18/05/2017 BBC Business Live


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


Global market turmoil intensifies with Wall Street


experiencing its worst day since the presidential election.


Live from London, that's our top story on Thursday 18 May.


Stock markets around the world are nervous that the political


controversy around President Trump will overshadow his


Also in the programme - Alibaba heads West.


China's 300 billion dollar e-commerce giant looks to America -


And this is what the numbers look like at the start of trade in Europe


as that Trump Slump rolls around the world.


We hear how the man behind Regus serviced offices turned his quest


to find a flexible workspace into a multi-billion dollar empire.


And if you struggle with recycling, you're not alone.


The worst products to recycle have been named and shamed -


so we want to know what are your recycling frustrations?


Get in touch use the hashtag #BBC Biz Live.


Send us your comments about that. My question is whether you can put


envelopes in recycling if they have the plastic window?


For months, optimism about the Trump presidency has been powering


But late on Wednesday the Trump bump turned into the Trump slump -


as US stocks and the Dollar suffered their worst day


It's down to growing concern that the President's promised tax


cuts and pro-business reforms may never materialise,


as the White House battles one controversy after another.


The Dow Jones industrial average fell 372 points,


and both the Dow and S 500 suffered their worst falls


The Nasdaq had its biggest loss for almost a year.


That is what markets are looking like. We will talk more about the


dollar in a moment. The last time the Nasdaq fell this much was when


the UK voted for Brexit. This is the US dollar against ten


leading currencies over the last year put up it has lost all of its


game since Donald Trump became president and is now back to where


it was last November. Look at the spike and fall away again.


Our economics editor Kamal Ahmed is here.


Thank you for being with us in the studio. We were anticipating this


rally would not go on and on but the political turmoil has really


intensified in the last 48 hours with regards to President Trump.


That was the trigger. What has been happening is there have been some


headwinds growing against this exuberance that was in place after


Donald Trump was elected with this big promise about tax reform,


appropriateness agenda, doubling gross in America. -- a pro business


agenda. There was inability in the White House to drive through


legislation in the houses in Congress. They were both run by


Republicans. That reform failed. There was a wobble around that. Then


were the weakest in three years. Has were the weakest in three years. Has


the American economy been doing as well as people thought? Another


wobble. Then, exactly as you say, there was always an idea, would


Donald Trump as president be like campaigning Trump or would he become


a more traditional political figure? The political controversies have


continued and so there is a volatility in politics which I think


has now led, this has been a spark for people looking back to the


reform agenda, will the tax reforms come through? Is the American


economy doing as well as people thought? The political turmoil will


continue. Suddenly it is a risk of. If you are things like Treasuries


and defence investments like utilities and properties, they are


all up. Things like the equity markets, they are all down. People


have gone risk off. Safe havens is very attractive right now with the


price of gold going up, etc, and began getting stronger. There is a


lot of disappointment within the business community in the US and


elsewhere about the fact, his priorities in a way. They wanted


these economy boosting members, tax reform, that kind of thing to come


in much sooner. We are beyond the 100 days and all of that. Now there


is this political storm. They have realised that the politics makes


chances of that getting through the houses more difficult. And, of


course, the fact is that the Republicans may not be in control of


both Houses by the time president Trump gets halfway through his


presidency because of the elections. He has a rather small window. If he


does not get the report was through, you are right. People believe there


will be reform but there are risks that the reform may not happen and


they have increased. Someone on the campaign trail promises one thing


and does not necessarily deliver. It was a question of, would there be


greater stability once he was president and once he surrounded


himself with businessmen from Goldman Sachs, for example? As a


president, he was quite similar to how he campaigned. To the


traditionalist it all seems quite random things would happen in


different ways. That means the volatility is still barefoot about


is why people are pulling back a bit and the Trump 's aid has come after


all the exuberance. Let's take a look at some of


the other stories making the news... There have been protests in Brazil


over a fresh corruption allegation. President Michel Temer has denied


a report that he authorised bribes to silence a possible witness


in a huge corruption scandal. A Brazilian newspaper says it has


obtained recordings of a discussion between the president


and the chairman of the giant US and EU officials have decided NOT


to impose a ban on laptops and tablets in cabin baggage


on flights from Europe. But after meeting in Brussels


to discuss the threat to aviation safety, officials said other


measures were still America has previously said it


wanted to extend the ban - which covers eight mostly Muslim


countries - to Europe. Let show you a story about Facebook.


The competition commissioner has been tweeting about this.


That is a really interesting story that is emerging. She was a guest on


this programme. Some of the tweets you have been


sending in today. We asked, what are your frustrations with regard to


recycling quest of their rather the top six offenders. Coffee pods are


the worse things. Paul says, trying to remove bubble wrap from Jiffy


bags drives him mad. You peel the little plastic window. Is that how


it works? You put the paper in the recycling and the plastic in the


bin. Keep your comments coming in. To Japan now, where economic growth


is picking up fast - Japan's economy grew at an annual


rate of 2.2% in the first three It's the fifth quarter in a row that


growth has improved - that's the best run in more


than a decade. Are we getting excited about this


thinking it is finally working? Seijiro Takeshita is in Tokyo


for us, he's a professor Always good to see you. Put it into


perspective for us. Is the Prime Minister thinking this is working or


are we getting over excited? Unfortunately, it is the latter.


Last year rises were horrible because of the bad weather. We are


getting much better in terms of capital expenditure by corporations.


You need to see a wage rise boosting private consumption that is not


happening and I do not think it will happen considering the Conservative


nurse of the Japanese companies. As we said, the third quarter in a row


that growth has improved and the best run for more than a decade. We


have been keeping such a close eye on it stopped expectation for Japan


has always been so high. Is the worst over? We will face a lot of


ambiguity, particularly in the United States, and also in Europe.


The growth you have been talking that has been driven by exporters.


Where we are seeing ambiguity factors overseas, there is


cloudiness in the forefront. That is one reason why people are not


rejoicing as numbers suggest. Thank you for your perspective on the


latest news out of Japan. Joining us is Jane Foley, Senior


Currency Strategist, Rabobank. You have been listening to all these


conversations about what is going on in the United States. We have been


talking about Japan with currency playing a huge part and the dollar


weakening significantly. This does not help Tokyo at all. Give us your


take on all of this. The yen is a safe haven. Whenever there is little


attention the yen goes up. The dollar perhaps is more interesting.


It has a very murky relationship with safe haven flows. The US


Treasury market, US government debt, is a prime piece of paper people


want at times of political stress. That can support the dollar. Now the


dollar is under pressure because the market is disappointed the reform


programme may not happen. A quick word on that. We talked about at the


start of the programme, what was happening in the United States. Is


it general disappointment that all of the sugar high we got on the


campaign trail may not turn out to be much? If we look back to where


the markets were today compared with where they were, there is a big


change in US equity markets. They hope the reforms that Donald Trump


made would cut away a lot of regulation and boost growth. Donald


Trump is so busy trying to firefight with all of these scandals. Here in


Europe, the UK has had a lot of economic data this week. More today


could give us your expectations. The trend we have been seeing in retail


sales since December has been one of weakening trend. The reason for that


is inflation. Inflation is rising at a higher rate than wages. We have


had confirmation of that. That means the money we have in our pockets


after we spend out on items like food and petrol is less. That is


down to the weakness of the pound. It is down to the weakness of the


Sterling exchange rate relative to this time last year. Jane will


return. Sharing with us your recycling frustrations. Indeed. She


has got the list. Alibaba - the Chinese e-commerce


giant that's been described as the country's eBay and Amazon


rolled into one, is expected to report another jump


in profits later today. It shares have been soaring since it


floated in New York and it now has a stock market value of $300 billion.


The vast amount of the business is in China which is something


billionaire to change. He loves this country and he loves China. For


president Trump, the best way forward Jack to show his love this


country is to make it easier for Americans to sell their wares to


China. This sneaker shop in Manhattan is an example. It has a


physical store but 90% of the business is done online. Since


August but they have been selling on Alibaba and it has been a big boost


to their sneaker empire. Over $100 million this year. They run like a


start-up, which has been really refreshing. We're not -- they treat


us like we are a trusted multi-billion dollar company. The


leader of China's big asked -- biggest e-commerce retailer wants to


bring business to China and 2 billion customers in the next


decade. They have been talking about making a big push out of China since


they became public company and prior to that when they filed to become


public and number of years ago at this point. If you look at the


revenue base, it is almost entirely treated to China. They might well


have aspirations and talk about that. The numbers suggest there is a


lot of work to be done on that front. He is not afraid of a little


hard work. You will be in the US next month to make his pitch


directly to US businesses. It just may be an uphill battle.


We meet that man cashing in on the flexible working boom -


It's made him a billioniare and says Brexit could be good


You're with Business Live from BBC News.


Here is a pet peeve we have been discussing this morning.


Do you find it hard to know what you can and can't recycle?


I think we all do, especially where we live, all different rules for


different boroughs. And today the worst items to recycle


have been named and shamed. Pringles tubes and Lucozade


bottles topped the list We are running short


of holes in the ground Yet landfill sites are peppered


with products that are supposed The trouble is that so many products


nowadays have several different types of materials


in their packaging. That can make them almost


impossible to recycle. The foil interior, the cardboard


sleeve, the metal bottom. There are different plastics


in the base of the bottle Black plastic is virtually


useless for recycling. So what will stop us dumping complex


packages straight into the bin? Well, Prince Charles is launching


a $2 million prize to stimulate new and more environmentally


friendly designs and packaging. If the competition works,


it will be easier in the future to shop for items that


do not fill a landfill. One interesting point from fine


repair cafe, it gives you an indication of where they are coming


from, suggesting that you need to repair more stuff, bring broken


stuff in the repair, we achieve a 63% the pay rate. Repair, repair,


repair. Another big story today, Royal Mail posting a big rise in


profits as parcels improved. I assume the money they make from


delivering parcels is improving, annual profits up by 25%. Growth in


parcel delivery business, it would seem it is doing well. It does well


from online, we send fewer letters but we get more parcels delivered


because of our online shopping habits. Full details on the website.


European markets, markets worldwide, we are watching them very closely as


the turmoil surrounding the White House and the Trump administration


intensifies. So let's quickly show you how things are going right now


so you have a sense of how the European day is progressing. Down


half a percent in London and elsewhere. This was after quite


heavy losses yesterday as well for the European markets, so not a


change in sentiment yet. The big question, can President Trump get


through those reforms he promised? Markets are increasingly doubtful


that will happen. All businesses need somewhere


to work but for many being able to shrink or grow their office


is neither easy nor cheap. So companies that provide rented


work spaces are growing quickly - cashing in on our need


to be more flexible. London is the world's largest market


for flexible serviced office space with around $21bn -


that's ?16 billion worth The USA and UK top the list


for co-working , that's when you share a work space


with other people who work And It's not just freelancers


and small businesses that use them, big multinationals like


Google, HSBC, McKinsey And perhaps that why it's been such


a profitable business for IWG - its brands include Regus and has


3,000 centres in 110 It's the result of nearly 30 years


work for founder Mark Dixon. I caught up with him at one


of his co-working spaces here in London to hear how it


all began. I started off with sandwiches,


delivering them on a bicycle, I didn't have my driving licence at


the time. The business was a failure but my customers were very happy.


Just tell us how that prepared you for running Regis now, which is huge


and 110 countries. I worked out I needed more experience. I travelled


all around the world, did lots of different things working for other


people, gaining experience. But with a goal. The goal was to run my


business and do it well. So what inspired you to start Regus? I had


my first expenses myself trying to get an office and I could see other


people were having the same problems, they were meeting in


coffee shops accept. I thought there was an opportunity and from that


single centre we still have we now have over 3000 buildings. What makes


you the person that can do that transition? You have to be someone


willing to learn, adapt. You have to be adaptable Camier have to be able


to hire good people, build a team. We are in a fast growing industry,


this is a new sector, this is new real estate, how people can work in


the future. Yes, there is more common vision that everyone is


growing in this marketplace. But it is a marketplace where you truly


have to be global, you think, to survive? What is important is to


have national networks, so we are growing in each country National


platform so companies within that country can work anywhere, people


can work from home, dropped in. It is a new way of working. So scale in


a country is probably more important than global scale, but the two work


together. London is an extremely busy city for you, probably the most


important in Europe, in terms of demand for your services. How does


Brexit affect what you do? I think we are concerned about Brexit, but


we are pretty bullish on the UK market. So what we can see is UK


companies very adaptable, a lot of companies adopting new flexible work


practices, so although there may be changes that will come once Brexit


finally arrives, there is lots of runway for our particular business


and the whole of the UK and in London. Did you want Brexit? Diyas.


I am a European at heart, you know, I love Europe. The environment we


are in at the moment where political risk is such a big deal. For


examples over the last couple of years, elections and the United


States, we have one coming up here in the UK, France, Germany, not to


mention Asia, where you have a big presence, how do you measure


something like political risk? Generally speaking, all of these


things are not bad things far business because we are providing


businesses with flexibility at variable cost. But do shocks like


poor example the 2008 financial crisis actually give you an


opportunity? The short answer is yes but I would rather not do 2008


again. All of these shocks make companies think more deeply about


how they are operating, how can we become more flexible? And especially


in real estate, which is one of those fixed things that most


companies rarely have difficulty changing, difficulty reducing cost,


difficulty in making that variable. So what is next to you? You have a


lovely home in Monaco, are you going to retire and enjoy the super


yachts? What are you going to do next? I have got to finish this job


first. This, for me, is really a job that is unfinished. I think the best


time for our businesses is coming now. The new digital world, more


competition from new players. I love business, it sort of like a sport,


it's absorbing, it's passionate. So I think our best time is yet to


come, think there are enormous possibilities, so I am quite excited


about the future. I am not ready to retire just yet. He absolutely


showed no signs of wanting to retire, that was Mark Dixon, who


started his career delivering Salmond is on a bike. Jane is back


with us to talk through some of the papers. We have been asking people


about their recycling horror stories, this was after the six


worst offenders were named in shaded and, Pringles tube 's, Lucozade


bottles stop you are a fan of recycling, you are building an


eco-home? I am definitely trying to build an eco-home. It is very slow.


But I think we all have a responsibility for recycling, and of


being conscious of the legacy we are leaving on this planet. But one


thing, despite all the different bugbears I have, one thing that


comes as a common to nominate, and that is the amount of packaging and


the amount of difficult to recycle packaging. I think the manufacturers


need to be told that there need stability packaging, because the


amount of rubbish that one family can produce in just one week is


huge. It is phenomenal. It is huge, it takes a huge amount of and we


need less of it. I agree with you Jane. The sponsors frustrated, every


packet is currently not recyclable. Having four bins in my kitchen but I


am happy to cycle. That might be the future. Thanks, Jane, good to see


you and to have your company as well goodbye.


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