tv World Business Report BBC News January 4, 2022 5:30am-6:01am GMT
this is bbc news with the latest business headlines for viewers in the uk and around the world. theranos founder elizabeth holmes is convicted of defrauding investors after a landmark trial in california — she could face a prison term of up to 20 years. could europe's biggest economy slide in to recession? business confidence in germany has sunk — manufacturing is hamstrung and the services sector is grappling with covid restrictions. we get the view of a top economist. and steeling a deal — the eu's agreement with the us means its steel companies from january the first are exporting to america tariff free — british steelmakers are feeling the pain.
she was once the darling of silicon valley — with her company at one point valued at $9 billion — but now elizabeth holmes has been found guilty of fraud and conspiracy following a four—month trial in california and awaits her sentence. the founder of the discredited blood testing company, theranos, was accused of lying to investors and retail customers by overstating what the firm's machines were capable of and the accuracy of its tests. holmes can appeal against the verdict in federal appeals court.
elizabeth holmes had a vision that turned her into a billionaire. she rated a machine that she called the mike edison, that could detect hundreds of diseases with just a few drops of blood. the pitch convinces a very prominent people. the pitch convinced some very important people. media tycoon rupert murdoch invested, bill clinton was a fan. behind me are theranos�*s former head offices. very plush, very expensive and in the heart of silicon valley. and the great and the good came to visit theranos. evenjoe biden came to california and heaped praise on the company. success seemed inevitable. this is my certificate for theranos, showing my shares and it was actually signed
by elizabeth holmes. so, it's kind of a bit of history? it really is. a sad bit of history, but history nevertheless. eileen lepera was a secretary in silicon valley. she heard about this amazing new company. my boss had indicated that it was going to be, in his words, "the next apple" and that i should get as many shares as i could, and so i did. it was six figures, which was a large amount for me. what eileen didn't know was that the dream elizabeth holmes was selling was a nightmare. the technology didn't work, but investors like eileen had no idea. elizabeth was in stealth mode, so that we had no idea whether it was going well or was on the brink of collapse. the retail giant walgreens had a contract with theranos to diagnose patients with its machines. however, the court heard that theranos wasn't using its edison machines, but was instead using openly available diagnostic equipment. the courts also heard that some patients had been misdiagnosed. i just really resent that somebody would make such a massive fraud, especially when so many people told her this isn't working.
elizabeth holmes has argued at trial that she had always attempted to create a genuine product that worked and that she never intended to commit fraud. what happened behind those closed doors has led to a lot of introspection here in silicon valley. but there's still a culture of faking it till you make it here, and until that changes, people worry that what happened in theranos could happen again. james clayton, bbc news. next, to germany where economists are warning the country risks sliding into recession this winter after the country's business confidence slumped and a fourth covid wave slammed the brakes on an economic recovery. germany's vast manufacturing sector has been hamstrung for months by delays and shortages of materials caused by supply chain bottlenecks.
the larger services sector is also being weighed down by new restrictions to contain a surge in coronavirus infections. economist carsten brzeski is global head of macro for ing research. good to see you and happy new year. the question is, what will the next few months you like for germany?— will the next few months you like for germany? happy new year to you — like for germany? happy new year to you as _ like for germany? happy new year to you as well. _ like for germany? happy new year to you as well. we - like for germany? happy new year to you as well. we are l year to you as well. we are looking into something that is at least a soft, maybe a so—called technical recession. we had a weak fourth quarter in 2021 under these supply chain, the fourth wave of the pandemic. now we're going into the omicron wave which is just getting to germany. we have new limitations, new restrictions, in the service sector, in the hospitality sector, in retail. i think it will take until the spring time before the german economy will gather momentum again but if it does it could actually return as the
strongest european economy in 2022 because on substance, the german industry is extremely healthy. theyjust need to supply goods from asia to start producing again. you supply goods from asia to start producing again.— producing again. you sound re producing again. you sound pretty up — producing again. you sound pretty up beat _ producing again. you sound pretty up beat and - producing again. you sound pretty up beat and positive. you are not concerned about the next few months. but what about the services sector and of course the management of covid, because that is so difficult and hard to predict, isn't it? it is extremely hard to predict. up to now, germany has gone very —— relatively well through covid. we also have discussions too, to reduce the period of people going into quarantine from ten days to five days. the restrictions are still 0k and are much milder during the first three waves of covid. so i think that is going well. at the same time we have seen throughout the pandemic that the government is taking a lot of money in their hands in order to support businesses which is clearly needed. the
funny thing is, when you look at the number of bankruptcies of companies, it is extremely low. looking at the unemployment levels, it is extremely low and that is thanks to the government support schemes.- thanks to the government support schemes. let's talk about inflation _ support schemes. let's talk about inflation which - support schemes. let's talk about inflation which is - support schemes. let's talk about inflation which is a i support schemes. let's talk| about inflation which is a big black cloud and a worry for most economies, certainly developed economies, currently stop across the eu it is around 6%, i believe. your thoughts on where that may head, tickly with regards to gas prices and energy provision and this constant situation between russia and germany, about nordstream two, et cetera. it will certainly add to the problems because germany will only feel these higher energy crisis now because there is annexation and households will only feel it january one. inflation will only gradually come down in the first half of this year. this has to do with
energy prices, this has to do with the companies actually passing through higher production prices to the i think we will only see in the second half of this year, that inflation will continue to slow down, probably reaching the 2% at the end of this year. all of this means that private consumption will be dented by higher inflation. it will also mean that they will be pressure on the european central bank to maybe accelerate its process of ending these policies.— ending these policies. karsten, aood to ending these policies. karsten, good to talk — ending these policies. karsten, good to talk to _ ending these policies. karsten, good to talk to you. _ ending these policies. karsten, good to talk to you. thanks - ending these policies. karsten, good to talk to you. thanks for| good to talk to you. thanks for your analysis today. it's a new year and for those moving goods to and from the eu to the uk it means new trading rules. they came into force onjanuary the first with ports preparing for delays as new post—brexit customs checks kick in. thousands of extra staff and border officials have been deployed in a bid to avoid a wave of disruption sparked by the post—brexit trading rules.
so how is it going? richard ballantyne is chief executive at british ports association good morning to you. so, i know it is extremely early days and we have had bank holidays in the uk, for example, and some countries in europe. so it is probably too early to tell how it is all going?— it is all going? yes, good morning- _ it is all going? yes, good morning- i _ it is all going? yes, good morning. ithink- it is all going? yes, good morning. i think it - it is all going? yes, good morning. i think it is - it is all going? yes, good morning. i think it is fair| it is all going? yes, good i morning. i think it is fair to say that it is very early. that said, the first few days it has gone fairly well, i have to say. but it is fairly light in terms of traffic and volumes so will have to give it a bit more time. we are expecting some non—compliance so errors with paperwork et cetera, but hopefully that won't cause a big snarl up at our key gateways. in big snarl up at our key gateways-_ big snarl up at our key ratewa s. , ., gateways. in terms of the actual changes _ gateways. in terms of the l actual changes themselves, gateways. in terms of the - actual changes themselves, have big changes it? for those who are having to do the paperwork
et cetera, how enormous is the task or not, as the case maybe? is another milestone in our brexitjourney is another milestone in our brexit journey and is another milestone in our brexitjourney and trading brexit journey and trading journey brexitjourney and trading journey with the european union. we have had requirements for customs documentation for the last year or so what the government is now is actually an fort —— enforcing the controls at our borders, so actually requiring people to have this documentation done and not allowing them to delay or defer their paperwork. the next big stage will be injuly when animal and plant —based products will have checks. now, this sounds a rather basic point this is where we typically find most interventions and inspections, and what this could mean our delays at the border. but and what this could mean our delays at the border.- delays at the border. but as ou is delays at the border. but as you is say. _ delays at the border. but as you is say. so _ delays at the border. but as you is say, so far _ delays at the border. but as you is say, so far so - delays at the border. but as you is say, so far so good. l delays at the border. but as | you is say, so far so good. is that to do with how well we
have prepared on both sides in terms of extra staff at the port —— at the port, border officials, et cetera, but that is not a sustainable scenario, is not a sustainable scenario, is it? i is not a sustainable scenario, is it? ., is it? i would disagree slightly- _ is it? i would disagree slightly. there - is it? i would disagree slightly. there has - is it? i would disagree l slightly. there has been is it? i would disagree - slightly. there has been a huge amount of preparation for both government and industry. but a lot of that is in systems and new processes which hopefully will stand the test of time and last. as i said before, the new processing coming in later in the year is where we expect to see some impact and not only potential delays but also extra costs for british importers which ultimately will be passed on to manufacturers and even potentially consumers but that is not untiljuly this year. we will keep _ is not untiljuly this year. we will keep a — is not untiljuly this year. we will keep a close _ is not untiljuly this year. we will keep a close eye. good to hear things are going well so far. richard, thank you.
well, let's stay on changes that came in to effect on january the first. british steel companies have been operating at a significant competitive disadvantage compared to their rivals in europe because the eu brokered a deal with the us that came into effect at the start of this year. it allows european companies to export steel to the us without tariffs. the uk has yet to agree a similar deal. our global trade correspondent chris morris reports on the impact. ata at a foundry in chesterfield raw materials are being furnace to make cast—iron bars. because of the american tariffs 25% on uk products, this company is moving some of its production to a factory in spain. so the uk manages to strike a deal with the us, without production come back?— come back? probably not, it really depends _ come back? probably not, it really depends on _ come back? probably not, it really depends on how - come back? probably not, it really depends on how early | come back? probably not, it - really depends on how early the deal done. once a customer gets over there —— gets used to the spanish product, the question
is whether it is worth to bring it back or not. it is highly likely we will leave it over there. i lost to the uk completely then. there. i lost to the uk comletel then. ,, ., , completely then. steel and cast iron are no _ completely then. steel and cast iron are no longer _ completely then. steel and cast iron are no longer a _ completely then. steel and cast iron are no longer a huge - completely then. steel and cast iron are no longer a huge chunkj iron are no longer a huge chunk of the british economy that if yourjob depends on them, they still really matter. it was to help protect american jobs that president trump introduced the tariffs in 2018. for the uk at least, the biden administration hasn't changed course. another public clemency nor private negotiation has yet led to any breakthrough. both the uk and the eu have retaliated with tariffs of their own against american products, but it is the eu that has got a deal done first. that is partly because in trade, size matters. they are 'ust in trade, size matters. they are just bigger _ in trade, size matters. they are just bigger so _ in trade, size matters. they are just bigger so they - in trade, size matters. tie: are just bigger so they account for more steel exports to the us and because there is more trade involved in the eu, the retaliation hurts more. the only reason it the eu is more
explicit about how they would mmp explicit about how they would ramp up the bed retaliation against those tariffs. the uk has been a bit friendlier, a bit chummier, and that means the eu has had a bit more leveraged. the eu has had a bit more leveraged-— the eu has had a bit more leveraged. the eu has had a bit more leverared. ., _, . leveraged. political concern in washington — leveraged. political concern in washington about _ leveraged. political concern in washington about reduced - leveraged. political concern in | washington about reduced rate to suspend parts of the post rex deal with the eu on northern ireland. it is an awkward mix. at the department for international trade, they don't want to dispute with the united states, quite the opposite. outside the eu, the government is relying on closer trade ties with the us. it is in response to public consultation on further countermeasures against those american steel tariffs has already been delayed and it can't hold off indefinitely. the government hopes and can be resolved soon before it gets what and the message from industry is pretty clear. let's aet a industry is pretty clear. let's get a deal —
industry is pretty clear. let's get a deal brokered - industry is pretty clear. let's get a deal brokered as - industry is pretty clear. let's get a deal brokered as soon | industry is pretty clear. let's l get a deal brokered as soon as possible and put it on a level playing field with the rest of europe. playing field with the rest of euro e. �* . , playing field with the rest of euroe. �* ., , , europe. but as with many things in trade, europe. but as with many things in trade. many _ europe. but as with many things in trade, many are _ europe. but as with many things in trade, many are easier- europe. but as with many things in trade, many are easier said i in trade, many are easier said than done. stay with us on bbc news, still to come: another bumper day on wall street as apple becomes the first company ever valued at $3 trillion. the japanese people are in the mourning following the death of emperor hirohito. thousands converged on the imperial palace to pay their respects when it was announced he was dead. good grief. after half a century of delighting fans around the world, charlie brown and the rest of the gang are calling it quits. the singer paul simon - starts his tour of south africa tomorrow in spite of protests and violence from some - black activist groups. they say international artists should continue to boycott . south africa until majority
rule is established. - around the world, people have been paying tribute to the iconic rock star david bowie, who sold 140 million albums in a career that spanned half a century. his family announced overnight that he died of cancer at the age of 69. the world's tallest skyscraper opens later today. the burj dubai has easily overtaken its nearest rivals. this is bbc world news, the latest headlines: a day of critical court hearings for virginia guiffre and prince andrew, as his lawyers in new york are to argue whether her civil lawsuit alleging sexual assault can be thrown out. it's back to school after the christmas break for millions of pupils — with face coverings now required in the classroom in england's secondary schools.
to wall street now, where markets started the new year pretty much as they ended the last, with record highs. apple briefly became the first company to reach a market capitalisation of $3 trillion. and shares of tesla soared 13.5% after the electric car maker announced delivery numbers that were far better than analysts had expected. joining me now is janet mui, head of market analysis, indicate up 2%, hong kong not as strong, the price of oil creeping up as well. —— the nikkei up 2%. let's discuss the new year's boost with janet mui. happy new year. what a day for wall street and what a day for wall street and what a day for apple?—
for wall street and what a day fora le? . ~' ,, ., ., for apple? thank you for having me. a tremendous _ for apple? thank you for having me. a tremendous day, - for apple? thank you for having l me. a tremendous day, actually, for some of the mega technology stocks like apple. i think markets are continuing to positive mood from 2021, the s&p 500 which is the active benchmark index is up 27% from last year, and the first starting day of the year, i think markets are encouraged by the fact that omicron is milder than people previously thought and hospitalisation rates have not been getting up significantly, so it is not as sinister as people had previously expected, so that has been quite positive, and for apple, has been quite positive, and forapple, it has been quite positive, and for apple, it is a gigantic moment and it is really because the markets are excited about the markets are excited about the upcoming market launches such as the virtual reality headsets, continuing to deliver robust and steady earnings throughout 2020 —— 2021, and of
course there is also a citation for a potential electric car or autonomous vehicle and also the fact that it's primary business, for example the apple store, has been doing very well. �* , ., ., , well. as we move into this new ear, well. as we move into this new year. markets _ well. as we move into this new year, markets are _ well. as we move into this new year, markets are not - well. as we move into this new year, markets are not so - year, markets are not so concerned about omicron and its impact, now not so concerned now about inflation. one reality that is in place is that many of us will be working from home for quite some time, so that is good news for apple. i think the wave of the omicron variant has helped to boost the technology stocks a bit, maybe not as much as at the start of the pandemic, but it has helped, because people will be using more of the technology equipment and software and companies will be using more of the cloud, so it is really another positive reinforcement story for these companies, and also for apple.
story for these companies, and also for apple-— also for apple. there is an expectation _ also for apple. there is an expectation that _ also for apple. there is an expectation that supply i also for apple. there is an i expectation that supply chain problems will gradually improve and also the demand for the iphone 13, for example, that is expected to be very strong. so as a result, apple analysts are very positive about the stock, and as a result, the stock has actually tripled in market value since the start of the pandemic. value since the start of the pandemic— value since the start of the pandemic. value since the start of the andemic. , . ., ~' , ., ., pandemic. janet, thank you for our pandemic. janet, thank you for your analysis- _ pandemic. janet, thank you for your analysis. they _ pandemic. janet, thank you for your analysis. they a _ pandemic. janet, thank you for your analysis. they a star- your analysis. they a star trivia. we will see how it progresses. the software company blackberry is discontinuing service on all its classic smartphones that do not run on android software. the blackberry technology that once dominated the market has been overtaken by the rise of iphones and android touchscreen smartphones and by 2016 the company ceased making phones moving instead into software. turkey's annual inflation rate has soared to a 19—year high, underlining the country's financial turmoil and alarm over its president's policies. as the cost of transport, food and other staples ate
consumer prices rose more than 36% in december as the cost of transport, food and other staples ate into household budgets. most central banks raise interest rates to help cool inflation, but turkey has gone the other way. opec plus is expected to stick to its plans to increase output in february when it meets today. the group of oil producers has been gradually unwinding record production cuts of ten million barrels per day — about 10% of global oil output — agreed in march 2020 to counter the hit to demand from the pandemic. but there have been some changes at the top. joining me now is our middle east business correspondent, sameer hashmi. it isa it is a new year, so we will look at how the omicron variant is affecting the reopening plans for many economies in asia in particular, two years on from the outset of the
covid—i9 pandemic, these countries are facing the challenge of keeping their economic recovery on track, but it isn'tjust omicron that will affect growth going forward. our asia business correspondence mariko oi explains what factors will affect the region's economies in 2022. let's start with what affects all of us. spoiler alert, some of the topics may sound like a sequel from 2021. firstly, things are getting more expensive wherever you are, and to call off inflation, brace for rate hikes this year. in case you have not had enough of it, inflation is partly caused by global supply chain issues. we saw a huge surge in demand for everything as the world �*s economy started to reopen last year, and supplyjust couldn't keep up. ports got congested, containers couldn't find any space to dock, and the world started to run out of warehouse space. speaking of too much
demand and not enough supply, shortage of semiconductor chips used in everything from cars to computers is here to stay for a while longer. what about china? the debt crisis of its property sector has not gone away. neither have us—china trade tensions. chinese tech giants will continue to be scrutinised at home and abroad. for south—east asian start—ups, 2022 could be exciting. after the region's biggest, grab, successfully rested on the market last month, others may follow. as of now, asian economies are expected to recover strongly, economies are expected to recoverstrongly, but economies are expected to recover strongly, but as we have learned over the past two years, everything depends on how the pandemic is evolving and our governments and businesses are reacting to the latest covid duration. that was mariko oi. i mentioned we would talk about oil, let's show you the markets once again. currently brent crude is costing, if you want one barrel of that, you have to payjust
over $79, so once again the price of oil is edging higher. the thing to watch out for, if thatis the thing to watch out for, if that is of interest to you today, the opec plus meeting, which is taking place today, they are looking to stick today are plans to increase output in the month of february. of course, there has been so much pressure on opec plus, which is oil producing countries that team up together to create opec plus, representing other countries that work with them such as russia which are not officially in opec. they've been under a lot of pressure from people such as president joe biden in the us and others, to increase production, because the price of oil has been historically very higher, you know, a few months ago it was around $85 a barrel, a roundabout there, a barrel of brent. we should see what barrow pack plus meeting, —— what the opec plus meeting, as
it concludes today, what they decide to do, that could have an impact on the price of oil as the day progresses. you are up as the day progresses. you are up to date on all things business, news and sport. see you soon. after what was an exceptionally mild start to the new year, we have now started to see quite a dramatic change in our weather. something much colder has been working its way in. a chilly—feeling day for tuesday — snow and gales for some of us, particularly in the north of the uk. the cold airfiltering in behind this band of cloud and rain with some sleet and snow on the back edge. ice a possible hazard across the northern half of the uk, where it will be a really chilly first part of the morning. wintry showers starting to pile up in northern scotland. in fact, snow showers even to low levels over the highest hills — 15 cm of accumulating snow. and with gales or severe gales, especially around northern coasts, there could be blizzard conditions for a time. a band of cloud and rain with a little bit of sleet
and snow over the high ground will slowly clear the southeast corner, then we see some sunshine, some wintry showers, a mix of rain, sleet and hill snow, especially out towards the west. those are the average wind speeds. the gusts will be stronger than that with the wind coming down from the north, so it is going to feel really chilly. on the thermometer, single—digit temperatures, 4—8 degrees. factor in the strength of the wind, this it what it will feel like. it will feel subzero across many northern parts of the uk. now, as we move through tuesday night, there's more snow to come in northern scotland, more wintry showers in the west, some clear spells elsewhere. it's going to be a cold night with frost and ice, temperatures dropping close to freezing, below freezing in quite a few places. so, a widespread frost to start wednesday morning, but wednesday should bring some decent spells of sunshine. a few showers still close to the east coast, one or two out west and up towards northern scotland. more in the way of dry weather, some spells of sunshine,
temperatures still between 4—8 degrees. but this is actually where we'd expect to be for early january. this approaches from the west. a little wedge of milder air with it, so some snow initially. then it'll tend to turn back to rain as that wedge of milder air works in, but then colder air returns from the west. wintry showers will start to push in, so only temporarily will temperatures be just a little bit higher. friday, another chilly—feeling day, highs of 5—8 degrees. we'll see a mix of sunny spells and wintry showers.
good morning, welcome to breakfast with sally nugent and ben thompson. our headlines today. a day of critical court hearings for prince andrew and virginia guiffre. his lawyers in new york will argue that her civil case, alleging sexual assault, should be dimissed. it's back to school after the christmas break for millions of pupils with face coverings now required in the classroom in england's secondary schools. good morning. unwanted presents. retailers are facing a flood of christmas returns. around one in four gifts get sent back each year. i've got some tips on how to get a full refund. it's all wright on the night for peter �*snakebite' wright who banks