12/08/2016 BBC Business Live


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This is Business Live from BBC News with Maryam Moshiri


The world's 2nd largest economy is making less and buying less.


And all of that will have an impact on you.


Live from London, that's our top story


China's slowdown has already sparked a fall in commodity prices.


We'll be live in Shanghai to find out what it will take


Also in the programme, Google under the spotlight.


South Korea launches an anti-trade investigation.


Our Asia business hub will bring us the latest.


I wanted to put all the American markets together, a record high,


they are partying like it is 1999, because that is the last time that


happened. we'll be finding out how a computer


outage grounded Delta We'll have our very own


Rory Cellan-Jones here - looking at the technology


stories of the week. Today we want to know as US


department store Macys announces it's closing 100 stores as it's hit


by online retailers, Are you well and truly over getting


up and going into stores or do you still like the high


street retail experience? Plenty going on. We do have the


Friday feeling. We start in China -


where in the last couple of hours we've had an update about the health


of the world's second Those numbers have come


in weaker than expected - undermining hopes that the great


slowdown is at last We'll get to them in a moment -


but let's just remind ourselves Last year the Chinese economy grew


at this rate - 6.9%. That was the weakest growth China


has seen in 25 years. This year - so far -


it's even weaker. In the six months to the end of June


growth has slipped to just 6.7%. The fear has been that this


slowdown is getting worse - and that the figure


could be far lower by We've just had the latest


numbers from China's Industrial production was up 6%


year on year in July. That's weaker than the 6.2% in June


- it was expected to be the same. We were expecting the same but


didn't get it. Beijing is making great efforts to shift the economy


from the floor of the factory to one which is more consumer driven,


getting the Chinese people to spend. But on that front -


retail sales for July That's down from 10.6% in June -


and again lower than expected. And investment by firms was up 8.1%


in the seven months to July - that is also a lot lower


than expected We can go to our reporter, more


evidence of a slowdown? Yes, the last figure just mentioned is the


one that will worry people, investment in factories is a


barometer of how confident the Chinese business people feel about


the future, and these figures are not just about the state of the


economy, but also they reveal the sentiment going forward, and it is


not good. The most significant sign of a slowdown is in investment in


factories and we can take that as a sign that the Chinese business


community which a sling to the government do not feel good about


the confidence in terms of the Chinese economy -- which is linked


to the government. And also global demand. Any signs of panic within


the economy and also in terms of the real economy, how is this affecting


Chinese people? We have heard from one official, not a senior official,


but a man Abbey National statistics bureau who spoke to the media -- at


the National. He said the trend remains good, that is the message


from the officials, China is moving towards a massive change, trying to


move away from global trade and a reliance on government investment


and moving towards domestic consumption, and big lay-offs are


expected in the steel industry and the coal industry and that will take


a long time. That remains the focus of the Chinese economy, but there is


also a new normal, to quote the Chinese president, and acceptance of


the slowing economy. They cannot maintain double-digit growth, and


what they want is stability. I want to ask you, and I'm enjoying that


backdrop, by the way. People watching this, going, China, 6.7%,


many countries would give their right arm for that kind of growth,


can you explain why China needs that kind of growth, six and 7%? It wants


to get richer and to continue the effort to continue to move tens of


millions of people in this country out of poverty and move them from


the country to the cities. The only way it can continue to do that is to


have wealth and an economy which grows at rates which people, many


people, would look on with envy, and it would like to maintain something


around 6% if it is to continue on this massive effort to increase


wealth in this country and make China a richer country. There's also


politics. The politicians from the President down, they state what the


ambition will be and low and behold they tend to stick to that, and 6%


is where we are for this year and that will be humiliating for the


president and the premiers they do not manage to maintain that. --


Premier if they do not. Thanks for joining us.


German economic growth slowed less than expected in the second quarter.


Europe's biggest economy grew by 0.4% between April and June -


That was slower than the 0.7% growth it saw in the first


But it was double the rate economists were expecting.


Growth was boosted by higher exports and strong government and consumer


A new online campaign is urging fast food giant McDonald's to impose


a global ban on products from animals treated


Scientists warn that treating livestock with antibiotics


will lead to a rise in drug-resistant superbugs.


The charity ShareAction has called on consumers to email McDonald's


Last week, the fast food chain stopped using poultry


treated with antibiotics - but only in its US restaurants.


You like a bit of antibiotics with your meat? Excavation


we have a good story here. Yes, great. If you have a tablet you have


got to do it, that is how the show works. The markets are up at the


moment. People pile money into gold, don't they? Yes, when they are


worried about the global economy. We'll gold still be trading between


sellers? -- will. More headaches for the internet


search giant Google this morning. It's already been fined $6.8 million


in Russia this week for competition violations, it now faces


a new regulatory probe from South The country's antitrust watchdog


is opening a investigation into whether the company violated


it's anti-competition laws. Leesha Chee is looking into it


for us in Singapore. What is the story? The authorities


in Korea have not released many details aside from the fact that it


has to do with anti-trust violations, but local media are


saying it has to do with Google's advertising policy. This is the


second time that Korea is looking into Google for anti-competitive


behaviour. In 2013 Google was accused of forcing smartphone makers


of using its android software to preload its search engine. It was


cleared of that, but this is one of several battles that Google is


facing globally. You mentioned the case in Russia, but they are also


looking in the European Union to other anti-trust issues. $7 million


fine in Russia, that is a drop in the bucket for Google, because they


make $75 billion in revenue last year alone. Yes, no worries, have a


great weekend. We can stay with the markets, it is a party time, the


markets are partying like they haven't done since 1999, the three


US markets all reached record highs at the same time. That has had a


follow-on effect throughout Asia. There was a blip in the oil price.


There won't be two rate rises this year. Investors are looking for a


terms on their money. -- looking for returns.


Now let's head to New York where Samira Hussain can tell us


Economists expect that sales will have increased for the four skin


sect of months, it is a sign that consumers are continuing to spend --


fourth consecutive month. Two thirds of the US economy depends on


consumer spending, and speaking of retail, department store Hemmings


will be reporting on their figures, Macy's reported strong sales figures


because of warm weather in June and July and healthy consumer spending,


and analysts are expecting the same from JCPenney. Also helping will be


the introduction of appliances as a retail category. We are joined by


the UK equities manager. US stock markets doing very well, is there an


element of it being quite quiet? Lighter trading volume? It is people


looking for somewhere to put their money, quiet trading periods do lead


to more volatility and bigger price movements are the up and the


downside. Authorities have proved to be able to ease people's confidence


and the interest rate rises that were spoken about by the Fed, just


not happening. We are talking about fiscal stimulus in Japan and Canada,


and the UK. Possibly in the United States. That has given people


confidence and has pushed down rates elsewhere. Or that stimulus, getting


through the crisis years, which we have seen -- tall that stimulus. It


is supposed to get Mary Smith and Joe blogs into the economy, but it


ends up in the market. Some of this money is ending up back in Wall


Street? People are not able to get much of a return on bonds and the


yields have come down. The same in terms of bank deposits, you are


getting next to nothing, and some places you are being charged for it.


Some of the money is looking for homes. All these distortions can


provide travel further down the line. You are going to take us


through the papers? Still to come, more than 2000 flights cancelled.


We'll be finding out how a computer outage grounded Delta


We'll have our very own Rory Cellan-Jones looking at


You're with Business Live from BBC News.


The first of four strikes by staff at Eurostar began


They're walking out in a dispute over members' work-life balance.


Victoria Fritz is at St Pancras station for us this morning.


What is a worklife balance? Many people at the BBC don't get it. We


have been asking the same question this morning. Good morning to you


both, I hope you are behaving yourself.


There will be eight trains cancelled over the next four days. This is


part of the work life balance for people working on the Eurostar. Only


8% of trains will be affected over the four days. It means the terminal


at the moment will be running pretty smoothly. Eurostar says tickets are


still available on all routes. We have talked about work- life


balance, what is the problem? Members of finding intolerable and


increase in hours. They are not getting the same package as


counterparts in France and Belgium. We want an agreement with a company


and are determined to get one. Members have told us they want to


take industrial action. It has brought matters firmly to the


attention of the company and hope we can start on an agreement we can all


support. We would all like a better work-life balance does is it really


necessary to start now, in the middle of the summer? Absolutely.


The timetables on the row a change in September. We have one window in


which to get the changes we need. -- on the railway. The company will not


focus on this issue unless we take these measures. Hopefully they will


come to their senses and make a straightforward agreement and we can


all get back to normal working patterns. I will let you go. I know


you have that meeting happening in about 15 minutes. It is possible we


might see some of the strike action actually stand down over the next


bidets and also the strikes that are at the moment scheduled for the


August bank holiday as well. -- the next few days. Trains to Paris and


Brussels will be affected over the next few days.


Our top story: There's been more evidence of the slowdown in China.


Latest figures show the world's second biggest economy is making


A quick look at how markets are faring.


We have been talking a lot about the markets. Wall Street had a cracking


day yesterday. What are you doing? I do not have control of the markets.


We cannot show them. The Dow Jones, Nasdaq and SN to be all up at record


highs. They did well, like me! Hundreds of thousands of passengers


faced transport chaos this week after a technical glitch


at Delta Airlines in the US grounded Its chief executive has apologised


for the computer meltdown - saying he knew the company needed


to make technological investments - but that he didn't think it had this


kind of vulnerability. As well as Delta,


Tesla has also been in the technology headlines this


week after one of its cars crashed while in autopilot mode -


this time in China. Rory Cellan-Jones is our


technology correspondent. This airline has 809 aircraft. On


that date, the scheduled flights were almost 3300. Chaos. What has,


since has been far from reassuring. On the day, all they said


immediately was, the computer system has gone down worldwide. Very little


details for that then they said it was due to a power cut at the


Atlanta headquarters. The Atlanta control centre, this vast control


centre. People were asking why they did not have a back-up. IT experts


said, why does a company in this modern age have a single point of


failure? More details coming out about this buyer at the data centre.


They revealed there was a fire at the data centre. -- this fire. It


was revealed it was such a small fire they did not even call out the


fire brigade. It seems, in some ways, putting out the fire may have


caused further problems. Why did they not use traffic Manager? There


is a history here. Organisations which have had technology for a long


time, they have legacy systems. They have invested far more in the past


in technology ban now. They need a second wave of investment. -- van


now. They're all being a bit shy. If you set up a modern business now...


You don't order to run your own service. You hire a big cloud


computing company. There is redundancy. You have a data centre


in Atlanta but maybe another one in Europe to switch to have something


goes wrong. It costs a pretty penny. I do not know how much time we have.


Ad blocking. Some people say, what is this about? This is a huge story


across the internet anyone trying to make money on the internet is


massively reliant on adverts. More more people are using ad blockers to


prevent themselves seeing adverts they find increasingly annoying. The


content companies, the media companies when you rely on money for


that, are fighting back. They have a big ally in Facebook, who up until


now has not said much. It is about on desktop sites. Not on mobiles and


tablets where most people see them because ad blockers are not very


effective on them as yet. But they are effective on the desktop. That


has got lots of media companies really angry. Facebook now has


joined them and acted against them. There is a bit of a war going on.


The biggest ad blocker has already said it has found a way around


Facebook's ad blocking. Facebook has come back and said, we have found a


way around their way around. A bit of a battle. Very briefly, Tesla had


that accident. I do not think there was an accident involved in this


accident in China. The fact it was in China, someone has made a big


complaint. They had an accident when the autopilot system was on. They


admitted their hands were not on or near the wheel. The advice from


Tesla, even when you have it switched on when your hands should


be poised over the wheel. I am sure we will be hearing more about that


story in time. Thank you. In a moment, we'll take a look


through the Business Pages but first here's a quick reminder of how


to get in touch with us. Stay ahead with all the breaking


business news. Keep up to date with the latest details with insides and


analysis from the team of editors around the world. We want to hear


from you as well. Get involved on the BBC live web page. You can find


us on Twitter and Facebook. On TV and online, whenever you need to


know. Let's start with a story about Macy's closing hundreds of its sites


due to competition from online retailers. Martin says, I must


confess to a bit of showroom in. By on the -- look on the high street


and buy online because it is cheaper. I preferred to go to the


shops and look around. I have to be honest, I preferred that as well. A


bit of both. Depends what it is full. Lots of things the children I


buy online and get them delivered and it is very convenient. Things


for me, I like the touch and feel. I like the reviews online of lots of


consumer feedback. You can do both. You can go into a store and have a


look at a book and then go on to Amazon and check the reviews and


then buy it in the book shop. I have done that. If it is quite pricey,


you could have a quick look to see, are they overcharging? People do a


comparison. This is what is happening to the bricks and mortar.


Macy's is a big name, isn't it? They are shutting 100 stores. They have a


portfolio of over 700. Some of the weaker stores where perhaps they are


situated in places where people have fallen out of favour with them. They


will recycle the money to refurbish the rest of the stores and putted


into digital offering, to bulk up that spend the online space. Let's


move on to the story in the Daily Telegraph. Evaluations for big tech


companies like Goober. Is there a dot-com bubble on the horizon? --


Uber. These are privately held companies are not quoted on the


stock market. The reader cross is, technology companies are quoted on


the stock markets. -- be read across. The Nasdaq index is


technology heavy. It is hitting all-time highs. Markets have been


powered by the success of these new technology, New World companies.


That has been mirrored in the private space. These companies can


raise vast amounts of money from private wealth companies, pension


funds. The valuations being put on them are extraordinary. Quite often,


profits at the current time are very small. It is all about grabbing


market share. They are not making those sums of money yet. The


comparisons against some established businesses are very high. Good to


talk to you. Thank you for coming in and talking to us.


Have a great weekend. You have more business out the rest of the day. I


am done. Goodbye.


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