21/09/2016 BBC Business Live


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This is Business Live from BBC News with Ben Thompson and Sally Bundock.


It is Super Wednesday with two of the world's most influential


central banks making big decisions that could directly affect


Live from London, that's our top story on Wednesday, 21st September.


There was no change in the cost of borrowing from the Bank of Japan


but all eyes now shift to America's Central Bank for any


signs of a rate rise for the world's largest economy.


Also in the programme, Tesla car gets hacked and they gain


The firm has updated the software to correct the problem,


but what safety issues does it raise for the electric car giant.


And we'll bring you all the latest market reaction to that


European markets up by 0.5%. Stay tuned for the reaction to what's


happening on global markets. And we'll get the inside track


on how technology is making life The website Live Better With sells


non-medical products to help Could hi-tech fitness tracker make


you fatter not fitter? It's being called super Wednesday


with announcements from two central bank heavyweights -


the Bank of Japan and The Bank of Japan has decided


to keep rates on hold at minus 0.1% and hasn't


added to its stimulus. Later it's the turn


of America's Central Bank to tell us what it has


decided to do. But the two are facing very


different economic challenges and today's events show why central


banks comes in for so much scrutiny. As economies have struggled to pick


up after the global slowdown, Central Bank policy has become


increasingly important but also Japan has led the way


in lowering rates. And the cost of borrowing


is hovering at near historic lows but also across most developed


countries around the world. Such low rates has meant


Central Banks have had to take other That's why we've seen a big rise


in the use of quantitative easing, where central banks buy


large amounts of debt and that frees up money


in the wider economy for lending In Europe, for instance,


the ECB is buying 80 billion euros a month and it includes government


and corporate debt. But despite this unprecedented


action, inflation has stayed stubbornly low and growth,


except in America, So what tools do Central Banks


actually have left to Karishma Vaswani is in Singapore


and we've had that Bank Some reports say it is tinkering


around the edges of a policy that's not working. Is that the case? That


would be fair to say that's been the assessment among many of the


analysts that I have been speaking to, but remember the Bank of Japan


is always controversial or it has been recently certainly and


investors in Tokyo re-Warded the policy statement with showing with a


rise in shares, by over 12%. 1%, the yen weakened slightly. As you said


the BOJ didn't push interest rates further below zero, but it is


targeting the yield curve of ten-year-old bonds aim to go keep


that around zero. Both the measures appear to be aimed at ensuring that


those big banks and financials, remember they make up a huge portion


of the Japanese economy, pension funds as well as insurance


companies. They don't continue to see profits hurting the way they


have been in the past and ever since that negative interest rate decision


came into play around January, but analysts as I was saying earlier are


pretty divided on whether the moves will be effective because as we have


been talking about, the ammunition for central banks appears to be


running out and key economic reforms have yet to take place there.


Thank you very much. There is more on the website. Thank you for now.


Pippa Malmgren is founder of the DRPM Group and an international


Nice to see you. So we've heard about the Bank of Japan. Give us


your take on how they've tweaked things. In Japan they are literally


running out of tools. They're minus interest rates. They have been


pumping stimulus and they've tried it all, haven't they? So today they


have said they are not going to have quantitative easing, they are going


to have quantitative and qualative easing and price for interest rates


for long-term and short-term money so it is more expensive to borrow


long-term. That's to help the pension funds, they are really


struggling? They surely are, but the thing is quantitative easing doesn't


necessarily work the same way in every country and I would argue it


doesn't work in Japan, but it does work in the United Kingdom and it


work in the United States and that's why there is speculation that the


Federal Reserve is going to raise interest rates potentially at some


point, maybe today, but maybe soon, but in Japan, no. And there are lots


of reasons, but I would say the main reason is they're not very


supportive of small businesses which is where two-thirds of the net new


jobs are created, firms that have less than 50 people. So in Japan,


you can put all the money you want in the system, but it never gets to


the little businesses, whereas it dus in the UK and the US. Let's talk


about the Fed. It is an interesting one. One we've watched closely. All


the speculation about will they do, when will they do and how much will


they do it by? Today we could get some answers and we will see a


direct impact on the markets? It looks like the polls are showing


only a fifth of the traders in the market believe that they'll raise


interest rates to. It would be a surprise if they acted, but they've


told us that they want to raise interests interest rates. I think,


they have not warned us as frequently as they did in the past


so people are hesitating. But the reality is if they do, it is the


equivalent of taking a teaspoonful of water out of a bathtub. It


doesn't actually tighten the liquidity conditions much. I say


even if they act, the market might be initially surprised, but I think


it will make the stock market go up. Pippa, thank you. Michelle is


stationed at the US Central Bank in Washington and will update us as


soon as we get the news. The boss


of American Bank, Wells Fargo, has apologised to customers,


but refused to resign after a two hour grilling by a Senate Banking


Committee yesterday. He was giving evidence


after two million fake accounts were created at the bank that


customers hadn't John Stumpf said he was "deeply


sorry" for that and Oil and gas giant Exxon Mobil


is being investigated over the way The company may have misled


investors and the public by failing to reflect a slump in oil prices,


increasing regulation and potential A Tesla car has been hacked


by researchers in China, and the company has now updated


the software in its vehicle The researchers managed to control


the brake system on a moving vehicle and opened a car door


using a laptop. Tesla says the attack could only be


triggered when a web browser was in use and the vehicle was close


enough to a malicious wi-fi It is very worrying, isn't it? Not a


great thing to be able to control the brakes and the door from a


laptop, for the people inside, anyway.


In Europe, it is all about what is happening at the central banks.


Michael Hewson from CMC Markets is in London.


We are 40 minutes into the European day, what's going on? Are people


reacting to Japan are just looking ahead to the Fed or a bit of both? A


bit of both. The financial stocks are up significantly on the Bank of


Japan's tweaking of its policy framework, but all eyes will be on


the Fed. It is clear the Federal Reserve is split down the middle as


to whether it should raise rates. The window is closing for the Fed to


act and while markets aren't expecting a rate rise today, there


is an expectation that Janet Yellen could give guidance on a potential


rate rise in December. Michael, when we talk about the reaction on the


markets, what is it that investors want to see? Is it just clarity,


some sort of direction rather than this scrabbling around for any tool


that's left or is it that they actually want to see a rate rise


because it makes money more attractive? Absolutely. I think


that's exactly what investors want to see. At the beginning of this


year we were told to expect four rate rises this year. Thus far, we


are still waiting for the first one. Ultimately, I think, the perception


out there is get it out of the way, get it done and update the market as


to what your inflation expectations are going forward. Michael, as


always, it is really good to talk to you.


Joining us is James Quinn, Group Business Editor


We promised we would talk about at thes lard, it sounds worrying,


Chinese hackers controlling the brakes? There was a team of Chinese


hackers 12 miles from the car. They published the video online and at


thes lard were able to issue an update to the software. You say it


is good they figured this out now before the cars, clearly, the cars


are up and running and on the road, but spot it early, get the patch


sent out and the software updated and they say no one needs to take


the car in, they have been able to do this over the air? That's


different compared to with what happened to VW and the emissions


scandal which is still leading to the recall of hundreds of thousands


of cars across Europe. This is how it works with innovation with


companies pushing into new frontiers, but the news about the at


thes lard vehicles has been negative lately. It has had an effect on the


share price? Yes, it closed at $204 yesterday compared to 240, the


question is regulation. The regulation is not really keeping up.


The US yesterday releasing rules to try and work out how companies like


at thes lard and Uber which is testing autonomous cars keep us all


safe. The regulation issue is a really interesting one. As touched


on, all this innovation is happening faster than the regulation can keep


up with, so you might find that the regulators are just having to do


piecemeal bits of regulation to stay on top of it and it strikes me they


need to step back and think this is the future, how are we going to deal


with this, but they can't do that yet? It is country by country. In


the US alone... State by State. The federal regulators said companies


should share their data and whether they do that, that's a different


matter. James, we will see you later. More to talk to James about


in terms of stories in the media. Including the fitness trackers and


whether they make you fatter or fitter!


Tech support, how one firm is using technology


We'll speak to the woman behind the website that's simplifying


You're with Business Live from BBC News.


In the UK, Royal Bank of Scotland has had a setback trying to offload


Selling the branches was a key condition of RBS' taxpayer-funded


bailout at the height of the financial crisis.


Theo Leggett has the details in our business newsroom.


Theo, they have been trying to sell them, but the buyer pulled out. Just


explain this for us. Well, this is a real problem for RBS because they


have, as you say a legal requirement to sell 315 branches by the end of


next year. That was a condition attached to the taxpayer bail out in


2008, but the problem is at the moment, there aren't many buyers for


banking branches. We're all moving our accounts online and they're not


particularly profitable and bank accounts anyway aren't particularly


profitable as an investment because of low interest rates and there are


a couple of million accounts we understand that come with the


branches. So RBS is trying to sell them. Santander was one buyer, it


was interested and it pulled out in 2012, RBS then tried to set-up a


stand alone business under the Williams and Glyn brand. That wasn't


working out and then Santander came into the picture, but they are


disagreeing over price. RBS would like ?1.5 billion and ?2 billion and


Santander isn't willing to pay that much. There is not many potential


buyers out there. Whilst this is going on, what about the wider


problems at RBS? Look at this share price from just a


few days ago. That was because of the fines which the Department of


Justice is thinking about imposing on Deutsche Bank for misselling


mortgage security. Now, RBS is also in the firing line for that kind of


thing. So you can see investor reaction there. Not only that but a


recently reported $2 billion loss for the first six months of this


year, which is partly linked to a legal hangover from payment


protection insurance misselling. The big picture for RBS is that there


are a lot of things on the line. It is not going terribly well. And


investors, as you can see, are not terribly happy, either. Majestic


Wine has warned that profits will be hit by a slow down in its commercial


business, and also a failure in its direct mail campaign in the US. More


on that on the websites. Japan's Central Bank keeps


rates on hold at -0.1%, and now, all eyes shift Stateside


for the Federal Reserve's decision, as Central Banks struggle to revive


growth in the world economy. The big question - do they have any


tools left to tackle sluggish growth? That's what we have been


discussing this morning. Now, we know technology has


changed our everyday lives, but can it also help ease


pain from illness? The website Live Better With was


launched late last year to help millions of people suffering


from cancer to find non-medical products specifically for them,


all in one place. Over 500,000 visitors have used


the site, with 20,000 patients and carers now part


of the online community. Live Better With has offices


in London and New York and has received over ?2 million in private


investment in the last few months. Tamara Rajah is the founder and CEO


of the website Live Better With. She joins us now. Nice to see you.


First of all, just explain the concept behind the website. It


strikes me, there's lots of places you can get these kind of things


online, but this is about bringing them altogether? Yes, they're all


over the place. If you're suffering from cancer or a long-term


condition, or you're caring for somebody who is, how do you bring


together what could be hopeful for them? That's the whole purpose


behind this. It should be at your thing tips. That's what we do, it's


to make day-to-day life a little bit better, bring together all the


things which can be useful and curated them. So if we look at your


website, we've got all the different elements. You've got different kinds


of problems, with skin, with Herrera, you can click on that


particular area. How do you make money out of this? We bring together


all of the products which would be helpful for people living with


cancer. They are available on the site. So you can come there knowing


only how you feel. So, I feel sick. Click on it and find all the things


which other people feeling sick have felt helpful, and then buy it, all


on one site. How do you get all of that information from so many people


you're talking to, it is an enormous task, how many people have you got


doing it? We're a team of eight at the moment, but through us, we reach


thousands of people living with cancer, through our online community


and through face-to-face interviews. But presumably you've got to check


the products are legitimate? Yes, so, a lot of the products are things


that may have been recommended in a very fragmented way by individual


doctors and nurses. So again, bringing together all of that in one


place. At the minute this specifically looks at cancer. It


strikes me the business model would apply to different conditions as


well - do you have plans to expand? The vision is to help all people


with long-term illnesses. Exactly as you say, the business model extends


to people living with chronic conditions who have different side


effects and symptoms. But to start with, we're focusing on cancer, and


for that alone, there's hundreds of products. Talkers through the


journey of getting this up and running. It's a lovely website, you


conceive the need for it, but there must have been a lot of pain and


long hours and blood, sweat and tears going into getting it off the


ground? And looking at some of the stuff, it's about bringing together


the experts as well? It absolutely is, it's a balance of content, as


well as the products themselves. Each of those needs a lot of


searching and validating and curating and clearing it all up.


It's balancing this social mission that we have two make life better


for people with cancer, with building a sustainable business,


which is what will help it grow in the long-term. You have been around


for a year, and most people don't know about you. It's a very, very


busy, noisy environment online. How on earth will you get your voice out


there, other than being on Business Life -- On Business Live? That Is


The Thing, We Have This Burning Need To Reach Everybody With Cancer In


The Whole World. That's what striving us. It is a huge mission!


But everybody should know where to find these things. That's what's


behind it. We are partnering with charities, with hospitals, and other


people as well. Where does the money come from to scale up on this, with


that sort of ambition, as well as with the charities on the hospitals,


you need to partner with financial institutions, clearly. How receptive


have they been to this? Yes. You mentioned the investment that we've


had, and it's got a very warm reception from investors. And I


think that balance of what we're doing for people with these


conditions, plus building a sustainable business, but coupled


together makes it an attractive investment story. Thanks for your


time today, and all the very best. Very interesting concept. We will


keep an eye on how it progresses. Best of luck to.


In a moment, we'll take a look through the business pages.


Including those fitness devices. My love of burgers, what can I say?!


But first, here's a quick reminder of how to get in touch with us.


We will keep you up-to-date with all the latest details, with insight and


analysis from the BBC's team of editors around the world. And we


want to hear from you, too. Get involved on our web page.


Let's talk about that story that we have now mentioned a few times. I


just want to talk you through the story first of all. This is about


fitness trackers and weather they can make you fat or fitter. A lot of


you getting in touch with us this morning. This one says, personally I


think it makes me smarter and fitter. It lets you check on the


amount of calories and nutrients. Where does he get that from, being


more smart? Is it about eating smart, do you think? Your thoughts?


The story is based on a University of Pittsburgh study which look that


500 people over two years. Those who did not have the trackers actually


lost more wait, there were people who were doing weight counselling in


any case. As Ben was saying earlier, you are thinking that you only have


to walk 10,000 steps and everything is all right - that's probably not


quite right. I think it is an interesting concept because it is


about this kind of outsourcing responsibility for your fitness.


It's not about thinking of a work-out plan, it's, I just need to


walk 10,000 steps. It's brilliant to get people moving, but then... I


haven't got one, but they do more than just how many steps, don't


they? Yes, it's smartphones and watches now have got lots of


different techniques to outsource health, and there is big business in


it. Google and others are trying to get into it. There is that thing,


all the gear and no idea. People posting about where they have run,


how long they have run for... Clearly you're not a fan! Let's move


on! The base rate could lead to any UK mortgages under 1%. Mortgage --


mortgage rates, should I say. People will be thinking, yes, please! I


think there are some banks where you can get that already, like HSBC, for


those with a 35% deposit, you can get a rate of under 1%. Thanks for


turning all the viewers about that, I don't mind! I think it's good to


be open. I think if the Bank of England cuts at the end of the year,


we should see another fall in mortgage rates. It's clearly good


for first-time buyers and those looking to switch mortgages. So what


is the downside? People might be thinking, I can make those payments,


but if the rates go up, even slightly, then people will get


indebted to a rate they cannot afford. And we are a bit addicted to


cheap money. We expect it always to be cheap and when it goes up, we


will suffer. The idea that money is cheap and you can borrow. Our


parents generation would be horrified. That's right. The big


companies have already got into this, with the impact of


quantitative easing on corporate debt. I think the impact of


quantitative easing on personal debt will have a similar effect. Nice to


see you, James. Are you going to be busy with the Fed decision later


today? Definitely, it will be a full day. Busy day for James, and for the


rest of us! I will be busy not using my fitness tracker! Bye-bye!


Good morning. The mist has arrived, with some dense fog patches across




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