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tv   Bloomberg Markets European Close  Bloomberg  July 24, 2020 11:00am-12:00pm EDT

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alix: live from new york i'm alix steele, guy johnson is off today, with francine lacqua. it's an ugly day shaping up on wall street, european markets down by a full percentage point and almost two when it comes to european stocks and communications, tech, health care all getting hit really hard and here again dragged down by intel. two big stories for you, though, consistently weaker dollar, consistently higher gold prices. euro-dollar $1.1626 is where we print right now. francine: lieu at sentiment, alix, it may turn uglier after u.s. officials said a chinese researcher who took shelter at the country's consulate in san francisco is in custody and will make a court appearance on friday. it seems that there are a couple things going on with the u.s. and china that actually markets are really nervous about but you're right, it's also because of earnings and some of the tech earnings that certainly disappointed the bulls. alix: in particular intel. coming up we'll talk to the c.e.o. of intel, bob swan and
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he c.e.o. of verizon, hans vestberg as we proceed throughout the hour. francine: european economies are starting to claw their way out of recession and we had encouraging p.p.i. physician and the confident p.m.i. jumped to 54.8 with the services and manufacturing sectors expanding. joining us now from paris is william, the bnp paribas group chief economist. it feels like this was a good week for europe. we have the p.m.i. more than expected and the recovery fund. if you look at job losses they're going to get ugly in europe. william: that is a concern i have if you look at the p.m.i. data today. what strike is that yes, manufacturing significantly and new export levels in germany are just flying but the employment series is showing that companies are under no intention whatsoever to
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increase hiring and on the contrary. that's a concern. it's a concern because the recovery will depend on what households do, how much they spend and they need confidence. alix: what is going to give them that confidence? william: the problem that you have at the current juncture is you have the kind of circular reasoning, what i mean is that households need to be comfortable about the labor market prospects. now, companies can only give that comfort if they say their sales will be ok. one needs the other and that of course is why it is so important that we have seen this recovery fund agreement in the european union this week because what that brings is the prospect in addition to the national policy impulse that will come later on this year, it will bring the deployment of a significant amount of money, more than 5% of european union
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g.d.p. over the coming three years and imploded for 2021 and 2022. that i think will play a role in bringing some confidence. francine: i guess the concern is that the european economy, people can be confident about it but it doesn't live on its own. it's in between asia and the u.s. the u.s., we're seeing what's happening with the economy and they're seriously concerned about trade escalations between the u.s. and china. how will that impact the european economy? william: that's a very fair point you're making. there's not a shortage of topics to be concerned about. you can add to your list as well what's going to happen to brexit, green or not. the latest indications show that it's going to be very difficult to strike a deal, and i'm referring what has been said in that respect. for instance when you look at the chinese data that came out
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very recently, what you observe is that production is going ok -- and infrastructure but on the other hand, households he very cautious. you see that in a very global, interconnected business environment what is happening to the trading partners is also playing a very important role and then of course there is the big unknown out there which is how is the pandemic going to evolve? we've seen the situation in the u.s. but also in a number of european countries, you do see that there was some increase in the number of new cases which is then raising fears that social distancing and the likes drag on inue to be a the recovery of the economy and growth. alix: we set it up well to the risk of the p.m.i.'s are on the downside. i'm just wondering, it feels like the market is looking at the europe -- euro as a safe haven. is that true, do you see that,
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and is that legit? a liam: what we have seen is change on the mantle which i would expect and the europeans hope to be longer lasting is that now they really have their act together. if you look at the creation of the euro, all the effort has come from the european central bank, whatever, and the pandemic emergency program which now has been created with this debt issuance at the e.u. level is a precedent, to address future nature economic shocks. and i think in the longer run this should be a factor that is giving people within the european union but also the noneuropean union and investors greater confidence and also what is reflected in recent
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dynamics of european financial markets and including the exchange rate francine: william, what's your biggest concern for the world economy overall, where does it come from? william: well, twofold. one concern is of course what is happening in terms of the health situation because we can only observe and hope all the measures taken will be efficiently effected. and the other concern is purely economic, is that we are still underestimating the kind of scarring effect that you have from such a deep recession. the most increase in corporate indebtedness, what does it do to companies in terms of decisions i think they will refrain from investment, from paying back debt. the other concern is too many companies are still very close to their operational break even and if they continue to be in that situation for several
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months, i think what they will do is want to lower that break even point by cutting fixed costs and by shedding labor and that's a big concern i still have. alix: how does it vary per country now particularly when you factor in the euro recovery fund, italy obviously will be a big recipient and we don't get the pers and p.m.i. and france and germany doing it better. it's hard to make a argument in the resurgence without in european assets without them? william: that's a very fair point. i think at the same time you have the complexity when you look at the health data, for instance in italy they are very good, very ok. so it shows you the complexity that they are suffering so much and now it's all under control, although in other european countries things are worsening again. i think all in all what is really important is what the
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orientation of the business of european listed companies and i think that is perhaps an argument to say well, they obviously have vacation in terms of products but also in terms of markets is something that's important in the current environment and that would then go for perhaps a draft for the larger companies at the detriment of small cap stocks that will tend to be geographically more concentrated but also financially than perhaps let's say a less resilient situation than you would have with larger caps. so this is something in the coming months i'll be very keanly following to see whether that feeling i have would be confirmed. alix: it's not over basically is what we're getting for it, it's not all green. thanks very much, william devijlder of b.n.p. paribas. and topping the assets, we'll
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look at things with hans vest berg. this is bloomberg. ♪
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♪ alix: live from new york i'm alix steele with francine lacqua. these are the european flows in the markets. the second quarterly result, the pandemic decreased earnings by 4% despite sales topping estimates and the company keeping the earnings forecast. joining us now is hans vestberg. always good to talk to you. one of the take away from analyst is no big surprises which in the middle of covid feels like a very big victory. wonder if you can give us some insight in retail operations in states reclosing or having a surge in covid outbreaks, how
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are you thinking about that the back half of the year? hans: great to be on. thanks, alix. if we start with how it looks, we see the pandemic moving around in the united states, we have today 77% of our stores open and are actually going to have 100% open by end of this month. but of course but it talks about a different operation, the innovation in our retail stores has been great and we do curbside delivery and cashless delivery and we also have a requirement on masks of any customer coming in. you also need to book a time in many of the stores coming in. of course we have changed our mod up but if you look at the numbers, especially at the end of the quarter, we are still generating a lot of new customers and ultimately we have 72,000 new net phone additions in the quarter and a record low turn. the infrastructure that's so important, the ability to broadband is so essential to
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stay connected to friends and family and do business we see this continue. we're very resilient in this time period when customers are suffering and in a time unheard of. so of course a lot of customers suffering but we work with them as well. francine: hans, how worried are you that a lot of people will not be able to make their bills? and is this your biggest concern for verizon going forward? hans: what we've seen is we of course saw in the beginning of the pandemic many asking for the pledge to keep america connecteded, we are not disconnecting them. and in the quarter we saw an improvement on that and today i would say our delinquent receiveables are as equally large now as before the pandemic and the ones that have asked for a pledge to keep america connected, 80% of them are actually paying some part of the bill. our work is to see these loyal customers continue to be our customers. and we have a great opportunity
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to work with them with refinancing, etc. it's such a crucial time and disconnecting our customers is the wrong way. we work with them and want them to stay with us. alix: that leaves you exposed by 300,000 customers that haven't paid and you said you're working with them on plans but do you see that as a more material risk and is there a time frame you're looking at or a number that it gets to that has you worried? hans: first of all, i don't recognize that number. i said, we have more than 100 million consumers using our network every day. there is of course some of them that have a tougher time. this is nothing unnormal for us that we have a few key customers that can't really pays us. we're working with them. there's no time frame in the works, etc. i feel we have a great network, very loyal base that wants to stay with us and we work with them. i assume that they all will be
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our customers a year from now. francine: but hans, the pandemic is different, we are looking at the numbers, 1.5 million customers that were protected by the pledge not to be disconnected due to nonpayment and you say that 80% of them made a payment. hans: yeah. francine: so the numbers are bigger than anything you ever had to deal with. hans: no, they are not. that's what i'm saying. the delinquent receiveables are equal now prior to the pandemic on the base we have a fairly small number. again, our job is to work with our customers so they can continue to be a customer of verizon. yes, of course, it's tough times and the pandemic and economic downturn and unemployment is extremely high but we don't feel this is something different than what we've seen before and why we work with our customers. there's no triggering event for us. alix: what about for small businesses and your subscriber base in that arena?
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hans: small business is different and of course will have a larger impact and are a little bit higher on keep america connected and asking for refinancing. and then some of them are of course shutting down their businesses. we see them a little bit more. but on the other hand we saw the large practice actually acquiring or buying more right now and we see our governmental business growing much stronger. it's a mix and how the society is turning out in these times, unfortunately. francine: how much pressure do you feel to cut prices given that people are struggling with their bills in general? hans: i think we have everything from prepaid all the way to unlimited premiums. so we actually have a way for our customers to pick and choose. what is unique for verizon's proposition is we are mix and match. so in a family you can have different plans in the family. that has turned out to be
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really well for us and we wrote a lot of new business last year until the pandemic happened and we're also writing now at the end of this quarter. i think we have an offering that customers depend on their financial situation. that's been all the time our plan to see that we can address the cool markets given different opportunities. alix: when do you feel the t-mobile crunch, though? because they added three times as many customers in the second quarter, their plan that is comparable to what you have is $100 and their is $140. at what point do you have to bite the bullet? hans: i'm not sure what you mean by that. i think we have been competing in this market for the last 20 years and will continue to do so. think we have a great network that nobody else has. that's our work. we have exciting times ahead of us with unique and transformtive society that we are developing. as i said, we have our mix and
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match at the same time that is appealing to our customers. we're not afraid of competition. we've had it for all time and nothing new. we're just going to compete and we're a leader and of course everyone beats us and we're not going to let them beat us. francine: hans, what would the biden administration actually mean for spectrum but also rural broadband policy? what would that mean for verizon? hans: i'm not sure really to say, but the only thing kid say is that americans will decide who will run this country. we as a corporation, we will work with that administration and follow the policies and laws that they will come up with. nothing different from previous administration or whatever changes are coming. i think we're operating in 150 countries and that's how we operate and we are a global citizen. we need to follow the laws and rules. if the world says whatever changes there will be and if there will be changes we'll
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comply. alix: 5-g, when does it happen? hans: it's already happened but i guess you're asking from the consumer point of view, i think we have a huge execution in the second half. we'll have them put out the wide band which is the fastest network in the world. and have another offering nationwide 5-g. so this second half will be very exciting. we have plenty devices on 5-g already in the market so we are ready for anything that will come up. and i think that our customers will enjoy enormously new way of using wireless technology. and i think, as i said before, coming off a 5-g phone will be important and we don't know when and how but the i.o.s. penetration in the u.s. and as well on our consumer base we have at verizon. it's important because people are hardly moving between the two operating systems that you
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have in the mobile phone market at the moment and why it's important whenever they decide to come up with a 5g phone from apple. alix: it's totally celtish to be asking this, if i upgrade my apple phone can i get it on verizon in 5g? hans: you have to ask apple. alix: from your per spictive you will deliver or if i have to get a google foifing? hans: no, the network will handle it but apple hasn't launched a 5g phone capable of handling signals in the 5g network or the wide band and as well the nation of coverage on the lower bands. they haven't come up with that phone yet. that's what we need to see when they're coming out. but we are excited. and i think the country is excited as well whenever they do. francine: hans, you're quite optimistic about the future and we're going through a pretty tough time economically for frankly everyone in the u.s. what do you worry about the
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most? is it that the situation gets worse or is it something that, you know, we can't quite perceive? hans: i'm optimistic because we have a business that is resilient even in tougher times. but it's also working in growth times. what concerns me of course is that we're managing multiple crisis here in the united states at the moment and of course the pandemic is continuing to spread and impacting people brutally with the fatality rates very high. secondly, of course, that leads to economic downturn and we know that the disparity in our economy is getting greater and of course the vulnerable is getting more vulnerable. and our concern, we also have this racial injustice in the thauns is panning out. all three at the same time is unheard of. i've been a c.e.o. for many, many years and i haven't dealt with crisis -- i've never seen so many things at the same time and you need to understand we have customers, hundreds of
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thousands of them and all feel the same concerns. so of course that's distinct how you run business as usual and seeing you do it right at the same time and being a responsible business. that we do every day and we balance it and that's of course a concern for any large corporation or any organization at all. alix: hans, quickly, you've been so generous for giving us so much time. there's been a lot of heating up between china and the u.s. when it comes to, say, consulates, etc. that doesn't directly affect your business but when you see these headlines getting more hostile between the two countries how do you think of that? hans: i think of course having countries not getting along, it's not good. we should have a world where we fight the big challenges. but for verizon, there's no impact at all. we don't use chinese equipment. we're not in that market. so for us it doesn't really matter. but when it's geopolitical
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there's a challenge when you have this type of situation but ultimately we want peace and we want friendship and we want to attack the larger societal problems together, all of us, large corporations and small corporations and governments. and of course that is something that i'm hoping. francine: hans, thank you so much. the verizon chief executive officer. coming up, the bling is back. gold breaks $900. how much higher could it go? we talk to susie cooper in charge of precious metals research director, coming up shortly and this is bloomberg. ♪
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♪ alix: live from new york i'm alix steal with francine lacqua in london. this is the europe own close. it's interesting to see the lack of market reactions with the latest headlines out of china. the u.s. officials saying a
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chinese researcher is in san francisco at the consulate and is in custody. if feels in the u.s. market it's about tech with the intel market leading it lower here. francine: if you look at what the market is behaving now compared to yesterday, president trump did say the china trade deal means much less to him after the virus and so maybe there's just a little bit of a concern he's not so willing to continue with the trade deal and that's what at the margin is hurting markets. alix: much more so when it comes to europe than the u.s. our european close is up next. the volume light and european markets down 2%age points at the low of recession. this is bloomberg. ♪ save hundreds on your wireless bill
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get a $50 prepaid card when you switch. 5g is now included with all new data options. switch and save hundreds. xfinity mobile. alix: live from new york, i'm alix steel with francine lacqua
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in london. stocks finishing up the day in europe. european equities getting hit harder than the u.s. euro stocks down almost 1%. it is tech, utilities, communication, health care leading the way lower in the dax. the ftse down 1.4%. volume heavier on the ftse. switch up the board and you can see the other asset classes. i want to focus on the euro. the dollar is getting pummeled again. euro-dollar up .4%. not the upper former in the g10 space. that goes to the yen. dollar-yen down a full percentage point. it is a safety trade, but if a safety only trade why would the euro be this? lessons in the bond andet -- the bid lessens the bond market in italy. we saw a lot of buying this week
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in the btp market. there could be reshuffling of positions and gold we will talk about in just a second. off the highs of the session. under $1900 an ounce. a stone throw away from record highs. stocks areuropean dropping on u.s. china tensions. a lifetime ago but that was only monday night. if you look at the sectors, it is pretty intuitive given what we heard. u.s. stocks and technology stocks down 3.7%. i would say a second-quarter earnings season in europe is not as bad as feared and that is offering a bit of support for equity gains across the week. second-quarter earnings overall are not great. they are still pretty lousy but they are better-than-expected amongst the stocks i am watching. forle of direct energy around $3.6 billion in cash. gaining 16.5%. inor posted an unexpected
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second-quarter profit. repsol down 2.2%. even if the chief executive says spanish oil demand has recovered. there was the russia surprised by the central bank because they had a smaller rate cut than expected but they did signal there would be more easing. there is a bit of movement as well. that is look at the european markets. time for our stock of the hour. airbus. abigail doolittle has more. abigail: it looks like there is the possibility one trade war maybe cooling down, but when we look at the shares of airbus would not know it because that stock is still down. airbus saying they have taken the final step to end a long-standing trade dispute with the wto, which is the justification for u.s. tariffs. this de-escalation from airbus
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is what they're calling the final step to end the situation with the u.s. and with the wto. what they are doing, they have agreed with france and spain to amend repayable launches on one of their planes. removedim this is what justification for u.s. tariffs. theou recall last october, u.s. did slap 7.5 billion dollars of tariffs on european goods come anything from alcohol to airplanes to luxury goods, hurting airbus. they receive 17% of the revenue from north america. the wto stood by the u.s. since they found out about unfair subsidies airbus and boeing had been receiving going back to 2004. another pressure on airbus. earlier this year the u.s. did increase tariffs on airbus to 15% from 10%, and in june the trump was threatening more whichs on european goods, could potentially make the situation worse.
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lots of tension. something that was negotiating tactic on the part of president trump. it seems as though it may have worked. there we have airbus trying to remove any justification for the tariffs. once again, it seems like they are trying to offer this olive branch. some of the other companies that are under tariff pressure from europe are also down, suggesting maybe traders do not believe this will work, that the u.s. will lift the tariffs, or could be a part of the down day. alix: also by the rumors, sell the news. thanks a lot. appreciate it. commodities -- gold topping $1900 an ounce, nearing the all-time high in 2011. we spoke to mark mobius yesterday and he said gold is an attractive asset to buy right now. mark: i would be buying now and continue to buy. alix: what about silver? mark: silver also because silver
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will follow gold. gold is the most important. alix: joining us now is suki cooper, standard chartered research executive director. we willnt $17 is level be watching for the record high. when do we get there? suki: many of the factors are aligned for gold to continue its upward momentum and we think it is likely they will see those highs this year. we are expecting them to materialize later on in the year and it looks like the factors have continued to support investment demand and etf flows continue to grow rapidly and it is likely they will get there sooner than expected. francine: what is the rationale in buying gold right now? suki: if we look at the macro environment, there are a number of drivers supporting the investment flows we are seeing in gold at the moment. the most crucial is the fact we have deeply negative real yields. and thear is weaker weaker appetite is supporting the environment to buy gold, and
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there is a built-in inflation expectation given the unprecedented fiscal stimulus package and the monetary easing. it is also created expectations we might see inflation later on. in the current environment, it is the view we are seeing negative real yields driving investors to look for a safe haven asset and a flight for quality and a flight to safety. alix: i was covering gold in 2011 and this feels different. the conversations are different. the euphoria and the feelings behind it are different. is it, and if so what does that mean for reaching $2000 or beyond? suki: the dynamics are different because in 2011 when we saw the all-time highs, the fiscal market was weak but it was not close to nonexistent. in the current environment india and china consumption has been close to nothing in the last quarter. to put this into perspective, in terms of etf flows, in q2 alone
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we had over 334 tons and the market was very weak. if we look at last year, if we look back during 2011, we still saw some fiscal demand, and the fiscal market was around 400 times. the etf flows have offset the weakness in the fiscal market and there is more demand in by physical gold. most of thejust -- flows have come from strategic allocation rather than tactical positioning. francine: put about silver? does it track gold in terms of investor demand or are there fundamental supported and improving? suki: silver is fascinating. it does benefit on gold's coattails. we tend to see late catch up investor momentum picking up in silver. what is interesting about silver is normally the industrial factor would be a drag on the
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market and that would cap that upside. given that we have seen covid-19 impacting the supply picture and the demand picture and seen a number of key mines in key countries like mexico and peru and china being impacted, supply has also suffered. the industrial data certainly shows some weakness, but not as weak as we had expected it to be. yes investment demand is driving the upward momentum in silver, but the industrial side is not as much of a drag. we've been seeing good retail interest materialize in silver and we would expect to follow in gold footsteps. alix: does this mean, when it comes to gold, is the investment can unity stickier now than in 2011, or if we get that flood of tactical players, does that provide the next catalyst? suki: that is a great way of looking at it. when we see the flows in the etf -- that isends to
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where we have seen demand for gold materializing across the etf. we have seen some of the tactical positioning starting to pick up, but the positioning in terms of the tactical side is nowhere near over clouded -- nowhere near overcrowded. the pete was over 50%. currently we are around 30%. certainly we see short-term drivers and continue dollar weakness, real yield remaining negative, we could start to see that tactical allocation. at that point, the rally might be more fragile and we could expect to see more profit-taking. alix: prayed to catch up with you. that is suki cooper of standard chartered bank. we want to look at where european stocks have ended up. definitely risk off. volume not terrible considering it is a friday in the summer. the ftse off 1.5%. the dax the biggest loser, down two percentage points lower, date of the -- definitely
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negative for the year. trade tensions. there is also tech in the u.s.. there is a lot of buying into european assets this week so we could be taking a little bit of profit into the weekend. this is bloomberg. ♪
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alix: live new york, i am alix steel with francine lacqua in london. this is the european close. intel plunging after it warned of another production delay. an hour onn spent yesterday's conference call discussing and idea that would've been unthinkable -- not making its own chips. bob swan joins us. i know it has been an intense 12 hours.
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i appreciate your patience. the word on the street is analysts are having a tough time swallowing the pill, as are investors. i guess the big question becomes why should investors believe you can still do your own manufacturing? me: first, thanks for having good we just delivered an outstanding quarter, 20% topline growth.16% bottom line over $1 billion revenue above our guide. been a very challenging market, we raised our full year outlook by $1.5 billion on the top line. that is a function of leadership products. we have a portfolio of leadership products we will be delivering through this year. 2021, 2022, that we feel very good about. there is been real uptick in
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a world where everything looks like a computer. is as big asties it has ever been. what we talked about yesterday is we have pushed our seven nanometer products we anticipate in the 22 to 23 timeframe by two quarters. that was due to a slip in the yields on our manufacturing technology. first, we will continue to invest in our manufacturing process technology to catch up -- obviously our desire is to play a leadership position in profits, but product leadership is much more than just profit. it includes other things like packaging, technology is, it includes different architecture, it includes memory interconnect, security, and how we use software to optimize our
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hardware. delivering world-class leadership products is more than simply where we are on the process note. doing is evaluating the other opportunities we have to engage deeper with our ecosystem partners, and with our design methodology we have the ability to mix-and-match different products to put them on the same package. what we talked about yesterday is our enhanced flexibility to make those trade-offs along the way to make sure we are delivering leadership products for our customers. alix: but no one seems happy with it right now. investors or analysts. bob: we are coming up 14 nanometers, we are ramping up the 10 nanometer product, and we feel good about where we are. we talked yesterday about 20%
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higher demand for our 10 nanometer products then we had anticipated earlier in the year. we are delivering on the products in 2020. we expect to deliver on 2021. we expect to deliver on 2022, and we also expect to deliver on 2023. our focused and our energy will be on delivering these products, regardless of the future. swordsf you wanted to al -- if you wanted to outsource to taiwan semi, can you do that? do they have the kind of technology you need to manufacture your chips? bob: one of the things we have been doing over the last couple of years his leveraging third-party foundries even more than we have in the past. our company has grown $20 billion, and with that growth we have evaluated when we
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use our own capabilities versus when we use the industry. this is something we've been doing for the last several years. even more so in the last couple of years. our ability to engage with the ecosystem is greatly enhanced because the relationships have grown over the last few years. alix: what i want to understand is if you are weighing how you make your chips, what is the criteria for exiting that manufacturing part of the business? relatively cadencele, and annual of leadership products that our customers on the client, on the server and cloud, and on the network and the edge, that our customers can count on. leadership products is what matters most. not necessarily where it is
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being manufactured. where it is being manufactured is an important part of the equation and we will continue to invest in that, but the priority for us is making sure we are delivering in annual cadence of leadership products, regardless of what process it runs on. you got five downgrades from analysts today. it feels like even if they believe your story for 2023, it is a short-term issue, a short-term growth margin issue that will be the problem. visibility wise, what can we look at over the next couple of quarters to measure if you will be able to fulfill your promises? margins gross historically have been in a range of 55% to 65%. it tends to go on the lower end of that range when you are launching new products on a new node. right now with the demand for
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our high-performance 10 nanometer products, the margins are dipping down into the bottom end of that 10 point quadrant. that is to be expected. that is what we informed investors in may of last year that as we ramp 10, margins will come down. improves, yields will improve. we said during the course of this year we expect gross margins to be in the 58% range. the measurement will be how do we do in q3? ramp 10e do in q4 as we nanometer products. we feel good about where we are in the outlook we gave yesterday , which is higher growth driven by demand for these 10 nanometer products, and that higher growth will have a modest impact on our gross margins, but the year is shaping up to be the best year
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in our 52 year history. alix: you mentioned, we were talking a lot about manufacturing chips and i brought up taiwan semi, which leads me to asia. i wonder how this hiding escalation between u.s.-china tensions is impacting how you think about your business? , chinarst and foremost has been a big and important market for our company for a long time. we've been operating there for 35 years. we have a relatively big presence in we have important customers. it is an important market for us and we have always been proponents of open and fair trade around the world, and we know in that open and fair trade we have responsibility to protect our ip, and we have done that effectively for a long time. at the same time, as the rules of the road evolve and change, we will meet the requirements of each jurisdiction in which we
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operate in. in the meantime, we will deliver for our customers and follow the rules of the road. china is an important market for us. alix: what do you do if tensions heighten? are you talking to the administration? how do you insulate yourself? view, thataid, our we share with every opportunity we get, is that global trade and access to mobile markets is very important for our company, for the semiconductor industry. it is an industry where a lot of the r&d happens in this country. for intel we do the lion share of our r&d in the u.s.. we have our large -- in oregon and arizona. we design and make everything here and we ship it to the rest of the world. .air trade is very important
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at the same time, as the rules of the road change, we have had to adjust and adapt the global supply chain and work with our customers as they adapt their supply chain so that we have access to markets but we do in the right way based on the rules established at the time. we are trying to keep track of the rules and make our voice heard when we can and continue to deliver great products for that market. alix: i appreciate you spending the time with us. thanks to bob swan, intel ceo. this is bloomberg. ♪
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alix: i am alix steel with francine lacqua in london. next week is the busiest week for earnings whether you are in europe or the u.s. monday you get ryanair, you get
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lvmh, will be a luxury story. he also get visa, pfizer, mcdonald's in the u.s.. ,ater in the week you get apple alphabet, amazon all in one day. i am looking at exxon and chevron on friday. it will probably be ugly. how ugly? have the and then you banks, you have credit suisse, you have deutsche bank. if you look at what we have had so far, the second quarter earnings season is not as bad as some people feared, but it is also not great. if you look at europe. i was kinda break it up in terms of earnings-per-share. with 25% of companies reporting overall, european earnings-per-share is 50 perceived set -- is 53% year on year. it is not as bad as the lower consensus estimate. we will have to see if the pattern continues. alix: speaking of consensus, i feel you've seen more positive revisions in europe than here in the u.s. that dichotomy will play out as
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well, which is interesting. the question is how does the outlook sum up in light of the trade tensions but also u.s.-eu. also central banks and the fed coming out on wednesday. francine: a very quiet week. enjoy the weekend. and cost cuts. alix: also the fiscal cliff in the u.s. on friday, july 31. the unemployment boost runs out. a busy week coming up. frank, it was a pleasure to spend this week with you. thank you very much for playing double duty. that does it for us. coming up, we will have david westin, balance of power on bloomberg television and radio. this is bloomberg. ♪
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david: from new york to our tv
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and radio audiences worldwide, welcome to "balance of power," where the world of politics meets a world of business. we start with the markets. picking up from where they left off yesterday. how much of this is u.s. china relations? abigail: there is an undercurrent of u.s. china relations. that was the big story last year that caused risked on, risk off. there are payrolls that suggest the economic data could stagger. the biggest pressure is probably the tech sector, the s&p 500 or the nasdaq in particular being pressured by weakness in tech. the nasdaq had been down more than 1% and it started yesterday after we spoke. the nasdaq closing down about 2.8%, its worst day almost two months. this is the microsoft results were not great enough. the tech stocks up so much. yesterday after the


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