It's Tuesday, the tenth of October in London. This is the Bloomberg Daybreak Europe podcast. I'm Stephen Carroll. Coming up today, Israel unites. A fractured country comes together after a horrific
attack that killed hundreds. Netanyahu says his country's response will reverberate with their enemies for generations as fears of mass civilian casualties grow, and will bring you the latest from the Labor Party conference in the UK, where Kirstahmer is set to warn that the country faces a difficult path to recovery. Let's start with a roundup of our top stories. More than nine hundred Israelis, mostly civilians, are now known
to have died in Hamas's surprise attacks. At the weekend, nearly seven hundred Palestinians have been killed during retaliatory strikes. A survivor of the attack by Hamas on the Supernova festival in Israel says his escape was terrifying. Hi Cohen says he dodged bullets as he drove through a field with his girlfriend to get away from the violence. He described so of what he witnessed.
We saw the chips in the motorcycles of Hamas pouching young children that they was under effect of trucks and alcohol. They just butchered.
Them while Hai Con and his partner made it to safety. Israeli authorities are still trying to identify and remove the bodies of over two hundred and fifty people killed at the event. Many others have been taken hostage. A spokesman for Hamas told Al Jazeera that the Palestinian militant group is preparing to kill them should Israel strike civilian homes in Gaza without warning. Israel's army is now planning the largest mobilization in the country's history, calling up three hundred
thousand reserve soldiers to fight. The Prime Minister benjaminettanie who says the response to Hamas has only started, willem.
I know that we all want immediate results. It will take time, but I promise you, dear Israeli citizens, at the end of this campaign, all of our enemies will know there was a great mistake to attack Israel. What we will do to our enemies in the coming days will reverberate with them for generations.
Netaniahu's comments come as the country's armed forces continue to launch airstrikes against the Gaza Strip. Israel's military often in struct civilians to evacuate before it hits apartment or office towers in Gaza where civilians might be present. Whoever, residents in Gaza now say buildings are being hit without warning. Of these six hundred and eighty seven people reported to have been killed in Gaza. The Health Ministry says one
hundred and forty year children. Senior Hamas official Ari Baraka warned against an all out assault on the Palestinian territory Hola.
Our allies are ready to join the fight. If Gaza subjected to a war of annihilation, they will not sit with their hands tied. The government of Israel knows they will open the gates of hell if they try to destroy Gaza and to use non traditional weapons to destroy Kaza, like American weapons.
Ali Baraka's call for support comes as America's most senior military official, General Charles Q. Brown Junior, warned Iran to not get involved in the Israel Hamas conflict. Speaking to the Financial Times, the chairman of the US Joint Chiefs of Staff said, we do know what do not want this to broaden, and the idea is for Iran to get that message loud and clear. Meanwhile, the US government says the first shipments of security aids to Israel or
already on the way. Bloomberg's At Baxter has the story.
There had been some question about what the US could do, but National Security Council spokesman John Kirby says it's important that the aid go now and more will be on the way soon. Meanwhile, Kirby on MSNBC says there is no known direct link between Iran and AMAS on the initial attacks.
No, we do not.
We don't have any specific intelligence or evidence that points to direct participation by Iran. That said, of course, Iran has long supported HAMAS and other terrorist networks, and.
The President is set to me can address later today, Ed Baxter, Bloomberg Radio.
Top Federal Reserve officials increasingly feel that another rate hike may not be needed after a recent surge in US borrowing costs. Speaking at the National Association for Business Economics conference in Dallas, Federal Reserve Vice chair Philip Jefferson said he's watching the increase in treasury yields closely.
What I think about is the real rate that is required to bring aggregate supply back in to balance with aggregate demand. I think current policy is restrictive in putting downward pressure on the inflation rate, and that's really what my concern is.
Jefferson went on to say that he will quote remain cognizant of the tightening and financial conditions through higher bond yields. His comments were echoed by Dallas FED President Laurie Logan, who also spoke yesterday, saying that elevated borrowing costs could do some of the work of cooling the economy for us. That's reflected in the markets, which believe there's only a twenty percent chance of a quarter point hike at the
upcoming policy meeting. And here in the UK, the Labor Party leader Keir Starmer will today warn that the country faces a difficult path to recovery as he urges voters to put their trust in him and his party. Starmer will tell Labour's annual conference this afternoon that quote what is broken can be repaired, what is ruined can be rebuilt.
The speech comes after the Shadow Chancellor of the Exchequer, Rachel Reeves, told Bloomberg's Lizzie Burden that Labor plans to fight the election on the economy.
Went borrowing to fun day to day spending. We'll bring dick down as the share of our economy and then only subject to that, we will invest in the things that can boost our productivity. Work it in conjunction with business to unlock further private sector investment.
Rachel Reeves also says Labor will use government borrowing to invest in British industry if it wins power. While popular with many, the move risks playing into the typical conservative of tax over the party's fiscal discipline. Well, let's bring you more now on the attacks in Israel, as we are joined by our head of Middle East and North Africa, Stuart Livingstone. Wallace is in Dubai and in London, OURMA
News director Rosland mathieson Roz to you. First, we heard from an international point of view, the leaders of the US, Germany, France, Italy and the UK spoke last night about the situation in Israel. What came out of that call.
Well, an initial statement of course, strongly supporting Israel and condemning her mass but not a lot more beyond that. For now, Europe is unlikely to want to get caught up in the military aspect of things. Is As very much a US ally and that's where the military ties lie. Of course, Europe is worried about their citizens. They're worried
about what's happening inside Israel. They've lit up their parliamentary buildings and places like Germany and the UK, but there is that caution about sort of supplying military aid to Israel or getting involved militarily, and in some places there is a sense of empathy over the years for the challenges facing Palestinian people. That's not to say they endorse the actions taken on the weekend by Hamas at all, but it's not as clear cup for people some officials
really in Europe as when Russia invaded Ukraine. So you see protests in these countries in Europe both supporting Israel and supporting those advocating for a separate Palestinian state. So you are seeing that general statement of support overnight from Israel, but it's a little bit more complicated than say the immediate aftermath of Russia's invasion of Ukraine.
And that played out as well at an EU level yesterday, where there was announcement from the European Commission that aide two Palestinians had been suspended. Now that was subsequently reversed. EU foreign ministers are meeting today and say they'll be reviewing humanitarian aid. Talk us through what happened in the EU.
Well, that's right, we got that announcement it was going to be suspended, and then late last night the idea no, it's actually going to be reviewed but not suspended, and they will discuss that today. It came after the UN Secretary General Antonio Guteris, he spoke with his European Council President counterpart Charles Michelle, and said, hang on, this is
humanitarian aid that Europe provides. It's aid aimed at supporting Palestinians who reject Hamas and in this situation we're seeing, for example in the Gaza strip right now, that the living conditions for people there for quite some time have been poor and the aim of this is to reach those people and to support them, regardless of their political affiliation.
In some states so they weren't consulted on the initial decision, including Spain and Ireland, and so what you saw was this late night reversed and at least now an idea. It's not going to be suspended.
It will be discussed today what more.
Have we heard from the United States? RA was about the aid that they're providing to Israel.
Well, this is also a bit complicated because of domestic politics. Right now in the US there is no House speaker and they've got to sort that out so the business of the House can resume. Of course, the Biden administration could do some munilateral announcements around aid military a but they've been a bit cautious there. Also, mean, the US provides already more than three billion dollars in military aid
to Israel every year. They've said they're going to support Israel in whatever way is needed, that sort of diplomatic support, strategic support, and possibly further military support, but we haven't really heard a lot of specifics about that so far. And of course Israel is a well equipped military, but also that soldiers already seemingly running short on kit according to some reports, and so you're going to see this possibly get caught up a bit also in the wash of US domestic politics.
Okay, Ras, and stay with us. We're going to turn to Stuart Livingston Wallace now who joins US from Dubai, a head of Middle East and North Africa. S Jude I wonder if we could start by just updating us on the security situation in southern Israel this morning and the efforts that are being made to secure the release of the hostages being held in Gaza.
Yeah, good morning. So it's still things are still a little bit murky. We know that they have regained full control over certainly the majority of areas that we're infiltrated on Saturday and into Sunday, but I think there is still a concern that there are how much medicines knocking around somewhere inside its rail there's no great certainty with that.
The regular ideas that of the Israel Defense Forces briefing kicked off about ten minutes ago, so we'll know what the latest situation is, hopefully in detail in about ten minutes from now. To the north. Again, we've had a few incidents, but nothing serious. On the border with Lebanon, We've have some rockets fired over a rather mortified over and some retaliatory responses there. We did have some infiltration, but again it was characterized as relatively low level and
seemed to be locked up relatively quickly. So for as things stand right now, at least on the ground, things appear to be getting better in terms of regaining control, but as you know, there is a long way to go in this conflict. In terms of the hostages, we know that castAR has been trying to broak of some sort of deal since Saturday. Really not clear if they're getting anywhere, and I think anyone everyone would be very
surprised if that was resolved soon. We think, based on comments from the US government yesterday, that there are Americans involved, but again no one quite knows the number in total. You know, We've been hearing all sorts of numbers. It's probably more than one hundred, but it could be a greater more than that. So in terms of where we go next on that, again we know the FBI is involved in helping out the regular authorities and figuring out how many there are and where they are and what
they can do about it. But again, rather like the situation on the ground, things remain quite murky.
We have, of course seen this series of airstrikes taking place in Gaza. I wonder what more you can tell us about what we know about what Israel as preparing to do next in its response to these attacks.
Well, so far we've not had clarity. I mean As things stand, we continue to get attacks from both the land and the se into Gaza. The death toll in Gaza is into the several hundred now, and broadly speaking, again this from the Israeli side, they're going after what they considered to be military assets. Of that is tunnel, that is, houses where they say hamas meat, that's even includes moss that again the Israelis say Hamas are using
for operational purposes. But we know they've targeted residential buildings as well on the grounds as they portrayed as being places where Hammas are operating from. Clearly, everyone is watching and waiting to see whether you're going to have troops on the ground, Israeli troops on the grounds in Gaza. The Israelis themselves have said nothing definitive on that so far.
We had Ron Berber on yesterday. Now he's one of Netna's closest allies in the Kabinet, and we asked him that question specifically, and again he was very careful not to give anything beyond what Netna himself has said. But obviously the rhetoric coming from Israeli government has been pretty strong, but we've had no specifics yes on what that might be or when might have.
We've been watching very closely the commentary around Iran's role, whether or not it supported or helped Hamas prepare for these attacks. What more have we heard about the role of Iran in.
This, Well, everyone's being very cautious. I mean, I think the furthest that anyone's gone is probably Ron Bermerin saying something along the lines of initially we didn't think that they were directly involved. He then said, now there's some evidence that they might have known about, but that they were still working to verify that evidence. But again there's a wide gulf between perhaps being aware of it in advance and being actively involved in planning and the operational side of it.
You know.
Similarly, the US has been repeated and the arsked did we have any evidence that they were directly involved? And again we had the National Security Council spokesman John Kirby yesterday saying that there wasn't any specific intelligence or evidence that points the direct participation in Iran and the attacks against Israel. So for now, I think the general view is that there is no evidence for it. But again, there is a long history there of Iran providing support
to how mass that. The question now is where they directly involved? Did they know about it? Do they not know about it at all? And I think that's what everyone's trying to figure out right now.
Ros and Madsen turning back to you, what have we heard from other international powers in this as well? We've been watching the US Senate leader Chuck Schumer meeting China's president she yesterday.
Well, so it's been fd quiet from countries like Russia and China. China's expressed sadness of what has happened and called for KHM, but it's not condemned Hamas. And so there was that criticism there, Yester, that you mentioned from Chuck Schuma. But China's response is hardly surprising. It's in line with its general approach not to be drawn into conflicts like this. On Russia's invasion of Ukraine, it said similar things but didn't really condemn Russia throughout calling for
ceasefires and the like. And of course China is quick to spott an opportunity to try and drive a wage between other nations, particularly between the US and other nations, and exploit them. And you know in Ukraine there was a case of nations who didn't want that war to carry on. So it's a bit more complex so for countries as they may not feel it's as clear cut
as Russia going into Ukraine. But the moment what we're seeing is like Russia China perhaps sitting on the sidelines watching developments but not wanting to get directly.
Pulled in own news director Razlin Matheson and are Head of Middle Eastern North Africa Sture at Livingston Wallace. Thank you, boot to you both for joining us with the later on this story. Turning to politics here in the UK, Keir Starmer will tell us Parties Conference of the UK faces a difficult path to recovery as he urges voters to trust Labor to rebuild the UK after thirteen years
of Conservative rule. His keynote speech is the main event at the conference at Liverpool today and carln Hepker is live there for us this morning.
Carlin, good morning, very good morning to Stephen. Let's start with the day yesterday, shall we hear at Labour conference. It was a hugely ambitious day. Rachel Reeves received a hero's welcome and delivered a very persuasive speech. She has claimed the Tories usual stomping ground of the economy ahead of an election that Labour says they are preparing for
as early as next May. Labor gave a clear response to the Hammus attacks in Israel, which could have been derailed by the previous leadership who were here yesterday in Liverpool. Now those you say, Stephen, the party waits Kirs Starmer's speech, in which he's expected to say that what is broken
can be repaired, what is ruined can be rebuilt. So the former Bank of England economist Rachel Reeves described the mini budget last year from the Conservatives as devastation and voters trust in the toy's handling of the economy has more than half since March twenty twenty, according to a
Yugov poll. So Addressing a packed hall, Reeves talked about boosting investment, increasing house building by easing the planning rules, scrapping non dom tax breaks, rebuilding infrastructure, including the electricity grid, all to spur desperately needed economic growth in the UK. The reception that she got from investors in business was positive and it is really notable that they are here in Liverpool in numbers not seen previously and that they
are listening so attentively. So here is the Shadow Chancellor, Rachel Reeves.
In the two and a half years that I've been Shadow Chancellor of the Exchequer reached out to business and I think you can see that in the speech that I delivered today where I set out that the lifeblood
of any successful economy is private business investment. And the plans that I set out, whether that is a form of the planning system, the stability that we need to underpin and provide the foundation of a successful economy, are all ideas that have been generated in conjunction with business, because we do need to get Britain building, and that means giving business the confidence to invest, but also giving
them a reason to invest here in Britain. And that's why I hope I did it conference today.
Lots of them are non doms, and if you abolish the non dom regime but it doesn't raise as much money as you expect, are you still going to stick by it on ideological grounds.
We've got a loophole in our tax system whereby you can live in Britain and Major Britain your home, but because your father was born somewhere else, you can pay tax in a different jurisdiction. There's outdated and it's not right and Labor will abolish it and we will use that money to put into our national health service and for breakfast clubs are all primary schools. But we've worked closely with businesses and investors to make sure that we
do not deter foreign investment. We're determined to get that investment here in Britain, but that tax loophole will end with a Labor government.
And you're a former Bank of England economist, you know the law of unintended consequences. If the money isn't raised as you expect, would you revive the measure under a different name.
Well, if you look at what Gordon Brown died with George Osborne's reforms for non don's a lot of people said it won't raise the money, people will go and live elsewhere. That didn't happen. And what did happen was the tax review came in and we've got public services in Britain today that are on their knees. We've got
seven point seven million people on hospital waiting this. We can't go on like this and that's why we are taking this straightforward measure bringing us into line with countries around the world that don't have these loopholes, and ensuring that if you make Britain your home, you pay your taxes here, and putting that money where it belongs in our national health service.
So you promise you'll be cautious about borrowing to invest, But we've got debt at ninety nine percent of GDP already, yields are high. The reality is we just don't know how the market's going to react to borrowing even more.
Idea, Well, I set out the fiscal rules that I would stick to with iron discipline, and I got support from conference again in setting out those rules where won't borrow to fun day to day spending. We'll bring debt down as the share of our economy, and then only subject to that, we will invest in the things that can boost our productivity, working in conjunction with business to
unlock further private sector investment. So today, for example, I set out how a new National Wealth Fund you will be targeted for every pound that we invest that it unlocks three pounds of private sector investment. That is partnership between government and business in action you're seeing around the world. It is unlocking investment around the world. I want those jobs. I want that investment in Britain and with labor we.
Will and shout out, Chancellor, none of your colleagues will tell me how fast after the general election you plan to have the fastest growth in the G seven. Isn't that a meaningless mission without a time frame.
In the next parliament. We want to achieve that mission of having the highest sustained growth in the G seven, with good jobs and productivity in all parts of the country, making everyone not just a few better off. And today at conference and tomorrow in Keir Starmer's speech, we will set out we have set out today exactly how we're going to achieve that.
This is Bloomberg Daybreak Europe, your morning brief on the stories making news from London to Wall Street and beyond. Look for us on your podcast feed every morning, on Apple, Spotify and anywhere you get your podcasts. You can also listen live each morning on London Dab Radio, the Bloomberg Business app.
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