17/03/2017 BBC Business Live

Hello, this is Business Live from BBC News with Susannah Streeter and

Rachel Horne. Chancellor Merkel makes the case for trade, the German

leader is on her way to Washington to meet President Trump with

business at the top of their gender. Live from London, that is the top

story on Friday the 17th of March. -- their agenda.

Will be two leaders be able to overcome the bitter rhetoric on

currency valuations and trade deficits? Also in the programme, we

sleepwalking into a world of low productivity? We will look at how a

lack of sleep could be making the global economy dozy. And other

markets dozy this morning? This is the picture in Europe at the open,

the FTSE 100 up again following on from a record close once again

yesterday. And we will be getting the inside

track on what the rising cost of borrowing in the US could mean for

the rest of the world, and the car industry's big problems with the

testing, business editor Simon Jack will be here to explain all.

And today we want to know what is stopping you from getting a good

night's sleep, and does it affect your work? Let us know on Twitter.

We start in the US where President Trump will be hosting

German Chancellor Angela Merkel at the White House later.

The two nations are major trading partners,

but there's been growing concern on the US side that their

The rhetoric has raised fears of a damaging trade war.

Last year, the US sold $49 billion worth of goods to Germany,

everything from Boeing airliners to Pfizer medicines.

That sounds like a healthy figure until you look at this one,

$114 billion was the value of goods Germany sold to the US.

not to mention everything from industrial machinery to medicines.

known as America's trade deficit with Germany,

That's a bigger deficit than the US has with Mexico,

and in fact any other country except China and Japan.

In January, one of President Trump's top

of using a "grossly undervalued" euro to "exploit" the US.

Chancellor Merkel rejects the claim and points out the thousands

of jobs created by German investment in the US.

She says she will remind the President that BMW's US plant

exports more US-made cars than GM and Ford put together.

The bosses of BMW and another huge employer in the US,

industrial giant Siemens, will be travelling

Julian Howard, head of multi-asset solutions at GAM, is with me.

Thank you for coming in this morning, trade is obviously a huge

concern here, the German Chancellor and arriving flanked by those big

bosses from Siemens and BMW. At one point recently, President Trump

threaten to slap a 35% tariff on BMWs coming into the US comedy think

it could happen? Not in the short term, but I think Donald Trump is

going to need all those top executives. On Wednesday he met with

various US auto executives, including the president of Toyota

North America, and said, listen, I am giving you a hard time, but you

have got to build more plants in the US. There is definitely a push to

try and reduce the deficit, try to get more production in the US, and

Germany does have quite a lot of production in the US, but the profit

is booked back in Stuttgart and Munich. What do you think will come

out of this meeting? Only two hours and then a working lunch, and it

does feel a little bit like the German Chancellor is geared up for a

fight, coming with their back-up, because when it comes to trade

deficit, she is in a vulnerable position, isn't she? Yes,

potentially, but the European story is starting to improve, and the weak

euro has been a big problem. Donald Trump has accused her of basically

cheating, using that weak euro. It is not our fault, it is the ECB

policy on quantitative easing, but the euro are starting to gain ground

against the dollar, so if she can buy some time, the problem may start

to ease on its own accord. Interesting, with these tariffs, if

the US chose to put tariffs on Germany, Angela Merkel cannot

respond to that, because it is above her head. This is the advantage the

US has when dealing with individual European countries, that he can

attack them on a bilateral basis, but they have the river all

negotiation up to the European Commission. The US already proposed

a bilateral defence deal with Angela Merkel and the Germans, but the

response was, that has to be dealt with at the higher level. That is

really interesting, the statistic that the BMW plant in the US

produces more cars than General Motors and Ford put together, a

really good fact for Angela Merkel to put on the table at this meeting,

saying, really, you cannot slap tariffs on German goods, because it

will harm your jobs if you do so. Yeah, and a German auto industry has

a 271 billion euros investment in the US, but like I said, the profit

still goes back to Germany. Toyota grasp this back in the 1980s when

they started building plans in the US, they are still being called out

on this issue. The reality is, unless it is by American and higher

American, that is what Donald Trump is getting at. One of these big

issues has been, why don't use the American cars on the streets of

Germany? One of the reasons for that is self-inflicted. GM has chosen not

to market Chevrolet aggressively within Germany, and they have

actually sold that whole arm back to the Europeans. So not all of this is

within Angela Merkel's control, some of it is at the industry level.

Thank you for your time this morning.

In other news: Shares in the maker of high-end winter jackets

Canada Goose rose 26% on their first day of trading.

Some of their coats sell for more than a $1,000

$256 million has been raised listing the shares in Canada and New York.

That's where animal rights groups protested outside the stock exchange

about the company's use of fur including from Coyotes.

But the company says its fur comes from regulated trappers

Pakistan says it's asked Facebook to help investigate

"blasphemous content" posted on the social network.

Blasphemy is a highly sensitive issue in Pakistan

The interior ministry says Facebook has agreed to send a team

to Pakistan to address reservations about content on its site.

The private equity firm run by the former boss

of Barclays Bob Diamond has made an offer to buy the loss-making

Mr Diamond will be teaming up with QInvest,

an investment bank with ties to Qatari government.

QInvest already owns 43% of Panmure Gordon.

Hong Kong's troubled flagship airline Cathay Pacific says

as part of a major overhaul in the wake of losses.

Simon Atkinson is in Singapore for us.

This comes off the back of really terrible figures that Cathay brought

out this week. That is right, we heard that 2016 had been a terrible

year for Cathay Pacific, they lost about $74 million compared to a $6

billion profit the before, and a lot of the reasons for that with things

that really are not going to change. Chinese passengers flying directly

out of China, rather than through Hong Kong. So these are the first

concrete measures from the company about what they will do to try to

reduce their costs, and as you say, one of the big things is cutting

headcount. We reckon about 1000 jobs could go at headquarters, but that

probably will not be enough. This is an airline which is struggling, the

hub does not work for Hong Kong as well as it used to, so it will have

to do a lot more. OK, Simon, many thanks.

So let's take a look at the markets in a little more detail now.

Overall in Asia there was a really positive trend,

helped by some numbers from Singapore which showed the city

state has seen its biggest jump in exports in five years.

Although the Nikkei slipped back slightly,

the Hang Seng index lifted once again to log weekly gain of 3%.

In Europe, there is a little bit of treading water, no wild swings,

and remember the FTSE 100 closed at a fresh record high yesterday.

In the US, the Dow Jones turned negative at the close.

We've talked about Angela Merkel's visit to the US later today.

Investors will be watching that meeting closely.

about what else is ahead for Wall Street today.

Tiffany will be reporting earnings, and they may look available blingy.

The upscale jeweller is focusing on new products to revive demand. And

it is Saint Patrick's Day, an estimated 33.5 million Irish

Americans live in the United States, seven times the population of

Ireland. The average reveille will spend about $36 for a total of $5.3

billion. Maybe luck of the Irish be with you!

Joining us is a global market strategist

You went green for St Patrick's Day! Let's move on, a fresh high on the

FTSE, what is driving the market up? It has been having a great few

weeks, and few months, given the low pound, remember that it sources

around 70% of revenues from abroad, so with a low pound, that makes the

exports of these companies more attractive, and those earnings, when

you translate them back into sterling, are much higher. That is

driving investors to pile into the FTSE 100. In recent days, we have

had a rate hike from the US, but still some easy language from the

Federal Reserve, so investors are more positive about equities on the

whole. Do think the FTSE can keep going up? If it remains about the

1.25 mark against the US dollar, and given that we expect Article 50 to

be invoked and Brexit negotiations to begin, that rate should remain

fairly low for the course of the year. Interesting remarks from

Germany's finance buzzed, Wolfgang Schaeuble, about how the City of

London retain its crown as a financial centre post-Brexit, and he

has made these comments today, the G20 summit day, when they are

starting to meet, quite important? It is, the G20 summit as a whole,

and these comments Brexit, trade and where financial centres will remain,

especially in the larger picture of the Trump administration being

anti-trade and the deregulation of financial services, so London will

be in a hotspot, thinking about what services can be a main to be located

here in London, versus having to be shipped around to the rest of the

European Union in the Brexit context, but also generally trade,

emerging markets very dependent on global trade, other European

countries that rely heavily on exports. How much attention to the

market is paid to these big summits, it is all chat and ideas, to the

markets listen? Or do they wait for the headlines afterwards? They do

listen, it is important when these big economic trends are shifting

equity indices and bond indices across the world, but like anything

that is more discussion or policy based, we have to wait for something

in terms of changes to policy or changes to trade and action. OK, we

will have you back for the papers at the end of the programme, we want to

know about your sleep patterns! It is hard when you have to get up at

3am. Still to come:

We'll get the Inside Track on all the big stories of the week

with our business editor Simon Jack. You're with Business Live

from BBC News. New research published today shows

that 4% of UK working adults aged between 18 and 70 are working

in the gig economy, that's a labour market characterised

by the prevalence of short-term According to the Chartered Institute

of Personnel and Development, about 1.3 million people are engaged

in gig work and many workers are calling

for basic employment rights. Ben Willmott, the Head of Public

Policy at the CIPD, joins us now. The thing is, some people want to

work flexibly and join the dead economy because of that flexibility

that it brings to their lives. -- gig. Others of falls to, and that is

where the real is you lies, and where you are campaigning, I

suppose. -- others are forced to do. On the positive side, gig economy

workers are at least as satisfied with their work as other workers,

they are more satisfied in terms of things like flexibility and

independence, and most gig economy workers choose to work in the gig

economy, so about one in ten say that they are working in the gig

economy because they could not get a regular job in the labour market,

and most people do so in order to boost their income, rather than rely

on income. So that is the sort of positive side. The negative side is

we know from our research that many gig economy workers do not know what

their employers are, and if they do feel exploited, where they can go to

seek redress. And crucially, a lot of gig economy workers, a

significant minority say that although they are classified as

self-employed, they are actually treated as workers in terms of the

level of control. So some people are getting the worst of both worlds in

terms of not enjoying the autonomy and independence of self-employment

and nor are they getting the rights that they should be getting if they

were classified as workers, things like eligibility for national

minimum wage, for example. That story is on the BBC Business

Live page. Some are forced to and some are

making a personal choice. Our top story: Transatlantic trade

is at the top of the agenda as Germany's Angela Merkel gets set

to meet President Trump The trade balance and currency

valuations are likely to be Quite a lot of treading water going

on at the moment. The Footsie closed at a record high yesterday. -- FTSE.

Let's get the inside track on global interest rates.

The US Federal Reserve raised its benchmark interest

It was just the third time in a decade.

Let's get more with our Business Editor, Simon Jack.

Take as around the world in interest rates. It is a global thing because

this is the cost of borrowing the world's reserve currency, all sorts

of things are priced in dollars so it affects the entire world. When we

had the rays everybody was expecting that. It is the third time in a

decade. Every time they have moved interest rates we have got this is

the beginning of the take-off and suddenly it peters out again and

watches that yesterday was that the US economy has not strengthened a

great deal since the last thing she looked at it. Although she can put

it up because inflation is 1.9% and the jobless rate is low, it looks

like a normal economy, it is not charging away, so she said maybe

there will be another interest rate rise this week, people were

factoring three or four a few weeks ago. The stock market got that

Donald Trump was going to spend big and cut corporate taxes. She's that

might be another one this year. Interest rates do not look as if

they are going to shoot up and that is good news for people around the

sluggish, wages are not going up. sluggish, wages are not going up.

That decision that she has made has a knock-on effect on the global

economy. Exactly because lots of people in emerging economies have

lots of debts denominated in dollars particularly in places in Asia and

South America and when the cost of borrowing goes up in dollars their

and yet their debts are going up in and yet their debts are going up in

price because the interest rates go up. That can cause a problem. Also

beat will have got money elsewhere around the world because they have

been chasing return and they think they can get a better return in

dollars. Why am I taking this risk over here? Maybe I will move it back

to somewhere safer. Capital flows go back as the interest rates go up on

the dollar. We are going to talk about the car industry. The

omissions scandal continues. Fresh allegations against rain all. VW are

going to be $25 billion to clean up their affairs in the US. I much that

will be in Europe is another case. Surely VW cannot be the only people

doing this. Sure enough other people have been put under investigation.

We got some allegations against Renault this week, a report compiled

last year, a French news paper got hold of some of their son said there

was reason to suspect that the cause of the difference in tests in

scenarios and real life, maybe there was something going on. Renault have

denied that saying there is no device in the way that VW have

confessed to. We will see how that goes on but it is a rumbling

question. As far as a mission scandals go it puts the spotlight on

diesel cars and their future because if you have to cheat the tests it

seems like they pollute more than we were told. It is interesting because

here in the UK we were told to go diesel and were incentives to do

that, diesel was cheaper, different taxes are my fees, everyone was

going diesel because you got more miles to the gallon, and now diesel

has been demonised saying you may win on one but the omissions on the

other side are not so good. We got to a point where 50% of all new cars

were diesel. I am not sure what the latest stats are but that advance of

diesel has been halted. There is a question of whether diesel has run

out of puff. Public policy changes as well, charging diesel drivers

more to intercity centres for example.

If all this news is giving you heavy eyelids, or like us

you started work at 3am, this may wake you up.

According to the Rand Corporation lack of sleep is costing the world

economy billions of dollars in lost productivity and it can

Theo Leggett stayed up just long enough to file this report.

We know that we need sleep and some of us probably need more than others

but what happens if you do not get enough? What can it mean for your

ability to do your job? I have come here to this clinical research

centre at the University of Surrey where they study sleep and in

particular what happens to your brain if you do not get enough. I am

going to go over a few things that we will do after we finish. This

doctor is a research fellow at the University. Her team studies what

happens to the sleeping brain and have analysed how insufficient sleep

can have deeply damaging effects on health and performance. Sleep

deprivation can lead to a mental state which is very similar to being

drunk. In part because you are not aware of your inability to focus or

perform at your best and your judgments are impaired, your speed

is imperilled. Maria is going to give you instructions. This gives

you a -- comes at a cost. Lost sleep can cut economic output by up to 3%.

In the US would cost up to $411 billion a year. In Japan it is

billion and in the UK $50 billion are just over ?40 million. People

who do not sleep as much or more likely to die of cardiovascular

disease and cancer and have a car accident. People who enough are more

likely to come to work and are more productive at work compared to

people who do not sleep enough. Sacrificing sleep to work long hours

me impress your boss but it may be dangerous and could be costing your

company a great deal. Perhaps it would be better all-round if we

could sometimes sit back and take a well earned nap. We will prod him

later to wake him up. It is an issue particularly if you are working

shifts and trying to get sleep when you can. How do you manage with your

sleep patterns? Do you get enough? What prevents it? I usually try to

get a couple of hours. A couple? Seven or eight if I can but if there

something big happening I often end up staying up too late. Have you

ever slept the office? No. Sleep deprivation can make people feel

like they are drunk. It is that serious. You may not want to be

filling like that. The Times. Ads shown on videos are contributing to

extremist content or extremist producers are not miss the family

what these advertisers, companies we know and use every day, would like

to be funding. He challenged for the likes of the internet companies or

Google or YouTube or any of these that have that connection. It is the

Home Office, the Royal Navy, the BBC, their ads are popping up on

controversial or extremist videos but they would not want to have them

on. How does it happen? That is the larger theme, algorithmic, high-tech

processes that connect content to content which are not necessarily

screening for the content of the extremist or nationalist videos so

there is an element of the human review process that is maybe messing

and that is what that investigation is looking into. This story about

how a piano tuner found a stash of cash and it was a big one in a piano

that he was working on. Incredible. A lot of piano is out there are not

really worth that much anyway. A sack of gold coins. I would love to

find that my old piano. Thinking about the history of how things are

passed down and the value, not just finding these gold coins, but the

history behind someone who must a stash this in there. The latest one

is 1915, they think it was stashed around then. Around a time of war,

where it was safe to put your money. Maybe they are worth more than we

think. Do you think they will give one to the piano tuner?