Transcripts For CNBC Closing Bell 20240713 : vimarsana.com

CNBC Closing Bell July 13, 2024

Organizati organization, china as well as investigations of practices of Chinese Companies that are listed here in the u. S. So were up 0. 4 . 3 for the week as a whole sara straight to kayla in washington to recap what we just heard from the president including that significant announcement that the u. S. Would be terminating its relationship with the World Health Organization and sara, the president prevud that a few weeks ago saying it would be reviewing the funding it sends to the w. H. O. In the wake of what it sees as shortcomings by the World Health Organization to alert the u. S. Of some of the risks of the coronavirus. Sources tell me that one of the ways the u. S. Feels most wronged is that there was no information about asymptomatic transmission of this virus until late in the game when the u. S. Population and economy was at risk. He announced the administration would be suspending the entry of foreign nationals from china to the u. S. , that the u. S. Finds at risk to the u. S. Population. My sources say these are people in the Higher Education space that the u. S. Believes have ties to the Peoples Liberation army in china the president also says the u. S. Will be suspending, or studying rather the accounting prakctices of chinese firms, essentially giving more heft to that senate effort to essentially cause a lot of these Chinese Companies to certify they have no Chinese Government involvement otherwise delist theyll be studying an elimination of economic exceptions from hong kong. But the president stuck to the script didnt say when or how certain of these special treatments of hong kong would be rolled back and what that would mean and when the president didnt take questions and you can be sure reporters would have accused him to e elaborate on some of these policies and the administrations decision not to go forward with some of the even tougher measures that had been on a menu present ed to the president. Notably any freezing of assets or any sanctions on top chinese officials themselves those were not included in todays policy announcement. My sources they the you h likely see a continual ramping up of rhetoric going into the campaign and into the election season, but that the administration wants to be very careful to not exact any more pain on the u. S. Economy than its already feeling while still reserving some of those actions and those poll icies if and when they wan to roll them out at a later date perhaps later this year or even in the president s second term sara and wilf. I was just going to ask you, kayla, about what he did not announce its good that you know you laid out there are some significant policy actions including obviously terminating the w. H. O. Relationship, but the sanction, the exiting of the phase one trade deal, i guess that, the Market Reaction had a lot to do with the fact that he did not go there. And im wondering if you have any background or reporting as to why not and whether those are still in the cards yeah, well my sources say that the treasury secretary was reluctant to use the office of foreign assets control to levy some of those tougher sanctions on china those actions they reserve for rogue ak r tors like iran and north korea and they have not been shy on using those actions on other regimes in the past as far as the trade deal goes, i believe the u. S. Wants to be seen as upholing its end of the bargain. A source told me the white house doesnt want to go back on its word on the trade deal and if anyone is going to exit the deal, it will be china there are also some of the purchases they want china to try to make quood on although with han eck peckation what the white house announced there will be some sort of chinese response in kind t hard to see china wanting to continue making those purchases if theres not a market need to do so. Were going to wait and see how china responds, but it is notable some of those tougher and harsher actions the white house could have taken did not happen especially as it relates to sanctions and potential visa restrictions for top members of the Chinese Communist party to mike now for more on how the market is reacted to all of this and mike, i guess the market reacting more to what wasnt said as opposed to what was said exactly for a bit over 24 hours, the markets been bracing. Just in case it was going to be something more economically consequential. The treatment of hong kong, the blaming of china for with Holding Information agent the virus. Pretty much all of it. Even the w. H. O. Tough was handicapped beforehand and no punch line about trade or further measures is so that being said, i think the market just lifed whatever pressure came from that source yesterdays high would point out in the s p like 3067 to still trading almost 1 below that, but just rebuilding a little bit after this strong rally in terms of what might come in terms of policy today mike, does this mean anything for a company like ab apple or nike that operates in china that pins a lot of growth on china thats been outperforming in the market because in large part of china . Any of these moves today get in the way of that . It seems no nothing that came from the Administration Today could get in the way who knows if theres going to be a resip row cal measure frs the chinese side so i do think Big Companies have sidestepped whatever might be a direct impact. I also think we have to keep in mind what the central fixation of investors is right now. I dont think the growth of the chinese economy is like top five in terms of whats going to decide whether this is a stock market rally that makes sense or economic revival thats going to happen on time its about restarting the u. S. And a climbing out of this deep hole in terms of employment and business activity. So thats why i dont think it necessarily had the acute effect you might otherwise think it would. Thanks so much. Well see you again shortly. Lets bring in mark moelggly thanks for joining us. Hong kong index was down three quarters of a percent today. Its closed as we speak, but ended the week essentially flat. Does that surprise you would you have expected it to have traded down more this week . What this is telling us is that this wall of worry that people are climbing in this bull market actually were in another bull market, is more stronger in terms of the upside than on the downside and i think by a lot of this business with hong kong has been discounted a lot because as you know, weve been through riots in hong kong for the last year, so i think were now in a bull market again and its quite amazing to me to see how much recovery theres been i was looking down the list of all the emerging market stocks and indices and we see increases at 30 , 20 , 15 et cetera, from the bottom so im optimist that i can we may see a v shaped recovery in the economies as well. Youre not worried at all about this renew eed tension the president there while not announcing sanctions or any tar you ha tarifs, did blame chinas malfeasance for people dying around the world broaden the use of the wuhan virus, really a direct shot at china. Youre not worried thats going to be economic or financial consequences i dont think so. I think sure, theres going to be trade tangss. Its going to continue, but trade with china and the u. S. Will continue at a slower rate of course. But the interest sbring is is how a lot o this trade is is mo moving to other countries. Supply chains arent going to be interrupted much because manufacturers and buyers and sellers are rei didnt go ling their supply chains to other countries, but chinas still very important cant deny that. Mark, i wonder what your expectation is that what this will all mean for hong kong. Do you think there might be an exodus of businesses of citiz citizens theres already been hong kong has so many advantages in terms of changing taxes or the legal structure in terms of commercial law, then i think people will understand dont forget the tax rate in hong kong is much lower than china. So theres a lot of advantage to being there. What are you buying and selling . Well china is biggest in our portfolio. Its not huge, but about 20 then we have india, about 15 . Brazil is up there, about 14 . South korea, 14. Turkey, five taiwan, five even kenya, where at 5 . So were pretty well spread around the world and china is still up there at the top. Mark, good to have you here that will kick off the hour with that china news. Lets get straight to eunice is there any reaction yet . So far, no official reaction. From the government. But you can expect that these comments from President Trump will not go down very well at all. First of all, he described the virus as the wuhan virus, which the chinese really dont like. Because they feel that this should not be a virus thats pin ed to one place. They repeatedly said this is a matter of science. That they should not be blamed that china itself is a victim and that the u. S. Was informed from chinas perspective, very early on the chinese have said that there was no cover up. Now from what also we know is that the Foreign Ministry had in the run up to this press conference by President Trump had said that hong kong that china would take countermeasures if there was action on hong kong from President Trump he said, the spokesperson said that china really sees hong kong as a, the issue of hong kong as an internal affair and gave a little bit of a hint as to what could happen if President Trump were to really push the hong kong issue and so he for example, he had mentioned that wall street firms have a very good presence in hong kong he also mentioned that the u. S. Runs a trade surplus are hong kong American Companies sell a lot of jewelry, a lot of beef machinery. To people in hong kong so there was a bit of a veiled threat earlier today from the Foreign Ministry about what could be done. Specifically when it comes to hong kong. Also what was interesting i think in the state media today has been how state media has been playing down the impact of the u. S. Revoking the special status that it has with hong kong and theres a global times editor whos quite influential or at least followed very closely by many people here who had said that this was a, that the true determining factor for hong kongs role as a Financial Center is china and that its not actually the u. S and so, so i think that whats interesting is that youre really playing it down and what i also thought was interesting in the comments from President Trump was that there was quite a bit of wiggle room in thiz lang wanl he wasnt saying we are definitely ending this relationship right away. It was all im kind of process and steps. Which i think also addresses some of the concerns of the American Business community in hong kong and in the region that had been very concerned that about the potential impact this could have on hong kong as a city, as a financial hub, but also to American Business. In thety so clearly, the president did talk about the special exceptions for hong kong and talked about looking at Accounting Practices of chinese firms listed in the u. S. X suspending entry of certain foreign nationals in china, but the market is taking it as a measured response. Thats what jim cramer just used on twitter he didnt go into trade and tariffs, into sanctions. Do you think ultimately as someone who has follow ed this closely, the chinese will see it that way i think that a the chinese are going to want to keep the trade deal going i think probably for the same reason that President Trump doesnt necessarily want the trade deal to end and thats because of the economics behind it the trade deal is something that helps keep chinas economy going. Right now, chinas in the process of reopening they have a lot of problems, especially when it comes to unemployment they want to have American Companies here they want to have American Business and they want to make sure that there arent any uncertainties to the recovery. So because of that, china would probably not want this trade deal to end in any way shape or form, but theyve repeatedly said in the past, if they feel that they are really threatened and if President Trump does come up with Something Else when it comes to tariffs, for example, then china would likely react with countermeasures i wonder what your reaction speaking to your many friends in hong kong has been, not just to what we heard from President Trump, but the ooefbts of the last couple of weeks in general and how likely we are to see maybe not on the business side, but perhaps driven by the citizens themselves as to whether we are likely to see a big exodus from china and also part of that, the fact that the u. K. Today has extended its offer of essential citizenship path for not just the original 300,000 hong kong citizen, but now up to about 3 million. Seems like theres a lot of pressure there building on certain hong kong nationals that may now decide to move on. Yeah, theres a lot more talk now about departing. So pretty much everybody that i speak to there, whether or not in business or in academia are all coming with a plan b and trying to figure out where they would land if they were to leave the city but as of right now, its still just talk. People are very depress ed for the most part about whats happening to the city. Either theyre angry at china or theyre angry at the protestors and saying that theyre hastening something that a lack of freedoms that they dont want to see so there are a lot of people who are really frustrated. I think that next week, we are likely going to see an escalation when it comes to the protests just because of the anniversary of the june 4th Tiananmen Square crackdown but for the most part, people are feeling that these protests have much more consequence than before. Hong kong has always been a place where you can actually protest quite peacefully and then more and more those peaceful protests are being broken up very quickly, which is something you see here in Mainland China all the time. Also the Security Apparatus here of the ministry of Public Security said its going to be coordinating much more with the Hong Kong Police and so that has also made people much more depressed about whats happen ng the city but i think what is is also important for people to understand is that even though President Trump is saying making all those strong statements about hong kong, that from chinas perspective, there really isnt any other option but to go really tough when it comes to hong kong because they do see this as an internal affair theyre very concerned about the Ripple Effect it can have on other parts of what they believe to be china such as taiwan so because of that, its going, its hard to see how china would back down. Thank you very much for st staying up late with us as we see the dow hovering around the n flat line after the President Trump News Conference. Breaking news on disney just crossing florida officials have approved the theme parkss reopening starting june 11th the department of regulations saying in a statement just now, Walt Disney World resort has established the necessary plans for the safe operations of its theme Park Properties upon reopening. Disney shares have popped into the green here along with the overall market in the last few minutes. A lot of that was antis paid as we knew disney was taking steps to outline their reopening plans. And disney up about half a percent. Broader market up about a quarter of 1 so holding on to some green ewe tiutilities and tech, finans with about 40 minutes left in the session for the final session. After the break, well look at what the growing feud between the Trump Administration and twitter could mean for the fragile Advertising Market youre watching closing bell on cnbc vo since our beginning, our business has been people. And their financial wellbeing. Its evident in good times, with decisions focused on the longterm. And crucial when circumstances become difficult. That continued emphasis on people our advisors, associates, clients and communities gives us purpose, strength and a way forward. Today. And always. Across america, Business Owners are figuring things out. Finding new ways to serve customers. Connect employees. And work with partners. Comcast business is right there with you. With a network that helps give you speed, reliability and security. And enough bandwidth to handle all your connected devices. Voice Solutions Like remote Call Forwarding and readable voicemail. And safe, convenient installation. When every connection counts, you can count on us. Get the connectivity your business needs. Call today. Comcast business. The battle between President Trump ard twitter heating up today after twitter flagged a tweet. Twitter says this violated its rules of glorifying violence the big question for the bottom line, will this war of words impact twittersable ility to da in advertisers joininging us now the mark douglas, founder of steel house. Nice to see you. Thanks for joining us. Is going to affect twitters Business Mod

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