17/06/2016 World Business Report


17/06/2016

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Now for the latest financial news with Sally and World Business

:00:00.:00:00.

Cutting out the middle man: Could the tech behind Bitcoin

:00:00.:00:21.

revolutionise the global financial system?

:00:22.:00:24.

We enter the fast moving world of Blockchain.

:00:25.:00:28.

How US firms are creating cash from cannabis.

:00:29.:00:38.

Also coming up: Japan's finance minister vows an urgent response

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It is really hurting financial markets in Japan and also the

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exporter is. What action will they take in the future. -- exporters.

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We start in the fast moving world of financial technology.

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This week the City of London has been hosting

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the Global Digital Banking Conference, ahead of

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London Technology Week which begins on Monday.

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One word that's on everyone's lips - blockchain.

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It's the system that was developed to underpin the digital currency

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BitCoin, but its fans believe it could soon revolutionise global

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finance and even the whole business world.

:01:28.:01:30.

Under the traditional financial system,

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So if I want to pay money to you, they process the transaction

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and record it in a single centralised database or ledger.

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Under the new system there is no middle man.

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The ledger of transactions is effectively shared

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across thousands or even millions of computers around the world

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When a transaction is made between two parties,

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it is broadcast to everyone else in the network.

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Everyone's ledger is updated that shared record is what's known

:02:05.:02:09.

Santander estimates the technology could save banks

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a fortune on infrastructure costs up to $20 billion by 2022.

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It also makes fraud much harder, as the BBC's Newsnight

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Bitcoin is a self-regulating digital currency. It doesn't leave a central

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bank in charge. It uses a blockchain, a ledger of who owns

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what. Every time Bitcoins are transferred to another block of data

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is added on to the chain. A complete copy of the blockchain is held by

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the entire network of users, therefore if he tried to cheat the

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currency and spend what you haven't got then everyone else would know.

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The same technology many believe could be used to track anything of

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value. There's a lot more detail on that on

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the website and they will be in the week ahead because London Technology

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Week is taking place next week and this is the main talking point. More

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on this later when we get an expert view on blockchain and how

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transparent it could be. Now let's have a look at Japan. The

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finance minister says he is deeply concerned about the strength of the

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country's currency. Rico Hizon is across this for us. Tell us a little

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bit more about what the finance minister had to say.

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He wants a weaker yen. The currency has been on a roll, appreciating the

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almost to -- two year lows. Now the finance minister has fired off a

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warning shot against a recent rise in the yen, saying he was deeply

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concerned about the one-sided nature of it and would respond urgently if

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necessary. So he could be hinting at market intervention to weaken the

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yen. So this latest rhetoric comes as the yen hit multi year highs

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against the dollar and the euro. So the finance minister stresses that

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stability in currencies is extremely important and they were closely

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co-ordinate with other countries on this issue.

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Thank you so much, Acra on of course the Japanese currency took a

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hammering yesterday. -- thank you so much, Rico.

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From computer code to something a bit more organic now,

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not to mention controversial, because we are also

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Since it was legalised for medicinal use in 25 US states

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and for recreational use in four, marijuana has entered the world

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Last year sales surged to almost $5.5 billion.

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But investors are still cautious about wagering on the weed.

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Samira Hussain took a trip to the Cannabis World Congress

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Pot has come a long way since the days of ruling a joint in your mum's

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basement. In the US it has grown into a multibillion-dollar industry.

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But the sector is hungry for recognition and cash. Betty has come

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to be Expo with her son. After using cannabis to treat her pain she now

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wants to be an investor. I used all of the teachers and it was so

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effective for my pain. -- tinctures. I was able to do things and I was

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debilitated before. I couldn't imagine doing anything. The

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challenge for many of these companies is getting funding. Got

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the laws have not caught up to this new business, many big institutional

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investors, like pension funds and banks, are not legally allowed to

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put their money anywhere near here. I think of the next five years you

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will see this industry develop and honestly if you look at the

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trajectory it has been on for the past five years keep it on that

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trajectory and this will all be cleaned up. Rob Hunt agrees. He runs

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one of the highest public equity funds in the business and has been

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within it for 16 years and knows how much money there is to be made

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investing in wheat. This past year the United States made 5.5 in

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dollars. -- investing in weed. It is expected to be as much as 20 billion

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by 2020. As others get a whiff of marijuana's potential, early

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investors hope it will continue riding the high.

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In other news: The gap between the rich and poor in the US

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is getting wider despite its recovery from the global recession.

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The Organisation for Economic Co-operation

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and Development says US economic output has jumped 10%

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past its pre-crisis peak in 2008, outstripping other major economies

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But the gains are not being evenly shared,

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with women and minorities faring less well, according

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It suggests raising the minimum wage, boosting income tax credit

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and helping people back to work through skills programmes.

:07:54.:08:02.

Volkswagen plans to launch 30 all-electric models to reposition

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itself as a leader in green transport.

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Matthias Mueller, chief executive of Europe's biggest carmaker,

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said huge investments would be needed as the firm moves

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He hopes that by 2025 all-electric cars would account

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for about 20-25% of the German carmaker's annual sales.

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Latest figures show that sales growth of Volkswagen-branded cars

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continues to fall behind European rivals.

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The ultra-luxury carmaker Rolls Royce is also planning to go

:08:38.:08:40.

The brand, which is owned by Germany's BMW,

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has unveiled the zero-emission Rolls of the future.

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The 103 EX is almost six metres long and will drive itself

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using artificial intelligence, but won't be available until 2040.

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The CEO says in the future not everyone will want to sit

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ICAC interviewed him many times and not having an electric vehicles is

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one of my questions. Looking at the markets, a very different picture to

:09:20.:09:23.

this time yesterday. Offcourse Japan was sinking like a stone, over 3%

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lower, because the Japanese yen was getting stronger. Once upon a time

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market watchers and currency experts would say that when the yen was 105

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to the dollar that was the moment the Japanese authorities would

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intervene to weaken its value, because of course began not so long

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ago was 110 to the dollar. Things have changed significantly. Today

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they are bouncing back. Let's quickly show you Wall Street. See

:09:57.:09:59.

you soon. Sir Cliff Richard won't face charges

:10:00.:10:09.

over allegations of sexual abuse

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