:00:00. > :00:11.This is Business Live from BBC News, with Ben Thompson and Sally Bundock.
:00:12. > :00:13.A loss in the Italian referendum triggers the resignation
:00:14. > :00:18.The euro has sunk even further as nationalism sweeps the continent.
:00:19. > :00:41.Live from London, that's our top story on Monday 5th December.
:00:42. > :00:43.Italy votes No in the referendum and as promised,
:00:44. > :00:46.Prime Minister Renzi quits - the euro is now at 20-month
:00:47. > :00:54.We assess what's at stake for the Eurozone's third
:00:55. > :00:58.Also in the programme....The new connection between the Hong Kong
:00:59. > :01:00.and Shenzhen stock exchanges is now live - giving international
:01:01. > :01:03.investors access to hundreds of Chinese companies for the first
:01:04. > :01:10.time - we'll take you there for the latest.
:01:11. > :01:16.markets are looking like this after that referendum. We will assess what
:01:17. > :01:17.it means for the future of the Eurozone.
:01:18. > :01:20.From LED disco balls and Christmas lights through to 3D mascara...
:01:21. > :01:22.Later in the programme, we'll get the Inside Track
:01:23. > :01:24.on the changing face of advertising with the boss of
:01:25. > :01:31.JML are famous for their household gadgets, so we want to know
:01:32. > :01:37.what household gadget can you not live without?
:01:38. > :01:52.Get in touch - just use the hashtag #BBCBizLive.
:01:53. > :01:55.My favourite gadget with a toastie maker.
:01:56. > :01:59.So as you've been hearing, Italy has voted a resounding No,
:02:00. > :02:00.rejecting the electoral reforms proposed by Prime
:02:01. > :02:05.He's now announced his intention to resign.
:02:06. > :02:08.The result has ushered in a fresh crisis for the Eurozone,
:02:09. > :02:10.with one of the founder members of the European project mired
:02:11. > :02:15.Here's a look at some of the problems facing the country.
:02:16. > :02:19.Italy has been stuck in a rut: the economy has barely grown over
:02:20. > :02:21.the last eight years, and is likely to remain
:02:22. > :02:33.Meanwhile, public debt is around 130% of GDP -
:02:34. > :02:35.in other words, the economy doesn't sell and produce enough goods
:02:36. > :02:51.Unemployment stands at 11.6%, that's about 2%
:02:52. > :02:54.above the eurozone average and youth unemployment is at breaking point -
:02:55. > :02:56.nearly 39% of young people are out of work.
:02:57. > :02:59.The IMF says Italian banks are holding around
:03:00. > :03:00.$400 billion worth of non-performing loans.
:03:01. > :03:03.This amounts to about one third of all bad loans in the euro area.
:03:04. > :03:05.More than 75% of these are loans to companies.
:03:06. > :03:09.Now that we have a No vote, some analysts warn we could see
:03:10. > :03:12.the failure of up to eight Italian banks and the Prime Minister's
:03:13. > :03:13.bank bailout programme could well be scrapped.
:03:14. > :03:15.Francesco Guerrera is Chief Financial Correspondent
:03:16. > :03:34.It sounds like a real mess. Talk us through what is at stake here. All
:03:35. > :03:40.attention is on these big banks in Italy that could be left high and
:03:41. > :03:44.dry. Yes, the stakes are much higher for the Italian banking sector and
:03:45. > :03:48.European banking sector than for the Eurozone as a whole. The most
:03:49. > :03:52.important thing now is to see whether Italy's third largest bank,
:03:53. > :03:57.Europe's oldest bank, will be able to pull off a 5 billion euros
:03:58. > :04:02.recapitalisation programme, which is badly needed and has been an
:04:03. > :04:05.important measure of how investors feel about Italy. The no vote throws
:04:06. > :04:12.that into a huge amount of doubt. It could make it fail. I understand
:04:13. > :04:18.that the plan was to have private investors come in and rescue that
:04:19. > :04:22.back, and some other banks as well. Why use the overnight results
:04:23. > :04:26.calling that into question? Because investors don't like to write checks
:04:27. > :04:30.during a period of political uncertainty, especially for a
:04:31. > :04:34.country like Italy, which has made a big brand out of political
:04:35. > :04:38.uncertainty and has had repeated moments of political uncertainty. $5
:04:39. > :04:42.billion for a bank like this is a lot of money. So a lot of investors
:04:43. > :04:48.this morning are already rethinking their stance towards that bank. But
:04:49. > :04:52.what are the other options? The Italian government cannot bail out
:04:53. > :04:57.these banks because of rules stated by the fact that it is part of the
:04:58. > :05:04.Eurozone. Exactly, so a state bailout is ruled out under Brussels
:05:05. > :05:07.rules. The other options are for a recapitalisation that hits the small
:05:08. > :05:13.investors in Italy bulges politically unpalatable. What does
:05:14. > :05:18.this mean for the economy as a whole, with Italy in political
:05:19. > :05:23.turmoil once again? Italy is used to this. Italy is used to turmoil, but
:05:24. > :05:27.this is different. Italy has more bank branches than pizzerias, so
:05:28. > :05:30.this was a chance to reduce the amount of inefficiency in the fiscal
:05:31. > :05:37.sector. That chance might be missed now. We are keeping a close eye on
:05:38. > :05:39.this story as it unfolds and how it has played out in markets around the
:05:40. > :05:41.world. More on that later. The Royal Bank of Scotland says it
:05:42. > :05:45.will pay just over a billion dollars to settle compensation claims linked
:05:46. > :05:51.to a rights issue in 2008. At the time, it was acquiring
:05:52. > :05:54.the Dutch bank ABN Amro - but that ultimately led to it
:05:55. > :05:56.seeking a bailout from The agreement is with three
:05:57. > :05:59.of the five shareholder groups Venezuela's central bank says six
:06:00. > :06:08.new denominations of banknotes will come into circulation
:06:09. > :06:16.on December 15th. Soaring inflation amid an economic
:06:17. > :06:18.crisis means that the largest 100 bolivar banknote is only
:06:19. > :06:21.worth about two US cents and people often have to use bags
:06:22. > :06:24.full of money to make payments. The new bills range from 500
:06:25. > :06:26.to 20,000 bolivars. The central bank says they will make
:06:27. > :06:50.payments more efficient. The business life page is dominated
:06:51. > :06:58.by events in Italy. Shares for that bank that we were talking about,
:06:59. > :07:00.Monte dei Paschi, are down. A lot of pressure is on Italy's biggest
:07:01. > :07:04.banks. Much more on the website. Hong Kong has launched
:07:05. > :07:06.its second stock-trading link It means foreign investors will get
:07:07. > :07:09.greater access to more than 800 companies listed
:07:10. > :07:15.on the Shenzhen exchange. Helier Cheung is at the Hong Kong
:07:16. > :07:33.Stock Exchange for us. Will foreign investors be
:07:34. > :07:37.interested? It is the end of the trading day in Hong Kong now, and
:07:38. > :07:40.has been exciting day because for the first time, international
:07:41. > :07:46.investors have access to nearly 900 pubs of stocks in the Shen and
:07:47. > :07:52.exchange. It is the second busiest stock exchange in the world and has
:07:53. > :07:56.access to nearly $3 trillion worth of stocks. The types of stocks are
:07:57. > :08:00.also interesting, because these are technology shares. The fifth of the
:08:01. > :08:04.shares available in Shenzhen from the technology sector, which is
:08:05. > :08:14.viewed as part of China's future, so a lot of investors will be
:08:15. > :08:26.interested in that. China wants to internationalise its markets, and
:08:27. > :08:27.this is seen as part of that. As far as the markets are concerned, the
:08:28. > :08:33.main story is Italy. Worries over political
:08:34. > :08:35.stability in Europe - in the wake of that Italian vote -
:08:36. > :08:38.weighing on Asian markets - but it's in Europe where we'll see
:08:39. > :08:40.the first real impact. Here's what it's looking
:08:41. > :08:43.like across the continent right now. Austria's vote didn t deliver
:08:44. > :08:46.a shock, the far-right leader failing to gain enough votes,
:08:47. > :08:48.but it's the impending resignation of Matteo Renzi that now throws
:08:49. > :08:51.Italy into a new era The most pressing question,
:08:52. > :08:55.as we've been discussing, is how to save the country's third
:08:56. > :09:00.largest bank, Monte dei Paschi. The euro has stabilised
:09:01. > :09:02.at $1.06 after falling We'll talk more on that
:09:03. > :09:14.a little later. But first, Samira has
:09:15. > :09:28.the details about what's ahead We can expect some little bits of
:09:29. > :09:33.economic data and company earnings coming our way this week. On Monday,
:09:34. > :09:37.the ISM survey is out. This looks at the strength of a variety of sectors
:09:38. > :09:40.outside of manufacturing, and it gives investors an idea of how
:09:41. > :09:46.different parts of the economy are faring. The wholesale retailer
:09:47. > :09:50.Costco will be reporting earnings on Wednesday. Falling prices for
:09:51. > :09:54.groceries have likely hurt sales, and traffic to Costco stores was
:09:55. > :09:59.slightly lower in the first two weeks of November ahead of the US
:10:00. > :10:03.presidential elections. Investors will be looking for comments on the
:10:04. > :10:09.upcoming holiday season. Finally, Friday is when we see how strong
:10:10. > :10:13.consumer sentiment is in the US. Remember, for an economy that relies
:10:14. > :10:17.heavily on consumer spending, it is important to see how confident
:10:18. > :10:20.people are feeling and how that will influence how much they spend.
:10:21. > :10:30.Joining us is Jeremy Stretch, head of G10 FX strategy at CIBC.
:10:31. > :10:37.Looking at markets in Europe, they are all headed up. That was not the
:10:38. > :10:41.reaction we were expecting, or worldly? Perhaps this result was
:10:42. > :10:45.priced in. For once, the opinion polls have proved to be correct. In
:10:46. > :10:49.essence, we had already been anticipating that, so the was
:10:50. > :10:53.already under pressure into the event. So the bosses are higher,
:10:54. > :11:00.although you have not got the Italian one there. But the currency
:11:01. > :11:06.markets were largely discounting the result. Yes, Asia is often a more
:11:07. > :11:14.volatile session as we saw in the aftermath of the US election, but
:11:15. > :11:19.people have been saying, what is the Italian situation going to be now?
:11:20. > :11:25.Are we going to have a caretaker government until 2018? That seems
:11:26. > :11:28.the most likely scenario. The pressure point is what will keep us
:11:29. > :11:32.on our toes, because this is where we have to get into detail. It is
:11:33. > :11:37.one thing saying they have to save the banks, but how is a different
:11:38. > :11:41.thing. Indeed. We have been working on plans to try and provide
:11:42. > :11:47.liquidity and capitalisation to the banks, but those plans are now very
:11:48. > :11:52.much up in the air. That is a uncertainty that investors will not
:11:53. > :11:56.like. And the political risk in Europe is setting the tone for next
:11:57. > :12:01.year to a great degree. It is, because if we had the worst case
:12:02. > :12:04.scenario playing out in Italy that we have early elections, which are
:12:05. > :12:09.brought forward to next spring, that would add another layer of political
:12:10. > :12:13.uncertainty into a year of political uncertainty as we know, with the
:12:14. > :12:17.elections coming up in France, the Netherlands and Germany. So there is
:12:18. > :12:21.European political uncertainty. The central institutions will do what
:12:22. > :12:27.they can to provide liquidity, and that will be the theme that comes
:12:28. > :12:31.out of the decision on Thursday, but the politics is the other big
:12:32. > :12:36.variable. That is what has been driving the markets throughout 2016,
:12:37. > :12:45.as we have seen with Brexit and Trump. I can just picture Mark
:12:46. > :12:51.Carney and the other heads of central institutions with their
:12:52. > :12:59.superhero cape is on, coming to the rescue. Well, I don't want to be in
:13:00. > :13:01.your mind, but it is down to the institutions to try and save the
:13:02. > :13:05.world and provide time for the politicians to do what is necessary.
:13:06. > :13:12.Can't you see them swooping in with a cape on? Well, their ability to go
:13:13. > :13:14.sweeping in has come mitigated over time. No one wants to be in Sally's
:13:15. > :13:16.head. Still to come, from LED disco balls
:13:17. > :13:19.and Christmas lights Later in the programme,
:13:20. > :13:22.we'll get the Inside Track on the changing face of advertising
:13:23. > :13:24.with the boss of Gadgets, gizmos and the things you
:13:25. > :13:32.cannot live without. You're with Business
:13:33. > :13:37.Live from BBC News. In the UK, the online estate agent
:13:38. > :13:40.Purple Bricks has been hoping to shake up the housing market
:13:41. > :13:42.by offering low-cost estate They've promised to be
:13:43. > :13:46.in profit by their third anniversary this spring,
:13:47. > :13:48.but this morning they published results for the six months
:13:49. > :13:51.to October and it shows they've The chief executive
:13:52. > :14:07.Michael Bruce joins us now Congratulations on hitting that
:14:08. > :14:10.target, but I am interested in how you have done it, given everything
:14:11. > :14:15.we have heard about the housing market. Yes, there is a seismic
:14:16. > :14:20.change happening in the estate agency market. Purple Brix has
:14:21. > :14:23.demonstrated that it can deliver for customers as a credible alternative
:14:24. > :14:27.to the high street. We have seen enormous growth in our business as
:14:28. > :14:30.people move away from the very expensive rigs and mortar commission
:14:31. > :14:38.based fee structure to something that is fixed. They can take more of
:14:39. > :14:42.that money and put that in their pocket to spend on their families.
:14:43. > :14:45.At the same time, they are getting a better service than they would
:14:46. > :14:49.ordinarily have got. That is what Purple Bricks is the most positively
:14:50. > :14:53.reviewed estate agent possibly in the world, certainly in the UK, in
:14:54. > :14:55.an industry that is often dogged by criticism about the service it
:14:56. > :15:11.provides. How do you plan to keep the momentum
:15:12. > :15:16.up? We are eating away every day at the market share as more and more
:15:17. > :15:19.people decide to move away from the high street and we're confident that
:15:20. > :15:23.wherever the head winds are in the particular industry, the sector or
:15:24. > :15:26.the economy that Purple Bricks will certainly capitalise on what's in
:15:27. > :15:29.market and available to us and that's been demonstrated by the
:15:30. > :15:34.results we announced today. All right. We will keep an eye, that's
:15:35. > :15:39.for sure, see if you can deliver next time. Thank you very much
:15:40. > :15:53.indeed for your time. This is the news from whirlpool of
:15:54. > :15:56.the serious house fires. The company committed to reducing the waiting
:15:57. > :16:01.time for repairs or replacements to ten days, but an investigation has
:16:02. > :16:05.found that could take between six and 12 weeks. Many people are told
:16:06. > :16:09.it is safe to use them, but only to use them if you're in the who is and
:16:10. > :16:12.keep an eye on them. But the picture there of a big fire in West London
:16:13. > :16:16.caused by that tumble drier. You're watching Business Live.
:16:17. > :16:18.Our top story: Italy votes
:16:19. > :16:20."no" in a referendum As promised, the Italian Prime
:16:21. > :16:25.Minister Matteo Renzi has resigned, causing the euro to sink
:16:26. > :16:30.against the dollar. A quick look at how
:16:31. > :16:44.markets are faring. We are seeing that markets are
:16:45. > :16:48.rising. Until there is any certainty about how Italy intends to deal with
:16:49. > :16:51.its debts or the problems at some of its largest banks.
:16:52. > :16:53.Now let's get the inside track on the lucrative business
:16:54. > :16:57.JML sells everything from cat toys to copper-stone frying pans and has
:16:58. > :17:00.a unique business model - pretty much every product it
:17:01. > :17:14.The incredible air powered disc that's perfect for indoor sport. The
:17:15. > :17:19.compact torch and toolkit you can take anywhere. Simply plug it in at
:17:20. > :17:25.home and watch your party come to life!
:17:26. > :17:32.JML is migrating towards online sales. The company markets its
:17:33. > :17:39.products in over 70 countries. They make those ads that you just saw in
:17:40. > :17:44.27 different languages! JML has a turnover of close to ?100 million.
:17:45. > :17:46.They sell 15 million products every year around the world.
:17:47. > :17:49.Ken Daly is the Chief Executive of JML and has been
:17:50. > :17:59.Good to see you. Welcome to the programme. Good morning. We were
:18:00. > :18:03.giggling after the back of the little short clips because they are
:18:04. > :18:07.the kind of adverts that drive you around the twist and yet you watch
:18:08. > :18:11.them and think, "They must be selling that stuff." Yes, I can
:18:12. > :18:14.assure you that we are selling that stuff. We are having a record
:18:15. > :18:19.Christmas and in fact seven out of ten homes in the UK have a JML
:18:20. > :18:22.product. The reason you have to have the ads is because your products are
:18:23. > :18:25.products that need to be demonstrated? Absolutely. They are
:18:26. > :18:30.the kind of gadgets that we need to know how to work them? That's our
:18:31. > :18:34.USP. We develop and market products that need some kind of explanation
:18:35. > :18:37.for the consumer to understand the features and benefits, but when they
:18:38. > :18:42.do, they really, really want to buy them. Is it about convincing buyers
:18:43. > :18:47.that they actually need it? Some of them are really useful products.
:18:48. > :18:51.They are things we use every day. Some maybe less so, they maybe more
:18:52. > :18:57.aspirational gifts. Talk us through why the ideas come from? The ideas
:18:58. > :19:02.come from all over the world. Our mission is to make consumers lives
:19:03. > :19:05.easier. Some of them are more quirky at Christmas because we are trying
:19:06. > :19:11.to make gifting more easy at Christmas and the ideas come from
:19:12. > :19:14.inventors, trade shows, some of them, we develop ourselves and come
:19:15. > :19:18.up with the ideas ourselves. Sometimes factories that we work
:19:19. > :19:26.with develop the ideas. So it is a whole range of sources. The weirdest
:19:27. > :19:29.product? Oh, the weirdest, possibly the light that illuminates your
:19:30. > :19:34.toilet bowl lend you enter the bathroom! A weird one, I guess...
:19:35. > :19:39.Did gu with it? It is something that we will be developing, yes. Ah,
:19:40. > :19:46.watch this space. You can't wait for that advert!
:19:47. > :19:49.Just in terms of the amount of stuff you're selling, how much, how many
:19:50. > :19:53.products have you got, you know, that you're selling at the moment
:19:54. > :20:06.and how do you keep across it all in terms of where it is coming from and
:20:07. > :20:11.quality and supply? Sure. We focus on key products and sell very, very
:20:12. > :20:15.large volumes of the key products the ones we're advertising on
:20:16. > :20:18.television. In terms of quality, absolutely it is our number one
:20:19. > :20:22.priority. We don't want to have anything like the tumble drier
:20:23. > :20:27.scenario that you just reported. You joined as a salesman, didn't you,
:20:28. > :20:30.initial? Initially? You came up with a lot of new ideas as to how the
:20:31. > :20:37.sell these things. What's the most important way of selling? Is it TV
:20:38. > :20:41.adverts or the JML shopping channel? Well, we want to reach the consumer
:20:42. > :20:45.whichever way they want to buy, but actually retail is still, believe it
:20:46. > :20:51.or not, despite the challenges in retail, retail is still the biggest
:20:52. > :20:55.avenue for us. It is 75% of our turnover is retail distribution. A
:20:56. > :20:58.quick word on cost. We have been talking about the imported inflation
:20:59. > :21:01.that we will get as a result of Brexit and the fall in the value of
:21:02. > :21:07.the pound. What does that mean for you? I imagine a lot of your stuff
:21:08. > :21:11.is sold here, but made abroad? Our attitude is we are a consumer
:21:12. > :21:15.product company and we have to protect the consumer. So at the
:21:16. > :21:19.moment we're absorbing the costs pretty much. How long can you do
:21:20. > :21:23.that before prices have to go up? With the dollar at 120, we can
:21:24. > :21:26.probably absorb the costs, but if it falls any lower than that, then we
:21:27. > :21:30.might to start looking at increasing some of the retail prices, but at
:21:31. > :21:35.the moment, that's not been the case and pretty much all of our price
:21:36. > :21:39.have remained the same. There is so much more we could discuss, but time
:21:40. > :21:44.has got the better of us. Ken, thank you very much for coming in. Make
:21:45. > :21:47.sure you bring us that light on the toilet the next time you come in. Do
:21:48. > :21:49.you need it then? It is always useful!
:21:50. > :21:51.Improve aim! Let's see what other
:21:52. > :22:02.stories are being talked The Business Live pages is where you
:22:03. > :22:11.can stay ahead with the day's breaking business news. We want to
:22:12. > :22:17.hear from you too. Get involved on the BBC Business Live web page at:
:22:18. > :22:23.On Twitter, we're at: You can find us on Facebook.
:22:24. > :22:27.Business Live, on TV and online, whenever you need to know.
:22:28. > :22:32.The BBC's Dominic O'Connell is with us.
:22:33. > :22:44.Hello. Just the software, not the car, and the first time they have
:22:45. > :22:51.confirmed? It is the worst kept secret in Silicon Valley this. Is
:22:52. > :22:56.Project Titan. Software and hardware as well, I think, but in filing with
:22:57. > :23:00.the US regulators they have admitted they were interested in this. If you
:23:01. > :23:05.think about it, under Steve Jobs they could have done anything they
:23:06. > :23:09.wanted. They went from personal computers into mobile phones
:23:10. > :23:17.seamlessly. Tim Cook is not Steve Jobs. If he goes into this field,
:23:18. > :23:23.which I'm sure, they will, it will be the first time, and he will have
:23:24. > :23:27.to make a success of it. It is Detroit versus the West Coast where
:23:28. > :23:31.all the fun stuff is coming out about driverless cars. Let's look at
:23:32. > :23:35.a story of Brussels and perhaps a free trade deal with Japan. Talk us
:23:36. > :23:39.through that one? They have been talking for a long time about it and
:23:40. > :23:43.it illustrates how Brussels and the European Union is forging away,
:23:44. > :23:48.throwing its weight around on the global scale and it illustrates the
:23:49. > :23:51.scale of the task. This is almost certainly going to happen. There are
:23:52. > :23:57.some issues around it, but it has been a long time in the works. It is
:23:58. > :24:02.going to come soon. It is quite interesting with the United States
:24:03. > :24:05.as well and the fact that the euro trade deal maybe off the boil
:24:06. > :24:08.because of president-elect Donald Trump, so Brussels looking
:24:09. > :24:13.elsewhere? Brussels looking to Asia and China is keen on free trade
:24:14. > :24:17.because it suits its domestic policies and the Trans-Pacific trade
:24:18. > :24:19.partnership, America and China has been looking shaky recently. The
:24:20. > :24:24.European Union now is the one that's making the running. The
:24:25. > :24:28.Trans-Pacific Partnership is America and Asia, but not China? Not China
:24:29. > :24:36.at the moment. China has been thinking of doing its own thing.
:24:37. > :24:42.There are conflicting agendas, each nation is trying to promote its
:24:43. > :25:04.domestic agenda through foreign policies. Let's talk about Donald
:25:05. > :25:08.Trump. He persuaded Carrier air conditioning to keep jobs. Now he
:25:09. > :25:09.has a company that was planning to move staff into Mexico. He has been
:25:10. > :25:12.saying, tweeting overnight, saying he could level 35% tariffs against
:25:13. > :25:17.products that are manufactured by jobs that are taken out of the
:25:18. > :25:22.American homeland. What's your most useful gadget in your home would you
:25:23. > :25:28.say? Well, everybody has the boring answer of the iPhone. I think
:25:29. > :25:37.probably the iment phone is pretty powerful. Householdy, not tech? I'm
:25:38. > :25:44.not gooden a hairdryer, I must say! We had the boss of JML on. So
:25:45. > :25:51.miracle warrior, whoever he was, "My hand-held vac." Another viewer says,
:25:52. > :25:57."I need my small mobile phone." Another viewer says he needs his
:25:58. > :26:02.juice blender. Mine is my toasty maker. Too many. That light for the
:26:03. > :26:08.toilet! Have a good day. Bye-bye.
:26:09. > :26:16.Good morning. It has ban really cold and frosty start for many of us this
:26:17. > :26:17.morning. Not much fog around. This is as cold as it is