30/10/2017 BBC Business Live

This is Business Live from BBC News

with Ben Bland and Sally Bundock.

The world's biggest economy

looks for a new banker-in-chief.

President Trump says he'll pick

a new Fed chair this week.

We'll tell you

who's in with a shout.

Live from London, that's our

top story on Monday 30th.

Janet Yellen's four years running

the Federal Reserve are nearly up,

so will she get another go,

or will financial markets be hanging

on the every word of someone else?

Also in the programme,

appreciating Asia.

Europe's largest bank, HSBC,

sees a huge jump in profits

after doing far better

in the Far East.

This is how the markets look across

Europe at the start of the trading

day, interesting moves following the

record highs from the US on Friday.

Spinning a profit out of silk.

We'll speak to the company

creating sythetic spider threads

to make stronger

and more sustainable fabrics.

As Nikon announces the closure

of its camera production factory

in China, we want to know,

do you still use a camera?

Or is it all about taking snaps with

your smartphone?

Just use #BBCBizLive.

Photos and a smartphone? You would

never catch me taking a selfie!

Hello and welcome to Business Live.

Janet Yellen is currently

the world's

most powerful central banker,

but her days could be numbered.

That's because US President Donald

Trump says he will tell us this week

who he wants to be the chair of

the Federal Reserve come February.

Whoever gets the job

will have a huge influence

on the world's biggest economy,

and therefore the rest

of the world too.

And they will also be vital to Mr

Trump's plans for the US economy.

Ms Yellen could get another

four year term

but seems likely to be replaced,

so who are the front runners?

John Taylor is a Stanford University

economist and always on the list

of potential Fed chairs

but never gets the job.

He's a hawk and thinks interest

rates should be much

higher than they are.

Next up is Jerome Powell -

he's a Republican,

a current member of the Fed board,

and he has experience

in the private sector.

But he's voted in favour

of post-financial crisis rules

that President Trump

doesn't approve of.

And then there's Kevin Warsh.

He's been on the Fed board for more

than a decade, so he is experienced,

but he may want to see

too fast a rise in interest rates.

I'm joined by Simon French,

chief economist at the

investment bank Panmure Gordon.

Good morning. So Ben talking through

the various candidates, no sign of

Janet Yellen among them.

No, the

markets have responded well to the

four years of Janet Yellen, if you

see the challenge she had on hands,

the US economy recovering from its

biggest financial crisis in 70

years, she started the normalisation

of monetary policy, bringing up

interest rates, and this month is

reducing the balance sheet, the $4

trillion held by the Federal

Reserve. So that is a skilful

balancing job, but she does not

appear to be currying favour with

the president.

So if she is not

nominated again, who do you think is

the most likely to take the job, the

most powerful central banker in the

world?

I thought the introduction

was really good, it laid out the

argument for all the candidates who

remain in the field, Jerome Powell,

talking about continuity, he has a

similar view on interest rates, a

similar sort of path as Janet Yellen

has delivered, and so he is the big

favourite with the market. I think

the thing to balance that against is

John Taylor, who may have a more

aggressive you on interest rates, or

at least his rules based approach

has, but he is very popular with

Congress, and of course in the

background to all of this is tax

reform. We'll Donald Trump think

there is a trade to be done? He

provides the candidate Congress

wants, and in return they will be

more amenable to tax reform going

forward? Advice and that it's

important for President Trump,

because he wants

to make a change,

he doesn't want Janet Yellen in the

post again, Barack Obama's choice,

but he also wants someone in that

position who will be the person to

help him through with his economic

programme, which is fairly important

to him.

Yes, and he is on record as

saying he wants persistent 3% - for

GDP growth, and that means running

the US economy quite hot, and

normally supported by low interest

rates, and therefore as a candidate,

Kevin Warsh, John Taylor,

historically they have talked about

higher interest rates, and that is

not consistent with that thesis.

Simon, thank you for coming in, as

soon as we get any whiff of who has

got the nomination, we will let you

know. I might even the slightest

whiff!

Let's take a look at some of

the other stories making the news.

Kobe Steel has announced it won't be

making a profit forecast

for the rest of year,

because it can't predict

how its data fabrication scandal

will hit its earnings.

The steel maker has also

scrapped its half year

dividend to shareholders.

Kobe Steel shares were

trading 2% higher

after the announcement was made.

EasyJet has confirmed a $46 million

deal with Air Berlin

to buy part of the insolvent German

airline's operations, in

a move that will secure 1,000 jobs.

EasyJet will buy some

of the company's assets

at Berlin Tegel Airport,

including landing slots,

as well as leases for up

to 25 A320 aircraft.

The UK airline said it plans

to take on 1,000 German

pilots and cabin crew.

Nintendo has raised its yearly

profit forecast of the huge demand

for its Switch console. The Japanese

games maker says and recently

increased production and now expects

to make an annual profit of more

than $1 billion. It also expects to

sell 14 million Switch consoles this

year.

It is a big day for earnings today,

and among the stories is banking

giant HSBC, Europe's biggest,

reporting a massive jump in profits

for the three months to the end of

September. Yes, doing much better in

Asia, Karishma Vaswani is in

Singapore, tell us more about this,

then.

Well, HSBC reported a pre-tax profit

of $4.6 billion, up more than 400%,

but it has to be said that this is

from a pretty low base of $843

million in the same period last

year, so that spectacular rise needs

to be put into context. The reason

for coming off that low basis,

because HSBC lost almost $2 billion

from the sale of its Brazilian unit

in the third quarter of 2016, and

also because of volatility in

foreign currency movements. Now, the

group chief executive said that this

quarter's strong performance was as

a result of the bank's continued

pivot to Asia. We have known about

this for some time, particularly in

areas like Hong Kong and parts of

southern area they have become

really important for the firm's

expansion going forward, and it is

likely that we are going to continue

to see that in the future, as

analysts say the bank's continued

bad Nader has been part of its

strategy to grow the business and

make up for losses elsewhere. --

continued growth in Asia.

A big story for the markets

will be interest-rate

setting decisions this week -

by the Federal Reserve

in the US on Wednesday,

the Bank of England on Thursday,

and the Bank of Japan as well.

Tokyo stocks ran out of steam

to end virtually flat on Monday

but still at a 21-year high.

The Nasdaq closed 2.2% higher,

spurred on by impressive results

from Apple and other tech companies

a quick look at the European market

at the start of the trading day, the

trading week. I noticed that the

Ibex in Spain doing better than it

has in recent days, the Catalonia

crisis rumbles on. We can look at

the day ahead on Wall Street with

Michelle Fleury.

Investors with have little time

to catch their breath this week

between all the economic

and corporate news due out.

Now, the big events of the monthly

employment report on Friday,

and the Federal Reserve's

interest-rate setting policy

meeting taking place

on Tuesday and Wednesday.

Of course, many Wall Street traders

are engaged in a parlour game,

trying to guess who will be

the next head of the Fed.

President Trump says he is close

to deciding who will replace

Janet Yellen when her term

ends in February.

Kicking the week off, though,

is personal income data,

for September, due out on Monday.

Now, this includes the Fed's

favourite measure of inflation,

and it's not clear to what extent

numbers, which inched up

in August,

will be affected by the recent

hurricaneshere in United States.

On the corporate side of things,

well, the focus on technology

continues, with Facebook and Apple

both turning in profit

figures later this week.

Mike Bell is global

market strategist

at JPMorgan Asset Management.

Good morning, what are you watching?

We have got our eyes on the Bank of

England, whether they will put

interest rates up, we think they

probably will, but we have seen some

signs that perhaps a few of the

members of the MPC are starting to

wonder whether this is a good idea.

So very focused on whether aren't

they will be concerned that wage

growth has not picked up another. --

whether aren't they will be

concerned. In real terms, wages are

still an issue.

The other thing that

we are watching, the big decision at

the Bank of England, but perhaps not

so closely watched, the bank of

Japan meeting, I mean, the Nikkei,

although it has taken a bit of a

pause today, it is still riding this

global equities wave.

Japanese

equities are doing very well on the

back of this global growth, exports

recently up 18% year-on-year, and

that is feeding through into strong

earnings for Japanese companies, and

the other thing you are seeing, on a

relative basis, they tend to

outperform when the yen has been

weaker.

What about the situation in

Spain? We have seen the euro come up

a bit today against the dollar, are

you watching that closely, or are

you less concerned about that now?

We are not concerned about it. As we

have seen it play out over the last

couple of weeks, they are not in a

position to leave, so it seems

unlikely to us that there is a

majority of people within Catalonia

who want to leave, and even if they

did, there is no clear mechanism for

them to do so.

All right, thank you,

Mike will return, we will find out

how much he uses a camera later.

Keeping it snappy today!

Still to come, spinning a profit out

of soap, a company looking to

spiders to make more sustainable

fabrics. Not a Halloween joke, will

explain all in a few minutes' time!

You're with Business

Live from BBC News.

Advance to digital technology could

give UK manufacturers a massive

boost and create hundreds of

thousands of jobs. That is according

to an independent review which

highlights the benefits of robotics,

3D printing and artificial

intelligence.

Its recommendations should help

inform the Government's industrial

strategy plans. The review was

chaired by the head of Siemens UK,

who joins us now, what were the

recommendations you would pick out

as key takeaway points, then?

Well,

first of all, the overall

recommendation is that Great Britain

needs to have much stronger ambition

and leadership in this fourth

digital industrial revolution. We

really need to drive it hard and

make sure that we have the right

mechanisms for British manufacturing

companies to be able to adopt these

technologies enable much simpler and

easier way. And another key

recommendation is to upskill our

people, we need to hit that head-on,

we need to give our people the

skills so it becomes something which

is less of a topic we are scared of

than one we embrace and transition

to this revolution.

Another topic

that some may be scared of, Brexit,

you talk about strong leadership in

this area - right now all the

leadership in this country is trying

to negotiate a trade deal with

Europe when the UK does exit,

something that manufacturers are,

for very good reasons, focusing on

at the moment.

Well, indeed, and as

a manufacturer in the UK, it is

absolutely clear that we are looking

for a deal which, at the end, has

the least possible friction for us

being able to trade with the EU. But

I am realistic, and there is going

to be some increasing friction and

increasing costs towards transacting

business here post-Brexit. Hopefully

not that much, but it is another

reason why this review is so

important, because what we need is

some optimism, and we need some

positive things which will encourage

companies like ours and many other

companies to invest in the UK,

despite what will happen on Brexit.

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All Saints is looking to expand into

China.

Hello. You're with Business Live.

Our top story, financial markets

worldwide are waiting on a decision

by US President Donald Trump, he

will decide on who he should

nominate to be chair of the Federal

Reserve. That's the job, some say,

is the world's most important

Central Banker. Let's look at the

markets. This is the picture across

the main European indexes. Frankfurt

and Paris outperforming London. The

Spanish eye becks is up more than 1%

this morning, doing better than it

has in recent days as the Catalonia

crisis continues.

I promised we would have a

Spider-Man in the studio!

You wondered what Ben got up to.

It

was Hallowe'en!

Now let's get the inside

track on spider silk.

Yes, it may be five times

stronger than steel,

but the mass of production of spider

silk will never become a reality.

And if the thought of all of those

spiders is making your skin crawl,

the California based start-up,

Bolt Threads, may have the solution.

The company uses gene splicing

technology to modify yeast and this

enables the mass-production

of silk protein.

Bolt believes that this is much more

sustainable than the conventional

method of producing textiles

which typically uses petroleum

as the key ingredient.

Dan Widmaier is co founder

and CEO of Bolt Threads.

So this is the Spider-Man I have

been talking about! But you're not

really, are you? Just tell us about

this. This is something that you and

two others worked on whilst you were

still studying at university for six

years and then you got more funding

to establish it further. Just tell

us about the beginning of this

story?

Something we told our friends

that we didn't want to get real jobs

so we started our own company and

probably a crazy idea, no idea that

it would go for seven years and work

as well as as it does today.

And you

are a scientist and you're creating

this spider technology to create

silk, but it's done in a much more

sustainable way?

We take the DNA

from an organasm and puts in a

protein powder and then we spin it

into fibres.

You have done a deal

with the Stella McCartney fashion

line for some products?

We have as

well as doing outdoor and we have a

brand in the United States called

Best Made Company. . Speed is

everything. This is one of the

things we've learnt coming from

Silicon Valley. Same thing, go

really fast and learn what it is

good for and bring the product to

market.

I'm sure president Trump

would be happy to hear you are

keeping it all in the United States,

you are not making the tie, you have

got a tie here for example, in

Vietnam or anywhere like this. But

in terms of the take-up, you have

seen a massive, massive take up, you

cannot respond to the level of

demand. Just talk us through that

challenge because that could be very

critical for you?

This is a

technology where we have designed

down the molecular level what it is

and had to build the technology to

scale it. We are working on building

more scale. We commissioned a

factory until California two blocks

from our office that can make this

fibre. There is 50 million tonnes a

year.

Pass me the tie a second. I

want to feel it. I spend quite a bit

on ties. We have to keep the

variety. How much would one of these

set me back? Sustainable, but is it

going to cost me a lot more?

Cost of

making materials we are getting

there on the cost of silk.

He has

got it! He has got it. How much?

So

that one is only a limited run of 50

units. $314. It's a scientists joke

not about bringing the product to

market.

Is it affordable? People

hear the big fashion labels and

think I'm priced out?

We are not too

far off the price what silk worm

costs. Over time this could be as

cheap as polyester.

Fashion is a

second dirtiest industry in the

world after oil which I was quite

astounded to learn today. That was

something I didn't know prior to

researching your company. How

quickly will this take on? I know

you're doing it, but the uptake is

not out there to have a real impact

on the fashion industry, is it, in

terms of making it cleaner?

You're

talking about 80 billion garments

this year. I think all of our

closets have too many. It is a

problem of giant scale and we are

moving as fast as we can. When the

demand is huge the appetite to

finance great expansion is huge.

All

right, Dan, it has been fascinating

to hear about your company. Thank

you for coming in.

Let's gets the latest in our CEO

secrets.

Cecile Rein of Seraphine,

the UK's first line

of fashionable maternity wear.

Coming to London from France,

she started the business

as a one-woman company.

She now has sales of $26 million

worldwide and employs 100 people.

But her biggest problem was finding

the right staff to hire

as her business grew.

When recruiting don't

look so much at the CV,

It's very hard for a new

entrepreneur to take on new people

and to give them the trust

so that they can start looking

after parts of your own business.

Many times I felt I have failed

dismally and I didn't kind of sense

that person correctly.

At times I have recruited people

from much bigger brands and I found

that they were really

difficult to adapt.

"We can't do this".

"We can't do that".

I think when you are an entrepreneur

you have to have a culture

which is a kind of yes culture.

I really learnt that don't just look

at the piece of paper

and the CV and the experience.

You want to really

look at the person.

Some people have got less perfect CV

and will be better for your company.

Look at their true skills rather

than what is written on their CVs.

Mike is back to look

through the papers.

Good to see you Mike. The first one

that caught our eye was Nikon to

close its digital camera plant in

China because we are using our

smartphones?

The compact cameras are

being shut down, but they will focus

on digital SLRs. Clearly, people are

using iPhones and other smartphones

to take their photos in a compact

way, but there is demand for the

larnler SLR market.

I am that

person. Ti cannot remember the last

time I picked up a, I call it a

proper camera, I know they are

proper cameras, compact camera.

I

bought one before going on holiday

because I wanted good quality

photos, you miss the chance to take

photos because it takes longer to

get it out of the bag. The phone is

out, you swipe, you snap. It is

really quick. We are asking you for

your tweets on this. Do you still

use a traditional camera or do them

on the smartphone? Quite a differing

opinions. Luke says, "I prefer to

take photos on my phone because it's

easier. We have Liam saying I use

both.

A viewer says she was never

good with the camera, but good with

the mobile phone.

You can focus.

What about you Mike?

I bought a

digital SLR a year ago.

Have you

used it?

A little bit. I would say

that I use my iPhone most of the

time for photos of people.

It's

there all the time.

Easier to use,

but for things if you are trying to

take a landscape photo of light,

sunsets, it is not as good as if you

use a digital SLR.

Technology can

make leaps ads bounds and sometimes

what you gain in terms of compact

and convenience you lose in terms of

quality.

American Express is

basically changing the bay it does

things. What's going on?

Well, there

is this competition in the card

industry at moment, trying to get

the high end consumers, who spend

lots on credit cards and there is a

battle around rewards going on and I

should say in full disclosure that

JP Morgan I work for are one of the

companies involved in that battle

with our credit card products in the

US and you know, we and various

other large banks are competing with

American Express to try and take

some of that business of the high

end spenders.

And that's it.

The

Fings Times calls it a rewards war?

I suppose people are looking for

benefit. If they are going to get

rewards on flights or cinema. The

other thing is hard to get tickets

because it becomes the marginal

benefits that might sway people?

Analysts do sit down and work out

what the benefits are per card. But

it is harder to measure things that

are much more tricky to make.

Mike,

thank you.