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This is Business Live from the BBC, with Ben Thompson and Sally Bundock.
Cutting off funding for terrorists - as world leaders try to stem
the rise of IS and other armed groups, attention shifts to blocking
Live from London, that's our top story on Thursday 19th November.
With an income of billions of dollars a year, IS is the richest
But how do they make it, and how do global leaders intend to hit back?
A Pacific power struggle - the US and China square up
at the Apec summit in Manila, with territorial disputes
And the European trading day is under way,
In Japan, shares headed higher despite Government data showing that
exports fell in October for the first time in over a year.
And we'll hear from the chief executive of Forbes.
It's known, amongst other things, for its influential rich-list.
But can the magazine stay relevant in a digital world?
Mike Perlis is a veteran of the magazine world -
And as one bank in the Gulf says it will offer customers more interest
on their savings if they do more exercise, we want to
know - are financial rewards an incentive to stay fit and healthy?
Let us know - just use the hashtag #BBCBizLive.
The fight against so-called Islamic State has stepped up
after the attacks in Paris which killed 129 people.
Today the focus is on how the terrorists are funded,
with a commission set up by Russia's President Putin.
It's thought the militant group IS has an annual income of $2-billion.
The US Treasury says it's probably the best-funded terrorist group
Up to $500 million a year comes from the illicit sale of oil.
That's sold to smugglers, who then sell it on through middle men.
The UN says eight million people live in territory controlled
by the group, with taxation and extortion a key source
of revenue, bringing in hundreds of millions of dollars a year.
The group has also looted up to $1billion from banks
when it took over the Iraqi city of Mosul in 2014.
Joining me now is Dr Sally Leivesley,
director of NewRisk - they look at issues of terrorism and security.
As Ben outlined, this is an organisation that is self funding
and from that point of view is doing pretty well? It is a different
situation to other terrorist groups, you cannot easily disrupt with land
and revenues and resources, so their resilience against disruption means
we are in for a very long time with them. Prior to the terrorist attacks
in Paris of last week, this was looked into in great detail because,
of course, there was that issue of how this organisation operates, how
do we try and curb that? What conclusions are drawn about that,
and do we have any more insight, given what happened in Paris? The
stimulus with the G20 nations is that the leaders have to cooperate
because so much of this is banking through the Internet, and also it is
coordination of data collections, and unless the country leaders all
take that on and look at issues of privacy versus trying to really find
these plots on the run, and it is to find inside or our countries who is
being recruited. In a sense, is technology, the online banking,
social media for recruitment, that whole world is the key to this, I
assume, and it is at a time when big companies that provide that are
fighting with governments over privacy? Indeed, and unfortunately
this is a public safety issue because marauding attacks across
cities like Paris mean the finances of cities like Paris will take a
hit, so IS is now becoming a very expensive terrorist group because
they are causing us a cost within our own countries as well. As you
say in some of your analysis, it is about demand, supply, looking at the
basics of how business operates, and how you affect change through that
analysis? What is good is that the countries have got together and
understand that a lot of recruits are crowdfunding through family,
friends, social media, so getting over there is an easy situation but
the state itself needs energy, needs fuel, so what is happening is trying
to disrupt, if you could fuel convoy you may be stopping a fighting
effort that Isis leads, said that immediate impact within the Islamic
State by what countries like ours and Russia are doing, but back home,
while we are looking at what is over there we are missing the point that
we have to upgrade these patterns of buying types of equipment online.
Small bits of funding, people who are quite educated but never in a
job and you need large datasets in the analysis. We appreciate you come
again, very interesting, so much more to talk about. As you say,
governments are talking about this and trying to coordinate more and
more as time goes by. Difficult to know where to start,
though. Let's bring you up-to-date with some
other business stories. Reports say the US drug giant Pfizer
is in talks to buy Irish rival It's a deal that could be worth
$150 billion, making it the biggest It comes despite the US Treasury's
plans to clamp down on so called tax "inversions",
where a big US firm buys a smaller foreign rival then moves
its headquarters to avoid US tax. America's Central Bank,
the Federal Reserve, has given its strongest hint yet that it could
raise interest rates next month. Minutes
of the Fed's October meeting showed "most" officials felt conditions for
a rate hike "could well be met That takes place on the 15th
and 16th of December. Troubled Japanese electronics giant
Sharp is trying to persuade its employees to buy its products
in a bid to boost sales. The firm says it's not mandatory
for staff to buy its goods, but that it wants workers to choose its
products over those from rivals. The company recently announced its
operating profit fell 86% in the The annual
Asia Pacific Economic Cooperation - or Apec - summit is wrapping up
in the Philippine capital, Manila. Apec's members include huge
economies like the United States, China, Japan, and South Korea,
as well as the likes of Indonesia, Between them, they account
for almost half of global trade. Our correspondent Rupert Wingfield
Hayes is at the summit for us. It has been an interesting time,
because although they want to remain a coherent club all about trade,
making it easy, there are deep divisions particularly between the
US and China? That's right, we have heard lots of
platitudes here about improving cooperation, enhancing inclusive
growth, which has been the slogan of the meeting, but I think what has
been start here is the noticeable deepening differences between China
and the United States on a number of fronts. Firstly on territorial
issues in the South China Sea, President Obama came here much more
assertive in opposing what China has been doing in the South China Sea
over the last year, building on weeks, creating artificial islands,
President Obama said that must stop. He backed it up with new
military aid for the Philippines and Vietnam, including cue new ships he
announced yesterday for the Philippine Navy. That is on one
side. On the trade site, deep differences on trading blocs.
President Obama pushing his big trading group, the TPP, the
Trans-Pacific Partnership, which includes 12 nations including
Japan, Australia and several other Asia-Pacific nations but excluding
China. President Xie Jin Ping of China has come here pushing another
block, you may have heard of TPP but I doubt many people have heard of
FTAP, the free trade area for the Pacific, which China say should be
the new trading bloc for this region. It wants that taken more
seriously and wants to push ahead with plans for its own free trade
area to oppose the Americans' creation of the TPP.
Thank you so much. That Apec summit under way there in Manila.
Some news coming across the wires from Reuters, basically telling us
that Belgium will spend an extra 400 million euros, $427 million, on the
fight against Islamist violence, that coming from the Prime Minister
of Belgium. More funds to fight hate speech in particular, to track
potential extremists, and boost its intelligence services. Interesting
this should be announced, given the conversation we have just had with
Doctor Sally lately, so Belgium, to reiterate, spending an extra 400
million euros specifically geared to fighting Islamist violence, that
story just coming across the wires. Let's just take you to the market
numbers. Stocks rising in Tokyo
after the Bank of Japan decided to keep its stimulus programme
unchanged, pushing up But elsewhere,
that early rebound at the start of the week levelled off yesterday
with further developments in Paris. In Europe, this is how
the numbers are looking. This after last night's news
from the Fed, where America's Central Bank laid out the case for
a potential rise in interest rates That's dominating Wall Street, but
what else is ahead in the US today? Wall Street will be hit with a
double whammy as two high-profile tech companies begin trading.
Square, Twitter CEO's Jack Dorsey's company, is one of the most
prominent unicorns, Private start-ups valued at over $1 billion.
The valuation has been significantly discounted from $6 billion a year
ago. The company has not been profitable and investors worry that
Jack Dorsey will be spread too thin between Square and Twitter to turn
things around. Match group which owns online dating
services will try to woo investors when it debuts on the Nasdaq. The
company plans to use the money raised to repay the debt it owes to
its parent company, IAC. And if we tell, Best Bites and Gap released
their earnings. Joining us is Sue Noffke, UK
equities fund manager at Schroders. It would seem that markets today are
quite happy with what they read in the central bank minutes on
Wednesday? The Fed are doing an important job of communicating to
market what it is that will cause them to start to move interest rates
after nine years. And then what they might look for in terms of the pace
of any further interest rate rises. It is clear that December, all other
things being equal, we will likely see the first rate rise. But the
pace and further moves are likely to be quite modest. It was that move
that boosted Asia? And we are seeing follow-through to Europe. What is
interesting in the detail, they talk about how the US economy has
weathered the storm perhaps better than they expected, talking about
external factors. They were unnerved in the summer and early autumn by
China in particular and what was going on in the emerging markets,
and I think they looked at the statistics, both internationally,
and what it means for the US domestic economy, and the data is
coming through reasonably strongly. I think we need to get away from
these kinds of emergency levels that we have lived with for so long. We
also have UK retail sales coming through later, expecting to see an
increase of something like 5% in sales, which sounds fairly decent.
What does that tell us about how the UK economy is doing? We always have
the comparison, year-on-year, what was the weather doing this time last
year to this year? It always comes back to the weather in UK sales!
There is a big weather in fact, in October and November we also have
the lead up to Christmas and also the important Black Friday,
pre-Christmas sales as well. Some retailers have decided to step away
from Black Friday, so I think we might be in for a surprise. We will
assess whether it is a good or bad move, but we need the right kind of
rain in the meantime! Stepping away from Black Friday, but
I don't think it is gone for ever, I think we are likely to see those
pictures of people scrabbling over TVs.
Also not gone forever, the various rich list, various people compiling
them and a bit obsessed with them. We'll hear from the first man
to head Forbes Media Steve Perlis is also a veteran
of the magazine industry, so we'll ask how do magazines
survive in a digital world? You're with Business Live
from BBC News. into what went wrong at the bank
HBOS will be published later. Our business reporter Simon Jack
is following the story for us. Simon, this is a long-awaited
report, we should get some detail but it is expected to be rather
critical? Yes, there is a big cast of
characters in this disaster movie but let's focus on the three leads,
James Crosby, former chief executive of HBOS, architect of an aggressive
sales driven growth strategy, Andy Hornby, his protege, came from
ASDA, retail background, went from selling mids to mortgages, he was at
Wembley when the bank went down in 2008. Dennis Stevenson, the chairman
of the bank who it could be argued was responsible for keeping his
aggressive executives in check. Possibly also criticism for the
auditor, KPMG, why were they not aware of what was going on, and
regulators at the time, people like John Tyler and Callum McCarthy,
around at the time at the FSA, expect them to get some flak, and
also the then Prime Minister Gordon Brown who brokered the deal for
Lloyds to take over HBOS -- HBOS, much to the chagrin of the
shareholders who say it prompted a hole in their bag. But why do we
care about this, it was seven years ago? 40,000 jobs were lost and it
cost a lot of money for the taxpayers. People will wonder why
only one single prosecutor, Peter Cummings, was fined when the rest
went Scot free. There will be a separate report on why that happened
out today by a QC called Andrew Green.
That report will definitely dominate the UK business news today.
The reason is caught our attention, news from Poundland, the brilliance
team who put it together, if you could hear the debate they had about
the pronunciation! This is Jim McCarty, TCL of
Poundland, he has been talking to the Today programme, about the
impact of the national living wage, and what impact it will have on his
company. Because he cannot put his prices at about ?1. And they are
merging with 99p Stores, so clearly a debate about whether prices will
go up or down! After attacks in Paris
killed 129 people on Friday, global leaders are now looking
at what they can do to limit the power
of the so-called Islamic State. the group's multibillion-dollar
funding stream. Russia has announced a commission
to combat terrorism financing, while the European Union
is now looking at what it can do to restrict the supply of
money to IS. Details of that as we get it, and
plenty more on the website, of course.
The magazine business has had a tough time of late.
The internet has been responsible for the demise
And denting the advertising revenues of others.
But there has been one notable exception, Forbes magazine.
The business magazine ended last year
with a record US readership of 6.7 million.
US visitors to Forbes.com have also risen significantly,
That success has spawned many admirers.
In 2014 Forbes Media, which controls the magazine, sold
a majority stake worth $300 million to a Hong Kong based investor group.
One of the key drivers of that success has been Mike Perlis,
back in 2010 he became the first chief executive of Forbes Media
to not be a member of the Forbes family.
Michelle Fleury asked him what he was doing differently.
I invested principally in digital content businesses, Huffington Post,
Buzzfeed, associated content, Buddy Media, and I learned a lot
about how to create content, how to figure out the right kinds
of business models around the creation of high quality content.
And I reached a certain age, and as a guy who's been an operator most of
my life, I decided, after ten years of venture capital investing, that
I wanted to take what I've learned and apply it to a grand old brand,
and I found Forbes, I've known Forbes,
they are very forward thinking, very nimble, and able to move,
and we put the old brand together with new digital thinking
and really transformed the company over the last five years,
which is what I left Softbank to go out and try and do.
You talk about the bigger opportunity being digital,
I mean, most of your advertising revenue now comes
from digital ads, not traditional ads.
It does, we crossed over that threshold
I think we are unique in old, well-established brands,
having found ourselves, worked very hard to get there,
but finding ourselves in the position
where most of our advertising from advertising comes from digital.
Which brings me to a concern that some people have about native
advertising, they are worried that somehow that wall between content
and advertising has been broken - how do you address those concerns?
Our native advertising product is something called Brand Voice.
We have over 100 marketers who take advantage of that.
they work with the business side of the house.
But the content that they create, it's not salesy,
it's not advertorial, it's thought leadership
that represents their company in the way
that they'd like consumer to see them, and as a result
is of great interest to our audience and drives traffic to Forbes.com
along with the content we do create, you know, in the old-fashioned way,
You also have to work with Hong Kong investment group that owns a portion
of Forbes, what has that been like? It's been...
It's new, it's just a year, we sold a majority stake in Forbes
Media to Integrated Whale Media, ut's a group of Hong Kong invesors
There are great opportunities for Forbes in Asia, and one of the
reasons that our new investors came on board, in addition to wanting to
continue to run the media company in an innovative way and ambitiously
and continue to grow it, they also see, and I agree,
that there are amazing opportunities from a branding standpoint
Products that are based on the image and the character and ethos
that is created by our media product, but that may be in the
travel area, the financial services area, the real estate area.
So when you mention travel there, is there an example you can give me
of what a Forbes branded travel experience might look like?
Well, we have a travel guide, Forbes Travel Guide, that rates hotels, a
five-star rating system, but I think beyond that we are looking at things
along the lines of investments in real hotel and conference properties
that may have the Forbes name, probably like everything we do,
with a strong dollop of business as an overlay.
Forbes branded business travel products.
So the Michelin Guide but for business travellers.
A bit more breaking news related to the events in Paris on Friday, news
on the AP newswire that authorities in Belgium have launched six raids
in Brussels. They say this is in the Brussels region, all linked to the
suicide bomber Bilal Hadfi. They say an bushel in the federal
prosecutor's offers say that is taking place in the Molenbeek area
of Brussels but other areas are included. Six more raids taking
place in Brussels. 24-hour is ago, the raids were ongoing in
Saint-Denis, a suburb of Paris, which was taking place this time
yesterday. Bilal Hadfi has been identified as one of three attackers
at the Stade de France stadium. The raids are centring on his
the AP newswire. We will update you the AP newswire. We will update you
when we get more information. We just want to take you through some
of the business pages, welcome back. We are hearing from Forbes, Mike
Perlis, this is the rich list, the hot 40 under 40, making us all feel
a little like failures in our careers! But nonetheless, the top
ten are worth $122 billion between them. A lot of money, and a lot of
very new companies, eight Facebook associates, three from air B, so
all the new companies that have really risen up so quickly, and what
is happening is that age is not a barrier to very real success,
certainly in monetary terms. It is happening for people a lot quicker
in the digital age than it did some generations ago. Just one on the
list is a woman, Elizabeth Holmes, who started a biotech company. Yes,
diagnostics. , worth $4 billion. Quite interesting, but it would be
nice to see more women on that list. One out of 40 is quite disappointing
as a hit rate, it should be something that is more
representative of our place in society. Indeed. Maybe it's big to
the entrepreneurial spirit, I'm not quite sure. -- maybe it speaks.
Speaking of diagnostics, big business in the United States,
health devices, this is a whole new take.
You get a higher interest rate on your savings account if you take
exercise. That is one way of getting people to do exercise. Depending on
the number of steps you are prepared to take, they will monitor your
activity rate and adjust the interest rate accordingly. I think
Big Brother is going to be watching us all, we will get something for
being more active in our lives. Thanks so much for coming in,
counting every step! Thank you for your company, we will
see you soon. Bye-bye.