03/03/2016 BBC Business Live

Latin America's largest economy is being battered on all sides.

Brazil was once a star of the emerging markets

but the global slowdown, commodities slump and corruption

Also in the programme...we're taking a look at the economic plans

of Democrat Hillary Clinton - this time yesterday it was all

about Super Tuesday and we picked apart the economics

of Republican Donald Trump as the race for White House hots up.

And are we seeing a turning point for financial markets

Oil is rising - emerging market currencies are strengthening -

having that conversation in about five minutes.

Today we'll be getting the inside track on Scott Scott -

a US law firm - specialising in class actions that has

We have its managing partner David Scott on the programme.

All week we've been hearing from businesses giving their view

on whether Britain should leave the EU.

Do you think that it's a decision for the individual or is it helpful

We start in Brazil - as it struggles with the worst

In a few hours' time official figures are expected to confirm

the once booming economy shrank last year at the steepest rate in more

Analysts including the International Monetary Fund think Brazil's economy

contracted almost 4% last year - the worst performance of any

1.5 million jobs disappeared last year - the fastest pace of job

Part of the reason is the slump in commodity prices.

The slowdown in China means there's far less demand for the minerals

and other raw materials Brazil produces.

And as an oil exporter - Brazil's been hit hard

And back at home - a big corruption scandal

at state-run oil producer Petrobras has implicated key politicians

and business leaders - shaking the government

of President Dilma Rousseff and the confidence of foreign

Himena Blanco is the Head of Americas analysis at Verisk

Thank you for joining us. We ran through those numbers, up to 4%

contraction in the economy, and to almost 11% in

inflation. This is not just numbers, this is major changes in

the way that people live and what they can afford to eat, the jobs

they can do and the access to sanitation, how long they can

stay in formal education, what is this like on the

ground for people in Brazil? This is the main risk the legacy of Dilma

Rousseff's party. success in improving the standards

of living of millions of Brazilians. We're talking about people losing

their jobs, struggling to pay rent and for transport while at the same

time seeing the cost of those services continuing to increase. But

we are also seeing a much more profound or structural struggle,

deliver basic facilities, so for example we

will see a delay in sanitation programmes and connecting households

to storage systems, and that can have a very important impact on for

example the health of the population and the spread of

communicable diseases. Like the Zika virus,

is a relatively new democracy. It has

from where it was in the 70s as a military dictatorship. What chance

is there that we will see any kind of income redistribution? Is there

any chance Brazil might improve itself at all or is it so tied to

commodities that think there's a silver lining to

what we've been talking about especially in terms of the

corruption scandal and democracy, we are seeing Brazilians much more

interested in how the state is managing the tax money that

they are paying. That is why this corruption scandal is so important

for many Brazilians, many have taken to the streets demanding justice.

The interesting thing, something that sets Brazil apart from its

neighbours is that corruption allegations are being investigated,

the judiciary is independent, we are seeing a moderate improvement in the

strength of institutions in Brazil through the investigation of this

case and a case before it. There is a slight silver lining.

This is not good news for everyday Brazilians going out looking for a

job now but I think the company is looking to invest in Brazil, and

that is the answer to the country's problems investment, that will

return growth in the long term. The companies looking at the country,

this provides a silver lining because institutions are becoming

stronger. Very briefly, can Brazil bounce back from this? I think so,

eventually, we won't see it in 2016, we might see

very low growth in 2017 but I think that Brazil will remain the largest

market in the region. It is very difficult for any business

wanting to operate in Latin America not to have some form of

presence in Brazil, even if at the moment they may be

struggling with an increase in social unrest and political risk.

Thank you so much for joining us. the news about growth, or not, as

the case it be, we will update you. Let's move on.

The mining company Samarco has agreed to pay $1.1 billion

in damages following a major environmental disaster in Brazil.

In November, two of its dams ruptured - causing the mudslide that

destroyed the town of Mariana in southern Brazil and killed 19

A new train station opens later on Thursday -

on the site of New York's World Trade Center.

A new train station opens later on Thursday -

on the site of New York's World Trade Center.

the cost has spiralled to more than $3.8 billion -

making it the most expensive railway station in the world.

Shares in Toshiba have closed 7% higher on reports the firm

is about to secure substantial new loans for its restructuring efforts.

The company is in talks with several Japanese lenders over raising funds

in the wake of a massive accounting scandal.

Let's take a look at the Live page on the BBC website -

and one story is dominating this morning - it's the comments

from the French economy minister - Emmanuel Macron.

We have them here. He says that France would

relocate its migrant camp from Calais to Britain and roll out the

red carpet for bankers fleeing if the UK leads the EU. He's headed to

a summit with various leaders and economy ministers will be meeting.

This is one of the key discussions going on in Europe with many

arguments for and against. We will cover some of them later. We will.

And the German finance minister will be speaking in London today, no

doubt giving his views on the EU question as well.

A day after Moody's cut China's outlook to negative,

the credit rating agency has now cut the outlook of 38

Everyone will be looking to the China National People's

Congress this weekend to see what new stimulus measures

How worried are people about what is going on with the downgrades

it is part of an ongoing narrative that we have been hearing from

analysts in China over the last couple of months.

As you rightly say, the downgrade from Moody's yesterday on the

outlook of China took a lot of people by surprise. The fact that it

has downgraded its outlook on 38 state owned firms, including China's

largest firm in some of its banks, is going to deal a further blow to

the country's state owned enterprises sector. The outlook has

been reduced to negative from stable. This will also put pressure

on Beijing as it attempts to clean up its sector and reform what are

known as zombie films, massive companies that are living of debt

and struggling to stay alive. The problem is that these companies

employ millions of people, so if they are shut down, where do these

people go? It is a theme we have heard frequently recently and it

will be top of the agenda when China's leaders meet at the National

People's Congress this weekend. Thank you. Certainly a big focus at

the end of this week. All that news is not enough to tempt investors off

financial markets today. The yen has been weak in the last

few days. That has helped. Wall Street ended the day keeping hold of

the gains they made the day before. Let's look at Europe. Where we are

down slightly the fact that perhaps the appetite for risk is back. We've

got the price of oil going up, gold going down, safe havens like the yen

off the boil. That kind of sentiment seems to be on the market. First,

news of another story in the US. The man who helped to kick-start

America's sale revolution died in a car crash on Wednesday one day after

he was accused of conspiring to rig bids for oil and gas leases. The

former boss of Chesapeake Energy is credited with helping change the

energy world, yet controversial business practices helped cost him

his job. Hewlett-Packard enterprise which is made up of the hardware,

software and servers side of the business, turns in its first-quarter

earnings this Thursday. You may remember that last week HP

Incorporated, the business side of the company, reported decent

earnings, yet investors were not too happy with the company's outlook.

And has the largest books dare - book store chain in the US changed?

It is now selling toys online as it tries to compete with retailers like

Amazon. Joining us is Richard Dunbar,

Investment Director We will go through some market

stories. We have seen the biggest rise in the Asia-Pacific region in

terms of shares since August. I wonder if this rally is sustainable

or will it fade? Markets have been spooked in the last couple of months

about the US and we've seen better numbers from there. They've been

spooked by China, and things are not getting any worse there, and they've

been spooked by the oil price and we've seen some stability and that's

that it is encouraging to see more stability in markets, generally come

in Asia in particular, taking into consideration some of the currencies

which have been selling in the last few weeks. Interesting to see the

oil price rising and also metals like iron ore going up a lot. In

terms of what moves first, when things improve, like sentiment about

the global outlook for the global economy etc, what tends to give

signs first in markets that things are going to improve? Markets are

doing what they are meant to do, every day into the office I see a

mining company stating that it is reducing capital expenditure and

digging fewer holes and we will see less production. Similarly, we are

seeing better news from the US, which should fill demand for these

products, better demand or expectations thereof, and less

supply, so arise in metals prices, the invisible hand of the market is

doing its job. For once! Richard, thank you very much. We'll have you

and later to look at the newspapers. Still to come is brash US style law

coming to British shores? There is a gulf between the British legal

system and the one in the US. We will be talking to the boss of the

US law firm about how to take on big business here. You are watching

Business Live from BBC News. UK car workers at Rolls-Royce have

been sent an e-mail from German parent company BMW, highlighting

what it sees as the risks of a vote Meanwhile, Lord Rose,

the head of the campaign to keep Britain in the European Union,

suggests that wages of low skilled workers could rise in

the event of a Brexit. We knew the debate was going to get

more and more intense. Today is quite a big thing, isn't it?

That's right and it is achieving some focus. Both sides are looking

at exactly what the results would be of Britain leaving the EU. The

difficult part is nobody knows because it would be a question of

renegotiating Britain's position towards the EU. That is the

difficulty many companies face. What would that period of uncertainty be,

and for how long, and what would be the final result, would they gain a

preferential position, or not? That is the question. BMW has written to

its workers a Rolls-Royce explaining that it feels Britain would be

better inside the EU. It makes it plain to its workers that isn't a

decision to be handed out by the employer. What it is trying to say

to car companies and workers here is that it wants to stay part of it.

Many work very closely together. I should say, though, that there are

200 small companies, and I find this interesting, who are saying they

would like to leave the EU. These are British companies. Slightly

counterintuitive. You would imagine small companies would feel

particularly exposed. But in some cases what they resent is some of

the regulation they are forced accent as part of the EU. Some of

them presumably trade outside the EU and they feel they wouldn't have to

accent that if Britain were not within the trading block. -- forced

to act set -- accept. We have to wade through all of the

arguments before the referendum. This is dominoes results. They have

done really well and they think they have been helped by record cheese

prices. -- Domino's. INAUDIBLE

You're watching Business Live - our top story - we're bad news

-- You're watching Business Live - our top story - we're expecting more

bad news from Brazil, expected to confirm Latin America's

largest economy is slipping deeper into recession,

in 2015 at the steepest rate in more than two decades.

When we have that news, I'm sure it will be on the website, so check it

out. Now let's get the Inside Track

on the battle between When you think of class action

lawsuits, perhaps the US movie Erin Brockovich comes to mind -

ordinary citizens taking Or do you see ambulance chasers -

lawyers making a fast buck specialising in class actions,

often against big companies. The firm is currently involved

in anti-cartel litigation in the US against 12 banks, achieving

$809 million in settlements to date. The firm has just

opened their London office, in what they've described as "a move

to prepare for a possible European front in the forex battle

against the world's largest banks." With me now is the firm's managing

partner, David Scott. -- welcome to the programme. The

foreign exchange and the reading investigation going on right around

the world first. Libel has been tough to prove and it has been very

difficult litigation all over the world, why do you think Forex means

you will have a better chance of success? -- Libor has been tough.

Libor Has been tough. In the other case we allege that in addition to

fixing the 4pm fix, there was also a conspiracy to manipulate. One would

have been injured, regardless of what side of the trade you were on.

That is the difference between the two.

Just explain to those watching, you are representing who in this, and

who are you chasing for damages? In the US case we represent everybody

who has been impacted through the conspiracy fix foreign exchange.

Because of the mechanism, it means we represent everybody who was

trading. That, by default, is generally very large investing

companies. In the European slashed UK market, we are representing large

multinational pension schemes, large traders, who have been impacted

again by the alleged conspiracy. -- Europe/Uk market. Do you see a

difference in the level of litigation? When times are good

people do not sue each other as much. On some level there is a

correlation between what happened in 2008 and the drying up of the

market. What seems to me, at least, on almost a daily occurrence, some

new governmental investigation into financial institution misconduct.

You have the foreign exchange scandal, the Libor scandal, the

sovereign debt scandal... I think what happened was when it dried up

banks needed a new avenue in which to seek profit. Unfortunately a lot

of banks appear to have been engaging in conduct which is

questionable. To be clear, you will be going after the banks themselves,

the banks will argue it was individuals behaviour that we were

not aware of, we were not across, they were secretly doing what they

were doing. -- individuals' behaviour. How will you go about it?

If you look in the US, I believe four banks pleaded guilty to

anti-trust violations at the corporate level. The corporation

themselves has pleaded guilty to the conduct. Moreover I think it was the

FCA, in their report, they found a systemic failure to have policy and

procedures in place to prevent this type of conduct. In fact, some of

the employees were meeting with the compliance officers and general

counsel to ask if the conduct they were engaging in in chat rooms was

violating the internal policies within the corporation. To argue it

was rogue employees, I don't think really has... I don't think it has

legs to stand on. So interesting. We could keep talking about this, but

thank you very much, and best of luck with all of your cases. Thank

you very much. We will keep an eye on this, I'm sure it will be one

about stories again. If you were watching on Wednesday

as we analysed the results of Super Tuesday in the US -

the economics of Republican Donald Well today, we're taking

a look at the economic plans of Democrat Hilary Clinton

as the race towards the White House Jeremy Howell explains the thinking

behind "Clintonomics". Hillary Clinton says ordinary

American wage earners are disillusioned with the economic

system. Wage rises are scarce, jobs are insecure. She has a three

pronged strategy to restore their says in it. The first is a push for

strong economic growth. -- faith. She wants to improve America's

infrastructure including airports, roads, and bridges. She wants to

help more young people go to college by lowering their tuition costs. The

second problem is fair growth. She wants to increase the minimum wage

to $15 an hour. And she would impose a fair shares tax on people who earn

over $5 million a year. The third prong is long-term growth. She would

use the tax system to punish investors who hold shares only for a

short while, and reward those who hang onto them the long term. But

even by her own calculations, her new spending measures would cost $25

billion a year more than her new taxes would raise.

Buber has big plans for the world. -- Uber. If the chief executive is

to leave, which I think you will, they could be losing even more

money. It talks to the ambition and the scale of the ambition of Uber.

They are hated by those with whom they compete. Is it sustainable if

their expansion plans are as big as they say they are, and we don't

doubt that, and yet the money is going out extremely fast, how will

it continue? Will it get some people who believe in them? It isn't

sustainable. Companies have to make profit and generate cash. That will

have to come. Looking at their accounts, it seems they are able to

attract significant equity capital investors. And they are able to

attract very significant debt from the banks. They are able to finance

it. The scale of ambition is clear when you look at the results. A

force to be reckoned with. Keep your eyes on Uber. It has been great to

have you on the programme. And thank you for your company. As ever, there

is a lot more going on in business which we don't have time to mention

in the programme. Do have a look at the website.

There will be more business news throughout the day on the BBC Live

web page and on World Business Report.

After another cold start, Thursday will be a half reasonable day for

most. Fewer showers than yesterday and the winds will be lighter. For

that we have to thank the fact this area of low pressure which gave us