>> good morning and welcome to "daybreak: australia." sophie: we are counting down to asia's major market open. shery: the top stories this hour. u.s. stocks in a five day slide, crude oil trading near a six week high. haidi: protests breakout over

evergrande, raising the stakes for chinese authorities worried about the developing debt crisis that could spark social unrest. shery: we talked to a venture capital investor as he goes all in on crypto. we will talk to mark carnegie. this is a picture across wall street, we are seeing u.s. futures gaining a 10th of 1%, after a bit of a mixed finish in the u.s. the s&p 500 and nasdaq down, but the dow gained ground. chinese tech stocks declining more than a percent. officials are seeking to break up allie k -- alipay, that leading the china index to fall. we also have the health index dropping on that report, with moderna down, as we heard from a scientific annals arguing vaccines work so well most people don't need a booster shot. the health index on the s&p 500

fell for a fifth consecutive session. the wti crude prices at the moment, extending gains to $70 per barrel, a six week high. the market bracing for another storm threatening the gulf coast, tropical storm nicholas on its way to texas. we could see more disruptions, and this coming after the call from goldman sachs earlier saying we will see a rally in oil prices, given hurricane ida left a decline in inventory. really, oil stocks not catching up to that rally in crude prices , although we could see a bit of a boost, even as opec predicted stronger consumption. we are also looking at crypto assets. it has been a wild ride for bitcoin and other digital coins, again after a press release that all market will accept cryptocurrency as payment, but then walmart denied the reports.

we have the news telling the crypto markets, the crypto index down 1.5%. we are also watching coinbase, looking to raise $1.5 billion from a bond sale. we are also watching ark's next generation etf, as we heard from kathy wood that they will be investing in a canadian bit owing etf. it has been all about the tax plan and congress, the ways and means committee releasing the most detailed picture yet of the tax overhaul. the market trying to digest what this means for capital gains taxes, corporate taxes, taxes on individuals as well. haidi: what are the implications for the inflation outlook as we count down to the cpi in the u.s.? we are looking at data that perhaps suggest inflationary pressures, while we are seeing them across the world, they are

perhaps strongest in the u.s. looking at the inflation in the united states versus other major economies seems to suggest stronger inflationary pressures is coming through because of stronger demand but also because the economy has received so much more in terms of powerful stimulus. what does that mean in terms of the come down? we did see data when it comes to what is expected, and research from international finance saying delivery and logistics problems are also more specific to the american economy as well. shery: all eyes on the tuesday cpi print, what is happening. commodity prices surging and consumer space. the spot index, the bloomberg index at a decade high. the rally from aluminum to steel to nickel, a broad rally in the metals space. at a rally in oil prices as well.

haidi: you mentioned it at the top in terms of the market reaction, but we have heard a new report suggesting most people will not need booster shots, saying covid-19 vaccines work so well most people will not need a third or potentially fourth additional shot, according to a panel of all-star researchers and experts from around the world. it is interesting, particularly in this part of the world, in new zealand, the auckland lockdown extended and we will continue to watch to see how that bears when it comes to policy normalization for the rbnz that. shery: summary factors affecting the markets. -- so many factors affecting the markets. sophie: some countries are debating if booster shots are needed, others still in a critical race to wrap up vaccination. a campaign to accelerate to one million shots per day, you can see indonesia has vaccinated less than 60% of its population.

in a lot of the come -- the countries pushing for reopened, singapore and australia, but there is a concern we could see a second wave of infection in new south wales next month. in japan, we have the country vaccinating 59% of the population fully. we have political developments. the leadership campaign is on. futures pointing lower slightly here after we saw a bounceback for the cash session late afternoon on monday. we do have reporting -- in the leadership race. i want to highlight what was said about japanese stocks. saying that we have to be realistic about the stimulus that might come under the new premier in japan.

strategies are recommending adding japan in cyclicals and cautioning against rushing into tech oil boosting exposure. aluminum in london hitting $3000, iron ore has collapsed, an outlier in the commodities space, gathering pace with futures down about $100 from the peak in may. haidi: evergrande is a facing even more pressure, not only from bondholders as evergrande approaches default, but a legion of angry homebuyers. even its own employees. let's bring out stephen engle in hong kong. what is happening the process? we know so much of the decision and policymaking from beijing is dedicated to maintaining social calm. stephen: absolutely, the

government in china puts a huge premium on social stability, and small-scale protests like what we have seen with evergrande are not unheard of in china, but when you're talking about the issue of social stability at a time when xi jinping isn't talking about common prosperity, kind of emboldening the retail, smaller retail investors. when these protests start snowballing, that is a huge concern of authorities. we have various protests breaking out the last few days over various issues of the evergrande empire, obviously in the quiddity crisis and faces a possible debt restructuring, default. could there be government intervention? that is the big question. you are seeing footage here of the shenzhen headquarters of evergrande late monday after dozens gathered to demand

repayment on overdue wealth management products. the protests reportedly numbered in the hundreds over the weekend on sunday. that is just one place. in a northern province, employees who bought wealth management products protested over the weekend and subsequently were told to go work from home to damp down on the tension. also just across the border, angry homebuyers surrounded a local housing bureau last week to demand the restart of stalled construction. keep in mind, probably the most conservative number we have is that evergrande has taken down payments on it yet to be completed homes from about 1.5 million buyers. there is trouble brewing. shery: and given the prospect of unrest, and we expect the

government to intervene? stephen: that is the big question while huarong got a bailout, it was heavily owned by state entities while evergrande is largely private. again, this is a company with more than $300 billion in liability, facing a huge haircut of about 75% dollar bonds. i want to redo iris chen, she says her best case scenario, best case, is a government supervised deal with evergrande that ensures evergrande delivers those homes and pays suppliers. social stability, pay the suppliers, where dollar bond investors would get 25% of their money back. 75% haircut. as we have seen, the market already pricing in the dollar bond at about early cents to the dollar. haidi: stephen engle there with the latest on evergrande. not helping market sentiment

either is the continuing outbreak across china. beijing conducting mass testing in one province after more than 90 infections reported over three days. several counties are being put under strict lockdowns within person teaching suspended at schools. this as new debate emerging on the vaccine front with some scientists questioning whether a booster shot is necessary at all. let's bring in kara with the details. given that most of the world is still unvaccinated, scientists have doubts about whether this is scientifically needed, to have a booster at this point. >> the study that came out today in the land set from a group -- lancet from a group of experts show data says there is not enough showing vaccine efficacy wanes over time. they are trying to get to the

people unvaccinated, that is the best way make use of the vaccines rather than a booster for people who already have them. haidi: meantime in the u.k., a final missing piece of the puzzle. there might be more vaccines available for children? kara: the u.k. followed the u.s. and approved vaccine for ages 12 and up. getting the vaccine more to younger people. we are still awaiting vaccines for younger folks under 12, that is a key issue for school-age kids. today new york is going back to school and everyone looks for further reopening in the u.s., schools have been open and we are looking more toward kids getting shots. we are looking for that in coming months, but yes, a key step in the u.k. haidi: let's get over to vonnie quinn with the first word headlines. vonnie: good morning.

house democrats have released a package of tax increases that fall short of president biden's ambitions. the proposal would raise the top corporate tax rate from 21% to 26.5%, and capital gains to 25%. it would raise government revenue by $2.1 trillion over 10 years. democratic lawmakers also say they will undo a $10,000 cap on federal deductions for state and local cap -- date and local taxes. china has urged the u.s. to repair damaged relations as the biden administration weighs an investigation into chinese companies. bloomberg sources say the u.s. is weighing the inquiry as a way to pressure beijing on trade. opec is predicting strong demand for crude this year and next on a combination of rising fuel consumption and output

disruptions. the group's latest report says the world will continue to face an oil deficit in coming months even as numbers revise production. opec says global oil production is expected to reach just over 100 million barrels per day in 2022, which would exceed pre-pandemic levels. walmart and a distributor say they are investigating a hoax tying the retailer to a nonexistent cryptocurrency deal. the fake announcement said the retail giant would start letting customers pay with a relatively obscure instrument not among the top 10 cryptocurrencies. the coin jumped as much as 34% before walmart denied the statements. global news 24 hours a day on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i am vonnie quinn. this is bloomberg. haidi: still ahead, mark

carnegie tells us why he changed his mind when it comes to cryptocurrency and where he sees opportunity now. next, a cio joins us with market strategy. this is bloomberg. ♪

>> that u.s. cpi print. >> a key point tomorrow. >> you may start to see the taper. >> the fed will make up stories to fit their story, which is inflation is transitory. >> a lot of uncertainty about inflation. >> any upside surprises. >> surprises to the upside. >> we have to think more critically about what higher prices do. >> imagine inflationary pressures. >> to what extent there is negative feedback, a second round effect.

>> at the next fed meeting. >> it is a bit of a dangerous game. >> some of our guests on what they expect from the august cpi trend, this two weeks ahead of the fed's next policy meeting. this report will be testing the view that a spike in u.s. inflation is only temporary. kathleen hays is here with a preview. jay powell himself still bets on transitory inflation. what can we expect? kathleen: this is at the core of what the fed is saying, we are going to taper carefully and slowly and not russian to rate hikes because the consensus view, not 100%, the consensus says prices spikes will start cooling off. instead what we are looking at is an inflation rate, we get this report on tuesday, it is expected to remain above 5% for the third straight month, that is the turquoise line. those old and yellow bars are showing a little bit of easing off on a monthly basis. we are looking for 0.4% for the

month of august versus 0.5 in july, but 5.3 for the turquoise line is not much less than the 5.4 in july. the fed's transitory inflation camp still says the base effects will say when inflation fell, we stopped comparing it to negative numbers and it will look better. we think the reopening driven things, like airlines and car prices, that will pull back because reopening will continue. but what is on the other side of the argument? let's go to this one, inflation expectations, according to the new york fed survey, is not the oldest one, but it hit a record looking at a year consumers say they think inflation is going to be 4%. three years, over 5%. another thing i would say the fed has to think about, the chip shortages, they are persisting and not going away. every day you see a new product

where the price is rising. and finally, fiscal stimulus. it is record fiscal stimulus on top of monetary policy. people like larry summers and jason furman saying this is a concern for inflation. you will have high demand that will push up prices and that will be the inflation issue for the fed to deal with. haidi: as we mentioned, democrats in congress proposing corporate tax hikes, that seems to reflect the political precariousness of the economic agenda. kathleen: it doesn't matter how progressive you are, as a house democrat, you know you need moderate house democrats onboard, and in the senate as well. here's what they propose now. tax hikes on corporations, just not as big as joe was looking for. the top corporate tax rate goes up from 21% to 26 point five, and president biden was looking for 28%. capital gains from 20% to 25%, but joe biden was looking for

nearly 40%. 39.6%. it's estimated to raise more than $2 trillion, however, and they will have another $3.5 trillion in spending, you have to pay for it, that is the idea. but it is aimed at helping business minded democrats in swing districts up for election in the midterms. and of course everybody is watching democratic senator joe manchin from west virginia. he is pushing back on some of the fossil fuel mandate being looked at. a lot of horsetrading is still going on. he is holding out, demanding more talks, a strategic look at this, and he will not vote yes he's is until that is done. shery: a long way to go. kathleen hays with the details on the u.s. inflation outlook, not to mention the stimulus picture. our next guest says she is positioning her portfolios with a bias toward equities with a focus on growth and quality. because after all of these

concerns we talked about, the impact of the delta variant is proving larger than anyone anticipated. shana sissel joins us. always great having you. i get your point on growth and quality, given a lot of people have been seeking more safe havens. this chart showing how the mega tech stocks have rallied versus the s&p 500. but again, valuations -- aren't you concerned about that? shana: you would be if you thought fundamentals were the key drivers of the market, they haven't been because the fed has been very accommodative and overall macro and economic picture has not been as rosy as we hoped. that is really weighing on investor psyche in they are trying to focus more on where they feel is quality and safety. we can debate valuation on technology and whether we think it is expensive or not, and talk about the different valuation

metrics that might support it not being that expensive, but the key is that, the concern is the recent economic data out of the u.s. and across the globe has not been that strong because alta has played a role. -- delta has played a role. we are not as reopened that we hoped we would be six month ago when we thought the vaccine rollout would stop me -- would stymie the spread of the virus. the vaccine is helpful, but it does not necessarily stymie the spread. this is a headwind to the economy and to a lot of things, cyclical stocks and the like, that would benefit from a full reopening. that is not happening right now. i'm focusing on staying with names that will do well regardless of how much we reopen or how long the headwind continues. shery: could we be more vulnerable as well, given

september and october are not the strongest month when it comes to equity markets? shana: absolutely. september has consistently being the worst performing month in the market and october tends to be the most volatile. when you look at the breadth of the market, that is sent and to be concerned as well. may 1 until today, almost 50% of the names on the s&p 500 have seen a 10% correction. 90% of the names on the russell 2000. greater than 20% correction. all of the energy names in the s&p 500 with a greater than 10% correction. the rest of the market is not strong and being driven by big attack names, the risk off names , risk on names, places people go when they are little fearful and looking for safe haven. haidi: when it comes to a may softer than expected in aquatic tax plan, is that comforting for businesses and those who invest in them? shana: i don't think so,

especially because now we are having conversations about vaccine task force and asking small businesses to make sure employees are fully vaccinated or not returned to work. that is a lot to ask of them. to add any additional tax burden i think would be not well received at this time. clearly it is not as aggressive, tax increases as proposed, but i think it is a precarious time for the u.s. economy, and doing anything that could push us into having more headwinds, i don't think it is smart right now. will be interesting to see how this plays out. haidi: shana sissel joining us from chicago. plenty more to come on "daybreak: australia." this is bloomberg. ♪

haidi: the cpi print in the u.s. on tuesday, we are keeping an eye on the commodities rally, the index at a decade high. a little consolidation for in business, it's never just another day. it's the big sale, or the big presentation. the day where everything goes right. or the one where nothing does. with comcast business you get the network that can deliver gig speeds to the most businesses and advanced cybersecurity to protect every device on it— all backed by a dedicated team, 24/7. every day in business is a big day. we'll keep you ready for what's next. comcast business powering possibilities.

>> whilst there is virus circulating in the unvaccinated world, there are huge risks of variants emerging that will eventually be able to beat the vaccines we are using in the u.s., u.k. and europe. we are in a very unstable situation. please, let's slow down, look at the world as a whole and develop a response plan for the whole world and do it properly. >> as you've seen, we haven't quite finished the job yet.

this remains our best option to contain the virus at this stage of the outbreak. we don't want to risk the sacrifices everyone has made and all of the hard work you have in -- you have put in. haidi: that was the world health organization saying let's slow down on boosters, and the prime minister of new zealand talking about the extension of the lockdown for its biggest city, auckland. matt, we continue to hear about -- the rhetoric has not changed for new zealand in terms of eliminating the outbreak even as neighbors and australia are slowly coming around to the idea that we have to live with the delta variant. matt: that is right. some people here are also starting to question whether the elimination strategy is still a purpose given how strong the

delta variant is, but the government says it can withstand the outbreak. new zealand is one of the strictest countries in the world. there were early signs it was working. daily new case numbers fell down to 11. the problem is they ticked up again in the last few days and there are a handful of mystery cases worrying the government. cases that cannot be directly linked to the main clusters in the outbreak. as you heard jacinda ardern say, let's stay the course, this is working, let's do one more week of strict lockdown. shery: what is been the economic impact so far? matt: of course, it is having a big economic impact, these lockdowns. most economists predicting a big contraction in the third quarter. and of course, the longer it drags on in auckland, the worse that will be, it's about a third of the population and one third

of gdp. previous experience shows us the economy bounces back very strongly from these lockdowns. new zealand's economy was growing very strongly prior to this outbreak. the current consensus says at least so far, this outbreak will not prevent the central bank from raising interest rates at its next meeting in october. haidi: matthew brockett, our wellington bureau chief. thank you. the school year has begun in new york city with roughly one million public students returning to in person learning. the vice dean of the johns hopkins bloomberg school of public health gave us his assessment of new infection controls in schools as they reopened doors. >> new york is taking as many precautions as it possibly can take, it is important for kids to be back in school, and you are right, it is great they are doing it, but it will require vigilance and these different mitigation steps.

masking, testing, other kinds of things, until we really get a handle on what the delta virus does in schools, particularly for younger kids. >> linked your knowledge of the unvaccinated, including the runner-up at the u.s. open, i believe is unvaccinated on the male side, djokovic, but link the unvaccinated across the nation with kids and teachers and staff going back to school. >> one thing that has been clear has been states with more people who are unvaccinated are also seeing many more sick kids, particularly young sick kids, and that is probably because adults who are unvaccinated who get sick it can really affect -- in fact kids. adults who are vaccinated, it is much harder for them to in fact kids. i think one of the -- for them to in fact kids. i think one way is for adults to

be vaccinated and another is for kids to be vaccinated. i am in support of adults being vaccinated for the safety of kids. >> almost every parent will get a dreaded email saying somebody in your kids at school was diagnosed with covid. don't worry, you have to quarantine or not quarantine. what is the correct photocall if someone is incontact or -- correct protocol if someone is in contact or in six feet to school? >> it is really important to have good communication and slain to parents exactly how this will be handled and followed -- and explain to parents exactly how this will be handled and follow through. this is how it will happen, here is how we will deal with it. i think in general, it is certainly for kids, older kids who are vaccinated, they don't

necessarily, according to the cdc, need to be quarantined. some schools might want to out of an abundance of caution, others might want to try tests. there will be different practices. the most important thing is they are explained clearly to parents and the school is monitoring whether their approach works and is flexible to changing if necessary based on what they see early in the school year. >> the start of the new york city school year highlights how people are trying to get act to some semblance of normal tv -- normalcy. yet it is pockmarked by all of these notices and the ongoing spread of the virus. when do we get to equilibrium or are we heading into a perilous fall where people are trying to act like things are normal when it is anything but? >> i think we are headed into a bit of a new normal. we can go to work but we may need to wear masks in the

workplace or make sure everybody is vaccinated, and people need to be a little more vigilance. i think we will be in that period a little while at least until cases go down and we get a little more distance between us and the virus. obviously it depends on where you are in the country. for example, at our school, we have kids back in class. we have a little more distance than usual, fewer people in the classroom, but they can sit three feet away with a mask on. and everybody is vaccinated. we have a new normal but we are excited to be in the classroom teaching, and i have been doing some of that. haidi: the johns hopkins bloomberg school of public health vice dean. that school is supported by michael bloomberg, the founder of bloomberg lp and bloomberg philanthropies. we continue to track the biggest vaccinated -- vexing campaign in history over 84 countries.

you can check out our vaccine tracker on the terminal and at bloomberg.com. let's get you the first word news with vonnie quinn. vonnie: a global scientific panel says covid-19 vaccine works so well up people don't get need a booster. a report published in the lancet says governments should focus on getting more people vaccinated and wait for data on which boosters would be most effective. this is based on a wide range of real-world operational studies and clinical trials. the frontrunner to be japan's next prime minister has been given a new boost with the report that the former defense minister will not run leadership of ruling liberal democratic party. a newspaper says he plans to back someone else in party elections. lawmakers vote for new leadership temer 29th. president biden will host

leaders of india, japan and australia next week for discussions that will include countering china's expanding influence in the asia-pacific. the first in person summit for a group known as the quad will help identical of making the region a top priority for foreign policy. they will also talk about climate change in emerging technologies. singapore is considering a bill that would allow the government to investigate and stop foreign actors from influencing national politics and inflaming social issues. it is the latest move to assert control over online content, with the government being threatening. the two-year-old law over so-called fake news has been used several times to blog posts. global news 24 hours a day on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i am vonnie quinn. this is bloomberg. shery: next, we hear from mark carnegie about his fresh investment in the crypto gaming

-- in a crypto gaming startup. and we see the fallout about a fake omar deal. this is bloomberg. ♪

>> anyone can start supporting it.

what happens is this news got released by a global newswire and one of our social media guys saw it. people release fake news for cryptocurrency all the time. shery: the litecoin founder responding to false reports of a deal with walmart. that is being felt in gains and losses. really on the press release that walmart denied any partnership. we are also watching coinbase, it is looking to raise about $1.5 billion from a bond sale. we also heard news that ark is letting one of its funds invest in canadian bitcoin etf. so there's been a lot of news to

digest today. haidi: let's get more on the litecoin hoax. joining us our strategist. is this an incremental, to the detriment of sentiment we see in the market? >> it is a unique one today, and i think what the crypto market learned is it is unlikely to happen again. the thing that tripped me up was a somewhat official press release source, and we all looked and said this doesn't sense, why would they take litecoin? it is number 15. i think this will only strengthen the market because it will not work again. like a crying wolf. markets will be immune to these things much more in the future. shery: we have heard of potential taxes that would be included in the house

democrats's plan. how much will this hit crypto? mike: the crypto market is really expecting it and somewhat embracing it. most of the market just wants proper regulation. what that is is different, but not much different than other asset classes. paying taxes on gains is what you would expect. for traders, it is a different story. but i think this is what the market is expecting. the key thing most of the market is expecting is regulation in stable coins. these stable coins are tracking the dollar and are unregulated at the moment and that makes sense. bitcoin is completely independent, no one else's project or liability. there is not much of the u.s. government should or can do and the u.s. is talking about regulation, and you look at china pushing back.

free-market i think will reign. just hopefully it is being done properly. haidi: mike, always great to have you with us. one of us really is most renowned venture capital investors is going all in on crypto with two crypto related funds active. from sydney, we are joined by mh carnegie founder mark carnegie. when you look at the back of the conversation we were just having , is regulation really the biggest concern for crypto investors now? mark: i think regulation is not one thing alone. there is market regulation, broad regulation, and there is money laundering regulation. i think people all agree that after janet yellen got global tax arrangements irking out to 20 years, crypto would get taxed

eventually and we will find a rational way to do that. i think the question about regulatory environment compared to wild west, that does concern people. at the moment, there are increasing numbers of what i call clearly financial products and yet historical regulation of crypto is that it is not a financial product and i think that's where we are getting tripped up. the regulators are trying to roll this back into traditional finance and it is just not a good frame to think about cryptocurrencies at the moment. i think the question is which is the tax jurisdiction in the world that will be the first to say we want to come up with an independent and clearly designed crypto regulation? for crypto, nothing to do with the tax environment where everybody will have to pay the

correct amount of tax in the future. haidi: what is most interesting when you look at the broad range of opportunity in crypto and blockchain? what is compelling and what you think be around as a compelling investment opportunity 5-20 years from now. mark: there are guys who understand payment and first and second and third orders as how the payment rails will work, that is not my world. what i am dumbfounded by is the speed in which the pay to play ecosystem is emerging. if you think about that being the on-ramp and actually being the sort of first model that is effective, and i'm sure there will be hundreds of not thousands coming out of that, that is amazing that you can take people who have no access to employment or any sort of

employment support around the world and get them earning $10 a day. and effectively they are in a joint venture with people in capitalist economies who are putting out 1000 to $2000 per day, as much as $12,000 in a joint venture to go into the gaming business, it is extraordinary. if i think about the work i have done over time on developing economics, i am not seeing any of this. shery: two-year points, how important are regulations in actually supporting these industries so they can prosper and also protect retail investors? mark: there are two different things, which are retail investors need to understand -- we have had huge problems with the way australia regulates crypto in that sophisticated investors can get access to the best source of support and infrastructure, and because retail investors cannot vote to

a registered financial advisor and talk about crypto, they go to the wrong people. i think there is a huge problem for retail investors on crypto currency the moment, and i am told again and again at some sort of sensible strategy, i am seeing no sign that is actually going to happen. in australia anytime soon. i'm hoping it will happen somewhere else. as to whether or not that has an effect on crypto long-term, i don't think so. i think it will be like online gaming, where it will be established, there will be countries like gibraltar that works, and we will find them sometime in the next two years here as well. shery: where could be that somewhere else when we see regulation done well? mark: you can look at the countries. japan is a chance, switzerland

is a chance, singapore is a chance, dubai is a chance. i think it has to be a white list tax country to do it. there are more speculative countries that could do stuff, but i don't think that will help. you've got to find one of the established, taxpaying countries who say taxes are focused on regulation. i don't know if a white list tax company -- country is going to come up with a different regulatory framework for crypto. but one will break soon for sure. when they do, the crypto world will flock to that. haidi: with monetary policy in the pipeline, what is interesting to you when he think about the solid investment in the alternative segment, doesn't have to be crypto? mark: if you think about what is going to happen when the everywhere bubble bursts, you have to say precious metals, and i like platinum better than

gold, and i like gold producers more than the metal. berkshire, even though they have had a run, continues to be a good uncorrelated asset. people think it is a stock and it really is not at the moment, i think berkshire hathaway is another where when the world bursts, it will only be good for berkshire rather than bad. what i've always said to people is why not put 1% back into the rebel alliance against the empire? that is my recommendation to people on crypto. you back the rebel alliance 1%. shery: great to have your insights. mark carnegie with her views on the crypto space. we continue to hear about the optimism over this space but also skepticism. and really one person has been the central bank governor coming out and saying compared to

buying and selling bitcoin, it doesn't have staying power, currencies without government backing. this coming from sweden, and country that is interesting for equity market performance, perhaps something people might call a little bit of a froth, the best performer in european markets this year. haidi: this surprises me a little bit from the swedish central bank, i would have thought they'd have more confidence in what mark was just calling the rebel alliance, if you will, with the star wars reference. we were talking about where in the world will you find the jurisdictions that will wholeheartedly regulate but also support the crypto universe? and we've seen progress in places like singapore and dubai, and places that aren't australia, for better or worse, but to the detriment of crypto investors in this part of the world. a lot more to come. this is bloomberg. ♪

sophie: you are watching "daybreak: australia." we are focusing on iron ore, on a downturn in's make, and we expect down pressure will

continue, and the august december period will fall. also expecting more consolidation. switching the board, over at j.p. morgan, they have boosted their overweight stands on japan, let's focus on that call from j.p. morgan on japan. it underscores the conviction in reopening, reflation trade will be short-lived. plus, with a stable majority, it will set the stage, j.p. morgan bullish on the yen. shery: apple saying it has passed a security flaw in his messages apple across major devices, which allowed hackers to take over user phones.

they will use software updates to patch the bug, disclosed by a cyber research unit at the university of toronto. sources tell us credit suisse has been dropped from the list of lead banks on an international ipo. the bank was set for a top role in the london debut alongside citigroup j.p. morgan. the lender has been stepping up its risk oversight after being hit by scandals. -- has tapped ubs for a hong kong sting as early as next year. the company could raise at least $500 million in an ipo. several chinese tea houses are eyeing ipo's after one raised 1.4 you dollars in a share sale in june. coming up, lori and gilbert says we should had to equity markets

in general, and brad gibson says central bank divergence will be the topic for the rest of the year. you don't want to miss those conversations. daybreak: asia is next. this is bloomberg. ♪

haidi: welcome to "daybreak: asia," i am haidi stroud-watts in sydney. sophie: i am sophie kamaruddin in singapore. shery: and in hong kong, i am shery ahn. markets await u.s. inflation data after wall street snaps of five-day losing streak. japanese leadership front