10/01/2017 BBC Business Live

This is Business Live from BBC News with Rachel Horne

The leader of the world's biggest economy gets ready

What will the world make of the Obama legacy?

Live from London, that's our top story on Tuesday 10th January.

The US economy has grown, but wage growth has lagged behind.

We'll assess the impact of the Obama Presidency.

We also have news from the world's second-biggest economy.

The goods it makes might be about to get more expensive.

Stay tuned to find out what that could mean for you.

The Ftse chalked up its tenth straight daily session

Are you taking a break from the booze after the excesses

We'll meet one man who hopes to turn abstinence into

But can non-alcoholic drinks really take over from the real thing?

During yesterday's metro strike in London, Uber prices

Are companies right to reflect increased demand?

Or do price hikes leave you feeling ripped off?

There are just a couple of weeks of Barack Obama's Presidency

remaining, and later today he gives his big farewell speech.

As well as being commander in chief he's also overseen

the world's biggest economy for the last eight years.

Well, since his inauguration in January 2009 more than 11 million

jobs have been added, with the unemployment rate

It peaked at 10.0% in Obama's first year in power.

The typical American family brings home nearly $54,000 a year.

That's almost exactly the same as 20 years ago,

Wage growth has been very low under Obama,

and has been called the "missing piece" of the recovery.

The economy has grown about 1.5% a year over

That compares to about 2% under his predecessor George W Bush.

One of the costs of that has been that US Government

debt has nearly doubled, from $10 trillion to $20 trillion,

during Obama's eight years in the Oval Office.

Marianne Schneider-Petsinger, US geo-economics fellow

at Chatham House, a think tank in London.

If you ask any president, you would not want to take on that economy. If

you were a teacher, you had to grade him on his economic, what grade

would you give him? Overall, let's not forget where he started. When

you talk about the economy, it was on the brink of depression. He

averted that, it was just a recession. Compared to when he took

it over, he has done a solid job, but it was not anything spectacular.

If you compare him to other presidents, he falls in the middle

range. Some may suggest it did not fall into depression because they

threw a lot of money at it. They pumped a lot of money in. Some say

not enough, though. I did not catch the wage growth. It is the missing

link. You have created these jobs, they lost a lot but they created

some. Why hasn't wage growth gone up? Many of the jobs that were

created were in low-wage sectors. There is pressure from overseas and

from technological change, automation is a key worry or stop

many of these jobs had that have been created are part-time. Many

people feel they are not making headway. There are a number of

issues that go together. How do you think Barack Obama will be feeling?

There are a lot of big issues, like his health care or trade deals,

which may not be lasting. How will he look at this? He hopes that with

some Democrats still in support of the things he has done, they will be

attempts by the Donald Trump administration to overturn them, to

chisel them down, but we will see, it is an open question. We have

spoken before, looking forward, Donald Trump and his economic

policies, there is a lot that people would look favourably on. Animal

spirit is back. In terms of the promised tax cuts and cutting down

on regulation. Businesses react favourably to that. They question

whether he can deliver on many of those promises.

Two prototype models of a highly-anticipated gaming

laptop have been stolen at the Consumer Electronics

They belong to the gaming company Razer, and each

It's the first portable laptop of its kind.

Razer said the devices were taken from its press room on Sunday,

and the Chief Executive Min-Liang Tan said they were treating the case

Volkswagen's chief executive for the North America region says

the company was "surprised" by the criminal charges laid

against the executive in charge of complying

The German carmaker has admitted installing secret software

On Monday Oliver Schmidt appeared in court in Miami charged with fraud

He chose not to enter a plea and was remanded in custody.

There are question marks about the future of Yahoo's

influential chief executive Marissa Mayer after it was revealed

she will not serve on the board of the company that is left behind

once Yahoo's core assets are sold to Verizon.

Five other directors will also not serve on the board.

We are looking at our web a cracking site. We will work with our UK

audience later, but Snapchat, or the company Snap, which owns it, they

are choosing the UK for anything outside the US.

It is a vote of confidence in the UK. If those companies come to

Europe, they go for Ireland. Says the Irish lady! Luxembourg, the

Netherlands. Could this be something to do with

the fine that Apple could be facing, 13 billion tax rebate?

It could be. Snapchat expected to go to the market this year.

A big float. It hopes to raise $25 billion.

We've had some numbers out of China which show that the world's

second-biggest economy could be about to push up the prices

of the things we around the world all buy from China.

Sharanjit Leyl is in Singapore and she's got the figures.

Just explain, how could these increases in China affect us as

buyers elsewhere in the world? Will it cause our prices to go up?

Possibly. Let me give you those figures, because they are

interesting. They grew at their fastest pace in more than five

years. The index for December was up 5.5% from the previous year, against

expectations of. That could lead China to export inflation two

nations around the world through its vast supply chains. This may prompt

manufacturers who are enduring those higher input costs to raise their

prices and pass them on to everyone around the world. Whether that

rebound will be sustained depends on how the global economy fares,

possibly under Donald Trump, and whether trade tensions flare between

the US and China. Consumer prices remain stable, rising just over 2%.

Others say that is an indicator that the real inflation seems restricted

to the industrial sector. Hard-hit is the mining sector, prices surged

over 21% in December from a year earlier.

The US dollar started 2017 at a high but it's been sliding,

along with the Dow on Wall Street, which closed down yesterday.

And Asian stocks were mixed, with a decline in Japan.

The Nikkei pretty flat, offsetting gains in Hong Kong,

This week we should keep an eye on the oil price.

It crept back up today after a fall on Monday over concerns

about whether output cuts by major exporters will be enough to support

the oil market as other producers have increased supplies.

And Samira Hussain has the details about what's ahead

More automotive news happening, General Motors will be telling

investors what they can expect from the number one American auto-maker

in 2017. Top officials will present the company's financial outlook at a

butcher bank conference in Detroit. It is held at the same time as the

Detroit auto show. Also happening, the Ford motor company CEO will

outline forecasts for 2017 financial performance at a conference during

the Detroit auto show. Investors will be watching for news on 2017

American market forecasts, as well as the outlook for Asia and Europe.

And Barack Obama will deliver his farewell address in his home city of

Chicago. Joining us is James Bevan,

chief investment officer at CCLA We want to talk about the American

market. But let's talk about the FTSE 100, the main market in London.

One record after another, but this is a story about the pound. The

pound goes down in value, the FTSE goes up. A very large chunk of the

earnings are overseas, either through export all through selling

overseas, and bringing the earnings back. Whenever the pound goes down,

profits go up, and vice versa. More bang for the buck. The American

markets, all eyes are on January the 21st, the President-elect takes

over. In the UK we have the weakness of the pound, in the US we have a

strong dollar, and many people think, if you are going to talk

about markets going up on the weakness of the pound, white is it

that American equities have gone up with a strong dollar. Donald Trump

is promising to cut tax substantially. Corporate earnings

will rise because the Government will take less money. If you join

and you should be tax cuts passed and you should be tax cuts passed

straight through to the bottom line is terms of earnings, the index goes

all the way. It is an overly optimistic perspective, but if you

said, let's cut the difference between some deflation of the

optimism and a revaluation on the back of that earnings numbers, maybe

2500. Looking at how the markets have gone up in the States, a lot of

it is on sentiment, we now know Donald Trump will be the president,

and he will invest in infrastructure and cut down on regulation and

taxes. Once he is in power and things either do or don't begin to

happen, at one point -- at what point will be see a reality check?

Have at least six months, because he will have to take the tax cuts right

through the process, and we don't know if you will backdate them to

early 2017 awful the date them to 2018. But the markets would begin to

focus anyway forwards. All of the sentiment we have had for the global

economy has been good, that has to remain in place, because it fits

begin to slide back down the hill, no matter of cutting taxes will lead

to better numbers. The US equity market is looking for 5% growth this

year and next year, and that is what we have to focus on. We will see you

shortly. We're all getting a lot more health

conscious these days, but can non-alcoholic drinks really

take the place of booze? We'll hear from a man who's hoping

to capitalise on the trend You're with Business

Live from BBC News. Snap, the company behind

messaging app Snapchat, is setting up its international HQ

in Britain, where it will book Many tech firms have

preferred Ireland, Luxembourg or the Netherlands

as their European tax base. Theo Leggett is in our

business newsroom. Snapchat, why this decision, it

bodes well for the UK economy and for London? A lot of social media

companies like Facebook and Google have run into trouble over setting

up tax bases in lower tax jurisdictions in Europe and then

diverting profits from other large markets into those jurisdictions in

order to minimise their tax bills. So schnapping is not doing that.

They are setting up in the UK and they're channelling the profits from

the UK first of all, but also from other countries where they don't

have a major base and that includes Australia and Saudi Arabia and

paying tax on them in the UK. Now, that tax bill at the moment won't

actually be very high because Snapchat's revenues are not that

high at the moment, but it is expanding rapidly. It is taking on

more advertising and it is expecting its revenues to go up in the near

future so there will be more money coming in and the money will be

going through the UK. Let's not forget. The UK itself as a major

economy has a low corporation tax rate. 20% at moment. It will fall to

17% by 2020. So by doing this, schnapp is avoiding the prospect of

big regulatory problems, like like the UK Government and the European

Commission clamping down on companies which have aggressive tax

policies and at the same time, it's basing itself in the UK where it has

a relatively low corporation tax rate. So I think that's what's

behind it. By the way, some of our viewers may not be familiar with

Snapchat, it is an app aim at younger people. If you're under 25,

you almost certainly will have heard of it. If you're over 30, maybe you

won't, but that's changing as well. Snapchat allows you to take pictures

and videos and send them and then have them deleted. It is becoming

more popular among people the same age as myself and dare I say it, you

too, Aaron. I'm older than you Theo! Thanks, mate.

Morrison, Christmas sales up. They are doing well, aren't they? Good

news for Britain's fourth biggest supermarket.

Our top story, President Obama is getting ready to make

He's expected to focus on his economic legacy especially

A quick look at how markets are faring.

We can see there the FTSE continuing that winning streak up and up,

pretty much every day since the start of the year. It is up almost

0.2%. The DAX up and the CAC down slightly. All the markets keeping an

eye on the oil price which had its biggest fall in six weeks over

concerns that some producers are making too much oil despite the Opec

agreement. You do like the markets! Let's talk

about something more interesting before I spit on the desk!

Now let's get the inside track on distilling and I don't

Herb and plant distillates have long been a medicinal tradition

in the east but when Ben Branson, a British tee-total marketing

executive stumbled across a copy of The Art of Distillation.

A solution to the problem of what to drink when you don't want to drink.

So inspired by craft techniques he set up soft drink

Since then Seedlip has gained investment from drinks giant Diageo

who seem to be betting on the rise of this adult market.

The founder and chief executive of Seedlip,

Guess what, he brought us? Nonalcoholic drinks! Sorry, I'm

probably not your target market here. Welcome to the programme. Are

you serious from a book? I know you've got the book, right? From a

book. Ladies and gentlemen, this book is 1664? The original copy was

1651. We managed to get our hands on a copy from 1664. This is original

recipes, nonalcoholic herbal remedies all the distilling

techniques that I found three years ago. So what prompted you? Was this

something you were thinking I want a business opportunity, I can see a

gap in this market? Was it that you were doing something else that

brought you into making nonalcoholic beverages? It was not a business

gap, business opportunity. Seedlip is just a product of my upbringing.

Halfify family have been farming for over 300 years and we still farm

today and that's really important. The other half of my company are in

brand design. I grew up in the countryside and then went to work in

brand design and I put the two together. You have an unusual, did

you go to university? No. No. You did work experience for a big vodka

company at the age of 14? I was doing work experience for brand

design agencies from the age of 14 and got to work on some fantastic

global brands. And so got a real insight into what it means to create

one. I imagine the biggest booze maker in the world, Diageo,

investing in you, which is kind of strange, but it sort of suggests

this is a growing market? I think we're now in an age... Who are you

targeting? We are in an age where you can go to a restaurant and have

all kinds of food, it doesn't matter what allergy you have got and it

doesn't matter what you want from wherever in the world, if you want

an nonalcoholic cocktail, you can do the same. If you're not drinking for

whatever reason, the options are poor, they are one dimensional and

sweet and fruity and there is no theatre, there is no adult

sophisticated flavour that we're trying to do. You know, I like a

drink. My wife will nod to that. I haven't even tasted this. We've

mixed it with tonic water. They are both mixed with tonic. We have got

two products. Isn't the problem, it is not a problem, the issue, you

were saying, you wanted other options? I have got three children,

every time I was pregnant the offers of what you wanted to drink were

limited. So I can see the appeal of an item like this, but your price

bracket, it is ?27 a bottle. That's expensive. 40 bucks, that's $40 of

the that's pricey. It is pricey. Because it takes us a long time to

make. So we're individually distilling each individual

ingredient. Two of the ingredients come from my farm, my hay, my hand

picked peas, the craft that goes into this and the actual time and

hand labour means that actually we're creating something that's

really grown-up. Here is my point. For a drinker like me, is it all

about the taste? It might be, but you don't get the buzz? You don't

get the feeling. I'm not talking about pregnant. If it is a Monday

lunch time or you're driving or as we are in dry January and you're

having a month off, the opportunity to have a great grown-up

nonalcoholic drink should still be there regardless of drinking for the

effect. I think the effect of wanting to feel part of the group or

wanting to feel like you're not the dummy in the corner drinking orange

juice. This product, that's filling this gap in the market for adult

drinks. There are a lot of other companies rushing in, Britvic have a

company launching a similar sort of, more savoury alcoholic alternative

rather than the fruity ones. We have nonalcoholic wines being introduced

by one of the upmarket cordial companies. Is there room for you as

well? We are the world's first distilled nonalcoholic spirits. So

we are taking the same rituals of a spirit mixer of a vodka and Coke and

of a gin and tonic that sits on the back bar that means you can make

something at home so we're taking that side of the market. I guess we

want to solve the problem of not drinking. If other people are coming

in and helping to build that owication, happy days. Ben Branson,

thank you. You can come back and see me when you've put some alcohol in

that one and we'll talk them. I'm not your target market, I'm sorry!

In a moment we'll take a look through the Business Pages but first

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What other business stories has the media been

James Bevan from CCLA Investment Management joins us again.

James, thank you for hanging around. Now, earlier we asked people to send

in any tweets they might have. We were asking about the Uber story,

there was a Tube strike in London and some Uber charges went up by

500%! Was that supply and demand? Is that fine? Is it OK to cash in? It

is the core part of the Uber business model. Uber pays by the

mile and the time spent behind the wheel and there is a loading factor

to get people to join the ranks of the drivers when demand rises. When

there is a strike in public transport, demand goes through the

roof and hence the loading goes up hugely. Some tweets have said,

"Look, they are really cheap norm times. This is their opportunity to

cash in." There is a legitimate problem when

there was too much traffic and you hope you're going to get a fast ride

and you don't. The road system is not good at coping with huge

volumes. It is not an Uber problem. Another company that is weighing

what is it going to do with president trump's dislike for cars

made in Mexico and sold in the US? It is made in Mexico and sold in the

USment there are successful car companies like Nissan and VW and BMW

that manufacture in Mexico and sell around the world, not specifically

to the United States. However, Ford and GM have definitely decided in

the past that they would want to manufacture cheaply in Mexico and

export to the US and they will have to re-think their strategy. James

Bevan, thank you very much for joining us today.

Thank you for the tweets. We're running out of time to mention them,

but a lot of people saying focus on the taxis as well, not just Uber. I

will. Bye-bye. Hello. It looks as if it will be a

fairly cloudy day for many parts of the British Isles and there is a

chance of rain on a weak weather front for many areas too. But it is

not all doom and gloom. There