done the deal, it shows like, okay, this this market, they're one. There is demand for their shares. Two. Um the shares like if they raise their funds, um, it seems like I don't like the bond market. Like you need to pay the interest. You need to pay the principal equity. You don't have that cost. It's like you raise the funds and then you leave the, you know, you leave the equity market where the cost. Um, I think was that my set has been, um, established. And if there is more examples to follow, it's going to be like a very big pressure for, for those guys. Gini, uh, a great story there. Thank you. To you, there are Asian stocks. Reporter on. Yes. Uh, all these are equity share sales we've seen from some of the tech companies. There might be too much of a good thing. All right. Um, terms of how things are looking at Asian markets. Yeah, we still continue to see quite a bit of downside when it comes to Chinese equities here are really led by the likes of tech. So Hang Seng seems to be underperforming A shares here this morning with HS tech down 1.5%. This is a China show. Some stories are tracking for you today. China has hit back after Philippine Defense Secretary Alberto Teodoro Junior publicly accused Beijing of coercive behavior in the South China Sea at a security forum in Seoul recently, Teodoro was given a memo asserting China's position in the waterway while speaking on stage. Do you know China's position on the South China Sea arbitration case is clear and consistent. The Philippines unilateral initiation of the arbitration constitutes a distortion and abuse of the dispute settlement mechanism under the United Nations Convention on the law of the sea. It is the Philippines, not China, that has truly violated the provisions of the convention and undermined its integrity and authority. In 18 of the most important shipping nations are warning that conflict, trade wars and extreme weather are signs of a structural shift in global trade. In a rare joint statement, the Consultative Shipping Group says these issues will undermine the global maritime framework and increase the risk of disruptions. Are calling for enforcement of international rules and more information sharing between governments. Okay, just for a look at markets, right now, we're looking at, uh, some of the telcos here. So you have two of the three. Although UBS came out I believe an upgrade of the three. So you don't have China. So what do you have here as you have uh, Yi Dong Lien Hong okay. You don't have telecom here. Um, anyway, that's just to say, of course, the upgraded all three two on your screens. Responding decently as expected an upgrade. The only one to talk about is Apple Supplies. We didn't see much reaction here today. Obviously the new hardware that Apple of course in the big news overnight, this seems to be more consistent with a down move we're seeing across equity markets across the region this Thursday. And when you look at what's happening on Chinese benchmarks themselves, really some sizable declines there in terms of breath volume starting to come through. Hang Seng tech is down about 2% now. Shanghai. So we're doing better on shore. But that just relatively speaking of course MSCI China is kind of about at 1.2% as far as the yield story goes or steeper. They're on the curve all the way through to the 30 year yield. Lots more ahead in the second hour of the Chinese show. He was. From Missouri. From Missouri. The home of Eric Schmidt came in from from the great state of Missouri. They flew for 37 hours back and forth. They refueled four times up in the air. And they bomb the hell out of them. And they knocked him out. And we may have to do it. There's another place called Pick Axe Mountain. Another nice place. We may have to give him a shot there, too, because somebody said there was a little movement that to say we don't need much. We see heavy, you know, because of the Space Force, which was my baby, I have to say first hand, We can see everything. We can see the tag on their coat. Mohammed. Al Ziad. It's just my habit. It's never Mohammed. It's never Mohammed. Jones. Mohammed. VI. Ahmed and his jury. And it says right on his tag. We can read it from space. Can you believe this? Thousands of miles away. And we're reading somebody. We know exactly what's going on. But we noticed there's a little activity at pickax. I would advise Iran not to get caught because we will have to hit them very hard. We have no choice, right? We have no idea. Does anybody here think that Iran should have a nuclear weapon? Anyone? Who feels Iran should not have a nuclear weapon? You know, it happens to me all the time. Guys come up. You know, I wish you didn't do the war in Iran. Gasoline up above. And I say, well, let me ask you. Just smart people. Let me ask you, not too many of them. By the way, let me ask you one question. Can Iran have a nuclear weapon? Absolutely not. Well, then I'm right that I win. Okay. Because, you know, for 51 years, they always say 47. But, you know, I've been saying that for four years. For 51 years, people have been trying to. And other presidents have been trying to talk them out of it, but they don't understand talk to these people. They don't understand. They only understand one thing, and that's they're getting plenty of it. Between our Venezuelan oil deal, all of our new mineral deals, trillions and trillions of dollars that we're taking in with my most favorite word, but now I moved it to fifth place. You know that. Where? Because the press, for the few people that haven't heard this story. Tariff, I said tariff is my favorite word in the whole fiction. My favorite. I love the word. And I said that at one of the big rallies I had a while ago. Tariffs are my favorite word. It's going to make America rich. It's make it as much richer than we ever thought. But we'd take it in trillions of dollars. Okay. But I said tariff is my favorite word. And the fake news went crazy. They said, what about love? What about wife? What about God? Religion? Family? So I moved tariff down to fifth. And now I'm okay. Now I'm okay. They've been. Leave me alone. Oh, they hit me hard. They hit me hard. They said tariff. What about religion? So I moved into fifth and now they've been pretty good. I'm surprised they didn't move me deeper, but trillions of dollars in tariff revenue have come in record investments from foreign countries and our enormous new equity stakes in major companies. I did something I'm getting killed for. Intel. Intel is a good, really good company. But what happened is stupid. Presidents allowed the chip business to leave our country and go to Taiwan and stupid. All they had to do is put tariffs on. They wouldn't have left. In other words, Taiwan, you're going to sell chips to America. And it got to be 100% got to pay 200%, 50% anything. And you wouldn't have had. But they didn't do that until I came along. What happened is Intel became old and tired and got in trouble, and they came to see me. The head of Intel was a nice man, actually, and he said, sir, I need your help. And he said, why, whatever it was. And I said, well, you came to the right place. I'm the only one that can help you. I was there with Scott and Howard. Let Nick, our commerce secretary, is doing a good job and a couple of others. I said I'm the only one that can. I'm the only one that can help you. I said, here's the deal. Give the United States of America 10% of Intel. Now they think it was worth like $120 billion. You know, it lost its way, but it's still worth a lot of money. I say give the United States of America 10% of Intel, and I'll get this problem solved for you. He stood up immediately and he said, you have a deal. And I said, I should have asked for more. So I said to my guys, what the hell is wrong with me? But anyway, I shook his head, but that was worth 12 billion. So in one meeting I picked up 12 billion. But what's happened? Well, that's that's not even the good part, because what happened to Intel is amazing. It, like, became the number one stock on the exchange. Various exchanges by the way. And I don't know, I see Scott up there. He made a great speech by the way. I see Scott. Scott, how many times has a doubled and tripled and quadrupled? What's it now, Scott? How much is it worth? You said five times. Oh. All right. Okay, so the US president was just talking about his U.S. Treasury secretary, which, by the way, in case you missed that, I think he's about 45 minutes into his speech. Few minutes before that, we did hear from Scott percent. And of course, the market story today was, um, the the buyback there, which was larger, not as large as markets were expecting and hoping for. And that to say he was he he'd be sending these these yields to the highest levels since 4.84% on the US at a ten year yield. That takes us into the equity markets right now, where that is really the pain point. It's that and of course you have the oil price. You compare those two. And when you combine those two things, and then you have an equity market that is struggling for positive traction, we're down about 2% on the Hang Seng Tech Index. It's a similar picture, by the way. When you look across the region, whether that's the Asian benchmark, Cosby's down to or more or less we check cost at the Taiwanese index. Uh was open down about 1%. So we are coming off lows a little bit as far as that is concerned. But we're still off by that's 1% on the benchmark itself. We are hearing a lot more, though from the Japanese, and it's getting more interesting. And as far as our approach to their rate decision next week and the need for more interest rate hikes, more than one, more than one, the yen was weaker. We are now stronger against the U.S. dollar. We are nearing year to date lows on dollar yen. Uh, last the lows we hit back in Jan and Feb this year. Uh, as far as some of the macro indicators are concerned there. So you have Brent. You have the dollar obviously has been on softer footing given where you are in the Japanese currency rate decision today out of the ECB. There we go. The U.S. ten year yield at 4.84%. Yes. I think we at one point in touch 45, which was a fresh three year high. So yeah, certainly there's going to be a lot on how the ECB meets later on today. Of course. And that kind of is right before the vote. And the feds have certainly a lot on tap. Let's bring in our live macro strategist Andre de Silva joining us now. Yeah I mean I think he said at least four times in the past month that he has asymmetric information about Japan, about what goes on it. And the market seems to be not buying it right now. Well, he absolutely right. So I think when it comes to managing expectations, he's fallen short, especially with that buyback is one thing that we had a quick reprieve and and low bond yields with the initial announcement doubling up of the buybacks and then hinting that could be more well the market extrapolated that thought would be maybe 8 to 10 billion rather than six. But I really think it's not just about the reshuffling of the debt pack. It's about the fiscal consolidation or lack of that. What's matters most say Scott Besson can talk, but it's more about the fiscal policy that matters more. What's the read through there with the Japanese currency? Because if they did manage to get the Japanese currency stronger, in some ways, of course it helps the yield story, too. In the U.S., it does, although one has to be a little bit careful because yields domestically are getting quite attractive for Japanese investors and repatriation. Um, and indeed there's a consequence of even approaching higher Treasury yields as a result. But on the, uh, currency, it's more about also about monetary policy differentials and fine expectations are fully priced in for rate hike next week. Uh, which is brought into the fed is a little bit less than that, around 60% chance. But it matters beyond that. Uh, we all had discussions about official suggesting there could be more successive rate rises, but that's not priced in. So we need back to back rate rises, not just the one next week. There is a narrative out there that maybe the E.M. world in the bond space is a bit more of a better see for option here right now, but then I have to contend with $101 oil now as well. I mean, how do you look at the M side of things? So yeah, if you looked into past history, you'd have thought with high U.S. yields a fed tightening, likely it will be negative for M currencies, etc. that's not the case. It's almost flipped in terms of the narrative and fiscal side about concerns of public debt. The percentage of GDP already mentioned, the U.S. that's heading to 100% plus all these things were very dominant. M are are not a feature anymore. So actually it's aside from the oil price, uh, the fiscal dynamics is far, far better and is a far, far better than they were. So they're more insulated than before. Yeah. We've covered this a lot. Uh, we'll continue to cover this. Of course. The the the attraction of the M space. Andrei, thank you so much. Fantastic. Andre de Silva, there are MLive macro strategists. So we're down about one and a quarter here on the Hang Seng index. Nikki's off about one as we go into the final 20 minutes of the cash markets in the morning session. This morning session there is lots more ahead. This is the China ship. All right, let's take you back to Seoul. We're back at the CWB financial Group conference there in the city. And this time, we're set to hear from a company that is seen as having enabled foreign investors to directly invest in individual Korean stock. So Achievement Asia corresponds. Stephen Engle joins us with our next guest, Steve. Yeah. We're going to talk Interactive Brokers with the managing director for Asia Pacific. He's been doing the job out of Hong Kong for three decades, since 1995. David Friedland, thanks so much for joining us here in Korea. Thanks for having me. So you have a lot I think your number of assets under management is creeping up towards that big number $1 trillion. Where are your trades pointing to market sentiment from Asia right now into the U.S., and also back to this part of the world? Uh, things seem to be frothy and I bond yields are high across many of nations. How do you read the markets right now? Well, you know, you talk about it gives me collapse but there's not. Um, our clients do tend to be sophisticated traders, and they do well typically in up and down markets. Um, obviously the US market is very active and that's, that's the bulk of trading globally. But our clients are looking at 24 hour trading and they're trending everywhere. So when when you know when Courier opened up you can very active. It's still very active. Hong Kong is an active market Japan and our clients are seen as moving capital around the world. Um, when it comes to risk and risk, off margin loans have actually been very, uh, steady over about 100 billion in margin loans the past three months. It's dropped from 108 million in June, but have been steady since, so I don't see a necessarily a huge drop off in risk. But it's how leveraged are the Eurasian clients? Because I was looking at the overall numbers from the June quarter, margin loans up 67%. You're also seeing the worldwide, um, what, uh, account growth up 34% globally. How did the Asian numbers compared to the overall global numbers? Well, we don't freak out numbers by any individual market, but they're about the same globally, so that's pretty steady. Um, the risk appetite. It's a healthy appetite because using margin and many hedging strategies and of course obviously this margin in the in the in the leverage ETFs which have taken off in quite active. But our clients tend to use them for day trading tools as opposed to overnight holding tools. Speaking of leveraged ETFs, that came at the same time, the whole thing that blew up in May June here in Korea with a frenzy as retail investors really piled into the launch of the single. Single company. Uh, ETFs. Leveraged ETFs you launched in May. Your career and platform. Tell us. Take us through not only the challenges of getting launched here in Korea, which you had a lot of regulatory issues to get into, but what was it like to be launching at a time when there was this frenzy and then an abrupt, abrupt slowdown? Well, it was a long process. We've actually been looking at entering into Korea for for foreign accounts, into Korea for the past 6 or 7 years. What held us up with us is, um, it's a complicated investor ID scheme, which is a manual process, requires a notary. So that was not possible for masses. And the other part was getting a tight currency spread, because no point entering a market of clients can trade the product. I had to convert to the currency and let's say lose a percent on a foreign exchange quote, and then get out and losing another percent. So we spent a lot of time coming up with the streaming quote, where our clients are very low slippage on the conversion rates, and they can do the conversion themselves. And then when the omnibus account was approved by the government, we were ready to go and rock and roll. And a timing was arguably impeccable because it was from day one. Um, it was it was active. Um, what was interesting is that we tried to do a soft launch where we only told 1 or 2 clients who were interested in Korea, hoping they would do a trade on the first day so we can test the cycles, make sure the system's working. But somehow it got viral and went on the internet and they hit the social media. We had several hundred clients trade the first day, and then on the second day, over a thousand clients. And it's grown up, um, exponentially since. So it's a very active product. So daily average revenue trades. Can you break that out at all? I know globally in the second quarter it was up 36%. Obviously them the S&P has been going gangbusters. Well on a typical day we're doing roughly for between 4 and 5 million trades. Uh we don't break down the individual market. It's safe to say the US market is active, but we also offer other products such as futures, options, options. Single day options American made extremely busy as well, so growth across the board has been active. And in markets such as Korea that clients aren't just trading a Korea on the trading Hong Kong they're trading everything. So they might be trading Hong Kong during the day, hedging it with the U.S. on the after hours market and then rolling it over into the states or Europe thereafter. So just launching in May, you talked about the regulatory hurdles. What kind of reform have you seen? Obviously, uh, currency trades now are 24 hours. I think next week they're going to starting on the Cosby and another index, uh, extended hours until 8 p.m.. I mean, this is a sign of the times, isn't it? Yeah, it's definitely a sign of the times. This is driven from the world we're in. And you can say it comes from the crypto space of the digital space, where there's 24 over seven trading and other changes have to compete. But the seeing that, um, for example, in Korea, the next train which is competing exchange with the cracks has been successful after hours. So the care has to end there. thereby their and their markets to compete and just only go to expand because demand is real. Information doesn't stop. The news cycle is 24 over seven. And clients, our clients in particular, want to move capital on an instance notice wherever the markets are active. What other markets are you looking at? Possibly opening as long to get Korea up and running online? Uh, Singapore was 2020, but Hong Kong was 1995. What where else do you look at Middle East, other places in Asia? Well, in the past year we had Korea, Taiwan, um, Brazilian Futures, Boutique Exchange and Hungary. They've also have access to the UAE and Dubai. Uh sorry. Um, Dubai and Abu Dhabi. Yeah. Um, we don't talk about other markets, but safe to say, when there's clients demanding, uh, markets in other markets, Southeast Asia, there's emerging markets that are coming out that we're looking at in European in Europe, there's a number of changes that we're seeing interest. And of course, there's always new derivative exchanges, uh, being added, particularly in America and elsewhere. So we just, um, we just have to adapt with the times and be proactive and markets where we can. What do you seeing in the home market of Hong Kong? Uh, the IPO pipeline. According to the Hong Kong exchange, is pretty strong. Obviously a lot of it or eye names coming out of China. But there has also been capital flow crackdowns by regulators, Futu and Tiger, brokerages among, you know, others who have been cracked down on because of the cross-border flow problem. What what what are you basically seeing in the Hong Kong market right now? Well, you know, the Hong Kong market is funny because China's been, um, slow for the past couple of years. It has been weak. It's it's only a matter of time. At some point, they get their act together and, um, sort out the troubles of have the real estate sector and get some positive, um, sentiment. Hong Kong has flipped a little bit. You have some of these. The IPO flow has been extremely strong. You're getting, um, some really hot companies in the memory space and chip space coming in, and it's driving demand. And, um, you know, Hong Kong also is looking to increase trading hours. And and we were talking about it earlier how the lunch, the sacred lunch hour in Hong Kong looks like it's going to be, uh, it's going to be shot to nothing. And they're adopting as well. And that's because the global flows are just continuing to be, um, clients just demand access everywhere all the time. And Hong Kong is going to be benefactor of that. We've talked about leverage and that the numbers were up quite a bit. How are you seeing those numbers as it pertains to the appetite for AI, whether it's in the West with the, you know, the no names or also northbound in the connect. Well, you know, we we published a top 25 stock list each week. And the typical names at the top we show buys and sells. And this past week, for the first time, um, three of the memory names and chip names are, um, um, net sells. And we saw, um, Vanguard Bio ETF, um, popped up in the top number 22. And that's a S&P 500 fund, which shows a small, um, maybe a flight to safety. But at the same time with these stocks ETF, which is a leveraged ETF on the memory sector. Um, that's that was met by. So I think our clients are steady stable that reactive to the times. And they're using hedging projects, uh, products to hedge um as necessary. So I don't see a panic. David Friedland, Interactive Brokers MD for. Thanks for joining us on Bloomberg Television. Thank you. We'll see you in Hong Kong. Back to you guys from the CWB Financial Conference. Yep. Okay. Uh, Steve, of course, has been busy there, of course, in Seoul for as as Steve was just talking there. Of course, you probably if in case you're just joining us right now, relative covering, of course, this ongoing speech, Donald Trump is at the Republican convention in Dallas ahead of the midterms. And boy, oh boy, he's come out with some headlines, this one potentially very consequential, uh, that a US president has promised a 5000 payment, U.S. dollar payment to U.S. adults if the GOP wins the midterms. Uh, Trump says the only caveat is the dividend has to be spent in the US in as far in as far as, I guess that being a fiscal stimulus instead of the government spending the money, they give it to you to spend the money. It's interesting coming at a time when really at any point over the last, let's call it ten, 15 years. Markets are very attuned to the concept of fiscal discipline in the US and the budget, you know, 270 million, a dollar to estimate that above the age of 18. You multiply 5000. That gets you over 1.3 trillion. So this is a headline that I think will be dissected and analyzed over the next few days. And let us see. Yes. And it's contingent that he says if the GOP wins the Senate and the House, uh, when it comes to what happens in November. So certainly that is the big headline here today. We'll get you across more of that as well. Um, and more of the speech which is continuing on here this evening in Dallas. That Democrats that's why. They seem to think, okay, uh, straight back to Dallas right now, where the US president is about an hour and a few minutes into his, uh, speech there. They've covered a lot of topics at this, uh, Republican convention ahead of the midterms, and one of the things that stood out so far has come in the last few minutes. He is promising if the GOP wins, and it's contingent on it being spent in the U.S.. $5,000 for every U.S. adult adult, U.S. adult citizen here. Yeah, you did the math right. It's about what, 1.1. 3 trillion or so? Uh, certainly. That raised some alarm bells for some of the fiscal hawks out there, as well as at a time when we are seeing yields at multi-year highs, right, particularly when it comes along. And and despite what President Trump, or at least Scott Bassett wants to do, is to in terms of reining in those borrowing costs. Uh, really it really is falling on deaf ears when it comes to how traders in the markets are interpreting that latest bond buying announcement here. Right. They said that they could nearly triple that amount, that what was announced last month is 6 billion. But the market was expecting maybe eight, up to 10 billion. So I bet a disappointment there. And that's why you are seeing that 30 year yield edging very much closer back to that 5.3 level right now. Okay. We have lots more heads. We're headed into the Japanese lunch break. The banks are rallying there. We'll tell you why in a moment. This is the China show. 11 point I am in Tokyo. Japanese markets are heading to that lunch break in just a moment. We are seeing stocks retreat here this morning. Dollar yen has been kind of going between gains and losses. But we've actually come off some of the initial lows at one 5353. But certainly what we heard from the board member Masu in that text and a speech I should say, was that they need more rate hikes to complete this normalization. So hikes plural, uh, might actually help sustain some of these moves for nowadays. Yeah. Well the banks are liking that use of force higher rates. That's been really good for financials. You know this is really one of the best performing groups this year so far, and more of that will do will result in more of that in the cash markets in Japan as we head into the break there. Okay, that well, this is certainly something we will continue to watch. Going into the meeting where we are basically fully priced for a rate hike next week, it's really what they do after that and also what the fed does. Right. So I think you are getting fuller pricing around the DOJ than you are with the fed for next week. Just also mentioned, the ECB is also expected to hike interest rates. That is later today. Okay. Um, let's take a straight back now to Seoul where we are still at the KB financial Group Korea conference. And this time we are going to be hearing two. Interesting. An ETF provider, uh, known for its leverage and thematic products. Stephen Engle, our chief North Asia correspondent is there this next guest. I love yeah. Our next guest is Matthew Tuttle, CEO of Tuttle Capital. Uh, I guess the best way to describe you, Matt, is a US based ETF provider known for its leveraged and thematic ETFs, among other things. So, um, we'll get to the Ono moment, uh, and the Ono ETF in just a minute. That would basically hedge investors away from an eventual crash. It hasn't launched yet, but we'll get to that in just a second. But what are the other market signals that you've been reading about the health of the equity markets right now, when some say it's fairly frothy in the eye space? Yeah, I mean, the biggest thing we're laser focused on, and there are a lot of elements that all lead to one thing and that's higher yields. So you've got inflation caused by CapEx caused by higher oil prices. You've got the issues with the yen. And maybe Japan is going to sell treasuries and you've got the fed, which I mean we'll see whether Warsh who's Trump's guy, is going to raise rates before the midterms. But certainly the thinking is they're going to raise rates. And we're thinking about what happened in 2022. And I'm concerned about rates. Well, the dot plots might say we should hike, but the white House is saying you better not write. I mean, worse for what happened to Powell. He doesn't want that to happen to him. He's Trump's guy. Trump brought him in to cut. He's not cutting. Uh, you know, I wouldn't be surprised if he holds pat, but you could have. What happened the last time he held that? The bond vigilantes come in and say, look, we've lost all confidence in you. We're going to take up the long end anyway. So I you know, he may have lost control over this situation, too. What other scenarios are you gaming out with the midterms, for example, and how it plays out the rest of this year? So I'm not as worried about the midterms. I think everyone's pricing in that the Democrats are going to win. So to me, that's not as big a deal. What I'm also paying attention to is we've had a correction in these AI names. When does that end? You know, so is I in a bubble or not? I mean, nobody knows. You mean your gas is as good as my gas? But certainly it looks like things are going sideways here and looking for direction. I think rates might give us direction, but, you know, rates don't move up. You know, we could see another leg higher in the eye trade, which obviously is what we're hoping for. What kind of demand are you seeing in this part of the world for various different ETFs? Obviously it comes at a time we're here in South Korea. You've said demand in Korea has been consistent I believe. But it also comes at a time just a few months, four months after we had that single, you know, single stock ETF, leveraged ETF meltdown, if you will. There was a lot of frenzy and retail investors piled in. What did that do to potential demand. And how do you seeing it. So it's interesting even with everything that's going on in this market, we're still seeing a lot of demand from Korean investors for our levered and inverse products and for our thematic products. So for example, we recently were on Dram, which is two dram. And we also launched Ramsey which is two x inverse theorem. And with everything going on in memory stocks, I sort of thought we'd get a lot of inflows into the inverse, not as much into the long. Totally wrong. We're you know, the long is maybe 750 million. The inverse is only ten. So and we're seeing people put money into 2XX2X uh two x uh SanDisk. So we're still seeing a lot of demand from Korean investors for the thematic in the Lebanon inverse. What other thematic uh, areas are you looking at now as we still play out? The I theme is the picks and shovels. I was just at semi con in Taiwan. It's about the suppliers to the I chain, but is it still just the big names? I know you added XMR as well to another, uh, fund, the Chinese memory chip maker. Give me where most of the focus is. Yeah, well, I mean memories a big thing for us. But after memory photonics. So photo is our photonics ETF. It's our biggest thematic ETF. We think photonics is a bottleneck trade. We love that area. Space is another one. And we look at space as a bottleneck trade. You know what we have in the US is data centers have become a political issue. You don't want them in your backyard. I don't want them in my backyard. Elon Musk says they're going into space. I'm not going to bet against Elon. So SPCA is our space ETF pure space. They're right. But space is there. But how much Asian demand has there been for that in the sense that at the IPO Asian or Chinese investors were not necessarily loud but they are through the ETFs. Yeah. We're not seeing as much demand. So we also have A2X1 space. We're not seeing as much demand for space and space names from the Korean investors. We are seeing that from the U.S. investors. That's tapered off since the SpaceX IPO. SpaceX names were rallying into that IPO. They've come off hard afterwards. I think that's fine. I still think we're not even in the early innings in space, but it's going to be volatile. What about crypto space and digital assets? We love crypto. We also love gold. And we think it's two sides of the same trade. We think you want to be out of currencies. You want to be out of the dollar. Certainly want to be out of the end. I mean, the one is doing well, but you know, I don't trust central bankers. Global debt has gone up so much. We in the U.S. have mismanaged our financial situation for so long. Yeah, I've been investing since 1981. Everyone's saying, oh, the deficit is going to get us. It hasn't. Our government is great at kicking the can down the road. But you can only do that for so long. I would rather have gold. I'd rather have bitcoin than I would have dollar based. Wow. Yeah. What do you make of business comments a couple of days ago. He's the house now. Don't bet against me. Yeah. I mean, it's interesting he over anybody else should understand that market forces win. I mean, he was the guy in that £1,992 trade. And the only reason they made so much money is the British government lost that to them. So I mean, I, I think he's a smart guy. I mean, you know, I like a lot of what he's trying to do. I don't think he's going to win this battle against the bond vigilantes. And I don't think he thinks that either. So I don't really know what he's doing here. How about oh, no, I want to get to that oh eight and oh, oh, uh, it hasn't launched yet, but it follows your heat formula where there's the head side of that. Uh, basically, uh, it pays out when things go in the toilet. So what we're trying to do in Ohio is going to be the first of a series of products. What we're trying to do is create no bleed tail rates. The problem that that we've historically had with tail risk protection is you buy something that loses money when the market goes up. And so you sit there every single day losing money. You're going to get to a point where you're like, I can't do this anymore. So what Ohno is designed to do is basically nothing. You know, up a percent, down a percent here, and there is no more give you anything. As long as you give you anything, it's not going to hurt you. Then we get a Covid or we get a 2008, which we're going to have again. But the problem is, I don't know when that's going to be. You don't know when that's going to be. Nobody knows when that's going to be. You can put on no sit in a portfolio. When that happens then it goes up big. We're going to do that for a bunch of different asset classes. When do you think it will go live? We are hoping now, sometime mid-October. It is to be able to do. What we're trying to do is obviously extremely complicated. Creating the index is taking longer than I thought. And very quickly, how much demand are you seeing for hedging against a crash? A ton. Okay. All right. Matt Tuttle, CEO of Tuttle Capital. Oh, no. We're done from our coverage here from Seoul at the KB Financial Korea Conference. Yeah. Oh, wow. It's the coverage. Oh, no. Is timely, of course. October going into Halloween. Uh, fantastic coverage everyone. Steve and a team there on the ground in Seoul. From there, we'll take a straight back to Dallas, where the U.S. president is still speaking. Uh, and of course, the big number that showed up so far is his Trump dividend. The Trump dividend. What did you say about this? 5000, 5000 for all U.S. adults? If if the Republicans win the midterms in the Senate and the House. So that was sort of the biggest takeaway, I guess, from from this, what looks to be a close to 90 minute speech now in Dallas. And you have to spend it inside in the U.S.. Domestically of us. There we go. Actually, there we go. The yields are picking off their 30 year yield perhaps is in reaction maybe to, uh, fiscal stimuli that's coming through the potential. That's why I had This is the Chinese ship left me. And took the monsters on his ship. Okay. Oil prices have inched ever so slowly, consistently to these levels. And here we are. It's almost a blink of an eye. We're back at 101. Back above 100 on. Happened, uh, mid-afternoon in the Asia Pacific yesterday as London was waking up. And of course, throughout the course of the European session, the European gas then started to pick up, uh, overnight into where we are currently. Uh, we are getting the opposite reaction, though. And as far as the equity energy concerns are concerned here. So, uh, downdraft here, it's worth pointing out. Of course, this has been really one of the best performing groups so far, given, of course, where you are on energy price inflation. All right. Um, let's get the latest when it comes to Iran. They say that they're preparing for a more intense war with the U.S. and will escalate counter strikes if American attacks continue. A senior Iranian official told us that Tehran sees a war with Washington as an existential threat. Let's bring in our chief Asia correspondent, Roslyn Matheson. She joins us now from Singapore. Ross. Yeah. Bring us up to speed on where we are in this latest escalation now. Well, we have seen again overnight an uptick and activities to the US saying they thwarted an Iranian attack hitting back at Iranian ships around, apparently targeting a Jordanian airbase that's used by the U.S. military. So certainly that activity is very much picking up. Again. You see the impact, of course, on oil prices and a sense from Iran, certainly from this senior official that they're buried in here for for the long term, that echoes what officials have been saying publicly for lunch. But for a long time now, for months, and a sense that really they see this as fundamental, this is the future of Iran. It's a very existential question for the regime and for its people. And we can see that's why this will continuing on into the seventh month now, and a sense that Iran is rebuilding its defenses. Certainly there seems to be increased activity around Pick Pickaxe Mountain, which is right near the key enrichment site. A lot of construction going on underground. So this sense that Iran, Iran is taking all these actions in its defenses domestically and in its neighborhood to really prepare itself for a potentially long term conflict. And, Ross, where are we if, if at all, in as far as negotiations back room via diplomatic channels, are there still these conversations taking place to provide us an off ramp from current from, you know, the current settings? Where they're always going on in the in the background, but no sense that they're edging really towards anything. I mean, the only conversation that seems to be making progress is Oman and Iran agreeing on terms for it, for the shipping lane through the Strait of Hormuz and prices that they're going to charge shippers in the area. We certainly have Donald Trump saying again that he thinks this war is going to be wrapped up. He says after potentially the midterm elections, which is still November. So we've got months potentially to go. He says oil prices will come down when they win. When being the big question here, because you also have other senior U.S. officials saying, reportedly that they think this war could continue through the duration of Donald Trump's term. So we're talking several years at least, more of conflict occurring. And and this fundamental questions beyond just stopping the fighting and the arrangements around the Strait of Hormuz, there are broader long term questions still about Iran's nuclear program, what to do about that? Is there any kind of deal or a pathway to every New Deal around its nuclear ambitions. And it's it's its missile program in general, including its ballistic missiles. So we're not even getting to a deal on Hermes, let alone those big long term questions around Iran. And certainly no sense coming into the midterm elections in the US that they're pushing to get a deal very soon. Roz, thank you so much, Rosalind Matheson. They're our chief Asia correspondent out of Singapore for us. In fact, some of the many of the topics we discussed there were mentioned by Donald Trump and this ongoing. Still, I believe he's still speaking in, in Dallas, talking about how he was asking the audience and got a resounding yes to his question, uh, around is the US is going to win? Um, do we want, uh, run to the nuclear weapon? Um, it also managing to suggest that maybe we should rename the Strait of Hormuz to the, uh, the Strait of Trump, I believe, is what he was talking about there. But, yes, that oil prices will fall once they win the war with Iran. Stop it! Say we love you. Charlie and Erica is here someplace. Erica, where is your. Well, axis Bank warns that elevated oil prices will keep heavy pressure on India's rupee. Speaking exclusively to US in Mumbai, the CEO discussed that currency strain while detailing how I is impacting the lender's hiring strategy. And what the number will end up in. I hope is that, at least to start with, there is no need to continue to increase. The had gone to the same pace as before. Maybe we will be able to maintain the headcount in the same zone and continue to grow our business, or even to bring the, you know, head on. Now. The benefit of ISE is much more than that. You know, we might see some reduction in jobs. That's a given. And, uh, we will have to go to that and manage that change. So are you then saying that status quo could be the way forward? I mean, we have banks, you know, giving estimates. City 20,000 jobs in multiple years. We have HSBC, 10% of the workforce, Standard chartered 7000. These are big numbers. So yes, they're growing at a much lower pace than us. So in that sense, obviously they can predict better. We are growing at a faster pace so we can absorb some of this, uh, growth through, you know, not increasing the headcount. So we are not going to announce any reduction in jobs per se. We don't intend to. But our hope is that our growth, our attrition, uh, will allow us to manage this problem ahead of the problem quite easily. This is what I hope is. Let's talk about CNR and the recent easing in FX deposits. Your take on that. Well, well, I mean, the ultimate finally, the number which came in was much higher than what anyone predicted. It just goes to show as to, uh, that people are willing to take into a risk. And this was a scheme where a lot of Indians thought it was worth investing in. Um, like every other bank. We also use this opportunity to raise a decent amount of money. We have not. This was the number. Uh, we will at the right stage. Realistically, how much of the flows can you capture and how much of the flows can actually go into lending growth? I think, you know, if you look at the amount of money raised, the Indian, the just the growth in the system will absorb this the next 2 to 3 quarters. So I don't think that is a big problem because the credit growth has picked up. Um, and uh, you know, the credit goes record over the last couple of months of 16 to 18%. So at that pace, it will be easy to absorb this. Um, now, again, I'm not talking about what's happening in the macro. Macro could have some impact on this growth. Uh, so it is a temporary, huge dose of liquidity. It will be absorbed quickly. It will allow for a slightly longer period of time. Nims to look better. Uh, and some banks have been able to raise much more money than some of the others. So obviously, they have been able to take advantage of this opportunity. And this will reflect in the balance sheet in panel over a period of time. You talked about how it's helped to stabilize the Indian rupee, but we have an environment where oil prices keep hedging high end. Have we seen the worst for the Indian rupee. All might be under tremendous pressure from here. Well it seems to be under pressure. Even in spite of India raising so much money through, uh, Epsilon out of the scheme. So in that sense, with oil prices spiking, and let's say if this uncertainty in the Gulf continues, I think my worry is that the pressure on rupee is not going to go away. That is what do you think India needs to do? I mean, take a look at how it's been pretty resilient in terms of growth, 7.8% in the last quarter. But whether or not that is sustainable depends on what India does from here. So I mean, they did a good job of kind of the first one to do all the supported the businesses where we supported absorb the oil price shock in the supply shock by ensuring that they didn't pass it on immediately to the consumer, and only when things settle down a little bit, they pass it on. So an Indian government did a great job in the first stage of the crisis. Now let's see how long this last. The ones that you seeing that I know the last couple of days, my view is that none of the parties can afford to sustain it for too long. So hopefully, if you come back to a slightly lesser level of hostility than what we see today. Interesting. At this point, you talk about HDFC Bank. It's looking for the top man. Have you been approached? Uh, very long for you to comment on that. I worked for the group. I mean, I want the best for the bank insurance in life. Yes, I want the best for the group. I'm sure. You know, board is a very eminent road led by very eminent chairman. Uh, I'm sure they're looking at all the possibilities as we speak, and we'll come up with the right solution, though. Don't want to get into who is being approached. What is their approach? Media is having a field. Let them have a field. Have you been approached? No, I, I don't want to comment on it. Would you be interested, please? The wrong thing to comment on. But the point is, I've. I've been looking at acts of vandalism and half years. I have a huge hit and tired of me. I have another, let's say, 18 months ago. I have work for 36 months, I know. I'm very, very focused on that and that's what's keeping me occupied and happy. So that's what I'm focused on. There we go. The axis Bank CEO, where the course has they're just discussing many, many things, uh, including, of course, the currency and some of the hits there and energy prices. Right. Okay. I will take you straight back. By the way, we'll have more, of course, but has the global fintech fest coming through there in the next hour or so. And we shall be speaking with, of course, more executives and CEOs. Just on that note, I just want to mention to you that we are still tracking and following and covering this, I believe. Yes, he is still speaking, the U.S. president still speaking in Dallas. We are going into about an hour and a half now, uh, into that speech. Uh, we're now into the territory. Uh. Um, he says he'll be making some of these Trump tax cuts permanent. He's also looking to do something about credit card swipe fees, he said, or cut them out. Uh, also making it legally impossible. I'm still trying to wrap my head around what this means for the border to be, uh, open. But, yes, we're touching on many topics here. Um, and certainly ahead of a crucial, well, very challenging environment for U.S. treasuries right now. Uh, uh, discipline. And it's interesting, as he has spoken in the past. I mean, 90 minutes, close to two hours now is that Treasury yields are actually a little bit higher. Uh, on the face of some of these headlines here, whether it's a Trump dividend, a $5,000 that he has, uh, you know, proposed here, if, in fact, the Republicans win the midterms. Uh, that certainly does lead to some of those fiscal concerns that have been driving yields higher. It's not just the oil story. It's not just what the Treasury buyback story is looking like as well. That that's one of the key economic forces, some say, is what is still why we're still in a higher for longer environment. Right. Nowadays. Fundamentals. Yeah. Debt burdens. Debt to GDP. Um, so let's call it what, 250 270 million US adults. You multiply 5000, gets you over a trillion U.S. dollars. Of course, that's spent inside. Uh, easier said than done. And that really comes ahead of this ten year Treasury auction. That comes through, of course, around I think it's midnight, 1 a.m. if you're watching, uh, you're of course, watching from Asia Pacific. Uh, apart from that, before that couple of hours before that is the ECB the rate decision coming through European futures coming up on your screens and really against a backdrop of this intolerance for risk. This story is the Asia-Pacific stocks are down uh on a benchmark basis. That's it for us here today. We will see you all tomorrow. Thank you for joining us today.