29/01/2016 BBC Business Live


Similar Content

Browse content similar to 29/01/2016. Check below for episodes and series from the same categories and more!



Hallo everybody. This is business life.


In a surprise move the Japanese central bank takes emergency action


introducing negative interest rates in a bid to stimulate the economy.


Live from London, that is the top story this morning.


Like many other central banks around the world the bank of Japan has been


battling sluggish growth, stubbornly low inflation and some volatile


markets. What will the latest move bring any results? Coming up...


Changes at the top. James Murdoch takes over at sky just four years


after his resignation at the height of the phone hacking scandal and we


show you the markets. China is up, all is up, Tokyo is up... Stay with


us. How much tax should multinational firms pay? It's a


dispute dominating the headlines this week and it's not going away.


Today we want to know if you think enough is being done to make


companies pay what is due. Use the business life hash tag.


What's going on. Welcome to the programme. Let's go to Asia, a


surprise move, the bank of Japan narrowly voting to introduce a


negative interest rate policy. Like many other central banks as I


mentioned, Japan has been struggling with sluggish growth, stubbornly low


inflation and volatile market sentiments. By doing this, what it


means, it will cost of the banks, the commercial and retail banks in


Japan, when they park their money in the central bank, it will charge


them 0.1% to hold that money. The hope is that it will encourage


commercial banks to lend Bor and stimulate investment and


consumption. Of course, all of this in response to global market


turmoil, on the slowdown with to get growth back up and running.


Let's go to our it out there in the economy and get


it working. Indeed, that's definitely the aim, to encourage


people and businesses to start spending money again. It is 0.1%,


that remains to be seen whether it will work other economists are


sceptical. A huge surprise and a huge symbol that the bank of Japan


is dry to boost growth. Because, as you say, Japan's economy which was


recovering quite gradually, has been seeing slowdown recently because of


the Chinese slowdown. It caught the markets off-guard, negate rising by


3% and the Japanese yen falling sharply against the major


currencies. Everybody is getting a bit of a hit from the slowdown by


China. Wide Japan in particular? It seems to be taking a bit of a


hammering? China is a major trading partner for Japan but also, as you


mentioned, Japan has been struggling to beat deflation or falling prices,


that has been the main challenge for the governor over the bank of Japan.


This is a move aimed at beating deflation but as recently as last


week he said he was not going to introduce any more stimulus so this


came as a surprise. It's been dubbed in Japan because he is known to


surprise the market, it's the third time he's done it and markets react


positively, whether or not it will have a real impact on the economy,


that remains to be seen. Good stuff as always, we appreciate that. Talk


to you seen. -- soon. We are joined by Bill Blain, and we will talk


about what this means. Is there any evidence from the European


experiment that negative interest rates work? This is a very good


question to ask. I am afraid they are not working at all. What we have


seen since the double financial crisis in 2008, or a series of


overhasty regulations, new rules on capital, interference with the


invisible hand of the market, markets have become less efficient,


less good at allocating resources but we've also seen zero interest


rates do not stimulate growth. It's very simple to see why. If interest


rates represent something cold the time value of money, you give


someone money and you get something back by lending that, if that amount


is zero tells you that you have no expectations for the future. As a


result, what we have seen in the last eight years of zero interest


rates has been global business, going out and borrowing some for in


the region of $25 trillion from the global bond markets and banks. What


have they done that? Have they invested it in new factories, new


infrastructure, creating jobs? No, they are going to the stock market


and they bought their own start back that pushes their stock up for a


short while and what we now see is the world in serious economic


crisis. Global trade is crashing, Japan throwing yet another kitchen


sink into the equation this morning. The economy is still not reforming,


the important third arrow and this afternoon we will get the US saying


the global growth in the US, GDP, is lower than expected. Just a few


months ago, the US Federal Reserve, the central bank, started to hike


interest rates, telling us all they were confident that global growth


was about to resume in now, it's looking like it's not. That's a


major credibility smashed. As a result, the global markets are


looking very weak, confused and slightly panicky. I think we will


get to the stage for growth comes back but it's difficult to see where


at the moment. Positive note... Thank you. I'm sorry, a bit of a


round. Thank you very much. OK... Let's have a drink! I am joking.


Let's look at all the other stories making headlines. We call costs and


sluggish sales weighing on Honda. The third largest order group in


Japan says its three-month profit to December is down 19% year-on-year


and short of what the experts were looking for. And how about this. I


ran has signed a deal to buy 118 Airbus planes worth $225 billion at


list prices of the biggest deals since western sanctions against


Tehran were lifted. The agreement was signed during a visit by the


Iranian President France and it includes 73 wide and over 40 narrow


body jets. Airbus needs those sales. What have we got? You have the


tablet. I do, Barbie has a brand-new body, apparently. Mattel is making a


bunch of other Barbies with tube body types, Kirby, tall and petite


and she is going to be available in seven skin tones, 22 eye colours...


Seven skin tones? Really? I mean, I am flummoxed as to how you make 22


eye colours. You have brown, blue, green... And 24 hairstyles. There


you go. One more story before we go. Some data out from France today


about economic growth. Growing its fastest in four years according to


official statistics. Would a turnaround after years of


stagnation. -- what a turnaround. Good news for the Eurozone. We are


getting Eurozone inflation numbers. Sheraton Amazon have tumbled in


after hours trading, after the results from the online retail


giant, they disappointed. You can never please Wall Street, can you?


Not unless you give them cheap money. Amazon racked up quarterly


sales of more than $35 billion in the three months to December, up 20%


in the previous year, taking annual sales above 100 million for the


first time but investors had expected more, sending shares down


more than 13%. Say what I did there? I have moved. Let's talk about the


markets, the Chinese markets, closing up for the first time in


more than four days, some suggesting the Chinese sell-off has been


played. The central bank throwing more money into the market ahead of


the public holiday. Or is up $35 a bowl, boosted by possible talks


between Russia and OPEC. Let's look at Europe. Will that play into the


ECB, hinting about more stimulus? If Bill is right, they shouldn't be


doing that, but the Russian interest rate decision, the big number... The


latest gross number from the US, the world's biggest economy, worries


that that is stalling. From the US, let's join Michelle Fleury. In the


week when the US central bank said the economic outlook was teary


rating investors will look to the latest growth figures for evidence


of how sharply at slowing down under, the commerce Department


issued its first let's must fourth-quarter gross domestic


product this Friday. The earnings parade continues. Chevron, the


country's second largest oil producer reporting quarterly


earnings. Profits will likely take a hit from the fall in oil prices and


the strong dollar is also expected to put a bit of a dent into


MasterCard's fourth-quarter profit. Markets will get a chance to react


to results from Amazon and Microsoft. The tech giants reporting


results after the market close on Thursday. James Murdoch, big story


today, becoming one of the most powerful figures in European


television by becoming the chairman of Skype. It is the British


subscription broadcaster. It comes after four years after he resigned


as chairman of what was then known as BSkyB. He quit after news car,


his father Rupert's business failed to push through a takeover of the


broadcaster. Our economics editor joins us. Good morning. We should


forget about Leonardo DiCaprio, the big ribbon and this year is James


Murdoch! Very good. James Murdoch was also Chief Executive of Oxford


makes revenant... A very big move. -- of Fox. When Rupert Murdoch tried


to take another four years ago, sky television in Britain merged with


sky Italia and sky Deutschland, numbers out this morning show


profits are up, the number of subscribers is up across Europe and


Fox is one of the biggest movie makers in the world. James Murdoch


now German of sky, Fox has a 40% stake in sky. It will resurrect the


notion of will Rupert Murdoch owns Fox wants to try and read takeover


sky in its totality? Nothing imminent. That is a very expensive


move. What we are getting is a reflection of the big double media


players wanting to consolidate and have a real world presence, movies,


television, of course, part of river border's Empire includes newspapers,


the Wall Street Journal in America, the Times and the Sun newspaper in


Britain and I think it's about consolidating. James Murdoch


certainly has resurrected his position in Britain and European


television which did crash and burn to an extent over the phone hacking


scandal in Britain. He resigned, not only as chairman of sky but also as


news International Bridge on the newspapers that were embroiled in


the scandal. I am really sorry but we will have to leave it there. Can


I talk to you later? Good on you. Thank you. Still to come. How much


tax should multinational firms pay? It's in dispute and has dominated


the headlines this week and isn't going away any time soon. You are


with business live from BBC News. I like this... It's the famous four


by four, a symbol of British carmaking. It certainly is. Today,


after 68 years, the final Land Rover defender will be rolled off the


production line. Ben Thompson has been assembling quite a line-up.


That's right, an historic day today, the last Land Rover defender rolling


off the production line in Birmingham. This is one of the first


built in 1950 and one of the 2 million or so and have been built


since then. Today marks a milestone in the history of the company. But a


lot of questions about why they feel the need to end production of the


defender given its popularity. Steve is with me. Good morning. Why are


the ending production when it has a loyal following and dedicated fans?


A number of reasons, it's a brilliant design, perfect for what


it needs to do but time has caught up at that. Emissions problems, it


could be re-engineered but that's expensive, it's expensive to build


on an old production line and there are safety issues, it doesn't have


the latest safety so it can be sold on the markets like the US. We say


it's the end of the road but we are expecting another incarnation in the


future? Like every great soap opera, the character will be re-born, we


will see a new defender and new family of defenders. Thank you. We


say it's iconic and an important part of the people who are fans of


that so I've been joined by loyal fans of the defender and they will


give me a quick sense of why it's important. In one word, what does it


mean? Useful. Utilitarian. Adventurous. Different. Timeless.


Lifestyle. Versatile. Legendary. Historic. Part of the family.


Dependable. The view of the Land Rover defender. Marking an important


milestone, the last one off the production line. But from all the


guys here, it is by no means the end of the road.


Just want to show you this. A little comment but we've heard from sky


about this story. The current chairman says he's been in the role


since Mr Murdoch stood down and is delighted by the appointment. His


deep knowledge of the media will make an even greater contribution.


Obviously they are delighted by the prodigal son returning. They are


indeed. He is back. The top story, the bank of Japan has slashed


interest rates. It is a move that has shocked the markets. Let's get


the inside track. How much tax should multinational firms paid?


We've heard about this dispute and it keeps rearing its head. It does


not look like it is going away at all. The tax authorities struck a


deal with Google. George Osborne described the agreement as a victory


but John McDonnell said the sums were trivial. Meanwhile, 31 OECD


countries agreed new rules aimed that tax avoidance. It aims to stop


playing national authorities off against each other. The EU are


targeting aggressive tax planning. Among the proposal is a plan to


share more information across multiple countries. With us now is


our economics correspondent. Shall I go? We need you! Thank you for


coming in. We threw a question out, how much should corporations be


expected to pay? This person says his company pays corporation tax and


those operating in the UK should do so as well and any argument


otherwise is baseless. What do you think about that? The general


principle is the idea that company tax should be paid in the country


where the value added is generated. The kind of things they have been


worried about our accounting devices, extra companies that have


no purpose other than to shift the prop it is -- shift the profits.


Much of the kind of thing, those things we are reporting about, the


EU proposals, the underlying idea is to make it easier to pin down with


economic activity really takes place. I want to move on, you have


done this so many times, I am bored of tax. I want to talk about


Azerbaijan. We have talked about the consequences to the oil-producing


countries, Azerbaijan, 95% of the money it rakes in comes from oil and


gas. This is a serious situation for


these guys. It is not the biggest player in the oil market but will it


does stand out is it is the first to get a visit from the IMF and the


World Bank where they are talking about possible assistance.


Has just arrived in the capital and what we've seen is a dramatic


deterioration in the government's finances because of this drop in the


oil price. It is a quarter of what it was at its peak. We have been


reporting things like the Saudi Arabian budgets being changed


dramatically. There are growing concerns that some might do. They


already have capital controls in place. They have been taking steps


to sort the problem out. One of the striking lessons we learned in the


course of the financial crisis is how quickly, if you get an external


shock of some kind, the position can deteriorate. We saw that with


Ireland and Spain. We are seeing the same thing happen with suppliers,


things have changed dramatically. Thank you so much. In a moment we


will take you through the business pages but first, here is a reminder


of how to get in touch with us. You can stay ahead with all the day's


breaking news. You can keep up-to-date with all the latest


details. We want to hear from you. Get involved on the BBC business


live web page. You can find us on Facebook.


We are going to talk through some of the... We need to talk about Brazil,


the worst recession there for almost a century. They are looking at


lifelines for the state-run banks. It is a relatively small gesture,


maybe in exchange for a political deal for the president who is


obviously trying to avoid impeachment. It is desperately


needed by the economy but you've got to question what is going on. Some


people think you should spend your way out of a crisis and others that


you should save. It seems like Brazil is trying to do both at the


same time. It seems like you send conflicting signals and businesses


do not know whether to take those risks or not. I'm not sure how much


time we have left... Actually, we've got three minutes. We spoke about


Azerbaijan, we often talk about Russia. But here is a perfect


example of when that cheap money that flooded in, all the


commodities, it is hard to see light at the end of the tunnel. It is. Was


only to undertake some pretty serious reforms, there is the


question of corruption, those investigations going on at the same


time, it is hard to see life getting easier for them. Shall we talk about


Mark Zuckerberg? We share a birthday. We were born on the same


day. However, I am not the sixth richest person in the world, which


is the story here. To be honest, it is everywhere. Mark Zuckerberg


making a lot of money during his maternity leave. He's done a lot


better than I did, I just came back to a lot of e-mails. Does it say how


much he made? An extraordinary amount of money, the value of the


shares has gone through the roof. That mobile advertising platform is


really engaging and consumers are starting to use it. It is actually


quite a difficult period for Facebook and is starting to pay off.


We had a lot of naysayers, people saying that Facebook needs to learn


how to monetise things. It is raking it in. It is beginning to happen.


You're seeing that from competitors trying to roll out a similar


platform. It is sucking a lot of advertising money away from other


organisations. Have we got time for the other one? When the Facebook


stock spiked we had Mark Zuckerberg is getting an extra $5.5 billion


from that news. Here we are sweating it out on this show. We were going


to talk but we will focus on it next week. The possible torque between


Russia and Opec. That is it from business live. Plenty more business


news throughout the day. See you next week. Blustery day today for


many of us, storm Gertrude will sweep across the


Download Subtitles