>> good morning.

i am tom mackenzie in london and these are the stories that set your agenda. global shock waves, financial stocks lead asia lower as svb's collapse continues to reverberate. 2-year treasury yields rebound after the biggest three-day decline since last monday in 1987. muddy pricing. with today's cpi dating -- data and focus, tomorrow -- nomua believes the fed will cut rates. ecb policy influx. ken griffin tells the ft that the government has intervened to protect these depositors for svb. regional bank stocks are now an incredible bargain. let's check in on these markets. what a historic day for the bond markets of the u.s. and in particular you saw it moves across the debt space in the u.s. and europe and now seeing

it pronounced in jgb's as well. the moves yesterday, the front end of the u.s. treasury curve, the two-year moving by 61 basis points lower. that is a movie had not seen since the early 1980's. some of that is rebounding in the session today. the eyes of investors now switching to what is happening on the inflation print and to what extent that makes a complicated picture even more complex. across the benchmark, the msci asia pacific index loss is now up to percent. that is particularly pronounced with the lenders in the financial sector, thanks under pressure in asia. the nikkei down more than 2%. the biggest losers are those main financial banking names in japan. teachers in the u.s. went into modest gains of .3%. european futures to a gain of .10%. in terms of the inflation print,

expectations are that for year on year february if you are looking at 6%, a slight softening for the cpi is estimate of 4%. a remarkable turnaround in expectations around the terminal rate from the fed. thinking back to last week 5.7% was a terminal rate work as by the markets by september. that has moved to 4.8% in may. in terms of the cross asset board, there is a u.s. two-year. 4.12. yields edging up by 15 basis points. bloomberg dollar index coming through .1%. brent oil remains under pressure on the recession risks and concerns about the tightness across the financial system. currently $79 a barrel on brent down 1.2%. let's go to yvonne man in asia for a check of the asian market. yvonne, good morning. >> good morning tom. you talked about the 2-year yields in the u.s.. we were talking about 100 basis

point move to the downside in last three days alone. we are barely there in terms of recovering. that is adding a bit of a floor especially for the dollar here this morning. still, equities in asia are seeing 2% lower. msci china feeling the reverberations here despite yesterday being a bit of a bright spot in these markets. volatility is picking up as well on the back of that because it seems like the fed has helped to reassure depositors of svb and the like but when it comes to stock investors in sentiment i don't think people have quite digested what this means for the fed. goldman is saying it's time to pause. barclays and nomura say next we do can see a cut in the fed and even a pause in qt. that debate continues on here whether it is about fighting inflation or ring fencing this financial stability appeared to a look at japanese bonds. you mentioned the jgb yields and banks. we are seeing the contagion effects hit lenders in japan.

you wonder why. for the most part it is because they are mostly exposed to u.s. treasuries these japanese lenders. you are seeing deep moves of 7% or 8% of the downside. also, there is massive repricing when it comes to the boj as well. because the fed's may be about pausing or even cutting, central banks here in asia might have a little bit more to breathe particularly when it comes to the boj. you are seeing when it comes to the 10-year jgb a month now just around 28 basis points. we are way below the new billing of 50 basis points and we were briefly just below the old ceiling as well. it goes to show how much the massive repricing has been playing out across asia. tom: arguably using the pressure somewhat on mr. ueda as he takes over the helm at the boj. a pleasure to have you yvonne man on the show with that market update. thank you very much indeed.

lovely to see you. svb still topping the bill. we have mark and valerie tytel to cover the latest angles. following the collapse of silicon valley bank, treasury two-year yields studied and recovered from the biggest drop since the early 1980's. regional banks continue to pile up losses. for more i am joined by mark greenfield from the market live team. mark, bond yields higher today. can we call the end of this volatility? mark: not much chance of that. we had the cpi report tonight. when you had the movements over the past few days, there will be more response from the bond market today. maybe we will swing around to that appeared one of the problems is that because the moves have been so huge, obviously, there has been a very big risk impact on several

financial institutions. that means the risk managers have been very busy, and they will be telling people to clamp down on risk dramatically. in some cases they will be telling traders that you can't trade anymore this month and you have used up your limit aired sit on the sidelines for a while. that will reduce the liquidity in the markets. whatever knee-jerk you get will be more exaggerated because of the deity -- liquidity is different than a few days ago. there is no chance that markets are going to quiet down quickly because people are still trying to figure out how much they can do and whether or not paired back anything more before we get the fed decision which is more did to interpret. some are suggesting a cut in some looking for a pause, some looking for a hike. it's all over the place and it doesn't make their job any easier for at the risk trader. tom: it is all over the place and that is reflected by the call from nomura say there will be a cut. it blackrock saying they will go

ahead with a hike because the inflation risks. mark, what does that mean as we reprice the bond markets and yields lower? can the equity markets breathe a sigh of relief? mark: not too much because of the banking sector. you have seen over the past two days how important when the banking sector is slinging around, it has such an effect on equity markets in general. that has not fully settled down yet. until we see a real sense of stability in the financial world , then the markets can relax a bit aired what they want to see is clarity on interest rate policy not just from the fed but also the ecb. we are still expecting the ecb to raise rates this week i believe by 50 basis points. just recently without they are going to do a series of 50 basis point rises. the equity market will be looking closely to see if there are any modifications in the east be outlook. they want to know more about what the fed is going to do. and central-bank policy needs to settle down. that would help the equity

market a bit. in the near term they are going through all the banks to see whether there are any more risk out there have not yet unearthed. in the short term, equity markets have a lot to worry about. tom: we have a redhead across the terminal. credit suisse which fell 10% yesterday is finding a material weakness in financial reporting. this is a redhead crossing the terminal and follows in of the redhead a couple minutes ago on the chairman of credit suisse waving a $1.5 million with -- 1.5 million swiss franc and taking ape a cut. -- épée but. i-- a pay cut. we'll bring you more context throughout the hour. at the u.s. federal reserve is launching an internal probe of its supervision of telecom valley bank after its collapse marked sharp criticism of its oversight. let's bring in bloomberg's nebula.

what do we know about this review and what is the timeframe? >> this is the biggest bank failure in more than a decade and the fed has been caught completely unawares. the aim of this review is to find out why. the review will be led by the vice chair of supervision at the fed. the date that it will be made public is may 1 appeared what they are looking at here as how this happened and how the regulators did not have a clue about it. at the heart the losses with the silicon valley bank, we know that it is to do with her bond portfolio and the loss in value in that. when rates were low, a lot of banks snapped up bonds at low prices and could not imagine rates ever rising and devaluing those bonds. that's what? the fed to start to raise rates and in that rising rate environment, the value of those bonds fell. that created a liquidity crisis when depositors went to pull

their money the question is of the bank carry out the necessary planning and stress testing of the rising rate environment? that is something definitely that the fed will be looking at. the other question is was this about a specific supervisor making a mistake, failing to do their job properly or was this about the fed's own guidance and as to how that oversight would be and should be carried out? the fed has been very good at regulating big banks of late. now it's time to turn the mirror back on itself. tom: nabila, thank you very much indeed. thank you. february the u.s. cpi data it will likely provide a reality check markets after the failure of silicon valley bank. bloomberg anticipates the fed will raise rates by 25 basis points at its march 22 meeting. joining us for more is bloomberg

markets reporter valerie tytel. what an incredible repricing around expectations for the fed. where do things stand? valerie: incredible confusion out there for what is the next step for the fed. last week ms and said he upgraded their fed calls to a 50 basis point hike1. and goldman sachs came out and shocked markets yesterday. they were the first ones clamoring for a pause in the march meeting. late last night nomura came out calling for a 25 basis point but not only that, calling for an end to the qt. the big question remains today what surprises are looking in the cpi print? any upside surprise in the month-to-month or number could really -- core number could really shake the fed and how they get this message across to the markets that they are planning on changing their path forward in a huge way. the consensus for both the core and headline month on month is

0.4% call. i will have my eye on that. any upside surprise really put that in a pickle. some might say this inflation data is backward looking. we only have to look at the tightening of financial conditions that the collapse of these banks has caused. it has now surpassed levels of last year, the tightest levels of last year you can just see the collapse. how london -- how lending conditions have tightened. these regional banks ever instrumental in lending credit to small and medium enterprises. perhaps the fed will try to focus in on this in order to claim that it warrants a shift in the rate hiking cycle. tom: debate around financial stability versus inflation. when it comes to the ecb have they boxed themselves and in terms of indication around 50 basis points? valerie: the ecb is in a huge pickle. printing the guard has reiterated many times attention to hike 50 basis point at this

thursday's meeting. the market is starting to doubt that. we are now pricing and 30 basis points for a hike. just next thursday. the market is bang in the middle. a lot of people are pointing to the widening of the bank the cds is a worrying sign for the ecb. who want to send a jumble hike into this jittery markets? the credit squeeze cds the last two days has -- credit suisse cds is widened to hundred basis points. tom: we will see what means for the fed and the ecb which will have its own decision as well. coming up, the turmoil engulfed u.s. banks as investors rush to reduce exposure to the industry. we will have more on that next. this is bloomberg. ♪

tom: welcome back. bill ackman has said regional bank stocks are in his words and incredible bargain right now. he is also called the u.s. to guarantee all deposits. joining us now is walter the cio agreement capital. thank you for joining us. financial stocks globally losing about $465 billion in market value just two days. what do you think about the call around regional banks in the u.s.?

are you reassured by the backstop on the fed and regulators? is this a buying opportunity? bill: good morning from the u.s. here appeared certainly aggressive actions by the fed overnight to try to backstop and calm the liquidity situation. when you look at the reactions in some of these other western regional banks in the u.s., some of them down 60%, it does not look like they have necessarily combed all the fears. you have to be very selective. we are in the southeast of the united states, a good region progrowth. we like a lot of the banks that are located in this area of the country. some of those are for our clients in certain strategies. tom: you need to be selective. what happens next? the selloff was pronounced again yesterday for many regional lenders. do you think calm enters these markets? walter: i think it will take

some time. we have to recognize that is the second largest bank failure in u.s. history followed by the third largest in u.s. history when signature bank was taken over as well. the combination of those two things inside of a couple of days is a shock to the system and it will take time to settle out. they took aggressive actions to try to calm down and provide a liquidity backstop for the banks as well as implicitly guaranteeing the supply of depositors with what they said. they did not this was that but i think that's where they are headed actually. it will take time for things to settle down. tom: would you make of the moves in the bond markets? it is incredible to get your head around. 61 basis points for the two-year . 388 at the front end. yields coming off again nine basis points at the front and peered 388 on the u.s. two-year year. have things gone too far? walter: about the positioning heading into this event was very one-sided. a lot of people were shorted

rates given powell testimony last week. they were anticipating rates would continue to move higher. if you think about powell setting the table for 50 basis points which back to your earlier segment is clear that they had no clue about what was about to happen given the testimony that he was giving. that has something to do with the magnitude of the move in rates. the question is will the fed go along with what rates are trying to lead them to do? the year and fed funds rate last wednesday was 550. today is at about 4%. will the fed change their tune? i think the cpi holds the key to that tomorrow or later today. tom: later today our time. the cpi holds the key peered what kind of number or print do you think will allow them to at least pause come march 22? walter: anything in line to slightly soft i think the headline projection is 6% and

5.5. anything 6% or less i think the potential is there if that happens to see a huge market rally particularly in some of the regional banks that have been beaten up. if it is a hot number and by that i mean really anything over six, 6.1, six point 2, 6 .3, i think it puts the fed in a bind and really, it's this balancing act between fighting inflation and of the new financial stability issue that they had to deal with. i think the market would probably react fairly met with to -- fairly negative to that. tom: in environments where the risks of a policy mistake would be pronounced. walter: yeah, i think what just happened is probably the first step of the policy mistake. literally a year ago almost to the date, the first fed rate hike happened, march 16, 2022. here we are a year later almost 500 basis. something is going to break.

the weak link adjusted here at how much more is there to go? that is dependent on what the fed does from this point forward. tom: how it disinflationary do think the tightening and financial conditions that we are seeing now actually is medium term? walter: i think it is significantly so. it is a deflationary shock to the system on the slate. credit conditions were already tightening this event. they will tighten significantly from this point forward. i do think that will help the fed fight inflation because it is setting the table for inflation to fall even more rapidly on the back half of 2023. the question is do they recognize that and see that and react to that and stop hiking rates and focus on the other issues? tom: you said you want to be selective in terms of regional banks. where else are you taking shelter in this environment? walter: health care is our

preferred defensive area of the market. consumer staples and utilities are expensive. health care had a great year last year. it struggled to start this year but has come back into favor and last few days people have fled the more cyclical areas appeared that is our defense of mode within the portfolio. some cash is not a bad thing either given where rates are. that is another thing you can do to be more defensive. tom: walter todd cio agreement capital. appreciate your insights on a massive date for these markets historic. thank you for the context and analysis. coming up, a deep dive into the nuclear submarine deal announced by the u.s., australia, and the u.k.. we will look at the geopolitical implications as the trio phase off against china in the region. this is bloomberg. ♪

tom: welcome back. president biden, rishi sunak and australia's from mr. anthony alban he unveiled a multibillion-dollar plan for a new fleet of nuclear powered submarines. joining us now is our reporter rebecca -- she is sitting in hong kong for us and we know china is in the focus of the new attempts and military initiative. what are the key takeaways that we have seen in terms of this new deal? we know this has been in the works. now we have the official announcement. where are we in terms of getting up to speed on what this means? rebecca: it is a young diplomatic and defense partnership between these three

different openings. part of the agreement will be for australia in conjunction with u.k. to develop a new type of submarine, again, as you mentioned, shifting to a nuclear powered submarine. in the meantime, while that is taking place, america to supply its virginia class submarines. the deal is not without skepticism. already we have seen some concerns about the cost. it is expensive to switch from diesel to nuclear on the one hand and of course the virginia class of submarines have been plagued with delays and concerns about cost. some experts are saying there is a risk that it comes as a frankenstein project. the big picture is about countering the rising risk of china's presence in asia pacific. tom: what had the u.s. been saying about the context of this deal? rebecca: jake sullivan it has

played down saying this is not targeting any particular one country, but we do know of course that this is all about countering the strength of china in place against the backdrop of increased cooperation in the deal between japan and south korea and you can see all of the u.s. and allies are taking seriously the risk of a potential hot conflict in this part of the world. tom: excellent context. thank you rebecca in hong kong. coming up, the president of the euro group says they have limited exposure to the fallout from svb after the significant selloff in european banks s

tom: good morning.

this is bloomberg daybreak: europe. i am tom mackenzie in london in these are the stories that set your agenda here to global shock waves. financial stocks lead asia lower as svb's collapse continues to reverberate. 2-year treasury yields rebound to an extent where they have been fluctuating after the biggest three-day decline since black monday in 19 87. yields are back down again. today's cpi data and focus. this prompts nomura to predict the fed will cut rates. goldman sees a pause. ecb policy influx. ken griffin tells the ft that the u.s. government should not have intervene to protect svb. depositors and regional bank stocks are now an incredible bargain according to bill ackerman. we are looking at lines from volkswagen and credit suisse. credit suisse fell 10% yesterday.

volkswagen is saying it will invest 180 billion euros from 2023 two 2027 presumably in their transformation around electric vehicles. i will wait for more clarity on that. volkswagen ceo is saying he sees 20 as a decisive year for executing strategy. vw co also says the 2023 will be consequential in terms of how they shift electric vehicles. the company remains in focus. the world's largest automaker terms of supply chains, inflation, labor disputes as well. hopefully there will be more lines on that. when it comes to credit suisse, the context of the 10% fall yesterday, lines crossing around financial material weakness in financial reporting. the chairman forfeiting the fee, waving a fee and taking a pay cut.

this is a story that we will get more details on. at the top line is that credit suisse found material weakness in its financial reporting. i will get the timeline for you because this is reporting procedures for the financial year of 2022 and 2021. they are adopting a remediation plan. conversations with the securities and exchange commission and the u.s. have apparently ended. we will bring you more details on this and when that stock starts trading at 8:00 a.m. u.k. time and it will be a focus for us. let's crossover to maria tadeo for the european response to what is happening, the concerns around the banking system and we saw the selloff in bank stocks pronounced in europe yesterday, most significantly in italy in the ftse took a hit on the back of the exposure to the banking stocks. the euro era has limited exposure to svb's collapse and they were monitoring the risks closely. still it has led markets to push

back on the ecb's guidance for a 50 basis point hike1 on thursday. maria tadeo in brussels. yesterday a turbulent date for european banks in the wake of the collapse of silicon valley bank. what have finance ministers been saying to you? maria: yes, tom, and we spoke to a lot of finance ministers. it is safe to say that your group was entirely -- eurogroup was eclipsed by the bank saga. this was a topic of conversation yesterday. three takeaways from finance ministers repeated yesterday. one is the operations in europe are way smaller relative to the united states. that makes the risks or potential risks to, more manageable. they plan to the regulation and resolution that we have seen in the financial crisis in europe. another point that we picked up with this idea that this was happening fast. if you looked back at sunday,

there were rumors and speculation swirling around the potential that led to this knee-jerk reaction on monday. when i spoke to the front finance what he told me and advised investors to do is relax and calm down let's take a look. >> calm down, and just have a look at the reality. the reality is that the banks that you just mentioned and the front banking system is not -- branch banking system is not exposed to the silicon valley bank. there are no links between the different situations. there is no specific concern for the french banks. maria: that was the front finance minister saying calm down and be selected -- selective and looked at the financials. that clip laid across the french media, which again, does speak to the worries that we have seen

in market yesterday. the big question is whether they continue today or investors become more selective in where they see weakness. tom: does it change the calculation? the ecb having a meeting later this week on thursday. this has got to factor into the decision-making but they have been explicit around 50 basis points. maria: absolutely, and the timing for this, what a week. if you remember we go back the previous meeting francine lagarde said 50 basis points was baked and unless nothing exceptional happened. a lot of the ecb that i talked to yesterday said they still see a 50 basis points happening on thursday. the question now is the guidance and signaling when it comes to it. when i spoke to the spanish finance minister who told me in the context of market volatility, everyone, the fiscal side, but also the monetary

policy should act with a letter prudence. -- a lot of prudence. tom: maria tadeo and brussels. fantastic contacts in the european response to the spanking crisis ahead of the ecb decision on thursday. let's bring in alan higgins cio of coutts & company. thank you for joining us in the studio. what is the mood at this moment? how reassured are you by the backstops in place by regulators? let's start in the u.s. with the fed. are assured they can get a grip on this? the selloff on the regional banks was pronounced yesterday. alan: somewhat. disappointed there is not the right buyer. the bonds which are not protected are trading at seven. you might think it is surprisingly high. the market is putting a value on residual svb, but a little bit disappointing that an outright buyer has not come in. online -- unlike ken griffin i

think the u.s. has done the right thing because it would have been absolute carnage not to protect depositors in terms of looking at the moral side of the story, management and shareholders suffering. there is some pain out there. tom: do you think the contagion can be contained? alan: they may need to do more on the surface. the 25 billion refocusing. it is good news of the fed will take it at par. 25 billion seemed small so maybe they will go bigger on that. a bit surprised. this was an old-fashioned way to lose money, buying many long-duration bonds. i am surprised maybe they have not seen it at first republic, the duration of our bond book portfolio is asked. that is what the market needs to know. tom: may be more clarity from

regional lenders. a tie that into the concerns around european banks. is it fell off yesterday justified? there was a selloff in italy. credit suisse has its own problems and that felt on percent. are your steering clear of european banks? how can you about fragility of the european banking sector? alan: let's concern because svb was unique. ridiculously long-duration. uncorrelated under best -- diversified deposits. we don't have that in europe. in 112 we saw greek banks go over -- go under because of greek debt. that did not work. a default appeared white italian banks have been big buys of the italian government successfully as far as i understand, short duration. again, it will be nice if the banks came out and told us what their durations are. short duration bonds, no problem. there is government debt and

government debt, six-month month, one year, no problem. i think svb had a duration of 5.5 so eight year maturity debt. ridiculous. tom: you flagged in your notes to us to look at loan standards because that for you is an important decatur. we got a terminal chart that can illustrate what has been going on. unpack that for us. alan: even before this crisis, senior loan officers had a great survey only quarterly unfortunately that correlated with and pointed to alarm. to be fair, a lot of survey data is the same. it has been more pessimistic in real data. imagine what that will be like now. there were over 5000 u.s. banks. regional banks are important the state. if you and i were running a regional bank we would be cautious. it will really have the economy. ironically, not silicon valley. they are fine. i used to have an account in a small bank in pennsylvania, 10

branches for long-standing reasons. i can just imagine really, really tough managing that now. basically, therefore following it through, absolutely can see a fed pause. it was only goldman-s but there are others who have gone out there that. but they are brave. tom: the financial additions have tightened and that is linking to the loan standards. this is the work done for the fed for it. alan: you can pull up the financial conditions index or other ones and there has been a huge one-day tightening of financial conditions. everything has changed. the pivot is in. that is why stocks are holding ok just about. it's an unfortunate way to get to the pivot but the pivot is in the. tom: what does that mean for the trajectory of inflation though? alan: fairpoint. if we are wrong on inflation,

and it just back up, all bets are off. it would be unlikely. all data points to lower inflation. we will see today. if we have a fight handle -- five handle on year on year inflation in a decent court, then the nomura call may look good in terms of a cut. there could be a bit of euphoria in markets today. very important cpi data today. it's always important, but i suppose that is the risk scenario. if we are wrong on inflation they pivot and hold an edge up again. that would not be good news. tom: how are you positioning in this environment? alan: we are relatively conservative. we are capital allocation not hedge fund. we always have some stocks and bonds, but relatively conservative. looking for the opportunities to add to risk and that senior low -- loan officers would point to the credit spreads that we saw

yesterday especially in european bank credit, national champion, that could be an opportunity. we already on them to be clear. looking for opportunities in terms of capital allocation. tom: the headline for me is that you have had a bank in a small regional area pennsylvania. thank you very much indeed, the cio of coutts & company on the market reaction to the terminal emanating from svb. let's get to first word news with madison mills and dubai. >> credit suisse says it has identified material weaknesses its reporting procedures the last two financial years and is adopting a remediation land. the annual report released today says internal control over reporting was quote not effective. chairman asked lehman meanwhile is to forgo a payment of 1.5 million swiss francs for his first full year on the job. that is after the bank reported its worst annual performance

since the 2008 financial crisis. in china,, president xi jinping and volodymyr zelenskyy are said to be planning a video call. that would be their first ever conversations russia's invasion. the wall street journal reported it could come after president xi visits moscow and a trip could come as early as next week. in the u.s., president biden says he expects to speaks with china's leader soon once the government in beijing returns to work following the national people's conference. one of the uk's leading business groups is urging the government to bring in a new tax deduction system to boost investment. the confederation of british industries says the move would seek companies spend an extra 52 billion pounds a year by the end of the decade. it jeremy hunt who delivers his u.k. budget tomorrow is under pressure to soften the blow of coming hike in those corporate tax rates. 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'm madison mills and this is bloomberg. tom: medicine in dubai, thank you very much indeed. coming up we look closely at the impacts of the svb u.k. by out on the country's finance industry. we will take a look ahead to u.k. unemployment data due shortly and we will get the latest on credit squeeze. stay with us. this is bloomberg. ♪

tom: welcome back. the u.k. government cleared the way for hsbc to acquire the british arm of silicon valley bank. andrew griffith told bloomberg that hsbc was given an exemption over rules that don't allow uncertain corporate customers to be housed within ring fenced banks.

joining us now is our bloomberg u.k. correspondent lizzy burden. what do we hear yesterday? >> the interesting thing he said was hsbc was given no guarantees when it bought svb u.k. for one pound and as you say, the ministers cleared the way i removing some of the ring fencing requirements which of course forced banks to separate the retail from the investment banking and international divisions. thinking about the wider impact of this in the u.k., there was a note from callum pickering who says that if the impact of tightening financial conditions in the real economy is strong enough, it would reduce the need for the bank of england to tightening or even tighten at all further. that is reflected in market pricing and he says it is not inconceivable that the bank of england posits quantitative tightening next week would you be a real strong signal that we are nearing the end of the tightening cycle in the u.k.. on the other hand, we will get

the jobs data at 7:00 a.m.. it is likely to show more of a cooling in the labor markets. it will be interesting to see where the traders paired back their bets even more. tom: that debate is happening within central banks across the world but important what mr. griffin had to say, the city administer around the exemption for hsbc to work through that deal very quickly in a short space of time. u.k. correspondent lizzy burden with the news there in terms of implications for a just easy and how they got that deal across the line. coming up, volkswagen raises its five-year spending plan to 180 billion euros. we will get the latest. this is bloomberg. ♪

tom: welcome back. let's bring you up to speed on some major investment plans and spending plans by volkswagen, the world's largest automaker. outlining 180 billion euros spending plan with a particular focus on new technology, the ceo saying that two thirds of the spending will be earmarked for new technology saying that the year of 2023 will be decisive for executing vw's strategy. let's bring in oliver crook. what are your key takeaways? >> we had pre-released a earnings of 10 days ago so those numbers we had a good handle on. today we got the increase in the spending plan, a substantial increase to 180 billion worth of spending up from 159. the other news that came out over the last 24 hours, vw will be to build a battery plant in canada which gives you an idea of where the money will be spent. it will be all about let's

vacation, software, and visualization. this is where the big spending plans will go. the battery plant in canada was a major move forward. ev sales lester were up 26%. this is the positive story from bw. you had a good reaction from investors with the earnings prerelease a couple weeks ago. there are a lot of headwinds on the horizon. the svb and other things remind us that risk is more creative than we are. they have guided a little bit too much to the upside they are saying. tom: risk is more creative than we are. i love that line. you have been talking to portia and that group now more valuable than vw. help us make sense of that. oliver: when you think about the most valuable carmaker in europe only sells 300,000 cars and vw sells 10 million it doesn't make much sense especially since vw owns 75% of porsche. when i spoke to analysts they

said basically these shares that vw holds have indicated they will not sell in the future so they are massively does wanted. this is the russian of the spinoff. $180 worth of spending, how you financed that over time? they managed to get a lot of money from the porsche ipo. he was happy about it yesterday and once brand chief executive to say how theoretically would you take these brands public? there is lamborghini, bentley, and other brands that they could unlock more cash from going forward. tom: bloomberg's oliver crook on the ground in berlin. he will be speaking to the cfo of vw later this morning. let's get more on the latest when it comes to credit suisse. lines dropping last hour. joining us now is the managing editor for finance michael. we have been hearing about the latest when it comes to the 2022 and 2021 results with the sec and the chairman forfeiting some comp. what does this mean for credit suisse?

michael: this is the annual report that was supposed to come out earlier but got delayed and now we are finding out why. a year ago, credit suisse did some revisions to previous years cap -- cash flow statements and the sec raised questions about that. now in this report, credit suisse calls that a mercurial weakness in its financial reporting controls. they are basically saying that the financials themselves are fine, but the process for producing those did not have enough checks and it and could have led to bigger issues beyond just the revisions of the previous cash flow statements. they are flagging that control and said they will take steps to fix that. it's unclear how much that will cost or what level of -- how extensive those fixes will have to be. but it is another kind of headwind for this turnaround plan. tom: help us understand the selloff yesterday of credit

suisse. link it to the svb in the financial sector in the u.s.. his idiosyncratic the story about credit suisse? are they more vulnerable than other banks? michael: any time you see a selloff you tend to see credit suisse doing worse. some investors believe that is because it's used as a proxy for bank risk and people just sell that as the first thing. there is the bigger question of credit suisse is out there trying to attract client money to turnaround these outflows from its own fourth-quarter issues. so, will a overall sense of unease around deposits hamper that ability to win that client money? tom: ok thanks michael moore the importance of credit suisse. thanks for coming to the studio early this morning to recap those lines. the chairman waving his feet from the board and taking a pay cut as well. let's check in on the markets.

the features here in europe pointing lower by .3%. u.s. futures pointing to gains of just around .2 percent. there is a two-year holding above the 4% level just about three basis point move now for the front and after yields fell 61 basis points on the two-year yesterday, the most since the early 1980's. futures down .3% after the selling pressure in europe yesterday. ftse futures down .2%. in germany the dax down 26 points on those features. up next bloomberg markets europe. we will continue to keep you across the market action with analysis. state with us. this is bloomberg. ♪

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