China Manufacturing Slumps Despite Trade Truce | The China Show 12/1/2025

>> 9:00 A.M. IN SHANGHAI SHENZHEN AND HERE IN HONG KONG YOU'RE WATCHING THE CHINA SHOW. I'M YVONNE MAN WITH DAVID INGLES. >> WE ARE COUNTING DOWN TO THE OPEN UP MARKETS IN GREATER CHINA.

LET'S GET TO YOUR TOP STORIES. A CAUTIOUS DAY.

FIRST TRADING SESSION OF DECEMBER.

WE DID A PRIVATE GAUGE OF THIS LATER THIS HOUR. YVONNE:

MADE ONE POSTING ITS FIRST LOSS IN ALMOST THREE YEARS.

DAVID: ALSO ADD, THE CHINESE PROPERTY PRICES IN FOCUS. MORE PRESSURE ON OFFSHORE BONDS.

ADDED TO SOME OF THE ANSWER OUT THERE.

THE GOVERNMENT IS WARNING OF ACTION AGAINST ANYONE WHO MIGHT BE AT RISK. ♪

LETTING.

WE ARE LOOKING AT SOME OF THE CLIENTS MARKETS AS WE KICK OFF A FRESH TRADING MONTH, FRUSTRATING WEEK.

WE ARE GETTING SOME FAIRLY HEFTY PRESSURE COMING ACROSS U.S. FUTURES. NOT TO THE EXTENT WE ARE SEEING

U.S. FUTURES. NOT TO THE EXTENT WE ARE SEEING CURRENTLY FOR THIS TIME OF THE SESSION.

WE WILL RECAP SOME OF THE PMI NUMBERS THAT WE GET FROM A SLEW OF ASIAN ECONOMIES. ABOUT 30 MINUTES BACK.

WE HAD THE GAUGE COMING OUT OF CHINA.

ON TOP OF ALL OF THAT, OTHER THINGS ON DECK.

RISK AVERSION OUT THERE. ON THE KOREAN MARKETS.

U.S. YIELDS WERE FULLY PRICED. FOR THE FED MEETING.

WHICH IS IN ABOUT 11 DAYS OR SO. AS IT PERTAINS TO JAPAN ON THE POLICY FRONT WE HAVE 1% FOR THE FIRST TIME IN MANY YEARS.

WE ARE EXPECTING TO HEAR FROM A CENTRAL BANK GOVERNOR ANY TIME NOW. WE WILL BRING YOU THE LATEST

NOW. WE WILL BRING YOU THE LATEST ONCE WE HAVE THAT INFORMATION. A FOCUS SPECIFICALLY ON METALS TODAY. SILVER AND ESPECIALLY COPPER

TODAY. SILVER AND ESPECIALLY COPPER WITH BOTH NOW TRADING AT RECORD HIGHS. YOU ARE LOOKING AT COPPER FUTURES IN SHANGHAI COMING UP IN YOUR SCREENS VERY SHORTLY.

YOU SHOULD SEE A FOLLOW-THROUGH MOVE FOLLOWING THE MOVE IN LONDON.

THE CHINA ONE IS COMING ONLINE. BITCOIN IS PULLING BACK.

I SHOULD ALSO POINT OUT THAT THIS BROUGHT A WAVE IS NOT SOMETHING WE SPECIFICALLY WOKE UP TO. FUTURES ON YOUR SCREEN.

THE MOVING AVERAGE. WE WILL GET YOU THAT IN A MOMENT. THAT IS NOT THE COPPER CONTRACT.

MOMENT. THAT IS NOT THE COPPER CONTRACT.

BUT YES WE WILL TALK ABOUT THE COPPER CONTRACT. A BIT LATER.

LET'S HAVE A OTHER THINGS ON DECK TODAY. YVONNE:

I DON'T THINK WE WORK FOR SEEING THIS KIND OF RISK AVERSION. THIS WAS SUPPOSED TO BE A MONTH

AVERSION. THIS WAS SUPPOSED TO BE A MONTH WHERE THINGS WERE LOOKING BETTER.

NOW WE ARE TALKING ABOUT THE MACROS AGAIN.

WHEN YOU LOOK AT THE CHINA PMI NUMBER.

THE WEAKNESS WE HAVE SEEN. YOU HAVE TO WONDER IF WE HAVE SEEN THE PEAK OF THE INTENSITY OF THESE PRICE WARS. DAVID:

I WILL THROW IN THE RESURGENCE OF THE PROPERTY.

WE KNOW A BIG PART OF THE ECONOMY IS NOT DOING WELL.

IT IS REALLY SHOWING UP IN THE EARNINGS STORY.

THAT HAS SHOWN UP IN THE EARNINGS.

IT IS REALLY SOMETHING WE WILL SEE TODAY.

WE WILL GET THE FIRST REACTION TO THE EARNINGS COMING THROUGH TODAY. ON TOP OF THAT, MONETARY

TODAY. ON TOP OF THAT, MONETARY POLICY, THAT IS JUST TO SAY WE MENTIONED THIS. WE ARE UP 1%.

WILL LIKELY BE A RATE HIKE OUT OF THE BOJ?

IF NOT DECEMBER THAN JANUARY. WE ARE FULLY PRICED AS FAR AS THE FED IS CONCERNED. YVONNE: WE ARE SEEING RIGHT NOW IT FEELS LIKE THE BANK OF JAPAN IS SPEAKING.

WE WILL BRING YOU ANY KIND OF UPDATES IN CASE WE DO SEE THAT.

IN TERMS OF YOUR AGENDA. WE TALKED ABOUT THE CURRENCY MOVES WE HAVE SEEN WHEN IT COMES TO DOLLAR CHINA.

THE 200 WEEK MOVING AVERAGE IS SOMETHING TO WATCH VERY CLOSELY.

YOU HAVE THE CHINA PMI MEMBER COMING UP AT THE BOTTOM OF THIS HOUR. STILL WALKING -- WATCHING WHAT

HOUR. STILL WALKING -- WATCHING WHAT IS HAPPENING WITH THAT. SOME KEY MILESTONES.

WATCHING THESE HIGH YIELD SPREADS VERY CLOSELY.

WHEN IT COMES TO COPPER, THERE IS A TAKEOVER EVENT THEY ARE TALKING ABOUT HERE IT. THE PROPERTY SIDE IS CERTAINLY STRUGGLING. WE ARE WATCHING A VERY CLOSELY.

STRUGGLING. WE ARE WATCHING A VERY CLOSELY.

CASINO REVENUE FROM A COW WILL COME IN TODAY AS WELL.

ALSO RETAIL SALES OUT OF HONG KONG.

LOTS TO DISCUSS GOING INTO THE SESSION TODAY.

LET'S START THINGS OFF WITH THE EARNINGS STORY.

THE REASON PERHAPS THIS IS TICKING UP MORE CLOSELY.

IT IS REALLY A REFLECTION OF A WEAK AND SOFT SPOT OF THE ECONOMY. THE FIRST LOSS SINCE 2022.

ECONOMY. THE FIRST LOSS SINCE 2022.

THE RED BAR IS THAT OPERATING LOSS.

ALMOST A 100% JUMP FROM THIS TIME LAST YEAR.

OF OPERATING EXPENSES. THE UNDERSCORES THE INTENSE COMPETITION IT IS AND.

GOOD MORNING. YOUR FIRST THOUGHTS WHEN YOU HAVE A LOOK AT THESE EARNINGS COMING THROUGH?

>> GOOD MORNING. REALLY I THINK OTHER THAN THE LOSS, ONE THING THAT STOOD OUT TO ME WAS THIS WAS THE FIRST TIME THAT MADE ONE --M MEITUAN LOSS OF MARKET SHARE IN

THE FOOD DELIVERY SECTOR.

THIS DID NOT QUITE SURPRISE ME THAT IT WAS STEEPER THAN EXPECTED. I THINK THE MARKET WAS NOT

EXPECTED. I THINK THE MARKET WAS NOT REALLY EXPECTING A LOSSES TO CONTINUE IN THE FOURTH QUARTER.

THE COMPETITION IS STILL INTENSE.

HOW RATIONAL IT IS GOING TO BE, THEY WERE NOT ACTUAL TABLE SAY THAT. THE VISIBILITY OR THE CLARITY.

THAT. THE VISIBILITY OR THE CLARITY.

REALLY IT ALL GOES DOWN TO HOW THE MARKET SENTIMENT WILL BE.

AND TO WHAT YOU HAVE ALSO HIGHLIGHTED EARLIER.

THE UNDERLYING CONSUMPTION SENTIMENT IN CHINA IS STILL FAIRLY WEAK. THAT REALLY CLOUDS THE ENTIRE

FAIRLY WEAK. THAT REALLY CLOUDS THE ENTIRE OUTLOOK. THAT WILL TAKE A HIT TODAY.

OUTLOOK. THAT WILL TAKE A HIT TODAY.

YVONNE: THE CONSENSUS EXPECTATION IS STILL FOR A TURNAROUND FOR 2026. DO YOU THINK THAT IS STILL FEASIBLE AT THIS POINT I WILL HAVE TO BE REVISED LOWER NOW?

>> I THINK THE QUESTION REALLY IS THAT WHAT IS THE MAGNITUDE OF THE TURNAROUND THAT WE SHOULD BE EXPECTING IN 2026?

IS THIS A PROLONGED PAIN?

WE KNOW THEY WILL NOT GO BACK TO THE 18% OPERATING MARGIN THEY HAD IN THE PAST. IS IT FAIR TO SAY IT WILL BE HALF OR WILL IT BE WORSE THAN THAT.

THEY LOOK VERY DETERMINED TO TRY TO MAINTAIN THEIR LEADERSHIP. IN FOOD DELIVERY. YVONNE: THANK YOU.

LEADERSHIP. IN FOOD DELIVERY. YVONNE: THANK YOU.

OUR SENIOR INTELLIGENCE BREAKING DOWN THOSE EARNINGS FOR US. STILL HAD WE WILL TAKE A LOOK

FOR US. STILL HAD WE WILL TAKE A LOOK AT THE CHINA TECH SECTOR AS THE AI WARS HEAT UP.

WHY SOME SEE NO BUBBLE IN THE NEXT TWO YEARS.

EXPECTING HUGE PROGRESS FROM ALIBABA AND TENCENT. DAVID:

WE WILL ALSO GET HIS THOUGHTS ON MEITUAN.

THAT WAS NOT OBVIOUS RIGHT NOW. GOING INTO THE OPEN TODAY.

WE WILL SEE WITH THINGS OPEN HERE. ON THIS MONDAY.

OUR FIRST GUEST THINKS THE CHINA TECH SECTOR STANDS OUT AS A TOP GLOBAL OPPORTUNITY GOING INTO NEXT YEAR.

THE HEAD OF CHINA EQUITIES AT UBS GLOBAL MANAGEMENT.

HOPE YOU'RE WELL. LET'S START OFF INTACT.

THIS IS A REALLY GOOD OPPORTUNITY, YOU GUYS THINK.

TELL US WHY.

>> THE RESULT ACTUALLY CONFIRMS THAT AI DEVELOPMENTS OF CHINA ARE ACTUALLY EXCEEDING PEOPLE'S EXPECTATIONS. NOT ABOUT CAPEX.

I THINK U.S. TECH DEVELOPMENTS ARE CLEARLY TELLING YOU THAT IT IS NOT ABOUT HOW MUCH WE SPEND, IT IS ABOUT HOW MUCH YOU CAN EVENTUALLY GENERATE IN TERMS OF REVENUE. IF YOU LOOK AT THE TIME LAG

REVENUE. IF YOU LOOK AT THE TIME LAG BETWEEN INVESTMENTS TO MONETIZATION, CHINA HAS BEEN DOING BETTER THAN THE U.S. IF WE ARE REALLY STRICTLY COMPARING. IN THE SECOND QUARTER RESULTS,

COMPARING. IN THE SECOND QUARTER RESULTS, SOME OF THE LEADING PORTALS WERE ALREADY TELLING US HOW TO USE AI TO GENERATE BETTER ADVERTISING REVENUES.

HOW THEY USE AI TO GENERATE GAMING DEVELOPMENT.

ALL OF THIS, I THINK IT IS CRUCIAL NOW THAT IT IS MOVING FORWARD. WE STILL HAVE THE CAPEX SPENDING.

FORWARD. WE STILL HAVE THE CAPEX SPENDING.

I KNOW THAT IS ONE OF THE THINGS COMPANIES ARE TELLING US.

IN CHIPS IN PARTICULAR. CHINA IS STILL RESTRICTED FROM IMPORTING CHIPS TO THE U.S..

OTHER COMPANIES ARE TELLING YOU THAT THIS IS OUR THREE YEAR BUDGET.

WE WILL SPEND IT EARLIER THAN WE EXPECT.

I THINK THIS IS IMPORTANT. CAPEX SPENDING. MONETIZATION'S.

THEY ARE ACTUALLY FAR EXCEEDING PEOPLE'S EXPECTATIONS.

THAT IS KEY. YVONNE: THE WAY AI PLAYS OUT REGIONALLY IS VERY DIFFERENT. IT IS KOREA, TAIWAN, THE EQUIPMENT. YOU ARE TELLING IN CHINA THAT

EQUIPMENT. YOU ARE TELLING IN CHINA THAT THIS. PROPOSITION IS MORE ATTRACTIVE.

THIS. PROPOSITION IS MORE ATTRACTIVE.

>> SUPPLY CHAIN IS IMPORTANT. THERE ARE CERTAIN LEVELS THAT CHINA IS STILL UNABLE TO DELIVER.

ON THE OTHER HAND, BECAUSE IS THE ECOSYSTEM BEFORE AI THEY WERE VERY COMPLETE. THERE ARE MANY AI USE CASES.

FOR THEM TO BENEFIT FROM. I THINK IN THE U.S.

THEY DO HAVE IT AS WELL. NOT EVERY SINGLE COMPANY.

SOME HAVE MORE, SOME HAVE LESS. NOW YOU SEE THE SHARE PRICE TELLING YOU THAT. IN CHINA, I THINK THERE ARE A COUPLE OF BIG ONES. ACTUALLY FOR BIG ONES.

THREE ARE LISTED. YOU SEE THEM SAY WE ARE DOING THIS. I'M WORKING ON THOSE. ONCE YOU ARE ON TRACK, YOU ARE

THIS. I'M WORKING ON THOSE. ONCE YOU ARE ON TRACK, YOU ARE ONLY ABLE TO ACCELERATE THAT BECAUSE YOU ALREADY FIND CASES IN USAGE OF AI. DAVID: ONE OF OUR GUEST LAST WEEK, SPEAKING OF THE FULL STACK OF SUPPLY THAT YOU HAVE IN CHINA , ALMOST ACROSS THE BOARD, WITH SOME GAPS, TOLD US THAT THAT

SEEMS CLEAR. THE RESEARCH COVERAGE DOES NOT

SEEMS CLEAR. THE RESEARCH COVERAGE DOES NOT SEEM TO BE AS COMPREHENSIVE YET. LOOKING AT THAT FULL STACK.

I'M WONDERING IF THAT IS A HINDRANCE.

WHEN YOU PITCH THE IDEA TO GLOBAL INVESTORS, HOW RECEPTIVE ARE THEY WHEN YOU GO BEYOND THE TOP FIVE?

>> THIS IS TOTALLY UNDERSTANDING.

WHEN PEOPLE TALK ABOUT AI, THEY SEEM TO JUST BE POINTING TO A COUPLE OF COMPANIES.

BUT WHEN YOU LOOK AT THIS, WHEN YOU HEAR THE SPEAKER SAYING THERE ARE A FEW THAT THERE IS A BIG PILE OF SUPPLY CHAIN, I AM TALKING ABOUT CHIPS, NOT JUST IN THE CSI 300.

THEY ARE PROBABLY IN THE 500 OR EVEN IN THE 1000.

NOT ALL COMPANIES ARE EQUAL. SOME ARE ABLE TO DO BETTER IN EXCEL. ON TOP OF THAT, THE VALUATIONS,

EXCEL. ON TOP OF THAT, THE VALUATIONS, SOME OF THESE COMPANIES VALUATIONS ARE LIKE 70 TIMES, SOMETIMES 100 TIMES. SHOULD I REALLY LOOK INTO IT?

AS AN ANALYST? SHOULD I PUT IN THE EFFORT?

IT WILL MATTER. BUT IS IT TOO EARLY TO LOOK AT IT NOW? YVONNE: YOU MENTIONED THE OPTIMISM

IT NOW? YVONNE: YOU MENTIONED THE OPTIMISM AROUND AI. IT SEEMS LIKE THE MACRO IS

AROUND AI. IT SEEMS LIKE THE MACRO IS GETTING WEAKER. YOU LOOK AT PMI NUMBERS AND

GETTING WEAKER. YOU LOOK AT PMI NUMBERS AND WHAT IS GOING ON OF THE PROPERTY SECTOR.

CAN I STILL JUST FOCUS ON TECH FOR NEXT YEAR FOR THIS EQUITY RALLY TO CONTINUE?

>> WE ALWAYS SAY, WALL STREET VERSUS MAIN STREET.

WE ALWAYS HAVE THIS DYNAMIC.

MAIN STREET PARTICULARLY FOR CHINA, YOU CANNOT HAVE CONSUMPTION CONTINUE TO BE WEAK. AND CONTINUE TO EXPECT PEOPLE TO PAY THIS MONEY IN TERMS OF AI OR PRODUCT FOR THE SECOND DERIVATIVE OF FUNCTION BEING AI. WE DO NEED A BETTER OR AT LEAST

SOME STRUCTURAL ISSUES NEED TO BE TAKEN CARE OF EVENTUALLY.

WE ARE RELYING ON TECH WITHOUT THE MACRO ECONOMY DOING WELL.

DAVID: ONE OF THE RECOMMENDATIONS FOR THE 2026 OUTLOOK IS ALLOCATED UP TO 30% OF EQUITY PORTFOLIOS TO SOMETHING RELATED TO AI. ARE THERE ANY CHANGES TO HELP PEOPLE HAVE BEEN ALLOCATING THIS YEAR THAT YOU THINK THEY SHOULD START ENTERTAINING AS A NEW IDEA GOING INTO NEXT YEAR?

OR IS IT MORE OF THE SAME?

>> I THINK IN TERMS OF PEOPLE THAT EARLY IN THE USA AT, THEY HAVE BEEN QUITE CONCENTRATED ON ONE COMPANY.

PARTICULARLY OVER THE LAST THREE MONTHS WE HAVE BEEN TELLING YOU THAT YOU SHOULD NOT DO THAT.

WE ARE ALREADY IN THE FOURTH YEAR OF THE AI DEVELOPMENT IN THE U.S. DIVERSIFICATION IS CRUCIAL.

THE U.S. DIVERSIFICATION IS CRUCIAL.

NOW YOU HAVE NOT JUST GPU BUT TV YOU.

YOU HAVE A BIG MODEL. THE USAGE APPLICATIONS ARE VERY DIFFERENT. I THINK THE SAME CASE IN CHINA.

DIFFERENT. I THINK THE SAME CASE IN CHINA.

YOU ALSO NEED TO THINK ABOUT HOW YOU DIVERSIFY.

MAYBE THE TIMING. MAYBE NOW I MORE IN GAMING BECAUSE I WORRY ABOUT THE FOOD DELIVERY PLATFORMS. THAT SORT OF DIVERSIFICATION IS CRUCIAL IN 2026. YVONNE:

ARE THERE POCKETS OF THE TECH SPACE THAT YOU WORRY ABOUT?

I THINK LAST WEEK THE REGULATOR SAID HUMANOID ROBOTS COME OF THAT SPACE IS A LITTLE TOO CROWDED.

OTHER PARTS THAT YOU LOOK AT AND YOU WORRY ABOUT?

>> WHENEVER WE ARE APPROACHING A NEW TECHNOLOGY, THAT IS A GOOD EXAMPLE. YOU ALWAYS COME TO A STAGE OF

EXAMPLE. YOU ALWAYS COME TO A STAGE OF IF THAT COMPANY CAN SURVIVE. THEY TALKED ABOUT 100 ROBOTS BEING DELIVERED THIS YEAR. 10,000 NEXT YEAR.

THAT SORT OF JUMP.

WHAT IS THE ENTRY BARRIER LIKE? IT IS ANOTHER NICE STORY.

IT IS EASY. BUT IF YOU DIP INTO WHETHER YOU REALLY HAVE TO ACT AND YOU ARE ABLE TO STOP NEW ENTRIES COMING IN, I THINK THAT IS CRUCIAL. ONLY A COUPLE ARE ABLE TO SURVIVE. DAVID: WE WILL HAVE MORE WITH OUR

SURVIVE. DAVID: WE WILL HAVE MORE WITH OUR GUESTS. JOINING US AGAIN IN A COUPLE OF

GUESTS. JOINING US AGAIN IN A COUPLE OF MINUTES. JUST TO ALSO MENTION, WE TALKED

MINUTES. JUST TO ALSO MENTION, WE TALKED ABOUT MEITUAN AS A STARTING POINT. WE SPOKE A LITTLE BIT TOO EARLY.

IT SEEMS LIKE THEY WILL BE TRADING IF NOT AT BELOW.

SPEAKING OF THE 90'S, THAT IS THE LEVEL TO WATCH WHEN YOU LOOK AT COPPER IN SHANGHAI. WE ARE JUST GETTING WARMED UP.

WE ARE NOW AN INCH OR TWO FROM THE 90,000 HANDLE ON THE BACK OF COPPER HITTING A RECORD. THE METALS REPORT IS SOMETHING WE ARE TRACKING. YVONNE: WE ARE COUNTING DOWN TO THE OPENING TRADE IN HONG KONG THIS MONDAY MORNING.

THIS IS THE CHINA SHOW. ♪

♪ DAVID: WELCOME BACK.

WE WILL TAKE YOU NOW TO JAPAN WHERE WE ARE GETTING THE ONGOING LIFE BRIEFING OUT OF THE BOJ.

SUFFICE IT TO SAY THAT THEY HAVE COME OUT LARGELY ON THE HAWKISH SIDE.

AN INDICATION THAT RATES WILL LIKELY HAD HIGHER.

AN ACKNOWLEDGMENT THAT THE REAL RATE IS VERY LOW.

IT MIGHT BE TIME FOR AN ADJUSTMENT TO A DEGREE OF EASING. IF THE ECONOMIC OUTLOOK IS

EASING. IF THE ECONOMIC OUTLOOK IS REALIZED, THEY WILL BE RAISING INTEREST RATES.

THE YEN HAS STRENGTHENED SINCE THOSE COMMENTS DROPPED.

IT IS NOW 1% FOR THE FIRST TIME SINCE I BELIEVE 2000.

THAT IS SOMETHING TO KEEP AN EYE ON. YVONNE:

THAT IS MORE LIKELY TO AFFECT PRICES.

THAT IS ONE THING THEY ARE CONCERNED ABOUT.

POSSIBLY STOKING INFLATION. DIRECTLY TALKING ABOUT THE CURRENCY IMPACTS. MAKE THE RIGHT DECISION.

CURRENCY IMPACTS. MAKE THE RIGHT DECISION.

WHEN YOU ASK US SOME OF THE ECONOMISTS, MAYBE IT IS A LITTLE BIT OF A POINT -- COIN TOSS WHAT THEY ARE GOING TO DO IN SEPTEMBER. THERE YOU GO. THE YIELD CURVE IS HEADING

IN SEPTEMBER. THERE YOU GO. THE YIELD CURVE IS HEADING HIGHER.

CERTAINLY WE ARE WATCHING THAT VERY CLOSELY.

LET'S TALK A LITTLE BIT MORE ABOUT HONG KONG. LET'S SEE.

THE GOVERNMENT HAS MOVED TO STAMP OUT MOUNTING PUBLIC ANGER AFTER THE CITY IS DEADLIEST FIRE IN ALMOST EIGHT DECADES.

LET'S GET TO OUR CHINA CORRESPONDENT WITH THE LATEST SO FAR.

>> IF YOU REMEMBER LAST WEEK I WAS AT THIS DISTRIBUTION CENTER THAT WAS STARTED BY VOLUNTEERS. WE HEARD ON SATURDAY AUTHORITIES WERE TOLD TO CLEAR OUT OF THE SQUARE.

THE GOVERNMENT IS TAKING OVER THE DONATION DRIVE AND TAKING IT ONLINE SAYING THEY WOULD MAKE IT MORE EFFICIENT.

YOU HAVE TO TAKE THIS IN CONTEXT OF THE OTHER THINGS HAPPENING.

THEY PUT OUT A WARNING AGAINST ANYONE TRYING TO USE THIS FIRE TO STOKE UNREST. ALREADY THEY HAVE ARRESTED THREE PEOPLE.

INCLUDING AN IDENTIFIED -- UNIDENTIFIED VOLUNTEER.

AS WELL AS A MAN WHO STARTED AN ONLINE PETITION BEGGING FOR DEMANDS OF THE GOVERNMENT. INCLUDING TAKING CARE OF THE VICTIMS AND TAKING ACCOUNTABILITY FOR WHAT HAPPENED. STARTING AN INDEPENDENT

HAPPENED. STARTING AN INDEPENDENT COMMISSION OF INQUIRY. THEY HAVE NOT BEEN TAKEN DOWN.

IT SEEMS LIKE THAT LINE BETWEEN PUBLIC A GRIEF AND PUBLIC ANGER IS THINNING. PERHAPS THE GOVERNMENT IS

IS THINNING. PERHAPS THE GOVERNMENT IS WORRIED. I GUESS YOU COULD CONSIDER IT A

WORRIED. I GUESS YOU COULD CONSIDER IT A MASS GATHERING OF PEOPLE AT THE DISTRIBUTION CENTER.

THEY ARE WORRIED THAT THAT COULD SPIRAL OUT OF CONTROL.

DAVID: DO WE HAVE NEW DETAILS ON HOW THE FIRE STARTED? YVONNE:

LAST WEEK THE GOVERNMENT GAVE A PRESS CONFERENCE AND THEY SAID THE FIRE STARTED IN A MESH.

THEY ARE NOW PUTTING THE BLAME ON THE STYROFOAM BOARD CEILING THE WINDOW.

THE FIRE DEPARTMENT EXPLAINED WHY THEY DIDN'T USE THE HELICOPTER.

SOME PEOPLE ARE SAYING THEY DO NOT KNOW.

BUT AN INTERAGENCY TASK FORCE HAS BEEN STARTED TO LOOK INTO THE EXACT CAUSE. YVONNE:

WE CONTINUE TO SEE THE VERY TOUCHING PHOTOS.

MORNING FOR THE ENTIRE WEEKEND. IT WAS AN ENTIRE SHOW OF SUPPORT.

>> WE SAW THOUSANDS OF PEOPLE LINING UP TO GIVE FLOWERS.

THE HONG KONG GOVERNMENT HAS DECLARED THREE DAYS OF PUBLIC MOURNING.

WE SAW RAW DEVASTATION AT THE SITE. THERE WAS THIS PLACE WHERE FAMILY MEMBERS COULD GO INTO IDENTIFY THE DEAD BASED ON PHOTOS. YOU SAW THIS TERRIBLE PROCESSION OF PEOPLE COMING OUT

PHOTOS. YOU SAW THIS TERRIBLE PROCESSION OF PEOPLE COMING OUT LOOKING ANGUISHED. I THINK IN THE PAST COUPLE OF

LOOKING ANGUISHED. I THINK IN THE PAST COUPLE OF DAYS THESE PEOPLE HAVE BEEN IN SHOCK.

THOSE THINGS ARE GONE BY NOW.

IT SEEMS LIKE MOST OF THE VOLUNTEERS ARE UPSET THAT THE GOODWILL IS NOT BEING SCRUTINIZED. DAVID:

WHAT IS NEXT TO WATCH HER TODAY AND IN THE NEXT TWO DAYS?

>> OF COURSE WE ARE ENTERING A POLITICAL TIME.

HE SAID HE WILL ANNOUNCE IF IT WILL BE DELAYED.

WE UNDERSTAND IT WILL STILL TAKE PLACE ON SUNDAY.

THEY ARE LIKELY TO RESUME ON THURSDAY.

OBVIOUSLY THIS INCIDENT WILL CAST A SHADOW OVER THE ELECTIONS. THIS IS THE SECOND ELECTION

ELECTIONS. THIS IS THE SECOND ELECTION THAT WILL TAKE PLACE UNDER THIS ELECTORAL SYSTEM.

THE GOVERNMENT IN BEIJING WILL BE WATCHING FOR HOW THE ELECTION WILL TAKE PLACE. OF COURSE WE HAVE SEEN POLICE AND SECURITY REALLY RAMPED UP AT THE SITE NEAR THE FIRE AS WELL. I THINK THIS IS SOMETHING WE

WELL. I THINK THIS IS SOMETHING WE WILL DEFINITELY BE CASTING A SHADOW OVER THE ACTIONS. DAVID:

THANKS FOR THE UPDATE. COMING OFF OF A CHALLENGING WEEKEND. IT IS REALLY HARD TO JUST TRY

WEEKEND. IT IS REALLY HARD TO JUST TRY TO NOT BE CONNECTED TO THE NEWS. >> I ALSO WANTED TO POINT OUT THAT THERE HAVE BEEN REPORTS THAT THESE RESIDENTS WERE COMPLAINING ABOUT THESE FIRE HAZARDS EARLY ON AS EARLY AS LAST YEAR. THE DEPARTMENT OF LABOR DID

LAST YEAR. THE DEPARTMENT OF LABOR DID ACKNOWLEDGE IN A STATEMENT THAT THEY HAD DISMISSED SOME OF THESE CONCERNS. THEY SAID THERE WAS NOT ANY

THESE CONCERNS. THEY SAID THERE WAS NOT ANY FIRE SAFETY LAW GOVERNING SCAFFOLDING.

THEY SET THE MATERIALS ACTUALLY MET STANDARDS AND DOCUMENTS.

BUT NOW THEY HAVE INCREASED THE NUMBER OF ARRESTS 211.

INCLUDING CONSULTANTS OF DIFFERENT COMPANIES. DAVID:

THANK YOU. THE DEVELOPMENTS OVER THE WEEKEND AND WHERE WE ARE RIGHT NOW.

AS WE MAKE OUR WAY INTO THE NEW WEEK HERE. PLENTY MORE.

♪ ♪ DAVID: COUNTING DOWN TO THE OPEN.

FUTURES TO THE UPSIDE HERE.

YOU SEE WE ARE SITTING RIGHT AT ABOUT LEVEL.

WE ARE RIGHT AT THE 50%. AS FAR AS THAT TRADE IS CONCERNED. THE WEAK DOLLAR STORY.

CONCERNED. THE WEAK DOLLAR STORY.

WE ARE LOOKING AT SOME EARNINGS REACTIONS. YVONNE:

THE FED IS IN A BLACKOUT TIME NOW. SO WE WILL MARKET MUCH MORE FROM THEM.

CERTAINLY THAT WILL BE THE KEY THING TO WATCH.

THE OPEN FOR YOUR MONDAY MORNING IS LOOKING LIKE THIS.

SOME MODERATE GAINS FOR THE CSI 300.

SILVER IS AT A RECORD. WE ARE SEEING GAINS AND SOME MAINLINE FUTURES. UP ABOUT 2.5% FOR COPPER.

MAINLINE FUTURES. UP ABOUT 2.5% FOR COPPER.

WE ARE FOCUSING MORE ON WHAT HAPPENS IN THE TECH SPACE.

GIVEN WHAT WE SAW WITH THE MEITUAN EARNINGS.

LAST WEEK IT WAS ALIBABA THAT HAD MUCH MORE OF THAT.

AFTER ANNOUNCING THIS BRAND-NEW HAVE -- AP.

THAT REVIVED THE STOCK UPP MEITUAN.

THEY ARE CONTINUING TO BRING DOWN PRICE TARGETS FOR THE STOCK. THERE YOU GO.

STOCK. THERE YOU GO.

THEY ARE DOWN 2.5%.

REPORTING THEIR FIRST LOSS SINCE 2022.

THEY STILL SEE LOSSES WHEN IT COMES TO THE E-COMMERCE BUSINESS AND THE LIKE. ALIBABA IS DOING OK.

TENCENT IS DOING OK. WE WILL GET A TAKE FROM BARCLAYS COMING UP. TECH IS GOING TO BE THAT KEY DRIVER FOR THIS EQUITY RALLY. DESPITE THE WEEK MACRO DATA.

PMI NUMBERS WE SAW. THAT CERTAINLY IS ONE THING.

THAT DID NOT LOOK VERY GOOD. THE MACROS ARE GETTING WEAKER.

WE WILL SEE THAT COMING OUT IN A FEW MINUTES.

WE ARE FOCUSING ON THE CONSUMPTION SPACE.

THERE WAS A LOT OF OPTIMISM LAST WEEK ABOUT HIS CONSUMPTION PLAN. THESE COLLECTIBLE DOLLS COULD

PLAN. THESE COLLECTIBLE DOLLS COULD HELP BOOST THE CONSUMPTION SPACE. POP MARK CONTINUES TO GO HIGHER.

CURRENT LEVELS RIGHT NOW. WE ARE WATCHING THEM.

WE ARE STILL FOCUSING ON THAT.

THEY HAVE BASICALLY PLEDGED THEIR ENTIRE STAKE IN THEIR MANAGEMENT UNIT TO A STATE BACKER.

THIS IS WHAT WE ARE HEARING IN TERMS OF THIS FRAMEWORK.

TO DEMAND COLLATERAL. FOR ITS NONSUPPORT.

NOT DOING A LOT HERE.

DAVID: IT ACTUALLY SHOWED UP IN THE NEWS. SHUT UP AND MARKETS LAST WEEK.

NEWS. SHUT UP AND MARKETS LAST WEEK.

THEY HAVE THEIR WORST WEEKEND OVER TWO YEARS IN AGGREGATE.

WE WILL SEE HOW THOSE BONDS TRADE GOING INTO THE SESSION TODAY. WE WILL CONTINUE TO TRACK THIS

TODAY. WE WILL CONTINUE TO TRACK THIS STORY. THE COMPANY PLEDGING ALL OF THE

STORY. THE COMPANY PLEDGING ALL OF THE SHARES THEY HOLD. THE PROPERTY MANAGEMENT UNIT.

WHAT DO WE KNOW ABOUT THIS SPECIFIC MOVE COMING OUT OF THE COMPANY?

>> THIS MOVE TO APPLY THE SHARES IS SURPRISING BECAUSE WE MENTIONED THIS IS PART OF THE FRAMEWORK THAT ALLOWS THIS BIG SHAREHOLDER TO ASK FOR A COLLATERAL PLEDGE.

FOR THEIR LOAN SUPPORT. WE ARE SEEING THAT APPLIED TO THIS PROPERTY MANAGEMENT LISTING COMPANY.

STARTING FROM FEBRUARY OF THIS YEAR. THE MOVE THIS YEAR IS NOT SURPRISING AT ALL BUT IT DEFINITELY UNDERSCORES THAT ITS BIGGEST SHAREHOLDER IS DEFINITELY TIGHTENING ITS FINANCING.

YOU CAN NEVER TAKE THE SUPPORT FROM THE BIGGEST SHAREHOLDER FOR GRANTED RIGHT NOW. YVONNE:

WHAT IS EXPECTED THIS WEEK FROM BANCA -- VAN IF ANYTHINGKE?

>> MAYBE IT WILL BE AS EARLY AS THE WHOLE MARKET IS WATCHING FOR THAT. THAT WILL SET THE STAGE FOR HOW

FOR THAT. THAT WILL SET THE STAGE FOR HOW THEY WILL DO WITH THIS MOVING FORWARD.

THAT IS THE KEY THING WE ARE WATCHING.

FOR NEXT WEEK THEY WILL HAVE A MEETING WITH BONSALL -- FUMBLED HER OWN STORE.

IF THEY CANNOT GET SUPPORT, WE WILL SEE THAT. YVONNE:

THANK YOU. OUR CHINA CREDIT REPORT OR THE LATEST WHEN IT COMES TO VANKE. A LOT TO LOOK AHEAD TO AS EARLY AS TODAY. WE ARE SEEING WHAT WE DID NOT

AS TODAY. WE ARE SEEING WHAT WE DID NOT SEE. NOT YET. USUALLY THIS TIME AROUND DURING

SEE. NOT YET. USUALLY THIS TIME AROUND DURING THE END OF THE MONTH IS WHEN YOU GET A PRIVATE GAUGE OF THE PROPERTY DATA OUT OF THE BIGGEST DEVELOPERS IN CHINA.

WE DID NOT GET THAT YESTERDAY. WE ARE ALREADY IN DECEMBER.

WE ARE STILL WAITING FOR WHAT THAT MEANS.

THIS ONLY ADDS TO THE UNCERTAINTY OF WHAT THE NOVEMBER REPORT WILL LOOK LIKE. IT COULD BE A PRETTY WEAK NUMBER. DAVID: THAT IS SAY WILL NOT COME OUT

NUMBER. DAVID: THAT IS SAY WILL NOT COME OUT BUT IT IS USUALLY AT THE END OF THE MONTH.

WE WILL CONTINUE TO TRACK HEADLINES.

ONCE WE HAVE MORE INFORMATION. THAT WILL FUEL UNCERTAINTY.

STILL WITH US HERE ON SET FOR SOME FINAL THOUGHTS IS OUR GUEST. ARE THERE OPPORTUNITIES WITHIN

GUEST. ARE THERE OPPORTUNITIES WITHIN THE CONSUMPTION SPACE IN CHINA? OR ARE WE THROWING EVERYTHING OUT WITH THE BATHWATER?

>> WITHIN CONSUMPTION WE LIKE NEW CONSUMPTION.

THE POPULAR STOCK. [LAUGHTER]

IT HAS CORRECTED A LOT. I THINK NOW THEY ARE TALKING ABOUT 20 TIMES SOMETHING THE IPO.

WHEN I LOOK AT THE STOCK, THE DOMESTIC GROWTH IS IMPORTANT.

BUT IN FACT THE GROWTH IN OVERSEAS HAS BEEN PROGRESSING VERY WELL. SOME OF YOUR FRIENDS WERE

VERY WELL. SOME OF YOUR FRIENDS WERE PROBABLY TELLING YOU THAT PEOPLE WERE LINED UP.

I THINK IT WILL BE AN IMPORTANT ELEMENT TO SUPPORT THE GROWTH OF THE STOCK.

THE MARGINS ARE A LOT HIGHER. COMPARED TO SELLING IN CHINA.

THEY ARE ABLE TO MARKETS THEM MUCH HIGHER.

HOW DO YOU LOOK AT 2026? IT SEEMS LIKE THIS YEAR WAS ALL ABOUT VALUATIONS. THAT IS WHAT LED TO THIS RALLY.

ABOUT VALUATIONS. THAT IS WHAT LED TO THIS RALLY.

HOW CRITICAL WILL EARNINGS BE NEXT YEAR?

>> LET'S TALK ABOUT THE TECH SECTOR.

THE CURSE OF THESE SUBSIDIES, YOU TALK ABOUT THAT.

NEXT YEAR BECAUSE OF THIS, EARNINGS ARE EXPECTED TO BE OVER 35% GROWTH. THIS IS A BIT LOW.

WITHIN THAT HANG SAYING IT IS ALSO INCLUDED.

THEY HAVE A BIT OF EARNINGS GROWTH.

IN TERMS OF THE BROADER MARKET WE EXPECT UP TO 13%.

EARNINGS GROWTH WILL BE GOOD THIS YEAR.

THE EARNINGS NEED TO COME INTO PLAY.

VALUATION HAS CORRECTED LATELY BECAUSE OF PEOPLE TAKING PROFIT.

PEOPLE WORRY ABOUT MAIN STREET.

WE DO EXPECT BOTH. SLIGHTLY ON PART TWO HISTORICAL AVERAGE. WE HAVE EARNINGS GROWTH COMING

AVERAGE. WE HAVE EARNINGS GROWTH COMING IN.

THE EASY UPSIDE WAS THIS YEAR BECAUSE IT IS JUST AT THE BEGINNING OF THE YEAR WE WERE AT THE HIGH OR LOW TEENS.

NOW WE ARE AT 17 TIMES. THAT IS WHAT THEY HAVE DONE IN CHINA. DAVID: THE EARNINGS HAVE TO START.

CHINA. DAVID: THE EARNINGS HAVE TO START.

THE TITLE OF REPORT IS ESCAPE VELOCITY.

YOU ARE STILL NOT CONVINCED?

>> I THINK THERE ARE DIFFERENT POCKETS THAT HAVE BEEN MOVING AROUND.

WHEN PEOPLE WOULD REALLY FOCUS ON ONE STOCK OR ONE SECTOR, YOU WOULD BE SURPRISED THAT THERE WOULD BE OTHER POCKETS OF DEVELOPMENT MOVING. YOU HAVE TO CHANGE.

DEVELOPMENT MOVING. YOU HAVE TO CHANGE.

YOU HAVE TO MONITOR THE SITUATION. WE LIKE GOLD A LOT.

WE STILL LIKE GOLD. BUT IT HAS MOVED.

YOU NEED TO THINK ABOUT WHY YOU NEED TO HAVE THAT AS A HEDGE.

BECAUSE OF THE GEOPOLITICAL SITUATION.

IT IS NOT ALL PEACE. THEY WILL MEET FOUR TIMES NEXT YEAR, THE TWO BIG LEADERS. BUT THE DISCUSSION IS NOT ENDED HERE. IT WILL JUST CONTINUE.

HERE. IT WILL JUST CONTINUE.

THE VOLATILITY WILL STILL BE HERE. YVONNE:

IT INFLATION PICKS UP AGAIN OR DEBT PROBLEMS RESURFACE , WHICH OF THE THREE CONCERNS YOU THE MOST?

>> I THINK IT WOULD BE AI. BECAUSE PEOPLE PUT HIGH HOPES AND AT THE MOMENT. DAVID: WHAT IS THE INITIAL ALL IN DICTATION FOR THAT? A LOWER NUMBER?

BLOWING IT UP?

>> I THINK IT IS MONETIZATION. THAT WILL BE THE KEY.

WE HAVE BEEN HEARING THAT THE CHINA TYPE OF A IS MUCH CHEAPER THAN THE U.S. TYPE OF AI. HE EVENTUALLY THERE WILL NOT BE TO SYSTEMS. WILL THERE BE ANY OTHER CHARGE BETWEEN THEM?

WE DO NOT KNOW. THAT IS THE BIG STORY.

YVONNE: HOLD THAT THOUGHT. WE HAVE A LITTLE BIT MORE NEWS.

THIS HAS BEEN HALTED ONCE AGAIN AFTER A PRICE DROP.

OBVIOUSLY WE WILL CONTINUE TO WATCH. POSSIBLY WE WILL GET THE DETAILS. CERTAINLY WE WILL SEE THEM

DETAILS. CERTAINLY WE WILL SEE THEM PRESSING THIS BUTTON AS WE SPEAK.

EVERYONE IS SAYING THAT THE PROPERTY MARKET IS STILL STRUGGLING.

PERHAPS THAT WILL FORCE THE GOVERNMENT TO IMPLEMENT SOME STIMULUS. SHOULD WE EXPECT THIS IN THE

STIMULUS. SHOULD WE EXPECT THIS IN THE PROPERTY SECTOR.

>> I THINK THEY ARE LOOKING AT IT LIKE A MORTGAGE SUBSIDY.

PARTLY THAT WILL BE COMING FROM THE GOVERNMENT.

MAYBE PARTLY FROM BANKS.

THIS IS MORE FOR THE ENTIRE MORTGAGE TERM. IT WILL HELP.

WE STILL EXPECT 2026 FOR THE CHINA PROPERTY MARKET, IN TERMS OF PRICES AND PARTICULARLY VOLUMES WILL CONTINUE TO CORRECT. DAVID: THE MARKETS DO NOT LIKE

CORRECT. DAVID: THE MARKETS DO NOT LIKE SURPRISES OR DISRUPTION.

WE HAVE BEEN HERE FOR SEVERAL YEARS NOW.

IF THIS CONTINUES INTO NEXT YEAR , DO YOU SEE ANY WAY THIS CAN CAUSE A DISRUPTION IN THE EQUITY MARKETS?

OR CAN THOSE THINGS CONTINUE TO DO THAT?

>> IF YOU TURN AROUND AND STABILIZE, THIS WILL BE THE BEST STORY FOR CHINA CONSUMPTION.

AT THE MOMENT, WE DO NOT NEED TO GO BACK TO THE GOOD OLD DAYS.

WE ONLY NEEDED TO STABILIZE. WHEN THE OCTOBER DATA COMING IN WILL BE A LOT WEAKER, AND THE SALES WILL DECLINE, EVEN IN THE BIG CITIES, THAT ACTUALLY MAKES ME MORE WORRIED.

DAYS STILL HAVE PROPERTIES THAT THEY HAVE NOT BEEN ABLE TO SELL.

THAT WILL STILL AFFECT THE SENTIMENT. YVONNE:

GREAT TO HAVE YOU HERE THIS HOUR. THE HAD A GREATER CHINA EQUITIES AT UBS GLOBAL MANAGEMENT.

WE WILL LEAVE YOU WITH A LOOK AT HOW MARKETS ARE DOING HERE RIGHT NOW. WHAT WE ARE SEEING WHEN WE COME

RIGHT NOW. WHAT WE ARE SEEING WHEN WE COME TO THE GREATER CHINESE MARKETS. THIS IS BLOOMBERG.

♪ ♪ YVONNE: WE JUST WANT TO RECAP THE PMI NUMBERS WE GOT OVER THE WEEKEND HERE. IT WAS NOT PRETTY. EIGHT STRAIGHT MONTHS OF

WEEKEND HERE. IT WAS NOT PRETTY. EIGHT STRAIGHT MONTHS OF CONTRACTION. THAT IS A RECORD OF LOSING

CONTRACTION. THAT IS A RECORD OF LOSING STREAK. LOOKING A BIT SOFTER.

STREAK. LOOKING A BIT SOFTER.

ALSO SEEING A CONTRACTION AS WELL.

THIS COULD BE ANY SECOND DAVID: NOWADAYS. DAVID:IT

HAS COME OUT IN THE READINGS IN OUR CODE. IT MISSED ITS FORECAST SUBSTANTIALLY. WE ARE GETTING AN UNDER 50

SUBSTANTIALLY. WE ARE GETTING AN UNDER 50 HANDLE ON THE PMI. THIS IS ALSO FOR THE SAME MONTH.

BACK BELOW 50 FOR THE FIRST TIME IN SEVERAL MONTHS.

CLEARLY WE HAVE HIT A CYCLICAL HEADWIND. YVONNE:

LET'S GET EIGHT TAKE FROM THE CHIEF ECONOMISTS.

SHE JOINS US FROM BEIJING THIS MORNING.

IT SEEMS LIKE THE WEAKNESS OF THE ECONOMY, WE ARE SEEING IT IN THESE NUMBERS HERE. WHAT DO YOU THINK IS CONTRIBUTING TO THESE NUMBERS?

>> NOVEMBER MANUFACTURING PMI, THE ONLY UPTICK A LITTLE BIT.

THIS IS A PRETTY WEAK RECOVERY I WOULD SAY.

A LOT OF IT WAS SEASONAL RECOVERY.

BECAUSE SEPTEMBER AND OCTOBER HAD MANY LESS WORKING DAYS.

PEOPLE TAKE TIME OFF DURING A NATIONAL HOLIDAY.

I THINK THE MARKET WAS EXPECTING A LITTLE BIT STRONGER RECOVERY THAT DID NOT HAPPEN. A FEW THINGS ARE CONTRIBUTING TO IT. WE DO SEE THE FIRST CO-EXPENDITURE GOING INTO THE

TO IT. WE DO SEE THE FIRST CO-EXPENDITURE GOING INTO THE YEAR. PROBABLY SAVINGS FOR NEXT YEAR.

YEAR. PROBABLY SAVINGS FOR NEXT YEAR.

THIS WAS NOT AS STRONG AS THE FIRST HALF OF THE YEAR.

ALSO SOME OTHER DISRUPTIONS.

WE ONLY HAD ABOUT 20 WORKING DAYS.

THE AVERAGE NUMBER OF WORKING DAYS IN NOVEMBER IS 21.

THAT COULD BE A SMALL REASON THAT PMI WAS ON THE WEAKER SIDE.

THE CONTINUED ANTIEVOLUTION EFFORTS.

ON THE LOCAL GOVERNMENT LEVEL. THAT ADDED TO IT AS WELL BECAUSE WE ARE SEEING PRICING GOING BETTER.

WE SEE AN UPTICK IN FINISHED PRODUCT PRICE.

DAVID: DO I TAKE IT BASED ON YOUR LAST THOUGHT THERE THAT GOING INTO NEXT YEAR, MANY IN THE MARKET ARE UNDER APPRECIATING INFLATION?

DO WE SEE THAT AS FAR AS CORPORATE EARNINGS ARE CONCERNED?

>> I WOULD DESCRIBE IT AS A MODERATE RECOVERY.

IT HAS BEEN ONGOING FOR A WHILE. WHEN YOU LOOK AT THE PROPER BALANCE SHEETS , AS WELL AS FROM THE FINANCIAL DATA, WE ARE SEEING CASH FLOW

IN TERMS OF CASH PLUS CURRENT ASSETS AS A PERCENTAGE OF SLOWLY RECOVERING SINCE LAST YEAR.

STARTING TO DECLINE FROM THE FIRST QUARTER OF THIS YEAR.

WE ARE SEEING SOME OF THE PRODUCT COMPANIES.

THE BALANCE SHEET CONTRACTION.

THIS IS ATTRIBUTABLE TO THE LOCAL GOVERNMENTS WHAT -- DEBT SWAP PROGRAM.

THAT IMPROVED THE CASH FLOW. FROM THE PPI PERSPECTIVE, IT HAS BEEN NARROWING. THE NARROWING HAS SPED UP AFTER ANTIEVOLUTION KICKED OFF IN JULY OF THIS YEAR.

WE DON'T SEE IT AS VERY STEEP RECOVERY AS WE SAW IN 2015 AND 2016. NEVERTHELESS, THERE SHOULD BE

2016. NEVERTHELESS, THERE SHOULD BE SOME KIND OF REDUCTION. WE DO SEE THE PROFITABILITY TREND SLOWLY BEING ON THE MEND. IN THE COPPER SECTOR. YVONNE:

WE HAVE TALKED ABOUT, IT IS A K-SHAPED ECONOMY WHEN YOU HAVE A I STILL LOOKING LIKE A BRIGHT SPOT.

YOU HAVE EXPORTS THAT ARE STILL RESILIENT.

EQUITY MARKETS ARE DOING OK. I LOOKED AT WITH THE PROPERTY SITE IS DOING. WHAT CONSUMPTION IS DOING.

I CONTINUES TO BE STRUGGLING.

WHAT DO POLICYMAKERS DO AND HOW THEY ADDRESS THIS K-SHAPED ECONOMY NOW?

>> I THINK THIS ECONOMY, SOMETIMES WE CALL IT THE TWO SPEED ECONOMY, IT IS KIND OF A GLOBAL PHENOMENON NOW.

THEY ARE ALL EXPERIENCING CHANGING INCOME DISTRIBUTION.

WHEN YOU LOOK AT WHAT IS GOING TO HAPPEN NEXT YEAR, I DO THINK THE GOVERNMENT IS TAKING NOTE OF ANOTHER LAG NOW IN THE PROPERTY SECTOR IN TERMS OF PRIMARY MARKET TRANSACTION VOLUME AS WELL AS FIRST-YEAR PRICE.

IN THE LAST COUPLE OF MONTHS. WE DO EXPECT SOME KIND OF POLICY COMING THROUGH IN TERMS OF TARGETED MORTGAGE RATES SUBSIDY CUTS AND OR ON THE CITY LEVEL THEY ARE DOING QUITE WELL ON CITYWIDE POLICIES. WE ARE ASSUMING -- SEEING SOME

CITIES PUTTING A MONETARY SUBSIDY FROM BURGESSES.

GIVEN THE DIFFERENT CIRCUMSTANCES.

MAKING SOME OF THE INCENTIVES FOR HOMEBUYERS AS WELL.

GOING INTO NEXT YEAR, IN THE FIVE-YEAR PLAN, WE SEE MORE EMPHASIS ON CONSUMPTION GROWTH. THAT COULD PROBABLY LEAD TO MORE IN TERMS OF GOVERNMENT INCENTIVE OF BOOSTING SERVICE CONSUMPTION. NOT THE LARGE TICKET ITEMS WE

CONSUMPTION. NOT THE LARGE TICKET ITEMS WE HAVE SEEN IN THE LAST YEAR. DAVID:

I WAS ACTUALLY GOING TO ASK YOU IN WHAT FORM DO YOU THINK WE WILL STILL SEE THE CONSUMER ORIENTED SUBSIDIES.

A FINAL QUESTION FOR YOU, WE HAVE SEEN THE CHINESE CURRENCY ON VERY STRONG FOOTING RECENTLY. DO YOU THINK SOMETHING HAS CHANGED IN TERMS OF CURRENCY BIAS IS CONCERNED?

WHAT DO YOU THINK OF THIS STRENGTH AND CURRENCY?

>> I DO SEE THE NARRATIVE SHIFTING.

NOW WE ALMOST SEE A KIND OF REBOUND.

FROM EVALUATION PERSPECTIVE, IT IS EXTREMELY COMPETITIVE.

IT IS AN EXTREMELY LOW VALUATION.

WE HAVE SEEN A LONG STRETCH OF DEPRECIATION.

THE LARGEST SINCE THE 1990'S.

WE ARE JUST LOOKING FOR A CATALYST.

THE U.S. DOLLAR IS SOFTENING A LITTLE BIT. RATE CUTS ARE BACK IN PLAY. WE ARE EXPECTING SOME

BIT. RATE CUTS ARE BACK IN PLAY. WE ARE EXPECTING SOME CONVERSION BACK INTO CHINESE AS FAR AS CASH FLOW.

WE DO SEE APPRECIATION SPEEDING UP. DAVID:

SORRY, WE ARE AT A TIME. THANK YOU SO MUCH.

PLENTY MORE AHEAD. ♪

YVONNE: WELCOME. HERE IS A LOOK A HALF-HOUR INTO THE SESSION. WE ARE SEEING GAINS OF ABOUT 1%.

THE SESSION. WE ARE SEEING GAINS OF ABOUT 1%.

THIS RALLY SEEMS TO HAVE GAINED MORE TRACTION IN THE LAST COUPLE MINUTES, ASSUMING THAT IS A GOOD WAY TO START YOUR MONDAY MORNING. WE ARE LOOKING AT GOLD AND

MONDAY MORNING. WE ARE LOOKING AT GOLD AND PRECIOUS METALS THAT CONTINUE TO RALLY.

COPPER IS DOING WELL THIS MORNING. DAVID:

IT WAS A BIG MOMENT INTO THE WEEKEND.

AND ACTUALLY CONTINUED GOING INTO THIS MORNING.

SILVER, ONE OF THE FIRST THINGS I SAW LATE FRIDAY WAS AT ABOUT THIS LEVEL. RECORD COPPER. I THINK WE SHOULD ALSO BE THE

THIS LEVEL. RECORD COPPER. I THINK WE SHOULD ALSO BE THE HIGHEST -- AT LEAST MY DATA TELLS ME -- THE HIGHEST SINCE 1999. IF WE CLOSE AT THIS LEVEL ON

1999. IF WE CLOSE AT THIS LEVEL ON COPPER IN SHANGHAI. THE REASON I PHRASE IT THAT WAY, I THINK INTRADAY BACK ABOUT A MONTH AND A HALF AGO, OCTOBER 10, WE WERE TRADING AT 91,000 VERY BRIEFLY ON COPPER.

OF COURSE, THE EQUITY MARKET NAMES ARE TIED TO THOSE NAMES, INCLUDING JIANGXI COPPER. YVONNE:

COPPER PRICES IS ONE THING, BUT THERE HAS BEEN THIS ONGOING TAKEOVER BID FROM THE COMPANY WHEN IT COMES TO SEOUL GOA LD.

WE HEARD THAT THEY HAD REJECTED THE TAKEOVER.

NOW WE ARE HEARING IT IS AT THE INFORMAL STAGE.

WE WILL SEE IF THERE WILL BE AN INFORMAL OFFER OF SEOUL GO LD.

DAVID: IN THE LAST HOUR, WE HEARD FROM THE GOVERNOR, A HAWKISH TONE. NOTHING NEW, BUT IN MANY WAYS VERY HAWKISH BASED ON THE HEADLINES THAT HAVE COME THROUGH. BEFORE THAT, THE TWO YEAR YIELD

THROUGH. BEFORE THAT, THE TWO YEAR YIELD OPEN, IF I'M NOT MISTAKEN, RIGHT BELOW, BUT WE ARE NOT TRADING ABOVE 2000. WE ARE GOING THE OPPOSITE WAY AS FAR AS THE EQUITY MARKET GOES. DOLLAR-YEN STRENGTHENED -- DROPPED FOLLOWING THE COMMENTS COMING OUT OF GOVERNOR UEDA.

A BIG WEEK AS FAR AS MONETARY POLICY IS CONCERNED. YVONNE:

DECEMBER 19 IS THE NEXT BOJ MEETING, SO THE SPECULATION IS RAMPANT. LET'S BRING IN RUTH CARSON.

RAMPANT. LET'S BRING IN RUTH CARSON.

THE YEN POPPING HIGHER ON THE BACK OF THE COMMENTS.

HOW ARE INVESTORS POSITIONING ON THE YEN? RUTH: ABSOLUTELY.

SO MACRO DRIVEN, SO SENSITIVE AT THE MOMENT TO EVERYTHING UEDA IS SIGNALING TO THE MARKETS, AND HOW ARE INVESTORS READING WHAT IS COMING OUT? THE DOOR IS OPEN TO A RATE HIKE IN A COUPLE OF WEEKS. AND IF WE LOOK AT WHAT SWAPS

ARE INDICATING, CHANCE OF A HIKE IN DECEMBER, 60%.

IN JANUARY, THAT NUMBER GOES UP TO 90%.

CLEARLY A RATE HIKE IS ON, ACCORDING TO THE RECORD TRADERS.

WHAT DOES THAT BODE FOR THE YEN? IT IS A POSITIVE.

WE KNOW DOLLAR-YEN HAS BEEN HOVERING AROUND 156.

IT HAS BROKEN NOW TO BELOW 155 ODD. IS THERE ROOM FOR THIS TO CONTINUE? WELL, IF SWAP MARKETS ARE TO BE

CONTINUE? WELL, IF SWAP MARKETS ARE TO BE BELIEVED, ABSOLUTELY. WE DO SEE A STRONGER YEN

BELIEVED, ABSOLUTELY. WE DO SEE A STRONGER YEN TRADING AHEAD. DAVID:

TRADING AHEAD. DAVID: RELATED TO THIS STORY, JGB IS ALSO SEEING SOME PAIN.

I THINK WE REFERENCED THE TWO YEAR YIELD NOW HAS 1%.

I DON'T THINK WE HAVE SEEN THAT IN A GENERATION OR CLOSE TO IT AT LEAST HERE. WHAT ARE BOND INVESTORS SIGNALING AS FAR AS THE MELT IN YIELDS? RUTH:

IT IS ECHOING A SIMILAR STORY WE ARE SEEING IN THE END.

RATE HIKES GENERALLY GOOD FOR THE CURRENCY.

RATE HIKES GENERALLY NOT SO GOOD FOR THE POLICY SENSITIVE END OF CURBS, IN THIS CASE DEFINITELY FOR THE TWO-YEAR JGB YIELD, WHICH AS YOU POINTED OUT IS AROUND THE HIGHEST LEVELS WE HAVE SEEN SINCE THE 2008 FINANCIAL CRISIS.

INVESTORS ARE WEIGHING WHETHER THIS HAS ROOM TO RUN.

DEPENDING ON WHO YOU SPEAK TO AN MARKETS, THE WIDOW MAKER TRADE SHORTING JGB'S HAS BEEN VERY LUCRATIVE, PARTICULARLY FOR THE HEDGE FUNDS THAT HAVE BEEN DOING CURVE TRADES.

I DEFINITELY SEE THE SPACE, A LOT OF OPPORTUNITY TO RUN.

YVONNE: THERE HAS BEEN A LOT IN TERMS OF SPECULATION IN TERMS OF WHO WILL BE THE NEXT FED CHAIR.

WE HEARD FROM PRESIDENT TRUMP SAYING HE HAS MADE HIS PICK ON WHO WILL LEAD THE FEDERAL RESERVE.

I WANT TO TAKE A LISTEN, ON THE BACK OF KEVIN HAZLETT, WHO SEEMS TO BE A LIKELY CONTENDER.

>> WE HAD A GREAT TREASURY AUCTION.

INTEREST RATES WENT DOWN. I THINK THE AMERICAN PEOPLE CAN EXPECT PRESIDENT TRUMP TO PICK SOMEONE WHO WILL HELP THEM HAVE CHEAPER CAR LOANS AND EASIER ACCESS TO MORTGAGES AT LOWER RATES, AND THAT IS WHAT WE SAW IN THE MARKET RESPONSE.

>> THE FED CHAIR, ARE YOU ANY CLOSER ON THAT?

>> I KNOW WHO I'M GOING TO PICK. >> IS IT KEVIN HASSETT?

>> WILL NOT GOING TO TELL YOU. -- I'M NOT GOING TO TELL YOU.

YVONNE: LIVING US ALL HANGING. I KNOW BUT I'M NOT GOING TO TELL YOU. IS THAT WHAT IS CONTRIBUTE INTO

TELL YOU. IS THAT WHAT IS CONTRIBUTE INTO THE DOLLAR WEAKNESS WE HAVE SEEN? RUTH:

IT IS DEFINITELY ONE OF THE FACTORS THAT WILL BE INFLUENCING DOLLAR AND TREASURIES TRADING.

IT IS VERY MUCH TALKED ABOUT. IT IS HARD TO COME TO YOUR DESK ONE DAY WITHOUT SOMEONE GOING, HAVE YOU HEARD ABOUT WHO THE LATEST FED CHAIR WOULD BE? DEFINITELY AN INFLUENCER.

WE KNOW HOW ASSET -- WE KNOW HOW ASSETT.

THERE ARE QUESTIONS AROUND CENTRAL BANK INDEPENDENCE AND ALSO THE RATES TRAJECTORY OF THE U.S..

DEFINITELY A CLOSE SPACE TO WATCH.

IT IS AN INFLUENCING FACTOR ON THE DOLLAR, TO GET LILY THE SHORT-TERM.

DAVID: THANK YOU. RUTH CARSON IN SINGAPORE FOR US.

IT IS A QUIET PERIOD AHEAD FROM THE FED DECISION.

WHEN YOU LOOK AT PRICING, IT SEEMS THAT THEY WILL NOT NEED FURTHER NUDGING. WE PRICED MORE THAN A FULL LATE

FURTHER NUDGING. WE PRICED MORE THAN A FULL LATE CUT COMING THROUGH IN ABOUT 10 DAYS OR SO.

FROM THAT STORY OF DOLLAR WEAKNESS ACROSS MARKETS ON MONDAY, GOVERNOR UEDA JUST WRAPPING UP THAT LIFE SPEECH.

TALKING ABOUT THEY WILL MOVE IF AND WHEN THE ECONOMY TELLS THEM IT IS WISE TO MOVE. THAT IS ALSO JUST SAY THE WEAKNESS IN THE CURRENCY MIGHT ACTUALLY BE HELPING THEM AS FAR AS INFLATION GOES. FX COULD BE A FACTOR TO BOOST INFLATION, ACCORDING TO THE BOJ GOVERNOR.

WE WILL TAKE A SHORT BREAK AND WE WILL SEE YOU ON THE OTHER SIDE OF IT. THIS IS BLOOMBERG. ♪ YVONNE:

TALKING ABOUT THOSE MEITUAN EARNINGS IN A BIT, BUT YOU LOOK AT THIS WHOLE CAMPAIGN TO REIN IN PRICE WARS AND BLUNT DEFLATION HAS DONE LITTLE TO LIFT QUARTER EARNINGS AS CHINESE STOCKS EXTEND LOSSES INTO A SECOND MONTH.

LET'S BRING IN OUR ASIAN EQUITIES REPORTER ON WHAT HER TEAM HAS BEEN SEEING IN TERMS OF THIS ANTI-EVOLUTION CAMPAIGN.

IT IS NOT HELPING ALL SECTORS, IT SEEMS. >> NOT REALLY. IT IS

THE SAME MORNINGS WE HEARD IN AUGUST. THE IRRATIONAL

COMPETITION IN THE DOMESTIC MARKET THAT HAS BEEN WEIGHING DOWN ON EARNINGS AND STOCK PRICE.

IT IS THE WORST PERFORMING STOCK AMONG HANG SENG TECH INDEXES THIS YEAR. THE STOCK IS DOWN ABOUT 30% YTD.

IT SPEAKS FOR ITSELF. THE PRICE WHERE WE ARE SEEING, -- THE PRICE WAR WHAT WE ARE SEEING.

THERE IS ONE PIE AND EVERYBODY IS TRYING TO TAKE SHARE OF IT.

MORNINGSTAR SAYS THAT MEITUAN FROM OVER 70% OF THE VALUE THEY HAD ON DEMAND AND FOOD DELIVERY MARKET, THEY SEE ABOUT 55% SHRINKING.

FOR ALIBABA, THEY SEE AN UPGRADE FROM 21% TO 40%.

WE WILL BE SEEING MORE OF A DUAL MARKET IN THE DELIVERY BUSINESS. DAVID: THANK YOU SO MUCH.

BUSINESS. DAVID: THANK YOU SO MUCH.

SANGMI CHA OUT OF OUR ASIA EQUITIES TEAM, TAKING US THROUGH THE BIG EARNINGS AND HOW WE ARE SET UP FOR NEXT YEAR.

IT BRINGS TO MIND SOMETHING EVA LI WHO JOINED US ABOUT 40 MINUTES BACK TALKED ABOUT EARNINGS.

AS A GROUP, HANG SENG TECH, YOU HAVE THE EV'S AND CHIPMAKERS, IT IS AT A VERY LOW BASE THIS YEAR.

IT WAS TOO AROUND YOUR QUESTION ABOUT RE-RATING.

SHE SAID, IT IS GOING TO BE LIKELY A 30% IMPROVEMENT IN EARNINGS NEXT YEAR. A LOT OF THAT IS DOWN TO A LOW BASE EFFECT, SO KEEP THAT IN MIND AS WE TRY TO EXTRAPOLATE MULTIPLES AND WHERE THEY SHOULD BE GOING INTO NEXT YEAR.

ON THAT VERY SPECIFIC NOTE, THAT WAS NOT JUST RANDOM, LET'S BRING IN CHINA TECH ANALYST AT BARCLAYS, JOINING US THIS SUNDAY EVENING. THANK YOU FOR STAYING UP AND WE

SUNDAY EVENING. THANK YOU FOR STAYING UP AND WE APPRECIATE THE TIME. NICE TO SEE YOU.

WE ARE DONE WITH EARNINGS. BEFORE WE GET GRANULAR, ANY BROAD TAKEAWAY ON A SECTOR LEVEL? JIONG: GOOD MORNING.

FIRST OFF, THANK YOU FOR HAVING ME. THERE IS A LOT TO TALK ABOUT OBVIOUSLY FOR THE SECTOR COME FOR THE EARNINGS.

IT IS OFTEN TIMES HARD TO GENERALIZE, BUT I THINK THE EARNINGS SEASON HAS BEEN PRETTY GOOD SINCE THE FOURTH QUARTER LAST YEAR. THAT BEING SAID, I THINK WE ARE

LAST YEAR. THAT BEING SAID, I THINK WE ARE CLEARLY SEEING SOME SIGNS OF SOME HEADWINDS AHEAD FOR 2026.

WE CAN GO INTO DETAILS A BIT LATER.

JUST FOR THE EARNINGS SEASON ITSELF, MOST COMPANIES REPORTING PRETTY GOOD EARNINGS. IF YOU LOOK AT TENCENT, ALIBABA, THE TWO TECH LEADERS FOR THE GROUP.

THEY HAD PRETTY GOOD EARNINGS, ESPECIALLY TENCENT.

ALIBABA HAD A VERY STRONG AI CLOUD GROWTH.

BUT NOT EVERY SINGLE COMPANY HAD GREAT RESULTS.

FOR EXAMPLE, MEITUAN YOU WERE JUST TALKING ABOUT THE COMPANY EARLIER IN THE PROGRAM. WE HAVE HAD AN UNDERWATER RATING ON THE COMPANY THE LAST THREE YEARS FOR MULTIPLE REASONS. I WON'T GO INTO THE NUANCES IN

REASONS. I WON'T GO INTO THE NUANCES IN TERMS OF THE COMPETITION FOR THE FOOD DELIVERY BUSINESS.

IF YOU WANT TO DIG DEEPER INTO THAT AREA. YVONNE:

I THINK LET'S GO THERE BECAUSE YOU MENTIONED ABOUT THE NUANCES.

SOME HAVE TALKED ABOUT HOW WE HAVE SEEN THE WORST OF THE PRICE WARS IN THE E-COMMERCE SPACE.

ARE YOU SEEING ANY SIGNS OF THAT IMPROVING NEXT YEAR? JIONG:

WE COULD BE BOTH SEEING THE WORST IN Q3 WHERE MEITUAN LOST ROUGHLY $2 BILLION U.S.

IN A SINGLE QUARTER, BUT THE LOSS, IT WILL GRADUALLY IMPROVE GOING FORWARD. THE PROBLEM FOR MEITUAN IS NOT

GOING FORWARD. THE PROBLEM FOR MEITUAN IS NOT SO MUCH ABOUT NEAR TERM BECAUSE THE COMPANY USED TO HAVE ALMOST A MONOPOLY POSITION IN THE INDUSTRY.

80% MARKET SHARE, 25% OPENING MARGIN.

BUT AS SOON AS THEY WANTED TO GET INTO THE INDUSTRY AND THE BUSINESS, THEN ALIBABA DECIDED TO COME BACK STRONG TO GET BACK ITS LOSS THE LAST FIVE YEARS. NOW THE INDUSTRY DYNAMIC HAS CHANGED COMPLETELY.

NOW ALIBABA HAS, AT 40%, 50% MARKET SHARE.

A LITTLE BELOW MEITUAN'S. BUT THE ISSUE FOR MEITUAN'S ALIBABA NEVER NEEDS TO MAKE ANY MONEY AND FOOD DELIVERY.

THEY WILL BE HAPPY JUST TO BREAK EVEN BECAUSE THEY MAKE MONEY FROM THE OTHER E-COMMERCE TRANSACTIONS FROM THEIR CUSTOMERS. BUT THAT IS THE ONLY BUSINESS

CUSTOMERS. BUT THAT IS THE ONLY BUSINESS FOR MEITUAN, MORE OR LESS, SO THEY HAVE TO MAKE MONEY.

SO YOU HAVE A VERY CLOSE TO NUMBER TWO PLAYER NOT NEEDING TO MAKE ANY MONEY. THEN YOU'VE GOT A PROBLEM.

YOUR MARGIN WILL NEVER GO BACK TO THE WAY IT WAS A COUPLE YEARS AGO. DAVID:

YEARS AGO. DAVID: LET ME JUST ASK AN OPEN-ENDED QUESTION.

YOU MENTION IT IS NOT A SHORT-TERM ISSUE FOR MEITUAN, IT IS LONG-TERM. WHAT DOES THE FUTURE LOOK LIKE FOR A PURE PLAYER LIKE MEITUAN? AND I WILL LEAVE IT OPEN-ENDED FOR HOW YOU WANT TO ANSWER THE QUESTION. JIONG: SURE.

THANK YOU, DAVID. WE HAVE ALWAYS SAID, WHAT WILL STOP ALL THE LEADING PLAYERS TO BE MORE RATIONAL IN SUBSIDIZING?

WE HAVE SAID THE ONLY WAY THESE PLAYERS WILL BECOME MORE RATIONAL IS WHEN THEY BELIEVE, NO MATTER WHAT THEY DO, THEIR MARKET SHARE WILL NOT GO UP. THEN THE NEXT QUESTION BECOMES, WHAT IS THE EQUILIBRIUM MARKET SHARE AMONG THE THREE PLAYERS?

THIS IS JUST A SCENARIO. IT DOESN'T HAVE TO BE THE SCENARIO. PERHAPS MEITUAN HAS 50% MARKET

SCENARIO. PERHAPS MEITUAN HAS 50% MARKET SHARE, ALIBABA HAS 40%.

LET'S JUST ASSUME EVERYBODY IS KIND OF HAPPY WITH THIS, OR AT LEAST CANNOT DO TOO MUCH ABOUT IT.

WHEN THAT HAPPENS, EVERY PLAYER SHOULD SCALE BACK ON THEIR DISCOUNTING. BUT THAT DOES NOT SOLVE THE

DISCOUNTING. BUT THAT DOES NOT SOLVE THE FUNDAMENTAL PROBLEM FOR MEITUAN. EVEN WHEN THAT STABILIZES, MEITUAN'S PROFITABILITY OR MARGIN WILL NEVER GO BACK TO 24%, EVER. BECAUSE BY THE WAY, BEFORE

24%, EVER. BECAUSE BY THE WAY, BEFORE ALIBABA CAME BACK TO THE MARKET STRONG, MEITUAN MADE MORE MONEY THAN ANY OTHER FOOD DELIVERY COMPANY IN THE WHOLE WORLD.

NOT JUST IN CHINA.

, SO, MEITUAN HAS PROBABLY OVER EARNED IN THE FOOD DELIVERY BUSINESS UNTIL LAST YEAR.

EVEN IN AN EQUILIBRIUM STATE, MEITUAN'S ABILITY TO MAKE MONEY IS STRUCTURALLY LOWERED. YVONNE: AND WHETHER THERE ARE STILL THE REMAINING MODES TO THEIR BUSINESS WILL BE A KEY QUESTION LONGER-TERM.

I WANT TO GET YOUR TAKE ON THE WHOLE ALIBABA STORY.

YOU MENTIONED, ALIBABA IS NOT GOING TO MAKE MONEY AND FOOD DELIVERY -- DOES NOT NEED TO MAKE MONEY AND FOOD DELIVERY TO DO WELL.

IS THAT GOING TO BE THE CASE WHERE INVESTORS CAN LOOK PAST WEEK EARNINGS AND FOCUS ON THE AI POTENTIAL AROUND ALIBABA AND SOME OF THESE BIG TECH NAMES? JIONG:JIONG:

FOR THE TIME BEING, FOR SURE. ALIBABA'S CEO SAID ON A PUBLIC CALL THEY SIMPLY DO NOT SEE THE AI BUBBLE FOR THE NEXT COUPLE YEARS, WHICH PROBABLY IS TRUE. THAT BEING SAID, GLOBALLY THERE

IS ONGOING DEBATE ABOUT WHETHER OR NOT -- WHICH INNING ARE WE IN A POTENTIAL AI BUBBLE?

AND I THINK FOR ME, WHO PERSONALLY WENT THROUGH THE DOT-COM BUBBLE BACK IN THE DAY, AT THE END OF THE DAY, THE SUCCESS AND ADOPTION OF AI INDUSTRY OR ANY INDUSTRY IS REALLY DEPENDING ON TWO GROUPS, ENTERPRISES AND CONSUMERS.

END OF STORY. THERE IS NO THIRD GROUP I CAN THINK OF. THEY DO NOT EXIST. BUT FOR

THINK OF. THEY DO NOT EXIST. BUT FOR

ENTERPRISES, THEY NEED TO MOVE BEYOND INITIAL PILOTING, TRIALING, PLAYING AROUND. THEY REALLY NEED TO ADOPT AI AS PART OF THE BUSINESS PROCESSES. AS WE ALL KNOW, CHINA HAS NOT HAD A BIG SOFTWARE INDUSTRY. IT IS NOT AN EASY TASK TO

CONVINCE THESE ENTERPRISES TO GIVE YOU THE MONEY TO BUY YOUR PRODUCT TO HELP THE BUSINESS PROCESSES.

THEY MIGHT AS WELL GO HIGHER ANOTHER HUNDRED ENGINEERS TO DO IT. FOR CONSUMERS, IT IS THE SAME

IT. FOR CONSUMERS, IT IS THE SAME THING. IN CHINA, IT IS IMPOSSIBLE TO

THING. IN CHINA, IT IS IMPOSSIBLE TO CHARGE CONSUMERS FOR A FEE FOR A APP LIKE CHATGPT.

YOU PAY THEM $20, 30 DOLLARS, $50, DEPENDING ON WHICH VERSION, AND THAT MARKET EXISTS IN AMERICA BUT IT PROBABLY DOESN'T EXIST IN CHINA. THEY NEED TO ADDRESS THAT PROBLEM IF NOT IN 2026, IT NEEDS TO BE ADDRESSED IN 2027 BEFORE WE ALL GET SUPER EXCITED ABOUT AI. DAVID:

JIONG SHAO, YOU BEING IN NEW YORK IS THE BEST POSITION TO LOOK AT BOTH SIDES OF THE TECH ARGUMENT.

A LOT OF PEOPLE WE TALK TO TALK ABOUT HOW CHINA IS PURSUING THIS DIFFERENT MODEL FOR AI. MY QUESTION FOR YOU IS, DID THE CONCEPT OF HYPERSCALERS, DOES THAT EXIST IN CHINA?

AND DO YOU THINK WE SHOULD GET THE SAME AMOUNT OF EYE-POPPING CAPEX WE ARE GETTING OUT OF SOME OF THE U.S. COMPANIES?

DO YOU THINK THAT IS IN THE FUTURE FOR CHINESE TECH OR IS THAT NOT IN THE FUTURE BECAUSE THEY ARE PURSUING A DIFFERENT MODEL? JIONG: THE U.S.

AND CHINA ARE TWO WORLD SUPERPOWERS IN AI.

OF COURSE, IN OTHER THINGS AS WELL, BUT IN AI IN PARTICULAR.

BUT THERE WILL BE SOME DIFFERENCES.

WE AT BARCLAYS, WE DON'T THINK THE HYPERSCALER MODEL WORKS IN CHINA. FOR THE EXACT REASON I JUST

CHINA. FOR THE EXACT REASON I JUST MENTIONED. THE REASONS THEY ARE HYPERSCALERS HERE IN THE U.S.

MENTIONED. THE REASONS THEY ARE HYPERSCALERS HERE IN THE U.S.

IS BECAUSE THE U.S. HAS ALWAYS HAD A VERY LARGE ENTERPRISE SOFTWARE INDUSTRY.

LATER ON, THEY HAD A VERY LARGE SAAS AS A SERVICE INDUSTRY.

YOU HAVE MANY OTHER SOFTWARE IS RUNNING ON THESE HYPERSCALERS.

BUT THEY ARE ON THE OTHER SIDE OF THE OCEAN AND CHINA HAS NEVER HAD A SOFTWARE OR SAAS, SO THERE WAS NO NEED FOR HYPERSCALERS.

BEFORE CHINA NEEDS TO HAVE A HYPERSCALER OR HYPERSCALER INDUSTRY, THEY REALLY NEED TO HAVE ENTERPRISES.

TO ADOPT AI, TO START, I THINK THAT WILL BE THE FIRST CHALLENGE FOR THE CHINESE AI PLAYERS TO OVERCOME.

I DOUBT WE ARE GOING TO SEE THIS 100 BILLION DOLLARS, $50 BILLION ANNUAL FOR ANY OF THESE COMPANIES.

AS YOU MAY RECALL, IN TENCENT'S RESULTS, IT WAS LOWER THAN EXPECTED AND LOWER THAN A YEAR AGO. YVONNE:

BEFORE WE GO, GIVEN YOUR COVERAGE, WHAT ARE THE TOP PICKS AROUND THE AI STORY?

HOW DO WE POSITION MOVING ON FROM HERE? YVONNE:

THERE ARE SEVERAL KEY PLAYERS -- JIONG: THERE ARE SEVERAL KEY PLAYERS LIKE OPENAI.

BUT THEY ARE PUBLIC COMPANIES, SUCH AS GOOGLE, WHICH SEEM TO HAVE COME FROM BEHIND. IT IS REALLY MAKING STRIDES.

IN CHINA, IN OUR VIEW, ALIBABA WITHOUT A DOUBT IS THE LARGEST AI PLAYER WITH A FULL STACK GOING FROM CONSUMER END AND INTO THE VARIETY OF MODELS.

I THINK CHINESE ENTERPRISES, IT WORKS FOR THEM TO ADOPT AI VIA U.S. ENTERPRISES BECAUSE THE COST IS

U.S. ENTERPRISES BECAUSE THE COST IS MUCH LOWER AND CHINA -- IN CHINA THAN THE U.S.

IN SOME CASES, 90% LOWER.

IT IS MUCH LOWER AND WIDELY AVAILABLE.

CHINA HAS THAT ADVANTAGE WORKING FOR THEM.

BUT THE DISADVANTAGE THEY HAVE NOT HAD A SAAS AND SOFTWARE INDUSTRY. BUT BEYOND AI, YOU WERE TALKING

INDUSTRY. BUT BEYOND AI, YOU WERE TALKING ABOUT 2026, WE THINK THE BIGGEST ISSUE WE MAY BE FACING FOR ALL THE TECH COMPANIES AND MAYBE A LOT OF OTHER COMPANIES AS WELL IS THAT IN 2025 WE HAVE HAD THE GOVERNMENT SUBSIDIES,

THE TRADING SUBSIDIES AND ALL THE OTHER TAX BREAKS.

EVEN IF YOU RENEW THAT FOR 2026, YOU NO LONGER HAVE THAT BUMP UP EFFECT ANYMORE. SO, WE ARE STARTING TO SEE COMPANIES START TO SHOW SOME WEAKNESS IN THE Q3 RESULTS BECAUSE OF THE LAPPING EFFECT. YVONNE: THANK YOU SO MUCH.

LET US KNOW THE NEXT TIME YOU'RE IN THE REGION.

JIONG SHAO JOINING US THIS EVENING.

TAKE A LOOK AT GAINS HERE. WE ARE OFF SOME OF THE INITIAL HIGHS WHEN IT COMES TO THE HANG SENG, BUT UP STILL 165 POINTS.

HSTECH WITH SOME LIFE. THE CSI 300 UP ALSO.

THIS IS BLOOMBERG. ♪

DAVID: A BRIEF PREVIEW OF SOME KEY EVENTS. OBVIOUSLY NOT A FULLY EXHAUSTIVE LIST OF THINGS TO

EVENTS. OBVIOUSLY NOT A FULLY EXHAUSTIVE LIST OF THINGS TO WATCH. IF I HAD TO PICK A COUPLE THINGS OUT, WE WILL TALK ABOUT

WATCH. IF I HAD TO PICK A COUPLE THINGS OUT, WE WILL TALK ABOUT TRADE IN A MOMENT. WE HAVE PCU ON FRIDAY.

GIVEN THE MOVES WE ARE SEEING IN THE JGB MARKET, YOU HAVE THE 10 ON TUESDAY AND THE 30 YEAR YIELD COMING THROUGH ON THURSDAY AS WELL. RIGHT DECISIONS, ARE B.I..

WE WILL TALK MORE ABOUT THE FED IN THE COMING DAYS OR SO.

YVONNE: IN TERMS OF THE DATA FRONT, THAT IS FRONT AND CENTER HERE. WHEN IT CAME TO ASIA, THE EXPORTS FROM KOREA LOOK PRETTY STRONG.

BUT IT WAS THE PMI DATA OVER THE WEEKEND OUT OF CHINA.

ALL SIGNALING CONTRACTION. 49.2 FOR MANUFACTURING, AN EIGHTH STRAIGHT MONTH OF CONTRACTION.

THAT IS A RECORD LOSING STREAK. THE PRIVATE GAUGE ALSO SUB 50.

DAVID: QUITE A BIG MISS. A WHOLE SLEW OF NUMBERS COMING THROUGH OUT OF JAPAN. DO WE HAVE THE GRAPHIC?

WE WILL SHOW YOU THEM. THIS IS BLOOMBERG.

♪ YVONNE: HONG KONG IS MORNING THE VICTIMS OF THE CITY'S DEADLIEST FIRE IN 30 YEARS. THIS WAS THE SCENE NEXT TO WANG FUK COURT. AT LEAST 146 PEOPLE WERE KILLED

FUK COURT. AT LEAST 146 PEOPLE WERE KILLED IN THE FIRE. HONG KONG OFFICIALS HELD THREE MINUTES OF SILENCE FOR THE VICTIMS ON SATURDAY.

CONDOLENCE POINTS HAVE BEEN SET UP IN ALL OF THE CITY'S 18 DISTRICTS FOR MEMBERS OF THE PUBLIC TO SIGN BOOKS AND PAY THEIR RESPECTS TO THE VICTIMS AND SURVIVORS.

>> GOOD EVENING, LADIES AND GENTLEMEN.

PLEASE RISE AND JOIN ME. A MINUTE OF SILENCE.

YVONNE: VETERAN HONG KONG ACTOR CHOW YUN FAT LED A MOMENT OF SILENCE AT THE MAMA AWARDS IN HONG KONG.

THE MUSIC CEREMONY WHEN AHEAD BUT ORGANIZERS CANCELED THE EARLIER RED CARPET EVENT FOR CONSIDERATION OF THOSE AFFECTED BY THE FIRE. BUT IT WAS CERTAINLY VERY TOUCHING MOMENT FOR THOSE THAT WERE THERE. DAVID:

TOUCHING AND TRYING, TO UNDERSCORE THE CHALLENGING LAST FEW DAYS THEY HAVE HAD GOING INTO THE WEEK.

WE ARE CONTINUING TO BE ON TOP OF THE STORY HERE.

LET'S BRING IN OUR TEAM ONSET.

MINMIN LOW ALONGSIDE STEVEN LAM. LET'S START WITH YOU.

WHY DON'T YOU GET US STARTED? MINMIN:

THE WEEKEND GIVE US A LITTLE TIME TO DIGEST WHAT HAPPEN.

THERE HAS BEEN AN OUTPOURING OF GRIEF AND SUPPORT.

YOU LOOK AT THE SPECIAL FUND THE GOVERNMENT HAS SET UP.

THE GOVERNMENT INITIALLY PUTTING 300 MILLION HONG KONG DOLLARS. IT HAS NOW BALLOONED TO $1.2

DOLLARS. IT HAS NOW BALLOONED TO $1.2 BILLION, A LOT OF IT COMING FROM PRIVATE DONATIONS, FROM MEMBERS OF THE PUBLIC, AND THAT IS WHY THE GOVERNMENT SAID THEY ARE INCREASING THE AMOUNT OF LIVING ALLOWANCE THEY ARE GIVING TO THE VICTIMS. INITIALLY THEY WERE HANDING OUT $10,000 PER FAMILY. THEY ARE GIVING OUT AN

ADDITIONAL 15,000 HONG KONG DOLLARS TO THE FAMILIES AS WELL, AND THEY WILL CONTINUE TO PROVIDE LONGER-TERM SUPPORT.

OVER THE WEEKEND, WE SAW LONG QUEUES AT THE SIDE OF THE FIRE.

BUT WHAT WAS DIFFERENT OVER THE WEEKEND WAS THE DISTRIBUTION CENTER THAT I WAS AT LAST WEEK HAS NOW BEEN COMPLETELY CLEARED OF VOLUNTEERS BECAUSE THE AUTHORITIES TOLD THEM TO CLEAR OUT. THEY ARE TAKING OVER THE

OUT. THEY ARE TAKING OVER THE OPERATIONS, MOVING THEM ONLINE IN ORDER TO CREATE EFFICIENCY.

AT THE SAME TIME, THE OFFICE OF NATIONAL SECURITY HAD ALSO ISSUED WARNINGS AGAINST ANYONE TRYING TO USE THIS FIRE TO INCITE UNREST. THE NATIONAL SECURITY POLICE ARRESTED THREE

INCITE UNREST. THE NATIONAL SECURITY POLICE ARRESTED THREE PEOPLE, INCLUDING AN UNNAMED VOLUNTEER, AS WELL AS A FORMER DISTRICT COUNSELOR AND SOMEONE WHO STARTED AN ONLINE PETITION CALLING FOR THE GOVERNMENT TO DO MORE FOR THE VICTIMS. YVONNE: IT GOES TO SHOW THE SENSITIVITY AROUND THIS ISSUE. MINMIN:

IT REALLY SPEAKS TO SOME OF THE UNDERLYING TENSIONS THAT ARE SIMMERING, ESPECIALLY GIVEN THE CHANGES HONG KONG HAS GONE THROUGH OVER THE PAST YEARS WITH THE IMPOSITION OF A NATIONAL SECURITY LAW, AND PERHAPS THE PUBLIC GATHERING OF MANY PEOPLE, ORGANIZING DIFFERENT GOODS, THERE IS SOME FEAR IT SEEMS FROM THE GOVERNMENT THAT COULD SPILL OVER INTO SOMETHING MORE SERIOUS, ESPECIALLY WHEN SOMETIMES THE LINE BETWEEN GRIEF AND ANGER IS NOT THAT

CLEAR. ESPECIALLY GIVEN THAT A LOT OF

CLEAR. ESPECIALLY GIVEN THAT A LOT OF NEW FACTS HAVE EMERGED AND IT SEEMS THERE ARE LAPSES ON MANY DIFFERENT PARTIES, NOT JUST THE ENGINEERING COMPANIES, BUT ALSO IT TURNS OUT MANY OF THE RESIDENTS HAD PUT IN COMPLAINTS TO THE DEPARTMENT OF LABOR AS EARLY AS 2024.

AND THE DEPARTMENT OF LABOR NOW SAYS THEY ACKNOWLEDGE THEY HAD MISTAKENLY DISMISSED SOME OF THESE CONCERNS.

AT THE TIME, THEY SAID THERE WERE NO LAWS GOVERNING FIRE SAFETY WHEN IT COMES TO THE SCAFFOLDING.

EVENTUALLY, THEY SAID THE MATERIALS USED WERE IN COMPLIANCE, WERE COMPLIANT WITH HONG KONG RULES, CITING THE DOCUMENTS ADMITTED BY THE CONTRACTORS.

BUT NOW THERE IS A TASK FORCE INVESTIGATING THE CAUSE OF THE FIRE, WHY DID IT SPREAD SO QUICKLY, BECAUSE THEY'RE OBVIOUSLY THINGS THAT SHOULD NOT BE THERE LIKE THE STYROFOAM BOARDS CEILING THE WINDOWS, THE SHEETS THAT ARE ALSO NONCOMPLIANT AS WELL. DAVID: DO WE HAVE A BETTER SENSE OF THE TIMELINE AUTHORITIES WILL NEED TO CONDUCT THEIR INVESTIGATION ACROSS THESE MULTIPLE FRONTS FOR US TO BE ABLE TO FIGURE OUT WHO WAS RESPONSIBLE, AND MAY BE

SEPARATELY, WHO IS LIABLE? YVONNE:

THE AUTHORITIES TOLD US THEY WILL NEED THREE TO FOUR WEEKS TO COMPLETE THE INVESTIGATION. CURRENTLY, THEY HAVE ALREADY ARRESTED 11 PEOPLE, INCLUDING CONSULTANTS, SUBCONTRACTORS RELATED TO THE SCAFFOLDING COMPANY, INCLUDING AN INTERMEDIARY AS WELL. MANY PARTIES ARE INVOLVED BECAUSE NOW THEY ARE SAYING THE MESH, ORIGINALLY THE GOVERNMENT

SAID THE SPEED OF THE FIRE WAS SPREADING UNUSUALLY FAST ON THE MESH, BUT NOW THEY SAY ACTUALLY THE MESH HAD MET COMPLIANCE STANDARDS AND IT WAS THE STYROFOAM BOARDS, AND IN ONE BUILDING THEY FOUND THE STYROFOAM BOARDS ON EVERY FLOOR, ON THE FLOORS OF THE ELEVATORS AS WELL, AND WHEN SEALING THE WINDOWS IT CAUSED THE WINDOWS TO SHATTER AND CAUSED THE FIRE TO MOVE IN FROM THE EXTERIOR OF THE

BUILDINGS TO INSIDE THE BUILDINGS, AND IT SPED UP THE SPEED OF THE FIRE AS WELL. YVONNE:

THANK YOU GREAT COVERAGE. BRINGING US THE LATEST ON WHAT IS GOING ON ON THE GROUND. WE CAN'T MOVE AWAY FROM THE HUMAN ELEMENT, BUT CERTAINLY WE NEED TO TALK MORE ABOUT THE NEXT STEPS WHEN IT COMES TO INSURANCE CLAIMS AND THE LIKE.

IT WILL BE A VERY LENGTHY PROCESS.

WHEN WE TAKE A LOOK AT WHAT STEVEN LAM HAS WRITTEN ABOUT, THIS WILL BE ONE OF THE COSTLIEST RESIDENTIAL FIRES TO THE INSURANCE INDUSTRY. LET'S BRING STEVEN IN.

TELL US ABOUT HOW WELL-EQUIPPED YOU THINK THESE INSURANCE COMPANIES ARE IN FULFILLING THESE CLAIMS. STEVEN: NO WORDS CAN REALLY DESCRIBE HOW SEVERE THE SITUATION IS.

IT IS VERY HARD TO PUT SENSE INTO THESE TRAGEDIES.

IF WE LOOK AT WHAT WE HAVE RIGHT NOW FINANCIALLY, I THINK IT IS VERY KNOWN THAT THEY HAVE A MAJOR UNDERWRITER THAT PROTECTS THE BUILDING AND CONTRACTORS.

THE DOLLARS AND CENTS WOULD BE ABOUT HONG KONG, $2.6 BILLION.

THAT WOULD BE THE COVERAGE AS UNDERSTOOD.

THERE IS A LOT OF INTRICACIES IN TERMS OF WHO IS LIABLE FOR WHAT AND WHO CAN CLAIM THAT AMOUNT.

THE COMPANY ITSELF IS FINANCIALLY SOUND.

IT IS A STATE OWNED COMPANY. IT HAS BEEN AROUND IN HONG KONG FOR A VERY LONG TIME. SO, WE ARE VERY CONFIDENT THAT THE ABILITY TO MAKE CLAIMS IS DEFINITELY THERE.

ANOTHER REASSURANCE IS RELATED TO REINSURANCE.

IT IS A VERY STANDARD PRACTICE THAT EVERY TIME A DIRECT INSURER UNDERWRITES CONTRASTS LIKE THIS SOME AMOUNT, THEY WILL HAVE A PANEL OF REINSURANCE COMPANIES.

IT COULD BE SEVERAL, SOMETIMES IT COULD BE MORE THAN 10.

IT IS GOING TO BE BORNE BY THE WHOLE INSURANCE MARKET, NOT JUST IN HONG KONG, BUT ALSO GLOBALLY.

BUT IF WE TAKE A STEP BACK, AS A SINGLE EVENT, VERY CONCENTRATED. THE SIZE AND SCOPE IS HUGE

CONCENTRATED. THE SIZE AND SCOPE IS HUGE BECAUSE IF YOU LOOK AT HONG KONG AND TYPHOONS, ONE COST HONG KONG ABOUT $3 BILLION. AND THIS IS ONLY THE COMPLEX WE ARE TALKING ABOUT. DAVID:

IT IS IMPORTANT TO DISTINGUISH WHO EVENTUALLY IS LIABLE FOR WHAT. YOU LOOK AT SOMETHING LIKE SEVERAL TOWERS THAT WERE

WHAT. YOU LOOK AT SOMETHING LIKE SEVERAL TOWERS THAT WERE BURNED, HOW DO WE LOOK AT WHO IS RESPONSIBLE FOR THE ACTUAL PROPERTY, THE ASSET? INDIVIDUALLY, YOU HAVE HOMEOWNERS -- I AM NOT SURE HOW WIDESPREAD IT IS IN HONG KONG -- THERE IS A PRACTICE TO ENSURE YOUR OWN PROPERTY, AND

ALSO SEPARATELY THINGS LIKE LIFE INSURANCE, WHICH IS A SEPARATE THING. HOW DO WE LOOK AT THOSE OTHER

SEPARATE THING. HOW DO WE LOOK AT THOSE OTHER FACETS? STEVEN: LET ME BREAK THIS DOWN FOR THE

FACETS? STEVEN: LET ME BREAK THIS DOWN FOR THE TEAM AND OUR AUDIENCE. IT IS A VERY STANDARD PRACTICE THAT THE OWNERS CORPORATION -- I AM TALKING ABOUT PRIVATE PROPERTIES HERE -- THEY WILL TAKE OUT A POLICY CALLED

PROPERTY RISK. THIS IS THE MAIN COVERAGE THAT

PROPERTY RISK. THIS IS THE MAIN COVERAGE THAT FOR THE PROPERTY WE ARE LOOKING AFTER, ABOUT $2 BILLION HONG KONG, THAT WILL COVER EVERYTHING STRUCTURE WISE, COMMON AREAS. EVERYTHING WITHIN YOUR UNIT IS

COMMON AREAS. EVERYTHING WITHIN YOUR UNIT IS NOT COVERED UNDER THAT. ANY BODILY INJURIES, DEATHS, IT IS NOT COVERED UNDER THAT.

IF YOU START WITH YOUR RESIDENTS, WHO THEY CAN GO AFTER, THE COVERAGE THAT IS AVAILABLE FOR THEM FROM CONTRACTORS OR THE PROPERTY, IT IS WHAT WE CALL THE THIRD-PARTY LIABILITY.

UNFORTUNATELY, BASED ON OUR UNDERSTANDING GOING THROUGH THESE CONTRACTS -- DAVID: WHAT IS THAT CONTRACT? STEVEN:

THIS IS THE POLICY FOR THE CONTRACT.

AND WE ALSO HAVE THE POLICY FOR THE BUILDING.

EVERY YEAR, THEY SPEND ABOUT $100 TO BUY A PROPERTY RISK POLICY. IT IS STANDARD PRACTICE FOR A

POLICY. IT IS STANDARD PRACTICE FOR A BUILDING OF THIS SIZE. GOING BACK TO YOUR POINT, FOR PEOPLE, THE DEBTS AND THE INJURIES AND THE TRAUMA, LOSS OF INCOME AND ALL THAT, THAT IS LIKELY GOING TO BE A LONG DRAWN PROCESS. I THINK WHAT WE ARE GRATEFUL

PROCESS. I THINK WHAT WE ARE GRATEFUL ABOUT IS THE QUICK REACTION OF SOCIETY.

THAT IS WHY GOING BACK TO MINMIN'S POINT, THE DONATIONS, BECAUSE THEY ARE READILY AVAILABLE.

IN TERMS OF THE CLAIMS SPEED, I WOULD IMAGINE DUE TO THE SEVERITY OF THIS INCIDENT, IT IS ALL HANDS ON DECK.

THE INSURANCE COMPANIES, THE BANKS, THE COURT, THE LEGAL SYSTEM. ALL PARTIES WILL PRIORITIZE

SYSTEM. ALL PARTIES WILL PRIORITIZE THESE CLAIMS. ANOTHER THING TO THINK ABOUT, NOT JUST THIRD-PARTY LIABILITY.

THE CONTRACTOR TAKES OUT COMPENSATION AND.HAVE

THIRD-PARTY LIABILITIES THESE ARE THE AREAS THE RESIDENTS WILL GO AFTER. YVONNE: WE HAD A CONVERSATION ABOUT THIS LAST WEEK. THIS IS AN OLD BUILDING.

IT IS MOSTLY RETIREES, PUBLIC HOUSING IN SOME WAYS.

HOW MANY PEOPLE DO YOU THINK IN THIS COMPLEX ARE ACTUALLY HOME INSURED? STEVEN: VERY GOOD QUESTION.

INSURED? STEVEN: VERY GOOD QUESTION.

ALTHOUGH WE DON'T HAVE THE OFFICIAL STATS IN HERE, BASED ON OUR UNDERSTANDING, IT IS A VERY COMMON PRACTICE WHEN YOU TAKE OUT A MORTGAGE THE BANK WILL ASK YOU TO TAKE OUT FIRE INSURANCE. THAT IS WORTH THE AMOUNT OF THE

INSURANCE. THAT IS WORTH THE AMOUNT OF THE MORTGAGE. IT IS VERY TRICKY. DAVID:

MORTGAGE. IT IS VERY TRICKY. DAVID:

IS IT MORTGAGE INSURANCE, TOO? STEVEN:

THAT IS BASICALLY THE MORTGAGE INSURANCE.

BASICALLY ANYTHING HAPPENS TO THE PROPERTY, SO THE BANK CAN MAKE SURE THAT THIS FAMILY CANNOT AFFORD TO PAY IT MORTGAGE, AND THE BANK IS PROTECTED.

AND ALSO PROTECT THE PERSON WHO LENT OR BORROWED THE MONEY BECAUSE THEY DON'T NEED TO BE LIABLE. THAT IS ONE.

THAT IS VERY COMMON.

LOSS OF PROPERTY, LAPTOPS, TV'S, AND WHATNOT, THAT PENETRATION IS NOT HIGH. WE ARE THINKING PROBABLY LESS THAN 20%, IF NOT LOWER. DAVID: THIS IS DIFFERENT FROM HOME INSURANCE. STEVEN: IT IS DIFFERENT FROM HOME

INSURANCE. STEVEN: IT IS DIFFERENT FROM HOME INSURANCE. THIS IS DIFFERENT FROM FIRE

INSURANCE. THIS IS DIFFERENT FROM FIRE INSURANCE. SOMETIMES YOU CAN BUY THEM AS A

INSURANCE. SOMETIMES YOU CAN BUY THEM AS A BUNDLE AS WELL.

I WOULD IMAGINE FOR THE LIFE PART, THE LIFE INSURANCE, IT IS VERY COMMON THAT SENIOR FOLKS BUY A LOT OF SAVINGS INSURANCE.

THAT MONEY WILL BE PAID BACK.

THEY DON'T HAVE A HIGH DEATH BENEFIT. IF YOU THINK ABOUT LIFE INSURANCE POLICIES, THAT IS NOT COMMON THAT PEOPLE PURCHASE.

USUALLY IT IS ATTACHED TO LONG-TERM SAVINGS PRODUCTS.

DAVID: THANK YOU FOR THAT. STEVEN LAM, OUR BLOOMBERG INTELLIGENCE SENIOR ANALYST. JUST A BOOKEND WHAT HAS BEEN A TERRIBLE FEW DAYS AND WE WILL CONTINUE TO STAY ON TOP OF THE STORY, WE WILL LEAVE YOU WITH LIVE PICTURES AS HONG KONG MOURNS THE LIVES LOST IN THE DEADLIEST FIRE IN ALMOST 80 YEARS. LIVE PICTURES HERE OUT OF HONG

YEARS. LIVE PICTURES HERE OUT OF HONG KONG THIS MONDAY MORNING. THIS IS BLOOMBERG. ♪

DAVID: WELCOME BACK. TO RECAP SOME EARLIER BREAKING NEWS, YOU CAN READ ABOUT THAT AT THE BOTTOM OF YOUR SCREEN, SOME ROSEWOOD ASSETS COULD BE UP FOR SALE ON THE BACK OF THE BROADER STORY OF THE GROUP LOOKING TO SHORE UP LIQUIDITY.

SHARES ARE UP 0.6%. FOR MORE CLARITY ON WHAT WE LEARNED, LET'S BRING IN SURELY?

-- LET'S BRING IN SHIRLEY.

>> THEY ARE SEEKING TO SELL PROPERTIES AND THE FAMILY'S LUXURY HOTEL GROUP.

WE LEARN FROM SOURCES THAT REPRESENTATIVES HAVE APPROACHED SOME COMPANIES FOR A POTENTIAL SELLOFF OF THE ASSETS.

WE ALSO UNDERSTAND THAT THE DISCUSSIONS WERE PRELIMINARY AND THERE COULD STILL BE CHANGES. YVONNE:

TELL US MORE ABOUT THE SIGNIFICANCE OF THIS ONE BECAUSE THEY HAVE ATTEMPTED TO DIVEST SOME OF THE FAMILIES ASSETS BEFORE. WE HAVE TALKED TO YOU ABOUT

ASSETS BEFORE. WE HAVE TALKED TO YOU ABOUT THAT BEFORE. THE FACT THAT THEY ARE EVEN

THAT BEFORE. THE FACT THAT THEY ARE EVEN CONSIDERING ROSEWOOD, WHAT DOES THAT TELL US? SHIRLEY:

THIS IS PRETTY SIGNIFICANT. ALTHOUGH IT REMAINS TO BE SEEN WHAT THE FAMILY PLANS TO DO EXACTLY WITH THE PROCEEDS FOR THE POTENTIAL SALE, IT COMES AT A TIME WHEN THE FAMILY'S FLAGSHIP PROPERTY DEVELOPER NEW WORLD IS FACING A LOT OF PROBLEMS. ROSEWOOD HOTEL HOLDS SOME OF THE FAMILIES HIGHEST

QUALITY ASSETS. FOR EXAMPLE, ROSEWOOD HONG KONG

QUALITY ASSETS. FOR EXAMPLE, ROSEWOOD HONG KONG WON HOTEL HAS WON THE TOP SPOT OF THE WORLD'S BEST 50 HOTELS.

AND THE MARKET VALUE OF ROSEWOOD HONG KONG IS ABOUT $15.9 BILLION HONG KONG ACCORDING TO SOME DOCUMENTATIONS WE HAVE SEEN.

DEPENDING ON WHAT ASSETS MR. CHENG IS SEEKING TO SELL, THE SALE COULD BE PRETTY SIGNIFICANT.

AND THE FAMILY IS ALSO SEEKING OTHER MEASURES TO TRY TO PROVIDE EXTRA LIQUIDITY FOR NEW WORLD.

FOR EXAMPLE, THE FAMILY IS STILL TALKING TO THIRD-PARTY INVESTORS ON THE POTENTIAL CAPITAL INJECTION INTO NEW NEW WORLD. THE FAMILY IS ALSO SEEKING TO

WORLD. THE FAMILY IS ALSO SEEKING TO SELL A BUNCH OF NEW WORLD ASSETS, INCLUDING THEIR INVESTMENT PROPERTIES IN MAINLAND CHINA, AS WELL AS A MEGA MALL NEXT TO CHINA'S INTERNATIONAL AIRPORT.

AND THEY ARE STILL DISCUSSING WITH THE AIRPORT AUTHORITY ABOUT POTENTIAL SOLUTIONS FOR THE MALL AS WELL. YVONNE:

11 SKIES HAS BEEN THE BIG ONE WE WERE TALKING ABOUT. DAVID:

THANK YOU SO MUCH. JUST UPDATE YOU ON OTHER CORPORATE NEWS WE ARE TRACKING THIS MORNING, AN UPDATE ON THE MASSIVE STORY ON FRIDAY, THE DATA CENTER THAT SUPPORTS THE CME GROUP DERIVATIVES EXCHANGE HAS BOLSTERED ITS BACKUP COOLING CAPACITY AFTER OVERHEATING AND SPARKING A 10

HOUR OUTAGE ON FRIDAY.

IT IS ABOUT 80 MILES FROM CHICAGO.

OPERATIONS HAVE BEEN RESTORED WITH REDUNDANCIES ADDED TO COOLING SYSTEMS. . SOUTH KOREAN AUTHORITIES ARE

COOLING SYSTEMS. . SOUTH KOREAN AUTHORITIES ARE INVESTIGATING A DATA LEAK. THEY SAY THE ALLEGED HACKER, A CHINESE NATIONAL WHO PREVIOUSLY WORKED AT THE U.S.

LISTED ONLINE RETAILER, POLICE BEGAN INVESTIGATING AFTER A FORMER -- FORMAL COMPLAINT. THEY BECAME AWARE OF THE LEAKS ON NOVEMBER 18. MICRON WILL REPORTEDLY SPEND 9.6 BILLION DOLLARS U.S. TO BUILD A PLANT IN WESTERN JAPAN, MAKING MEMORY PLANTS -- MEMORY CHIPS.

THEY WANT TO DIVERSIFY THE CHIP PRODUCTION AND PLANS FOR SHIPMENT. THE FACTORY WILL MAKE

SHIPMENT. THE FACTORY WILL MAKE HIGH-BANDWIDTH MEMORY CHIPS, A KEY COMPONENT IN WORKING WITH AI PROCESSORS.

YVONNE: AIRLINES ARE SCRABBLING TO UPDATE SOFTWARE ON THE AIRBUS A320.

THIS IS THE MOST WIDELY FLUNG COMMERCIAL JET IN HISTORY.

CARRIERS SAY THEY HAVE RUSHED TO EMERGENCY FIX.

LET'S GET TO RACHEL CHANG. THIS SPARKED A FRANTIC RUSH.

TELL US WHAT IS THE UPDATE NOW. HAS EVERYTHING BEEN FIXED?

>> IT HAS MOSTLY BEEN RESOLVED, BUT IT WAS A WEAKEN OF MASSIVE CHAOS. IT WAS A SHOCK TO THE INDUSTRY.

CHAOS. IT WAS A SHOCK TO THE INDUSTRY.

IT WAS A LATE NIGHT FRIDAY THING.

WE HAVE THE REGULATORS SAYING YOU HAVE TO DO THIS SOFTWARE UPGRADE BEFORE THE NEXT FLIGHT. THIS IS A JET THAT IS ONE OF THE MOST COMMONLY USED IN THE PASSENGER INDUSTRY.

THE FIX WOULD AFFECT ABOUT 6000 AIRCRAFT.

THAT IS OVER HALF OF WHAT AIRBUS SUPPLIES TO THE INDUSTRY.

IT WAS A BIG DEAL. WE HAD LOTS OF CANCELED FLIGHTS.

IT WAS A REALLY TOUGH WEEKEND COMING OUT OF THE HOLIDAY.

THERE ARE ABOUT 1000 OLDER AIRCRAFT THAT WILL REQUIRE A WHOLESALE HARDWARE UPGRADE. THAT WOULD STILL BE ONGOING RIGHT NOW. DAVID:

RIGHT NOW. DAVID: DID WE SEE ANY FLIGHT DISRUPTIONS TO THAT?

>> WE SAW A LOT OF DISRUPTIONS OVER THE WEEKEND BECAUSE A LOT OF THESE AIRLINES HAD TO DELAY OR COUNSEL THE FLIGHTS -- CANCELED FLIGHTS. THIS TIME, AIRBUS CAUGHT IT.

CANCELED FLIGHTS. THIS TIME, AIRBUS CAUGHT IT.

IT BRINGS UP A LOT OF QUESTIONS BECAUSE IT IS VERY MYSTERIOUS.

THEY SAID THAT INTENSE SOLAR RADIATION CORRUPTED SOME OF THE SOFTWARE.

WE DON'T KNOW MUCH ABOUT THAT AND CAUSING A LACK OF CONTROL.

THAT IS SOMETHING THAT AIRBUS WILL BE TRYING TO DIG INTO OVER THE WEEKS AND MONTHS. IT IS JUST ONE OF THOSE SITUATIONS WHERE YOU REALIZE THERE ARE SO MANY UNKNOWNS THAT COULD IMPACT SO MANY PEOPLE. YVONNE:

ON A FLEET THAT IS SO WIDELY USED. THANK YOU FOR THE UPDATE.

RACHEL CHANG. COMING UP, WE WILL BE SPEAKING TO ONE OF THE LARGEST OPERATORS IN THE WORLD, AIR ASIA.

THEIR CEO TALKING EXCLUSIVELY WITH HASLINDA AMIN.

♪ >> THE RESULT ACTUALLY CONFIRMED THAT AI DEVELOPMENTS OF CHINA ACTUALLY EXCEEDS PEOPLE'S EXPECTATIONS.

THE U.S. TECH DEVELOPMENTS ARE CLEARLY TELLING YOU IT IS NOT ABOUT HOW MUCH YOU SPEND, IT IS ABOUT HOW MUCH YOU EVENTUALLY CAN GENERATE IN TERMS OF REVENUE.

IF YOU LOOK AT THE TIME LAG BETWEEN INVESTMENTS VERSUS MONETIZATION, CHINA HAS BEEN DOING BETTER THAN THE U.S..

IF I WERE STRICTLY COMPARING.

>> THE ISSUE FOR ME, ALIBABA NEVER NEEDS TO MAKE ANY MONEY AND FOOD DELIVERY. THEY WILL BE HAPPY JUST TO BREAK EVEN AND MAKE MONEY FROM THE OTHER E-COMMERCE TRANSACTIONS FROM ITS CUSTOMERS. BUT T THAT IS THEIR ONLY BUSINESS, SO THEY HAVE TO MAKE MONEY.

WHEN YOU HAVE VERY CLOSE TO THE NUMBER TWO PLAYER NOT NEEDING TO MAKE ANY MONEY, THEN YOU HAVE A PROBLEM.

YOUR MARGIN WILL NEVER GO BACK TO THE WAY IT WAS A COUPLE YEARS AGO. DAVID:

YEARS AGO. DAVID: JUST SOME OF OUR GUESTS ON SHOWS THIS MONDAY TALKING ABOUT TECH EARNINGS, WHICH IS A THEME AS WE LOOK AT THE RALLY ACROSS THE MARKETS. MODEST RALLY GOING INTO A

THE MARKETS. MODEST RALLY GOING INTO A FRUSTRATING WEEK. YVONNE: IT IS INTERESTING TAKING STOCK.

FRUSTRATING WEEK. YVONNE: IT IS INTERESTING TAKING STOCK.

WHEN YOU TALK ABOUT ANTIEVOLUTION AND THE LIKE, YOU ARE NOT SEEING THAT PLAY OUT IN EARNINGS, EXCEPT FOR THE MATERIAL SECTOR. THERE ARE STILL PARTS OF THIS

MATERIAL SECTOR. THERE ARE STILL PARTS OF THIS ECONOMY AND INDUSTRIES WHERE YOU ARE SEEING QUITE A BIT OF PRICE COMPETITION.I THINK E-COMMERCE IS CERTAINLY ONE OF

PRICE COMPETITION.I THINK E-COMMERCE IS CERTAINLY ONE OF THEM. DAVID: WE SAW THAT IN LOSSES.

THEM. DAVID: WE SAW THAT IN LOSSES.

WE WILL LOOK AT THESE AND SEE YOU ALL TOMORROW. ♪

WE WILL LOOK AT THESE AND SEE YOU ALL TOMORROW. ♪