05/02/2016 BBC Business Live


Similar Content

Browse content similar to 05/02/2016. Check below for episodes and series from the same categories and more!



As the Zika virus spreads across the Americas there are now


growing concerns about its impact on tourism, and for a country


like Brazil it couldn't come at a worse time.


Live from London, that's our top story.


The Brazilian President has declared war on the deadly Zika virus,


but with just six months to go until the Rio Olympics will it be


enough to protect the country's tourism industry?


Also in the programme: The world's most hated man,


Martin Shkreli, faces lawmakers in America to defend raising


And this is how European shares have opened ahead of that closely watched


And we'll get the inside track on the week in tech including Google


overtaking Apple to become the world's most valuable company


and Microsoft buying British tech firm SwiftKey.


And as a new report says top London lawyers can charge ?1,000 an hour,


the highest ever recorded, we want to know, how much


Today marks six months until the opening ceremony


of the Rio Olympics, but the event threatens to be


overshadowed by the spread of the Zika virus, now present


in 20 countries and expected to spread further.


As well as the health risks, the virus could also wipe out any


economic benefit that many in Brazil were counting on the Games to bring.


Tourism linked to the Olympic Games is predicted to add around


$23 billion to the Brazilian economy this year.


Similar outbreaks have taken devastating tolls


In 2003 the spread of the Sars virus led to a 20% fall in tourism


If Brazil was hit in the same way, the economy could miss out


The Brazilian government says there's not yet evidence of people


cancelling their trips but US based United Airlines are already offering


full refunds to passengers who are booked to travel


Geraint Johnes, Professor of Economics at Lancaster University


I want to talk about the Brazilian economy generally but let us touch


on tourism. There is no doubt, it is inevitable, Brazil is going to take


a hit with people cancelling. There are two important uncertainties. We


do not know how people's behaviour will respond to the outbreak. You


mentioned SARS earlier. There was a decline of 20% in two days to the


affected countries at the time of SARS and if something similar


happens to Brazil which is a major tourist destination with the


Olympics coming up then the economy would take a major head getting on


for $15 billion. It is not clear people will behave in the same way


as with SARS. This is something that has a major effect, serious effect,


but only in a relatively small group of people, pregnant women. Only a


relatively small group are pregnant at any given time. For most people


the infection leads to mild symptoms so it is not clear how people's


behaviour will respond. The second thing we are uncertain about is how


long the outbreak will last. If it is dealt with very quickly then the


effects might be minor but if it lasts a year or so in the economic


impacts will be greater. It is also fair to say that even before there's


Zika outbreak, this is unlike economy that was in turmoil facing


possibly its worst recession in a century and its budget deficit is


around $151 billion, more than 10% of its GDP, and if you look at


Greece in 2009 its deficit was 15% of its GDP and that was just before


it needed a bailout. Yes. Recession has hit Brazil badly. Last year


economic death, growth was -3% and to date is predicted to be -1.2%. If


the head turned out to be similar to SARS then it could knock another 2%


of the growth rate. We appreciate that. Thank you for joining us.


Martin Shkreli, the former head of Turing Pharmaceuticals,


laughed off questions at a US congressional hearing


on the company's drug pricing policy.


He later took to Twitter to call committee members imbeciles.


Congress is investigating Turing's 5,000% price increase of a drug,


Daraprim, used by many Aids patients.


Shares in Mattel, the maker of Barbie dolls, jumped 8%


on Thursday following reports it discussed a merger with rival


Hasbro, which makes the board game Monopoly and the latest Star Wars


action figures, was first approached by Mattel back in 1996,


but the two sides failed to reach an agreement.


In 2014, Lego overtook Mattel to become the world's largest


Toyota says profit came in at just over $6 billion in the three


Earnings were down by 5% on the previous year


But the world's biggest car maker did raise its full year forecast


for the US, thanks to stronger demand.


On the website, Russia having to sell off some of its family silver,


and the Russian economy minister has confirmed states sales, the


privatisation programme to be approved within days.


The parallels between Russia and Saudi Arabia, both countries wanting


to raise money, big questions about who would want to be involved and


the security of that investment. There's the potential for newly


privatised firms to be national eyes to?


Oil prices. Saudi Arabia and Russia have been dipping into their


sovereign oil funds. Their savings pot.


Growth in South East Asia's largest economy, Indonesia,


picked up speed in the fourth quarter, but full-year growth


was still the slowest since the global financial crisis.


It also marks the fifth consecutive slow down.


Ali Moore has the details in our Asia Business Hub in Singapore.


I do not remember how to say happy Chinese new year. I know you are not


Chinese, but I thought I would say that. Indonesia has been having a


tough time getting momentum into its economy partly because of the


slowdown in China which is affecting everyone, that is a key trading


partner, and the crash in commodity prices. Growth last year was the


slowest since the global financial crisis. Lower than what the


president has promised. The pick-up in the last quarter to 5% could be


significant. Driven by higher public spending and optimists arguing that


is good news because the president might finally be getting some of the


reforms through and unclogging much-needed infrastructure


investment. It is too early to say whether the momentum is going to


hold. We will have to see what happens in the current quarter.


Happy Chinese new year to you. It's been another difficult week


for European markets - the first week of February trying,


but failing, to shake off Those worries of a slowing world


economy, weak inflation and relatively


disappointing earnings. Oil prices are starting to creep


back up, but at the same time, we've had more downbeat growth


forecasts from central banks. The latest, the Bank


of England yesterday, downgrading UK growth forecasts


from 2.5% to 2.2% this year. We will discuss that in a moment.


What will be making the news on Wall Street? After weak data on US


economic growth, all eyes will be on January's job report. It will play a


large part of the Federal Reserve's decision-making. Analysts predict


job growth slowed in January. A lot of that is down to the fact that the


manufacturing sector continues to shed jobs. January is traditionally


slow for hiring and unemployment is expected to remain at a seven and a


half year low and wages are expected to have grown modestly. The trade


deficit is expected to be reported to have had little change.


Joining us is Jane Sydenham, investment director


It is that time again. It feels like four years, every single month we


have had this incredible focus on what the US jobs number is going to


be. When do we get... Unemployment has come down... When do we shift


our focus and look for something else? We are nearly at the natural


rate of unemployment. That is the natural expectation for unemployment


regardless of what the economy is doing. We're probably going to be


focusing on wage growth going forward. It is going to be about


wage growth than the earnings of companies and weather at the


consumer is spending, whether the service sector caddies on doing well


because manufacturing is slowing so it is about the service sector and


wage growth so slightly different. The Bank of England downgrading


growth forecasts for the UK not wholly unexpected and blaming all


the same sorts of things but there was a lot of criticism of forward


guidance. Mark Carney trying to tell us what the bank was thinking that


he keeps changing his tune. Yes, they must be regretting the use of


that phrase. They are reacting to what is going on as events changed.


Having said that signal and manage expectations that we can tell you


what is going to happen it is uncomfortable. It is. You are going


to take us through the papers later. Central bankers must communicating,


I do not think that, I think they are dealing with the changing time.


They are having to react as they go but they are setting up different


expectations and that is what people are angry about.


Our technology correspondent Rory Cellan-Jones will take us


through the biggest stories in the tech world this week,


including why Microsoft were so keen to part with a quarter of a billion


dollars for the British firm SwiftKey.


You're with Business Live from BBC News.


Could the great British breakfast be under threat?


Pig farmers in the UK seem set for a difficult year,


with the price of pork at an eight year low.


It's feared that many producers could go out of business.


Do you have food on your feet? Who knew that my feet were so tasty?


There is nothing on these apart from my wellies. 100,000 pigs reared here


every year. These guys are 14 weeks old and went they get to 20 weeks


they will sell them for about ?100 on average per pig. Prices have


fallen from ?125 down to ?100 which means they are losing ?10 on every


pig they cell. Farmers are losing money because of various things. As


we talk about with commodities, these guys are commodities, and


there is a lot of oversupply, we are not eating as much pot. -- pork. We


are not selling as much pork because of the ban on exports. Some pork


coming in from Europe and because of the strong pound it means the picks


here are pretty expensive and that means pressure on the industry and


farmers are concerned about what it is going to mean for the industry. I


have never seen such inquisitive animals in my life. I am going to


try to escape them. Do they bite?


Real pressure on the industry. I will see you later.


I have never heard quite so many sound effects.


We are not allowed to talk about pigs as commodities.


What about the Danish? Pork in Denmark is big.


We will find out soon. With only six months


to go until the Olympics, the Brazilian President Dilma


Rousseff has declared war on mosquitoes responsible


for spreading the Zika virus in a recorded TV


message to the nation. There are now increasing fears


that the virus could devastate the country's tourism industry,


which was expecting a big boost And now let's get the inside track


on some of the tech biggest tech A week where Google overtook Amazon


as the world's largest firm, Microsoft snapped up British tech


firm Swiftkey and Shares in the camera maker GoPro slumped


19% after reporting losses That should not have said Amazon, it


should have said Apple! Did you have one of those GoPro things?


No, but their shares were down 19%. Our technology correspondent


Rory Cellan-Jones is here. Good morning, Rory, welcome to the


madhouse. I should be wearing a GoPro struck my head. I have run a


five kilometre race with a GoPro struck to my head. Goodness knows


what you would record in this studio! Things that should be off as


state arts -- stay off our. Now Google and Apple, vying for the top


spot? After Apple's somewhat disappointing results last week,


their shares have dipped, Google, now renamed Alphabet, came out with


their results. They split off the other stuff from the main stuff.


Google shares went up. The market capitalisation of Google overtook


that of Apple, which is extraordinary, because Apple still


make small profit in a quarter than Google makes in a year. So what the


market was effectively saying is it is the growth story of Apple, it is


over, the growth story as Google has a long way to go and they will


overtake each other. But overnight, Google shares are down again and


Apple is back in the lead. Does it really matter? We talk about it


being the world's largest company, the truth is they are both hugely


successful organisations and it is all based on perception? There is a


great quotes, I think it is from Warren Buffett, that the market is


in the short term a voting machine and in the long term, a weighing


machine. The market gets things right in the long term, in the short


term it is driven by emotion. Sometimes those emotions go in the


wrong direction. Talking about this UK firm, Swiftkey, known for a


predict with keyboard? They make a little keyboard. They have brilliant


technology behind them. They are founded by very clever young


scientists from Cambridge University, they are using a lot of


artificial intelligence techniques. Their technology was used to upgrade


Professor Stephen Hawking's technology, so that when he


communicates it can be done quicker. Microsoft, one of the big firms


looking at these artificial intelligence research in the UK,


they snap them up. We did not get the price that we were told it was a


graduate and $50 million, for a firm that probably makes very tiny


amounts of revenue at the moment. There is a great story about the


guys who founded this, one cashed out pretty early in return for a


bike? It is a great story. As ever, slightly exaggerated. The firm was


founded in around 2008 by three guys, two months in, who knows where


a company will start to go, this guy cashed out and got a bike in


exchange, he was quoted this week as saying, maybe it wasn't my best


decision. In about 30 seconds, what are GoPro doing wrong? Not meeting


market expectations. Market expectations were completely daft. A


little maker of action cameras, great little cameras, but there are


much cheaper ones coming out of China now. The company was priced as


if it was growth stock, I always thought there would be a limit to


the number of crazy geek like me who wants to strap onto their heads, so


it has been pro then! -- crazy people like me. Have a good weekend.


It's estimated that tens of billions of dollars a year are gambled


However, a string of match fixing scandals have damaged the reputation


of Indian sport - and pressure is growing to legalise sports


betting to try and weed out corruption.


It is nearly race time. As these jockeys lead their horses to the


track, activity in the betting hall is picking up, too. Gambling is a


big part of the day for many racegoers. Horse racing is the only


sport where betting in India is legal. You will find licensed


bookmakers at racecourses like this at accepting bets from punters. This


has been held up as an example of how gambling can be legalised across


sports here. For now, though, with most gambling


outlawed, the underground sports betting market is thriving. Tens of


billions of dollars are thought to be staked every year, the bulk of


that on cricket. Bookmakers tend to take bets only from gamblers who


they know, to reduce the risk of being caught. Many punters who bring


those bookies to lay their bets say they would rather be able to gamble


out of the shadows. TRANSLATION: We all are scared of the police, that


is why I had to be really careful while placing my bet. I call only a


known bookie. If the police find stuff, they arrest people. I think


the Government should legalise betting, as so many do it. It may


still be India's greatest sport, but the credibility of Indian cricket


took a hit after a in the IPL.


There is a clamour to legalise betting. As well as making gambling


more transparent, it said it would bring in taxes and help restrict the


flow of so-called black money, cash not declared to the taxman.


Globally, online sports betting is booming. The Indian law is ambiguous


about its legality here. There are many more betting site is now,


allowing people to play for fun without risking money. Even if


sports gambling is legalised, those global firms will have to cater to


the legal audience -- to the Indian audience. Global legitimate


operators can come in and say, we will deliver a very strong, safe


product to the market. That would compete strongly with the black


market. As Indian sport leagues like football get more popular, interest


in betting is picking up. But for that to be done legally, they will


need Parliament to agree. That could be a difficult law to pass.


Let's take a quick look at what's been making the business news


The Washington Post reports that Martin Shkreli,


former head of Turing Pharmaceuticals, refused to answer


questions at a US congressional hearing on the company's


The FT reports on a study that says partners at top London law firms


are charging as much as ?1,000 an hour -


And Business Insider says that Apple's big expansion plan


for its European headquarters could be affected by a shortage


Jane Sydenham from Rathbones Investment Management


Let's get cracking. Let's start with Mr Martin Shkreli, calling the


congressional hearing and the people on that panel imbecile. He has got a


smug little look on his face. He was originally a hedge fund manager and


I think he is used to working out of the eye of the media. This is a


business that quite a lot of companies bought drugs, repurposed


and, that the prices up and sold them again, which is fine, but this


seems to be going to an extreme. It was picked up a Hillary Clinton last


summer. He is not the only one, there are others. I think it is the


extreme nature of the price increase causing difficulty. Looking at it


from his side, he says he is doing it because drug research costs a


lot, so you need to invest in the research to make sure new drugs are


coming in the pipeline. Here's trying to play off the health care


system in America, whereby providers can't negotiate the price of drugs.


He is saying, look, this market is not working, I am proving I can do


it, it is in need of reform. Some would say he has a point in that


respect? I think it probably highlight the need for reform,


actually. I think it will push the pace of change and will be a good


thing, it is just a rather extreme example. And the way in which he is


doing it as one of the issues. Let's talk lawyers. You are not married to


a lawyer? No, but I am beginning to regret my choice of career! 1000


quid an hour for some of the top partners! You had to speak with


glee! This is at the top end of the corporate litigation market -- and


you had to speak quickly! Legislation is much more


complicated, some of these cases are incredibly complicated. It is a lot


of money. It is stopping people from pursuing litigation because it is


out of the reach of most people, although you would not go to a top


London lawyer to defend a parking fine. It pushes up the cost


genetically. We will not have time for the next story.


This is like the Victorian age, employers are having to stop will --


start building property because that was not enough, and Apple are


expanding their operations. We have to go, thank you for coming


in, Jane. Thank you for watching. Goodbye.


Good morning. Quite mild for the next few days, but it will remain


very changeable. We have more clout and drain on the way. The main,


thick belt of cloud as this


Download Subtitles