# Housing Policy, AI Productivity, and Global Consumer Trends

**Podcast:** Bloomberg Daybreak: US Edition
**Published:** 2026-02-13

## Transcript

Bloomberg Audio Studios Podcasts Radio News.
This is Bloomberg Daybreak Weekend, our global look at the top stories in the coming week from our daybreak anchors all around the world.
Straight ahead on the program, a look at what we can expect from home builders in the months ahead.
I'm Nathan Hager in Washington.
I'm Caroline Hetke in London where we're looking ahead to the UK jobs numbers and asking whether AI is starting to affect productivity.
I'm Doug Christner looking at the outlook for Chinese consumer spending during the Lunar New Year holiday.
That's all straight ahead on Bloomberg Daybreak Weekend.
On Bloomberg 1130 New York, Bloomberg 991, Washington, D.C., Bloomberg 929, Boston, DAB Digital Radio London, Sirius XM 121, and around the world on Bloomberg Radio.com and the Bloomberg Business App.
Good day to you.
I'm Nathan Hager.
We begin today's program with home builders.
Recently, we heard the Trump administration is exploring an antitrust investigation into the industry as the White House sharpens its focus on tackling the housing affordability crisis.
For more on what we can expect from home builders in the months ahead, we're joined by Drew Redding, U.S.
home building analyst for Bloomberg Intelligence.
Drew, how do you see the backdrop now in the new home market?
So in the new home market, the backdrop is still a little bit challenged.
We have made some progress on affordability, which, as we all know, has been the primary constraint for buyers out there in the market.
Mortgage rates are down about 100 basis points from where we were last year.
Um, but what we've heard pretty consistently from the builders that we talk to is that it's not just about affordability, um, it's also about sentiment.
You have more consumers out there in the market who may be concerned about the direction of the economy, the outlook for employment.
So there's not a lot of urgency.
And you know, one of the things I think that's happening is you have a lot of people sitting on the fence who are saying to themselves, look, I think rates might be coming down.
I think home prices might be coming down.
So I'm going to take a wait and see approach.
Now, with that being said, we think that the market can grow this year from a sales perspective.
A lot of that's going to be driven by community count growth.
So we actually have new home sales rising in the mid single digit range, but we do think that housing starts, which is probably the most widely followed measure in the new home market, will be flattish because builders want to work through their standing inventory before putting new product in the ground.
So that uh sentiment damper you're talking about, is that across the board or is it just in the luxury sector, the low to middle income sector?
How does it look uh that way?
Yeah, so I I think we've heard pretty much across the board from builders that sentiment has been a major issue.
You know, when you start to look at customer profiles, certainly the entry level has been a little bit more pressured.
If you you think of that buyer, they're typically more sensitive to fluctuations in mortgage rates and monthly payments compared to, you know, call it a toll brothers, who is more exposed to the luxury end of the market where you know the buyer is more affluent and doesn't have those same rate considerations, but you have to think of housing as an ecosystem.
So while the the higher end may be doing better, they still need to see movement at lower price points in order to facilitate those move up home sales.
So if builders are sort of working through this despite those sentiment concerns, what could that mean for their margins?
Yeah, that's a great question.
And it's probably the the number one thing on investors' minds because margins have come in pretty significantly over the last couple of years.
And the reason is because builders have had to be pretty aggressive in their use of mortgage rate buy downs in order to stimulate demand.
Now it has helped them maintain sales levels.
If you look at you know how new home sales have trended versus the resale market, they've held up a lot better, um, but they're having to pay a lot in order to buy down these mortgage rates.
And you know, what we've heard from those that have reported earnings so far is that they expect the use of incentives is going to remain elevated through the spring selling season because there's still you know a lot of challenges out there.
Oh, you've seen a lot of focus uh from Washington on the housing sector as well, these ideas about limiting institutional purchases of single family homes, maybe allowing more uh use of 401ks for uh for a first-time down payment, things like that.
Does that affect uh your view on the outlook for the housing market if some of these policy ideas come into fruition?
Yeah, so policy has certainly become the biggest wild card, I think, for home builders in 2026.
They've been squarely in the crosshairs of the administration for four or five months or so, given you know the heightened focus on affordability.
Um, you know, outside some of the things you discussed, like the the proposal to ban institutional purchases, we really don't have a lot of concrete ideas.
You know, we've got plenty of tweets and leaked news stories, um, but nothing substantial yet.
And I think, you know, we could hear something at the State of the Union in a couple weeks.
What that may be, I don't know.
But um, you know, the administration has been critical of the large public home builders in particular.
You know, they've talked about their landholding saying, you know, they own two million lots, they need to start building on them, and they've even threatened to withhold liquidity from them if they don't start building.
Um, you know, they've said that builders shouldn't be buying back their stock, which has become a big part of their business model.
And then the other piece that we think could be a risk going forward is, you know, the discussion about mortgage rate buy downs.
Um, you know, there were some tweets out there saying that they're artificially propping up prices.
So it does seem that they're looking at everything, and I think ultimately what it does is creates a more volatile operating environment and two-way volatility for the stocks.
Are you seeing the industry actively making preparations for whatever could come down from the Trump administration, Drew?
Yes, so I mean, at this point, it's kind of just business as usual.
We've heard from most of them that, you know, really since the end of last year, they've been working alongside the administration and policymakers um in a collaborative manner to to try to come up with solutions, you know, whether they be demand-side stimulants or a way to get more supply into the market.
Um, so as of now, it's business as usual.
We'll we'll have to wait and see what comes down the pike.
Thanks for this, Drew.
Great having you on with us.
That's Drew Redding, home builders analyst for Bloomberg Intelligence.
Let's take a look now at some stocks making news in the week ahead.
I'm Nathan Hager, joined by Bloomberg News Equities Reporter Alexandra Semenova.
And Alex, we're gonna hear from some big ones this week in terms of the earnings.
The biggest name in retail is reporting on Thursday.
What are we expecting from Walmart?
Hey, Nathan.
So it is indeed going to be another busy earnings week.
Walmart is such a bellwether of low and mid-income consumers.
So that's going to be an important company to watch.
It is scheduled to report earnings results before the bell on February 19th.
And something to note ahead of its earnings readout is Walmart just saw its market cap eclipsed the one trillion dollar mark on February 3rd for the first time ever.
This is something that you don't see from retailers.
It's something you typically see from tech giants.
So Walmart is now in a category typically occupied by big tech heavyweights such as Nvidia and Alphabet Inc.
And Walmart is a longtime favorite, of course, of bargain hunting consumers, which is why it has been doing so well.
It has flexed its massive scale and supplier network to keep prices low and grab market share across uh various income levels.
And not only has Walmart maintained its appeal to households looking for value, it's also been recently drawing some new wealthier shoppers as well with its online business.
So when we get to those results, some of the key metrics to watch will be same source store sales uh performance that uh you know is going to be an important uh metric to monitor growth for long-term revenue and profit expens expansion for the company, uh, contribution from higher margin businesses too, and inventory management.
And I want to point out that the stock is up something like 19% year to date.
So the bar is pretty high going into these results.
Yeah, certainly, with a trillion dollar valuation now, and with the fact that Walmart recently relisted to the Nasdaq, it really does seem like they're leaning into this uh tech side of the story.
But we're also gonna hear from uh another name that we think of more traditionally on the tech side, DoorDash reports on Tuesday, right?
Yeah, it does, Nathan.
So I'd say for this company, the main thing investors will be watching is signs that it can monetize on heavy CapEx spending.
So during the last earnings report from DoorDash, it took a record plunge after the company said it's going to spend more on investments next year to build new products and bolster internal tools, uh, which really weighed on its earnings forecast.
These increased costs contributed to a muted fourth quarter forecast for adjusted EBITDA specifically, with the company expecting that metric to be around $710 million to $810 million.
So watch that number.
Also watch order growth, which is currently exceeding that of some of its online delivery peers.
And it's also supposed to get a potential boost from Deliveru, which it acquired recently.
So that's going to be something to monitor during those results.
And then it is also expanding into new categories beyond just restaurant delivery.
So groceries and convenience, which are expected to aid with consumer retention.
And ahead of the report, some of the big Wall Street firms did lower their price targets on the company.
Bank of America was one of them, lowering their price target to $260 a share from $305 a share, but it did still maintain a buy rating.
Goldman Sachs added DoorDash actually to its US conviction list.
So that's pretty positive.
And one more thing to note is of course, DoorDash and Uber just lost a bid to block a New York City law requiring a tipping option to be presented to uh customers at checkout from going into effect.
So it's likely we're going to see perhaps management commentary on that front.
Doordash has been having a pretty hard start to the years.
Well, another big name we're gonna hear from is uh bellwether on the uh agriculture economy.
Deer has really been on a tear since the start of the year, Alex.
Yeah, it has been a really interesting company to watch, given the fact that it's kind of been at the center of Wall Street's big rotation trade into sectors outside of technology.
So it's actually trading at a record high now amid a rally that has come as interest rate cuts and strong U.S.
growth push investors into sectors of the market closely linked to the health of the U.S.
economy.
So Deer sells construction equipment in addition to its iconic farmer machinery.
And that's been an industry that up until recently was really struggling.
Investors are betting it could get a boost from the Fed's monetary easing and some data that showed that the U.S.
economy is expanding at a healthy pace.
So when the company reports earnings, Wall Street will be looking for any update on its industry outlook.
Investors are still waiting for a rebound in the U.S.
farm economy specifically.
So something that would spur farmers to buy new tractors and other equipment.
Uh expecting uh net farm income to fall by one percent according to the USDA.
And Deer also said in November that it expected industry sales of large equipment to fall 15% to 20% in the US and Canada.
So we're going to see what it says on those fronts.
It is up nearly 32% year to date.
Yet again, a company that has a really high bar going into report.
Yeah, certainly sounds like it.
Thanks for this, Alex.
Great having you on with us.
Great to be with you.
That's Bloomberg News Equities Reporter, Alexandra Seminova.
And coming up on Bloomberg Daybreak weekend, we'll look ahead to jobs numbers in the UK.
Is AI starting to affect productivity?
I'm Nathan Hager, and this is Bloomberg.
As markets move and headlines break, what matters most is context.
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Visit Bloomberg.com/slash podcast offer to learn more.
This is Bloomberg Daybreak Weekend, our global look ahead at the top stories for investors in the coming week.
I'm Nathan Hager in Washington.
Up later in our program, we'll look ahead for what to expect during the nine-day lunar new year holiday in China.
But first, the UK economy is facing a tricky mix of slowing growth, stubbornly high unemployment, and mounting global uncertainty from trade tensions to tariffs and political turmoil.
But amid the gloom, there is a growing debate over whether artificial intelligence could help lift productivity and offset some of the weakness in Britain's labor market.
Even as questions mount about whether the technology's already displacing workers.
After recent GDP data out of the UK showed sluggish growth, we get fresh jobs data from Britain next week.
Let's get more now from Bloomberg Daybreak Europe anchor Caroline Hepger in London.
Nathan, AI is talked about as both a coming storm, but also a potential solution to Britain's growth woes.
The UK's unemployment rate has climbed to Nick COVID levels since Labour took power in 2024.
But ahead of the UK jobs data in the next few days, there is a new quirk in recent data.
Some economists increasingly think that productivity may actually be improving, and they wonder if artificial intelligence adoption may be playing a part.
The Bank of England Governor Andrew Bailey is one of them.
So is AI a panacea and what impact is it actually having on the UK economy?
Joining us now in studios Bloomberg's UK economy reporter Irina Angel and our Bloomberg Opinion columnist covering technology, Palmi Olsen.
Welcome to both of you.
Thanks for being with me.
Irina, can I start with you just on the actual figures?
What are we expecting from the UK jobs numbers in the next few days?
So next week we'll get uh the jobs report for December.
Um, and the unemployment rate is actually expected to edge up again.
Um, it's now at 5.1%.
Some economists who are surveyed by Bloomberg think it'll go it'll go up to 5.2%.
And this is just so you have a sense of how important this is.
It's the highest since sort of COVID times 2021-2020.
And it will get worse in the next months, but perhaps not for much longer.
The Bank of England kind of sees unemployment peaking at 5.3% in spring.
And, you know, now this is starting to raise important questions about the jobs costs of their you know fight to bring inflation back to the 2% target.
The party has been quite difficult for the labour market in the UK.
What's your analysis about why that is?
Well, it's uh it's all pointing to one thing.
It's the the payroll tax rises.
Um, Chancellor uh Rachel Reeves's 26 billion payroll tax rises, and you know, those came on top of large consecutive increases in the minimum wage.
Um and you know, the country has lost almost a quarter of a of a million jobs after these um payroll costs were increased in Reeves's first budget in October 2024.
Um, and since then, you know, employers have blamed them for job cuts and and hiring freezes in key sectors like retail and manufacturing.
There's been a lot of talk about the number of young people who are not in work or employment or training of any kind.
That's got quite a lot of attention.
But um, how isolated is the issue with jobs when you segment things by age or gender or skill set?
Well, most of this increase in unemployment that I was just talking about has been due to a lack of hiring so far rather than mass layoffs.
So, of course, you know, this impacts young people looking for their first job or just other people, you know, moving out of economic inactivity straight into unemployment.
Um, and it's actually very interesting that because men are becoming unemployed at a faster rate than women, and you know, of course, in particular young men, that's a big problem, but men in general, and it seems like uh that hiring freezes and layoffs fell particularly hard in male-dominated sectors.
So, you know, construction, manufacturing, but also IT.
Um, and this is all kind of helping reform because um, while reform did not stand out among unemployed voters at the general election, it has become the dominant party for this group over the past six months.
And it's particularly unemployed men who turn to reform.
We have data from more in common that showed that more than 40% of men who are out of work support reform, and that's double the level in July 2024 and 10 points more than women.
Gosh, that's interesting, isn't it?
So the political ramifications then from the data.
I want to lay into that outlook, what AI might mean.
Because I note that the technology secretary Liz Kendall was speaking at um Bloomberg's headquarters right here in London, talking about how the government's going to use AI to turbocharge different industries in Britain and pledging this idea that there will be AI training for all UK employees.
Palmy, you've been covering AI companies and how their tools are really starting to unsettle the world of business, the world of work.
What kinds of products, I suppose, first of all, are we actually starting to see being used?
And then, you know, maybe we'll think about what that means for employment in a minute.
Well, most people are using chatbots already, right?
I think it's something like 800 million to 900 million people use chat GPT on a weekly basis.
That's something like 10% of the global population every week are using these tools.
Um but the most recent updates have been agentic AI.
Of course, you might have heard that term, agent, um, a lot last year.
It was very much hyped.
Uh unfortunately that didn't have much to show for it.
Only a few companies actually released anything.
They were a little bit unreliable.
But actually, just in the last few weeks, we've seen a couple of product launches of these AI agents.
And this is different to a chatbot.
This is AI that can not just give you information, but carry out tasks for you.
So the the one that the market really got spooked by was uh a product called Claude Co-Work, which came from a company called Anthropic.
They were spun out of OpenAI a few years ago.
Um, and I I've used it myself.
I I pointed it at some files on my computer and and got it to create a PowerPoint presentation out of it, create a spreadsheet of all the people and all my interviews with all their areas of expertise, you know, stuff I'd been wanting to do for years, but just didn't have the time to do.
It was even answering my LinkedIn messages.
I didn't even have to go to LinkedIn, and it would just answer them for me.
Um so those are just some examples of the kinds of things they can do.
And and this is what I think is kind of rattling the markets a little bit is this sense that okay, some of these tasks that certain jobs are doing could well be under threat.
The thing is, traders and investors are reacting pretty strongly to the idea of these products, but they've not been fully adopted yet.
As you say, lots of people are testing them out, lots of businesses are trying them out.
And they haven't really claimed much market share yet.
But I suppose people are worried about whether that's coming or why that is.
I think so.
I think I think you're right.
I think people just kind of want to get ahead of whatever disruption is coming and ride that wave.
But this is so typical of the market, right?
Like just a few m a few months ago, everybody was freaking out that we're in an AI bubble.
And now the sentiment, the narrative has totally shifted to we're practically in the AI singularity.
You know, it's like maybe not to that extent, but um it is funny how the pendulum has swung so far the other way.
Um and I uh if you remember in January last year, there was a huge um drop in the share price of big tech companies when China's Deep Seat came out uh because there was a belief that that was gonna threaten the status quo of all the infrastructure and data centers that was being spent by big tech.
Now, of course, that was an overreaction.
I think we're seeing the same thing here, a little bit of an overreaction, but there's truth to it.
When people are selling off s stocks like Salesforce or some of these other enterprise software makers, um there is some truth that the application layer that those software makers have, that bit of their business is under threat, I think, from these new AI agents that are coming to market.
Okay.
So let's bring that together then with the idea of jobs here in the UK.
How far away is the future where artificial intelligence does actually make workers redundant?
Because we're starting to see bits of reporting around that and bits of data in Britain.
Well, the obvious casualty for now, maybe it's not quite showing up in the data yet, is uh the graduates, entry-level workers whose companies are told treat your AI like an intern.
So they do, and that works really well, and then they don't need to hire interns or junior analysts or junior researchers.
Um and I think that might just be the starting point.
But I think it's very I I don't think it's gonna be as simple as just jobs get replaced.
I think jobs are gonna change.
So for example, uh I was talking to the the head of Zapier, which is a big software company in the US, and he was saying that the way they build product now, they used to have three people who would be on a team, and it's a very classic structure called EDP, so it's or EDMs is the engineer, the product marketer, and then the designer.
Now, instead of three people, they just have one, but that one person has to cover all those three different areas.
So the titles have been squished together into one person who's using AI to kind of augment themselves.
It doesn't mean the other two people have been fired.
Uh they're just doing different things.
So I think we're gonna see a mixture of that, of roles just changing and morphing and blending together.
But perhaps also certainly elements of hiring freezes.
I mean, there are some people who've been using this new Claude plugin for legalist legal work.
And one person told me that they weren't using their fractional lawyer anymore for anything up to a commercial contract worth 50,000.
You know, anything higher than that, you do need a human.
But if it's kind of low stakes, they were using the AI now.
So of course, that is job, a job not going to a human.
So we're seeing, I think, a kind of mixture of those things happening.
Yeah, anecdotally, I've certainly seen it with people I speak to that that they are feeling that change.
And I will point to one bit of data.
Morgan Stanley in the last few weeks has talked about AI leading to an 8% net job loss over the last 12 months in the UK.
So there's some tiny bits of research out there.
Um, Irina, are we seeing any signs that AI is starting to affect the UK labor market?
Is it's you know, people recently graduating, uh what sorts of jobs might be affected first?
I think the problem is not necessarily job cuts, but the lack of job creation in the UK.
So, you know, that Morgan Stanley research, you know, it's showing the UK is losing more jobs than it's creating because of AI and it's doing so at a faster pace than um, you know, countries like the US or Japan or Germany.
But if you actually look at the data, the UK is sort of losing jobs at the same pace as the other countries, so it's kind of like losing jobs at the same rate as Germany, it's just creating way fewer jobs thanks to AI.
And some of that is also due to higher employment costs here.
Um, that's you know, are not really like it's not really uh AI is almost coming in as a solution for companies to deal with this increase in in in the cost of employing a human.
Um and you know, to be to be sure, like there's also some productivity gains that are coming as a result of adopting AI.
And it there are, you know, this is you know one for the AI optimists like the Bank of England Governor Andrew Bailey, the fact that you know these companies are actually changing how they do things after adopting AI, and you know, maybe the UK is um is about to see a productivity uh like fine to finally escape its productivity trap.
But there uh the data does point to the fact that there are some job losses to come and the cost of this may be a bit too high, or we'd not we're not ready to deal with it yet.
My thanks to our UK economy reporter Irina Angel and to our Bloomberg opinion columnist covering technology, Palmy Olson.
Thank you so much.
And we'll have full coverage and analysis of the UK's jobs data.
I'm Caroline Hepkeh here in London.
You can catch us every weekday morning for Bloomberg Daybreak Europe, beginning at 6 a.m.
in London.
That's 1 a.m.
on Wall Street.
Nathan.
Thanks, Caroline.
And coming up on Bloomberg Daybreak weekend, we'll look ahead to lunar new year festivities in China.
I'm Nathan Hager, and this is Bloomberg.
This is Bloomberg Daybreak Weekend, our global look ahead at the top stories for investors in the coming week.
I'm Nathan Hager in Washington.
We go to China next, where Lunar New Year festivities are set to kick off.
The nine-day holiday will drive spending on travel, dining, and gift giving.
For a look ahead, let's get to Doug Krisner, host of the Bloomberg Daybreak Asia podcast.
Nathan, the Lunar New Year holiday or spring festival is one of China's longest holidays.
And this year it will usher in the year of the horse.
Festivities will run for nine days from February 15th.
That's a day longer than usual.
And as usual, the focus for markets will be on consumer spending.
Now we know the Chinese economy continues to struggle, largely due to weak domestic demand.
For a closer look at the holiday mood, let's bring in Bloomberg Shirley Zhao.
Shirley covers consumer companies in the region with a close eye on luxury goods.
And she joins from our studios in Hong Kong.
Thank you for being here.
First of all, Shirley, I want to know about the level of confidence among consumers.
I think people are relatively optimistic because although China is in an economic slowdown and people's spending power has not been as strong as before, and people's spending appetite has been weakening.
But Lunar New Year is one of China's biggest holidays, and people tend to stay in the country instead of traveling outside, because the holiday is all about you know spending time with your family.
So it's it's like Christmas in the US or or in Europe.
It's a big holiday, and people tend to want to spend on food and drinks, on uh, you know, big meals outside.
So um people in the food and drinks industry at least are relatively positive about the outlook of lunar new year.
But how much um it may grow from last year or whether it will grow at all, um it remains to be seen because as I said just now, um people's spending appetite still remains relatively weak in the broader economic slowdown.
So if a consumer, let's say, were to make the choice to travel abroad or offshore somewhere, what destinations have become popular?
I'm thinking Korea, Japan, is that likely?
Maybe even a place like Vietnam?
Yes, for people in mainland China, Korea has become one of the hottest destinations for people to travel outside, maybe in the latter part of the holiday, because at the beginning of the holiday, everybody will stay home and stay, spend time with family, and then they will visit their neighbors and relatives.
So the first few days people tend to stay within the country.
But in the uh second half of the holiday, some people may choose to travel outside, and Korea has become a really hot destination.
And Japan used to be a hot destination as well, and especially when yen is so cheap now.
Um people should have you know uh chosen Japan, but unfortunately, since China and Japan got into this big dispute over Taiwan late last year, China has um instructed airlines to cut their flights or even halt their flights for a prolonged period of time.
So um flights were really limited in mainland China for people who want to go to Japan.
And you know, under this rising nationalism and domestic pressure, a lot of people would choose to go to other places than Japan.
So we would say Korea and definitely Southeast Asia, places like Thailand and Vietnam would be preferred destinations for mainland Chinese travelers.
For travelers from Hong Kong, um, Japan remains a big destination, and other places like Taiwan and Korea and Southeast Asia.
In addition to eating lots of good food, gift giving is a major part of the festivities, and red envelopes in particular.
Talk to me a little bit about the red envelope and how some e-commerce companies are trying to convert that type of gift giving into online commerce.
Right.
So it's it's interesting because Bloomberg Hong Kong actually, so we have a weekly newsletter, and this week's newsletter is actually a review of red envelopes by different brands and financial institutions.
So for example, Hong Kong's flag carrier, Cathay Pacific, has issued a really fantastic set of red envelopes featuring the company's history and their milestone um plane models over the 80 years of its history.
So red envelope is definitely a huge tradition.
And if you have children, or if you will go to meet your friend's children, then you're supposed to give red envelopes to well with money in it to them because they are junior to you.
But your parents or people who are senior to you will give you rare envelopes with money.
So that's been a huge tradition in China and Hong Kong.
But over the past few years, you know, e-commerce has developed so fast in China.
It's, you know, so ubiquitous everywhere, and everybody, it's got to a point that if you go to China today, if you want to use cash, it's very difficult because very few places accept cash anymore, or they don't have changes for you.
So everyone is paying online using e-commerce platforms.
And in fact, my parents and my relatives are giving me money via online envelopes.
So we can see, you know, there's a huge shift of people, you know, of this money gifting from offline to online.
I know you focus a lot on luxury goods.
And I'm wondering about the outlook for luxury sales, given the state of the economy and how consumers are feeling about their finances.
Is there, in your view, a risk that spending on luxury items, particularly on those well-known fashion brands, is a little on the soft side?
Yes, over the past two years in China, the trend is definitely that people are becoming more cautious and selective when it comes to buying big ticket items, including like jewelry, watches and leather goods, you know, all those luxury brand items.
Um the trend in China is that people are now becoming more aware of their own needs and their own lifestyle.
Uh and they don't have much money or they don't feel rich enough for them to buy a huge amount of luxury stuff.
So they're becoming more selective.
They are not only looking at brand names, they're also looking at whether they identify with the brand stories, the bank brand philosophy, and whether these brands can elevate their lifestyle, it can make them feel better.
So in the past, you could see that people would just go to any luxury brand stores because of the brand names.
People thought that, you know, they if they bought luxury goods, it could elevate their status, but now people are really choosing very carefully.
So luxury gift gifting um could still become a bit subdued in China.
Um, but this year, you know, everybody's going after gold like crazy.
So I won't be surprised to see that, you know, gold gifting could become a big trend in China during the Chinese New Year because you know the gold prices have been going up and up and up.
Right.
And in China, you know, everybody goes into this investment if the prices keep going up and you know, everybody pulled out if the prices come down.
So yeah, the people are there's a huge frenzy over gold in China right now.
We talk about the many ways the Chinese government has tried to tackle the problem of weak domestic demand.
And since holiday spending has the potential to provide a bit of a lift to the overall economy, I'm wondering about what the government is doing to encourage consumers to spend more than they would otherwise.
Yes.
So the Chinese government has actually focused more on consumption than before.
So previously its focus was on um, you know, heavy industries and new industries, for example, like EV and new energy sectors.
But it has come to realization that consumption is is a big part of economic driver.
So it has been issuing uh uh, for example, consumption vouchers and it has been implementing uh policies to encourage people to buy things.
So that's a good shift, and and it's uh, you know, we have seen uh the Chinese government doing more in encouraging people to spend in China.
I've learned that much of the gift giving during the lunar new year holiday has been described as emotional consumption.
We've also seen a tendency to favor experiences rather than goods.
Shirley, I'm gonna go out on a limb here, so work with me, and I'm gonna ask whether gifting stock is something that consumers would ever consider.
Actually, that's a really interesting thought.
And I definitely wouldn't mind if people give me, you know, stocks in major Hong Kong or mainland companies.
Uh, but this is not a trend that I have observed.
In fact, in China, I still think that the majority of people don't think stock market being a safe way to put their money in.
Um a lot of Chinese people think still think that property is their only way of investment because it's safe and and the prices would be bound to go up.
Uh of course, you know, that was up until a few years ago uh when China's property market started to crash.
So a lot of Chinese people's wealth, because everybody invested in property before the property market slowed down.
So a huge amount of Chinese people's wealth was locked up in the property market.
That's why people are spending less now because their wealth is locked up.
And even though their income remains unchanged.
They still feel that they're they're not rich.
They still feel poor.
So that's why people are not spending.
Um of course, you know, I won't be surprised if China's stock market and China's financial market become better regulated.
Uh, and if China gives more um flexibility for people to invest in um different financial tools.
Um stock market could become a big investment for for Chinese people and stock giving could become a trend.
But at least for now, I haven't observed um this as a big trend right now.
Just a thought, Shirley, thank you so very much, and happy new year, by the way.
Bloomberg Shirley Zhao joining from Hong Kong.
I'm Doug Krisner.
You can catch us weekdays for the Daybreak Asia podcast.
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Nathan.
Thanks, Doug.
And that does it for this edition of Bloomberg Daybreak Weekend.
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