Ren Zhengfei says US government ‘underestimates’ Huawei

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Huawei founder Ren Zhengfei has remained defiant towards US moves against his company, saying the US “underestimates” its abilities.

Speaking to Chinese state media, Mr Ren downplayed the impact of recent US curbs and said no-one could catch up to its 5G technology in the near future.

Last week the US added Huawei to a list of companies that American firms cannot trade with unless they have a licence.

The move marked an escalation in US efforts to block the Chinese company.

“The current practice of US politicians underestimates our strength,” Mr Ren said, according to transcripts from state media.

Huawei faces a growing backlash from Western countries, led by the US, over possible risks posed by using its products in next-generation 5G mobile networks.

The potential fallout from the US decision to place Huawei on its “entity list” was drawn into focus on Monday after Google barred the Chinese tech giant from some updates to its Android operating system.

Later on Monday, the US Commerce Department issued a temporary licence that enabled some companies to continue supporting existing Huawei networks and devices.

The US said it would issue the 90-day licence that “will allow operations to continue for existing Huawei mobile phone users and rural broadband networks,” said US Secretary of Commerce Wilbur Ross.

Still, Mr Ren played down the significance of the move, saying that Huawei had already made preparations ahead of the US restrictions.

Huawei has been at the epicentre of the US-China power struggle for months.

Consumers are worried about what this all means for them, while the implications for Huawei are also likely to be significant.

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Trump loses lawsuit challenging subpoena for financial records

(Reuters) – A U.S. judge on Monday ruled in favour of a U.S. House of Representatives committee seeking President Donald Trump’s financial records from his accounting firm, dealing an early setback to the Trump administration in its legal battle with Congress.

U.S. District Judge Amit Mehta in Washington also denied a request by Trump to stay his decision pending an appeal.

Last Tuesday Mehta heard oral arguments on whether Mazars LLP must comply with a House of Representatives Oversight Committee subpoena.

Mehta said in Monday’s ruling that the committee “has shown that it is not engaged in a pure fishing expedition for the President’s financial records” and that the Mazars documents might assist Congress in passing laws and performing other core functions.

“It is simply not fathomable that a Constitution that grants Congress the power to remove a President for reasons including criminal behaviour would deny Congress the power to investigate him for unlawful conduct – past or present – even without formally opening an impeachment inquiry,” Mehta said.

Mehta said Mazars has seven days to comply with the subpoena.

It was the first time a federal court had waded into the tussle about how far Congress can go in probing Trump and his business affairs.

Trump told reporters the decision was “crazy” and that it would be appealed.

“It’s totally the wrong decision by obviously an Obama-appointed judge,” Trump said.

Trump is refusing to cooperate with a series of investigations on issues ranging from his tax returns and policy decisions to his Washington hotel and his children’s security clearances.

The standoff deepened on Monday when Trump told former White House counsel Don McGahn to defy a subpoena to testify about Special Counsel Robert Mueller’s Russia investigation before a different congressional committee.

Trump’s lawyers have argued that Congress is on a quest to “turn up something that Democrats can use as a political tool against the president now and in the 2020 election.”

The House Oversight Committee claims sweeping investigative power and says it needs Trump’s financial records to examine whether he has conflicts of interest or broke the law by not disentangling himself from his business holdings, as previous presidents did.

Lawyers for Trump and the Trump Organization, his company, last month filed a lawsuit to block the committee’s subpoena, saying it exceeded Congress’ constitutional limits.

Mehta was appointed in 2014 by Democratic former President Barack Obama, who was often investigated by Republicans in Congress during his two terms in office.

Mazars has avoided taking sides in the dispute and said it will “comply with all legal obligations.”

The ruling was “a resounding victory for the rule of law,” Elijah Cummings, the House Oversight Committee chairman, said in a statement.

FILE PHOTO: U.S. President Donald Trump speaks at the National Association of Realtors’ Legislative Meetings & Trade Expo in Washington, U.S., May 17, 2019. REUTERS/Carlos Barria

“Congress must have access to the information we need to do our job effectively and efficiently, and we urge the President to stop engaging in this unprecedented cover-up and start complying with the law,” Cummings said.

A judge in Manhattan will hear arguments on May 22 in a similar lawsuit Trump filed to block subpoenas issued to Deutsche Bank AG and Capital One Financial Corp.

Mehta’s ruling “will probably have considerable weight in similar factual contexts where the House is seeking other records,” said Carl Tobias, a law professor at the University of Richmond.

Reporting by Jan Wolfe; Writing by Jan Wolfe and Howard Goller; Editing by Dan Grebler, Grant McCool and James Dalgleish

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India to post highest level of growth from 2020

Billionaire investor Rakesh Jhunjhunwala, CEO, Rare Enterprises.

Hemant Mishra | Mint | Hindustan Times | Getty Images

Indian billionaire investor Rakesh Jhunjhunwala said he is very bullish about the country’s medium-to-long term growth prospects.

In an interview this week with CNBC’s Tanvir Gill, Jhunjhunwala, who is commonly referred to as the “Warren Buffett of India” said things have begun to improve in the economy following five years of a banking crisis, subpar capital expenditure and the introduction of important reforms such as the country’s Goods and Services Tax and demonetization.

“We are now having improvement in credit culture, we are having integrity come to the fore,” he said, adding that the government has taken steps to improve the ease of doing business in the country. “The China-America spat on trade is (also) a great opportunity for India. I don’t see any reason why growth in India will not come back with a bang.”

The investor said he sees India’s growth reach around 8%-9% in the near future and them jump into double-digit figures in the longer term.

“We’ve raised our rate of growth in every decade since independence,” he said. “I think India’s sitting on what is going to be the highest level of growth it has ever seen from 2020 to 2030.”

Still, reports have said that economists and investors are increasingly skeptical of India’s official growth numbers, questioning if the statistics put out by the government paint an accurate picture.

Reuters reported that a study conducted by a division of India’s statistics ministry in the 12 months ending June 2017 found that as much as 36% of the companies in the database used in the country’s GDP calculations could not be traced or were wrongly classified.

Former Reserve Bank of India governor, Raghuram Rajan, also expressed doubts over India’s growth number. He was reported to have said that it was unlikely India grew at 7% when not enough jobs were being created, according to local media. He said India should consider appointing an impartial body to look at the data.

Jhunjhunwala, for his part, downplayed the concerns about the numbers.

“Just because you don’t agree with your figures, you’re suspicious of them, you can’t say the method of calculation is incorrect,” he said. “If they were incorrect, Mr. Raghuram Rajan should’ve corrected them. When he was the RBI governor, what was he doing?”

He added that he was also bullish about India’s future because of the diminishing presence of Indian crony capitalism — which refers to the mutually advantageous relationship between government officials and businesses.

Prime Minister Narendra Modi’s government was said to have taken a strong stance against corrupt businessmen in some of India’s top companies, particularly as India underwent its banking crisis and revamped its bankruptcy laws.

“The journey to limit crony capitalism: It’s a journey, it’s not a destination,” Jhunjhunwala said. “Slowly but surely, in India, crony capitalism has died and governance is what brings about real growth.”

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Japan economy beats expectations of slowdown

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Japan’s economy unexpectedly grew in the three months to March, shrugging off forecasts for a contraction in the world’s third largest economy.

The economy grew at an annualised 2.1% in the period, preliminary gross domestic product (GDP) data showed.

That beat analyst expectations for a 0.2% contraction, as imports fell faster than exports.

The data were closely watched for any signals a planned sales tax rise could be delayed.

The surprise expansion in the official GDP figure was fuelled mostly by imports falling faster than exports.

Imports slid 4.6% – the biggest fall in a decade, according to Reuters – while exports dropped more than a 2.4%.

“The surprising resilience of the economy at the start of the year means that GDP growth will be stronger this year than we had anticipated,” senior Japan economist at Capital Economics Marcel Thieliant said.

Mr Thieliant also said that following the better-than-expected growth figures Japan “will press ahead with the sales tax hike scheduled for 1 October”.

Some policymakers have called for a delay to the sales tax increase from 8% to 10% given a backdrop of uncertain domestic and global economic conditions.

Prime Minister Shinzo Abe has already delayed the planned increase and uncertainties in the world economy – including slowing growth in China and its trade war with the US – have prompted some concern that it may be delayed again.

But the country’s Economy Minister Toshimitsu Motegi appeared to indicate that the plans for higher sales tax remained on track.

“There’s no change to our view that the fundamentals supporting domestic demand remain solid,” Mr Motegi told reporters, according to Reuters.

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Exclusive: Google suspends some business with Huawei after Trump blacklist – source

NEW YORK (Reuters) – Alphabet Inc’s Google has suspended business with Huawei that requires the transfer of hardware, software and technical services except those publicly available via open source licensing, a source familiar with the matter told Reuters on Sunday, in a blow to the Chinese technology company that the U.S. government has sought to blacklist around the world.

Holders of current Huawei smartphones with Google apps, however, will continue to be able to use and download app updates provided by Google, a Google spokesperson said, confirming earlier reporting by Reuters.

“We are complying with the order and reviewing the implications,” the Google spokesperson said.

“For users of our services, Google Play and the security protections from Google Play Protect will continue to function on existing Huawei devices,” the spokesperson said, without giving further details.

The suspension could hobble Huawei’s smartphone business outside China as the tech giant will immediately lose access to updates to Google’s Android operating system. Future versions of Huawei smartphones that run on Android will also lose access to popular services, including the Google Play Store and Gmail and YouTube apps.

“Huawei will only be able to use the public version of Android and will not be able to get access to proprietary apps and services from Google,” the source said.

The Trump administration on Thursday added Huawei Technologies Co Ltd to a trade blacklist, immediately enacting restrictions that will make it extremely difficult for the company to do business with U.S. counterparts.

On Friday, the U.S. Commerce Department said it was considering scaling back restrictions on Huawei to “prevent the interruption of existing network operations and equipment”. It was not immediately clear on Sunday whether Huawei’s access to mobile software would be affected.

The extent to which Huawei will be hurt by the U.S. government’s blacklist is not yet known as its global supply chain assesses the impact. Chip experts have questioned Huawei’s ability to continue to operate without help from the United States.

Details of the specific services affected by the suspension were still being discussed internally at Google, according to the source. Huawei attorneys are also studying the impact of the blacklist, a Huawei spokesman said on Friday.

Huawei was not immediately reachable for further comment.

Visitors pass by the logo of Google at the high profile startups and high tech leaders gathering, Viva Tech,in Paris, France May 16, 2019. REUTERS/Charles Platiau/Files

Chipmakers including Intel Corp, Qualcomm Inc, Xilinx Inc and Broadcom Inc have told their employees they will not supply critical software and components to Huawei until further notice, Bloomberg reported late on Sunday, citing people familiar with the matter.

Intel, Qualcomm, Xilinx and Broadcom did not immediately respond to requests for comments on the Bloomberg report.

Representatives of the U.S. Commerce Department did not immediately comment.


Huawei will continue to have access to the version of the Android operating system available through the open source license, known as Android Open Source Project (AOSP), that is available for free to anyone who wishes to use it. There are about 2.5 billion active Android devices worldwide, according to Google.

However, Google will stop providing Huawei with access, technical support and collaboration involving its proprietary apps and services going forward, the source said.

Huawei has said it has spent the last few years preparing a contingency plan by developing its own technology in case it is blocked from using Android. Some of this technology is already being used in products sold in China, the company has said.

In an interview with Reuters in March, Eric Xu, rotating chairman of Huawei, struck a defiant note in anticipation of retaliatory actions by U.S. companies. “No matter what happens, the Android Community does not have any legal right to block any company from accessing its open-source license,” he said.

Popular Google apps such as Gmail, YouTube and the Chrome browser that are available through Google’s Play Store will disappear from future Huawei handsets as those services are not covered by the open source license and require a commercial agreement with Google.

But users of existing Huawei devices who have access to the Google Play Store will still be able to download app updates provided by Google. Apps such as Gmail are updated through the store, unlike operating system updates which are typically handled by phone manufacturers and telecoms carriers, which the blacklist could affect, the source said.

The impact is expected to be minimal in the Chinese market. Most Google mobile apps are banned in China, where alternatives are offered by domestic competitors such as Tencent and Baidu.

A woman looks at her phone as she walks past a Huawei shop in Beijing, China May 16, 2019. REUTERS/Thomas Peter/Files

Huawei’s European business, its second-biggest market, could be hit as Huawei licenses these services from Google in Europe.

“Having those apps is critical for smartphone makers to stay competitive in regions like Europe,” said Geoff Blaber, vice president of research, CCS Insight.

Reporting by Angela Moon; Additional reporting by Georgina Prodhan in London, and David Shepardson and Karen Freifeld in Washington; Editing by Kenneth Li, Daniel Wallis, Sandra Maler and Sherry Jacob-Phillips

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What exit polls tell us about Narendra Modi’s chances

Prime Minister of India Narendra Modi waves his hand after casting his vote during the presidential election, at the Parliament House on July 17, 2017 in New Delhi, India.

Sonu Mehta | Hindustan Times | Getty Images

Exit polls from India’s month-long parliamentary elections suggest that Prime Minister Narendra Modi’s Bharatiya Janata Party (BJP) and its allies are set to form the government again. Political consultancy Eurasia Group, however, said that election watchers should exercise some caution around those predictions.

Local Indian media reported that exit polls predicted a clear majority for the BJP-led National Democratic Alliance. It is expected to win nearly or above 300 seats in India’s lower house of parliament, or Lokh Sabha as it is known, according to the Economic Times.

“The exit polls released are in line with our belief that Modi’s BJP will be the single largest party, while it will have to rely on allies to form the government,” Akhil Bery, South Asia analyst at Eurasia Group, said in a note on Sunday. “However, it is important to recognize that exit polls in India have not had the best history in predicting the elections.”

More than 8,000 candidates contested for a total of 543 seats in the elections. The polls spanned over seven phases, which began on April 11 and ended on May 19. To form a government, a party or a coalition needs to win 272 seats. Votes are set to be counted on May 23.

Every exit poll would need to be extremely wrong for a NDA coalition not to return.

Akhil Bery

South Asia analyst at Eurasia Group

Bery pointed to previous elections where exit polls either completely missed the mark or failed to accurately predict an outcome.

In 2004, when the NDA was expected to win between 230 and 275 seats, they ultimately won only 187 seats and were unable to form the government, he said. In the 2014 elections, while exit polls predicted that the NDA would win, only one of them was able to accurately forecast the extent of Modi’s victory, according to Bery.

Still, the scale of the NDA’s projected seat count would mean that “every exit poll would need to be extremely wrong for a NDA coalition not to return,” he added.

In April, before the elections began, opinion polls stated that Modi and his coalition were expected to win by a very slim majority. But some analysts pointed out that exit polls, despite being inaccurate in some cases, have a better track record than opinion polls.

Markets cheer

Indian markets cheered the exit poll numbers on Monday as the benchmark Nifty 50 jumped 1.71% in morning trade while the Sensex was up 2.1%.

In the currency market, the Indian rupee strengthened against the U.S. dollar, trading at 69.60 at 12:06 p.m. HK/SIN — that was comparatively stronger than the 70.20 level the currency pair traded at late last week.

The rupee’s strength was reflective of a “higher likelihood of a strong mandate for the incumbent coalition and prospects of policy continuity,” according to analysts from Citi.

Ahead of this week’s final election results, Sonal Varma, managing director and chief India economist at Nomura, highlighted three likely scenarios, and their ramifications on India’s policy and economic paths. In the event that the NDA is able to form a government with a clear majority, there would be policy continuity, she said.

“Rural reflation, infrastructure spending, streamlining of the goods and services tax, direct tax reforms and the consolidation of public sector banks are likely to be key priorities,” Varma wrote in a Monday note.

If the NDA’s power is reduced, the pace of reforms will likely slow, she added. On the other hand, a government led by the Indian National Congress and its allies could potentially lead to “policy paralysis” and stall progress on key reforms like the goods and services tax, Varma said.

Opposition mocks exit polls

The exit polls have predicted it is likely the BJP may have made major gains in the eastern states of West Bengal and Odisha.

West Bengal, particularly, had been an important battleground for Modi because it sends 42 elected representatives to the lower house of parliament. Progress in West Bengal was said to help the BJP offset some of the seats it expected to lose in India’s most politically important state — Uttar Pradesh.

Opposition parties, however, have dismissed the results from the exit polls. West Bengal’s chief minister, Mamata Banerjee, who is also a bitter rival of Modi, said on Twitter that the fight was not over.

Meanwhile, Congress spokesman, Sanjay Jha, called the exit polls “almost laughable.”

— Reuters contributed to this report.

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The firms turning their workers into owners

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Julian Richer gave staff 60% of his company, Richer Sounds

In the past few weeks a few employees have suddenly found they didn’t just work for their company, they owned a bit of it too.

The owner and founder of Richer Sounds, Julian Richer, used a special trust to give his 500 staff a 60% stake in the business and a £3.5m handout.

Engineering company Weir is giving all 15,000 staff £300 each in shares this year and next.

Meanwhile telecoms group BT has said it will distribute £50m of shares between staff annually starting in 2020.

All this generosity may come as a bit of a shock in our dog-eat-dog world of corporate capitalism.

But aficionados of employee ownership say it makes perfect business sense.

The Employee Ownership Association (EOA) says the employee-owned sector now accounts for more than £30bn in annual turnover.

Its 2018 report, The Ownership Dividend claims employee-owned companies have:

  • Greater productivity
  • Less staff turnover
  • A more innovative workforce
  • Longer term planning

The first partnership

It all began in the UK in the 1920s when John Lewis, or more exactly John Spedan Lewis, created a trust settlement for his father’s department store.

In 1950, he expanded it to make the business 100% employee-owned, a system he called partnership. In fact he wrote a book about it: “Partnership For All”.

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John Lewis, where employee ownership began in the UK

Today some of the best-known examples are big global firms such as engineering and design company Arup, and consultancies PA Consulting and Mott MacDonald.

The idea has spread out to so many companies that the EOA says the sector contributes more to the UK economy than either aerospace or agriculture.

But its success often depends on the generosity of the owners who decide to sell up.

Part of the Union

Paul and Isobel Schofield bought Leeds-based door manufacturer Union Industries in 1973 but by 2014 were looking to retire.

In the end they turned down a lucrative trade sale and sold instead to an Employee Ownership Trust (EOT) for a lesser sum with a 14-year repayment plan, and even left behind £1m in working capital for the new owners.

“The Schofields are the heroes of this piece,” says Andrew Lane, the managing director of Union Industries. “Even though Mr Schofield was 80 at the time he accepted a very long repayment plan.”

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Union Industries

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All in it together: employees at Union Industries with the original owners (right) Paul and Isobel Schofield

EOTs are designed to pay for the owner’s shares out of the company’s profits and then hold the shares for the benefit of the employees. At Union Industries the employees have full voting rights and can vote the directors on to (and off) the board.

The business has seen record sales since the sale, something Mr Lane is convinced is down to employee ownership.

“It is absolutely to do with it,” he says. “It’s no longer a case of the owner saying ‘I want you to do this and that for me’. Now it’s about how we are going to do these things for us.”

The tax benefits

EOT’s bring with them considerable tax advantages.

The Finance Act 2014 that created EOTs allowed a Capital Gains Tax exemption when an owner sells at least half of the business to an EOT.

So under the Act Mr Richer should pay no Capital Gains Tax at all on the £9.2m he receives from the 60% of Richer Sounds that he sold to his EOT.

Considering he started the business from nothing when he was 18, and is the sole shareholder, that would have been a considerable tax bill.

However, it’s worth remembering he is also spending £3.5m of his own money to make additional cash payments to his staff.

The 2014 act also allows employees to get tax-free windfalls from bonuses made through an EOT.

Union Industries has had another good year. So all its employees have each been given a tax free sum of more than £3,000.

Sharing out ownership

Employee ownership doesn’t have to be a under an EOT.

Weir Group’s plan gives employees shares over the next two years, with a commitment to match any extra shares that employees want to buy with an equal award.

It will cost the company about £10m, but it represents a fraction of its £4bn market capitalisation,

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Weir employees will get £600 in shares over the next two years

Weir says there are no tax advantages and admits it also created an administrative nightmare for itself trying to tackle the different legal complexities in each of the 53 countries where its employees work.

But chief executive Jon Stanton says its institutional investors have welcomed the move. “They tell us – it’s the right thing to do.

“The company is a special place with special, passionate people and we wanted to underpin that by giving them a stake in their companies – so our interests are aligned”.

Coping with the bad times

Of course employees, as owners, have to take the rough with the smooth.

At John Lewis their bonuses have been cut to the lowest level in 66 years after profits slumped, and the partnership has ditched its final salary pension plan.

Aber Instruments, a supplier of advanced systems for brewing and biotech companies such as SABMiller and GlaxoSmithKline, became employee-owned in 2008.

A few years later when times grew tough the employees agreed to take a 10% pay cut while still maintaining output.

The EOA believes employee ownership is especially suited to companies where there’s a succession problem and doubts over who will take over the firm when an owner dies or retires.

Mr Lane of Union Industries agrees: “I would advise any owner of a company to sit down and write a list of what you want for yourself and what you want for your company after you have gone or moved on, and I will guarantee that list will fit the description of employee ownership.”

The EOA says full employee ownership is not necessarily for everyone.

Weir’s Mr Stanton says: “I think what a company like Richer Sounds is doing is terrific. But we are a big public company, with international investors. We’ll see how we go from here.”

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Soccer: Man City crush Watford 6-0 to complete treble in style

LONDON (Reuters) – Majestic Manchester City crushed Watford 6-0 in the FA Cup final on Saturday to become the first team to win the English treble of league championship and both domestic cups in the most emphatic way imaginable.

The victory matched the competition’s record final win — set when Bury beat Derby County 116 years ago — and was the perfect end to an amazing season for unarguably one of the finest teams to grace the long history of the English game.

Coming after they retained the Premier League title last week and won the League Cup in a penalty shootout over Chelsea, City’s sixth FA Cup triumph made them the eighth team to win the prized League and FA Cup double and first since Chelsea in 2010.

Raheem Sterling was initially credited with a hat-trick, only for his first goal to later be awarded to Gabriel Jesus, who also got two as City ended their 61-game season with 169 goals, beating their own previous best of 156.

“It was an incredible final for us and we have finished an incredible year,” City manager Pep Guardiola said. “The players deserve all the recognition. To have gone 10 months in all competitions and be the first team to do that is incredible.”

City, 2-0 up at halftime through David Silva and Jesus, effectively sealed the deal when Kevin de Bruyne came off the bench to smash in the third after 61 minutes.

Jesus slotted the fourth before Sterling, who was brought up in the shadow of the stadium, took centre stage with two in the last 10 minutes.

“I grew up here and saw this stadium get built. It’s a massive dream come true to win trophies here,” said the England winger.

“It shows what the manager is building here. He said we needed to get the mentality right and we did that and did it exceptionally well.”

Other than one early chance for Roberto Pereyra, Watford never looked remotely capable of ending their 30-year winless run against City in their second appearance in the final having lost to Everton in 1984.

Soccer Football – FA Cup Final – Manchester City v Watford – Wembley Stadium, London, Britain – May 18, 2019 Manchester City’s Vincent Kompany lifts the FA Cup as he celebrates winning the final with team mates REUTERS/Toby Melville

“We knew we had to play the perfect game and started well but they were better, congratulations to them,” said Watford coach Javi Gracia, whose team finished 11th in the league, 48 points behind the champions.


It always looked a long shot for them to deliver a classic Cup upset. City had beaten Watford in the teams’ last 10 meetings, scoring 32 goals in the process, while Watford’s last win in the fixture came in 1989 in the old Second Division.

The underdogs did have the first clear chance after 11 minutes when Pereyra shot from the edge of the box but Ederson flew off his line to save with his foot and that proved their high-water mark.

There was an air of inevitability when City struck after 26 minutes as diminutive duo Silva and Sterling won headers against big Watford defenders, allowing Silva to seize on the loose ball and fire past Heurelho Gomes.

They doubled the lead when Bernardo Silva supplied Jesus, starting ahead of the unused Sergio Aguero, to steer the ball goalwards.

His hooked shot looked to have crossed the line, but Sterling lashed it into the net to make sure – initially being given the goal before the FA changed its mind an hour after the match.

Following a brief attacking flurry at the start of the second half, Watford’s hope was extinguished when City broke at pace and De Bruyne drilled in the third five minutes after coming off on to the pitch.

Watford, too late, threw men forward and were exposed when Jesus broke from his own half to tuck in the fourth. Bernardo Silva was the provider again as Sterling arrived at the back post to smash in the fifth and the local boy fittingly finished things off three minutes from time.

After also winning the Premier League and League Cup last season, City have now lifted five of the past six available domestic trophies.

Slideshow (12 Images)

The one blip is their failure to again make even the semi-finals of the Champions League – something that will nag at Guardiola throughout the summer but ensure he and his team come back full of vigour in August.

“What a team this is,” said Bernardo Silva. “Now it is time to rest, to celebrate and next season we will try and win it all again.”

Also celebrating on Saturday were Wolverhampton Wanderers, who will now qualify for the Europa league via their seventh-place finish in the Premier League.

Reporting by Mitch Phillips, editing by Ed Osmond

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US multinationals will help market rally to all-time highs: Yardeni

Despite the new burst of market volatility, long-time bull Edward Yardeni sees a return to all-time highs this year.

And, he believes U.S. multinational companies, which are directly exposed to the trade war, will ultimately help provide the market boost.

“I think it moves higher partly because there’s a recognition that even companies that do business with China are going to find ways to deal with this escalating trade tension like moving some of their supply chains to other countries,” said the Yardeni Research president Friday on CNBC’s “Trading Nation. “

It’s an outlook that hasn’t appeared to be resonating on Wall Street.

Market volatility resumed Friday on reports of a stalemate between the U.S. and China on a resolution, and the major indexes ended the week in the red.

For the first time in almost three years, the Dow saw its fourth negative week in a row. The blue chip index is now more than 4% below its record high, hit on Oct. 3, 2018.

The S&P 500 isn’t performing much better. It’s off 3% from its all-time high, posted on May 1. However, it’s not deterring Yardeni’s optimism.

“This trade escalation is probably going to be more of a negative for China than it is for the United States,” said Yardeni. “They desperately need a deal much more so than we do.”

Yardeni, known for spending decades on Wall Street running investment strategy for firms such as Prudential and Deutsche Bank, contends the U.S. market doesn’t need an official resolution to secure fresh record highs. He cites a strong economy as a major reason why the U.S. will weather the trade war storm no matter what happens.

“This may last longer than was anticipated,” he said. “I think a deal will be struck and probably by the end of this summer, if not before then.”

He expects the market’s wild swings to continue. However, he still predicts the S&P 500 will end the year at 3,100, and his 2020 forecast takes the index to 3,500, a 22% gain from Friday’s close.

Yardeni particularly likes cyclical groups such as industrials and technology in this environment. 

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How the humble brick built the world

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Rome’s Colosseum is made of various materials including limestone, concrete and brick

“I found Rome a city of bricks and left it a city of marble,” the first Roman Emperor, Caesar Augustus, is said to have boasted 2,000 years ago.

If he did, he was exaggerating. As UCLA’s Prof Diane Favro and others have argued, although he did build or at least begin a number of new marble buildings, Rome largely remained a city of brick – and is of course no less glorious for it.

But Augustus’s disdain sits within a long tradition of denigrating one of the most ancient and versatile of building materials.

The great Roman architectural writer Vitruvius mentions them only in passing. Denis Diderot’s great 1751 Encyclopaedia of the Sciences, Arts and Crafts doesn’t include any images of brick-making at all.

Perhaps it is because a brick is such an intuitive thing: people have been teaching themselves to build simple structures out of brick for many thousands of years – and grand ones too.

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The biggest man-made structure on the planet, the Great Wall of China, is largely constructed of brick. The Hanging Gardens of Babylon were made of brick, as were:

  • the astonishing temples of Bagan, in Myanmar, also known as Burma
  • the Taj Mahal, in India
  • the mighty Malbork Castle, in Poland
  • the Palazzo in Siena
  • the Duomo in Florence
  • the bridges of Isfahan, in Iran
  • Hampton Court Palace, in London
  • Hagia Sophia, in Istanbul
  • the Clifton Suspension Bridge, in Bristol
  • the Chrysler Building, in New York

The architect Frank Lloyd Wright said he could make a humble brick worth its weight in gold.

Find out more

50 Things That Made the Modern Economy highlights the inventions, ideas and innovations that helped create the economic world.

It is broadcast on the BBC World Service. You can find more information about the programme’s sources and listen to all the episodes online or subscribe to the programme podcast.

In fact, bricks seem to have been with us since the very dawn of civilisation.

The oldest were found in Jericho, in Jordan, by the archaeologist Kathleen Kenyon in 1952.

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Kathleen Kenyon is considered to be one of the 20th Century’s most influential archaeologists

They are somewhere between 10,300 and 9,600 years old – and are simply loaves of mud, baked dry in the sun, then stacked up and glued together with more mud.

The next big step forward was the simple brick mould, also originating in Mesopotamia, at least 7,000 years old, and depicted with great clarity on a tomb painting in Thebes, Egypt.

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The brick mould is a wooden rectangle, with four sides but no top or bottom, into which clay and straw could be packed to make bricks faster and more precisely.

These moulds can’t have been easy to make – they predate the use of metal itself – but once constructed, they made mud bricks much cheaper and better.

Even in a dry climate, sun-dried mud bricks do not usually last. Fired bricks are much more durable – they’re stronger, and waterproof.

Making such bricks, by heating clay and sand at a temperature of about 1,000C, has been possible for many thousands of years – but at a price.

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Accounts from the third dynasty of Ur, dating back about 4,000 years, note that you could buy 14,400 mud bricks for the price of a piece of silver; but only 504 fired clay bricks. That’s an exchange rate of nearly 29 mud bricks for a single clay one.

By Babylonian times, 1,500 years later, kiln technologies had improved so much that the price of fired clay bricks had fallen to that of between two and five mud bricks.

And cheap and easy mud bricks are still perhaps the most popular material for building houses across much of the world.

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Evariste Citegetse shapes mud bricks for her family’s home in Ruyigi, Burundi

But, as the economists Abhijit Banerjee and Esther Duflo observe in Poor Economics, fired bricks can also be an effective way for a very poor household to save. If you have a little money, buy a brick or two. Slowly, slowly, slowly, you’ll have a better house.

Chinese staff paid in bricks to top up unpaid wages

The brick is one of those old technologies, like the wheel or paper, that seem to be basically unimproveable.

“The shapes and sizes of bricks do not differ greatly wherever they are made,” according to Dobson’s Rudimentary Treatise on the Manufacture of Bricks and Tiles, first published in 1850.

There’s a simple reason for the size: it has to fit in a human hand. As for the shape, building is much more straightforward if the width is half the length.

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The Kalan Mosque’s famed minaret contains a brick spiral staircase

That’s why, if you get your nose up close to some buildings that seem vibrantly distinctive to their culture – the minaret of Kalan Mosque, in Uzbekistan, Herstmonceux Castle, in East Sussex, and the Twin Pagodas of Suzhou, in China – you’ll find the bricks are all much the same.

It’s precisely the uniformity of the brick that makes it so versatile – a lesson freshly rediscovered by every generation of parents when their children start playing with Lego.

Lego, by the way, points out that its plastic bricks don’t need to be sent for recycling because they can be reused almost indefinitely. And what is true for toy bricks is also true for the real thing.

Many medieval buildings, such as St Albans Cathedral, in Hertfordshire, simply reused Roman bricks.

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St Albans Cathedral was built from bricks salvaged from the ruined Roman town of Verulamium

“Bricks manage time beautifully,” writes Stewart Brand in his book How Buildings Learn. “They can last nearly forever. Their rough surface takes a handsome patina that keeps improving for centuries.”

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My own house, a brick building from the mid-19th Century, now has a large glass door in the back. To make the hole for the glass, we took away some bricks. Then, we mixed them with similar reclaimed bricks, and used the brick salad to extend the house elsewhere.

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Artist Cornelia Parker’s installation Neither Here nor There celebrates bricks from houses that fell off the White Cliffs of Dover

Brick production is still fired using traditional methods in many parts of the world – for example in India, handmade bricks are often fired using a Bull’s trench kiln – a long trench lined with bricks that can burn almost any fuel and produce 30,000 bricks a day.

It may be fuel-hungry and polluting, but it uses local labour and materials.

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Automation, however, is gradually nosing its way into most parts of brick production.

Hydraulic shovels dig the clay, slow conveyor belts carry bricks through long tunnel kilns, and fork-lift trucks shift precision-stacked pallets of bricks. All this makes the brick itself cheaper.

Building sites have tended to resist automation: the weather and the unique demands of each site require well trained workers.

The bricklayer has long been celebrated as a symbol of the honest dignity of skilled manual labour, and bricklaying tools have barely changed since the 17th Century.

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Construction Robotics

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Sam uses a conveyor belt, robotic arm and concrete pump to manoeuvre and place bricks

But, as in so many other professions, there are signs that the robots may be coming to bricklaying. A human bricklayer can lay 300-600 bricks a day. The designers of Sam, the Semi-Automated Mason, claim it can lay 3,000.

What of the brick itself? Various designs of interlocking brick, much like Lego, are catching on across the developing world. The end result tends to be less strong and waterproof than traditional bricks and mortar, but they’re quicker and cheaper to lay.

And if you have robot bricklayers, why not give them bigger hands so you can make bigger bricks? Hadrian X is a robot arm that lays gigantic bricks no human bricklayer could wield.

Maybe we shouldn’t get too excited, though. Sam’s 1967 predecessor, the “Motor Mason”, inspired similar claims. Perhaps the bricklayer will last a little longer yet.

The brick certainly will.

The author writes the Financial Times’s Undercover Economist column. 50 Things That Made the Modern Economy is broadcast on the BBC World Service. You can listen to all the episodes online or subscribe to the programme podcast.

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