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tv   Countdown  Bloomberg  October 20, 2015 1:00am-3:01am EDT

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woman snoring take the roar out of snore. yet another innovation only at a sleep number store. week long visit the. williams, the president of the san francisco bank, weighs in on the rate hike timeline. we bring you the exclusive interview. mistakenly transferred $6 billion to an american hedge fund. the money was recovered one day later. welcome to countdown. i am guy johnson.
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we have politics to think about. what a combination we have for you this morning. the canadian loonie is under a depression this morning. anna: there is the prime minister's decade-long ball. markets are interpreting this as a little bit of a negative. it is trading a little bit lower this morning. people are nervous around the fiscal picture. does this mean more deficit spending? a very challenged economy. guy: a different take from what we look for in europe. this is the chart i love, though. they were having such a good day. this is the db adr. then, we got this. mid little crater
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afternoon, in the adr session. -- what i want to know is, $6 billion arms up in your hedge fund, what are you going to do with it? assuming you have it for 24 hours. answers are all trending on twitter. back to the market. so much is happening currently in equity markets. let's go to david in hong kong. david: a very good morning to you guys. i can tell you none of that $6 billion appeared in equity markets in asia. we do see mostly a ring picture, though. thenat australia and hong kong.
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we are looking to push the benchmark lower for eight straight days. been mostly in a trend. up.days down, two days still quite thin, especially here in hong kong and up in about 57ere we do have more minutes in the trading session. let me break this down further. the original benchmark is down 1/10 of 1%. have some of these stocks in hong kong. travel and leisure are down one half of 1%. streeta selloff on wall
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is saw some of that trickled through. we did see some weakness and it filtered through into the basic materials. back to you guys in london. anna: thank you, david. we had comments from williams in the rate hike for the near future. manus: the u.s. values at the moments are a little negative. we are working our way toward the u.s. open. we are looking at the negative open and wall street. now, back in london. lasthinese presence landed night. it is not surprising that they were given a royal welcome.
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the visit will bring in more than 30 billion pounds worth of investment deals. caroline joins us from buckingham palace. she is promised to meet the queen later today. where will we see the benefits? caroline: 300-9000 jobs were created. 390,000 jobs were created. nearly every industry is getting a boost. think the focal points are going to be technology. areas of technology here received a boost. i think telik -- i think technology is one area. you will also see energy and financial services front and center. some of the deals are likely to be struck in the nuclear industry with chinese operators helping not only finance, but
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also design and build new nuclear reactors in the united kingdom and the financial sector. london wants to become the real hub for europe and the yuan denominated transactions. we already see them get their way. we saw the first release of yuan denominated sales. clearly, we are starting to get our wishes when it comes to the financial sector. you got a little peek at the room where the chinese president is going to be speaking. they lavish day ahead. tell us what is planned. caroline: they are parliamentarians here that will david cameron. his country retreat will also be traveling to manchester, as they i mentioned.
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they will be going to a football stadium here in london. they are wooing politicians, but also the queen herself. there will be prompt and circumstance behind me. they will be driving down the road in a state carriage. state charles, the son of the queen, will have a private lunch with queen elizabeth the second herself. after a stated dinner, a will be staying the night at buckingham palace in no less than the same suite, the belgium suite, then prince william and kate the duchess of cambridge stayed in their marriage night. the red carpet is being rolled out for the beijing prince and his wife. anna: thank you, caroline. financial details, and if you others, from caroline at buckingham palace. guy: we getting to breaking news.
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-- we are getting to breaking news.\ we have got be third-quarter earnings here. we have both the sales and earnings before the depreciation and immature eyes asian. their 2015ut forecast. what investors have wanted to hear about is something that happened last week. liasonera shares the lowest in three years. a published a report questioning a.e transparency of teliasoner at the time, they said they were open and transparent. we do have an additional statement. they said their additional financial statements are reportingith the standards.
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disclosures in the annual report provide sufficient information, they say. that is a further update on that end we will see how the shares react, back to you. guy: thank you very much indeed. next,coming up competition in the cloud. we will be joined on the phone. speak tor, we will andy harrison. he is up right and early. that is around 7:00 a.m. u.k. time, following the company earnings. anna: we will look at what we are keeping our eye on today. farrell will be speaking to committee inpolicy an exclusive interview, regarding the recent votes in the npc. dudley and powell
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will give opening remarks regarding the fed. then, the revolving structure of the u.s. treasury market. fed, speaking of the heliams speaks about 1how will vote. >> i will not speculate about my views for that meeting. a deep dive into briefings. i spend a whole week preparing for the briefings. i listen to my colleagues. i will not decide on that today. ♪
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anna: welcome back to "countdown." the david cameron says chinese president will bring more than 30 billion pounds in deals and investments to britain
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this week. saysrime minister's office that for create 4000 jobs. the countries were plunged into phraseear diplomatic after 2013. anna: after still praying that the yuan remains an appropriate is the firstt currency report from the obama administration since august. this just follows the biggest yuan devaluation in 21 years. in advancedd preparations to separate the
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chinese business. salescloud subscription more than doubled. we are joined on the phone by the company ceo, bill mcdermott. it is great to have you on the line. thank you for staying up so late to speak to us. let's ask you about your outlet. after you gave the headline numbers, there was some suggestion that may be with his performance, you should be upgrading? why any hesitance around that? bill: thank you so much. it is always nice to have an exceptional quarter for everybody wants you to raise guidance. there has been a lot of enthusiasm at sap. great momentum, but we still have a lot of work to do to deliver the quarter. versus raised.
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we are working to do as much as we can for our shareholders. every explained in any way why you are not able to upgrade? bill: we're not nervous. every software company is in the same situation where the fourth quarter is the largest quarter of the year. if you look at our cloud business, we were up 116%. software and cloud combined for a very large company like ours was up 19%. up operating profit was also 19%. the big strength was in mature markets like europe and america. in the held our own countries where most had a rough time. we held our own. it is true that those countries are more unpredictable than they once were.
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you have to factor that into your guidance and that is what versus raised. morning, is the global economy slowing down? seen evidencenot of that in our business. what is interesting about our business is, every company you talk to, they are trying to digitize their corporation so they can become more relevant to their customers and capitalize on the internet of things. thatnk sap is an innovator helps digitize these businesses and helps these companies grow. if they want to run a leaner and take cost out, it is impossible to do that without great technology. finally, when i think about the whether youwork, are trying to buy things more effectively, or trying to have
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your people travel and spend money more intelligently, you need more software. i don't see the slowdown. however, when you look at other companies more reliant on hardware, or potentially people-based software, they are not as bullish and don't have pipelines as robust as sap. are as what i think we very uniquely positioned asset in the corporate hierarchy these days. guy: when do you think he will migrate to your last licensed customer in the cloud? when will that happen? all one could put them the cloud now. we have our flagship business suite. 1300 customers invested in this. i think of this as the digital control room that every board should run their business in real time by. prefer tor customers run that in their own data
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center, as opposed to our cloud, or even somebody else's cloud. we are having a philosophy at is that says everything designed for the cloud because software designed for the cloud by definition, can run even better. software wheret our customers want to put it. as you know, a lot of customers today are concerned with their data and the privacy of that data. i think there is going to be a market for on premise software for many years to come. final question. when you look at margin development as migrations for the cloud happen, is there going to be greater margin pressure with the relation with the cloud? seen in thisu have quarter, and his quarter was a very important one for sap,
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because we turned the quarter with operating profits. our margins expanded this quarter. so now, you actually see sap expand margins as we have diversified our company to be a market leading cloud company. we have done that by intelligently taking cost out of the company so we can run more effectively and we have done that by making the business transformation. we are not so reliant on the upfront revenue recognition. we have actually built a business and radical recognition based upon the cost base. within oure operating margins and the expansion operating profit. that is what the market has reacted so positively to our results. they are sustainable. we fundamentally change the model. anna: thank you very much for joining us. we were joined by the ceo of
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sap. guy: let's go to canada now where the liberal party has swept into office. this was not the expected outcome, was it? reporter: it was expected there would be a liberal i know receipt and this was a big sweep -- a liberal minority and this was a big sweep. the conservative party led by stephen harper is firmly in place and 70% of canadians polled were looking for change. it was going to happen on some level, but we did not think it would be a majority for the liberals. harper, the stephen prime minister, step down. he was elected to power with 100 seats. the liberals at the moment have 184. youngudeau is the
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43-year-old, i guess you could say that is young, the son of a rather famous prime minister. he had a shaky start in the early days of the campaign. who could bumbler not get his words out. he was ridiculed. not many people saw this happening. he did find his seat in the last couple debates and that we see a victory for him. he campaigned on a plan that included going back into deficits. canada came out of the great recession relatively on skate. -- unscathed. the first half of this year has seen a technical recession. on trudeau has campaigned putting the country back into a deficit position to have infrastructure spend on. canadians have gone for the plan. anna: more infrastructure
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spending is a change in the fiscal stance. as the well-known, the complex is the big question mark. canada went into a technical recession because of the massive export dollars from oil. a big question about how that money will be made back. at the moment, there will be spending, some stimulus, and mr. harper, the prime minister that just resigned, has been firmly entrenched that we must keep the budget balance. the dollar falls or to a little bit after the results came in. most people expect with a little stimulus, the dollar will even out. anna: thank you, pamela. will we get surprises from the federal reserve? well, probably, maybe.
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john williams, president of the federal reserve bank in san francisco spoke to bloomberg television's mike mckee. progress oneen huge the job market. close to 5%, close to fall appointment. employment. we understand why that is happening. meanly due to the decline in oil prices and the strong dollar. i do see a economy that is strengthening. ande are still risks uncertainties there. the important thing to think about is not just about the first move to raise interest rates. it is really that, we are going to need to monitor for a few years. even when we do start the process of raising rates, it will still be the case of monitoring conditions pretty accommodative and supportive of
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continued growth. mike: would you vote for an interest rate increase on the 28th? on whatl not speculate my views are for that meeting. we start with the process of the deep dive briefings. that starts tomorrow for us. i have spent a whole week preparing for that. it was into my colleagues. i will not decide on that today. mike: if you were to vote for an increase in october, it would shock the markets. is the fed willing to do that? to do is focus on economic fundamentals. where the economy is and the progress we have made. and, where we see the economy going over the next couple years. forakes about a year or two monetary and policy actions to have their full effect on the economy. we have to be looking at the front window and not in the rearview mirror. anna: that was the president of
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the federal reserve in san francisco. guy: let's go to the deutsche bank. its foreign exchange unit had $6 billion worth of a mistake. let's get to the details now. reporter: this was reported in the financial times. bloomberg has since been briefed on the matter that was indeed, the deutsche bank's mistake. they mistakenly sent $6 billion to a hedge fund in june. the recover the money a day later. how did this happen? it was a junior person on the foreign exchange sales team. they used a growth, rather than a net figure. that prompted a pavement much intended.n
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their losses then rebounded and the bank says it has no divider. anna: more on the chinese visit to the u.k. when we come back. ♪
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and it is 6:30 in london 7:30 in brussels. the liberal party has swept into office in canada in a surprise majority. it was the biggest election comeback victory in the history of the country. the nation said needs to return to running a deficit. guy: david cameron says the chinese president will bring more than 30 billion pounds of deals and investments.
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that will create 4000 jobs. after the dalai lama visit in 2012, there was a two year diplomatic freeze. anna: the treasury has dropped the reference to the yuan being significantly undervalued. pboc surprised markets with the biggest yuan devaluation in 21 years. planning ahut is kfc. restructuring with they plan to break up the is yum plans to separate
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the chinese business. reporter: i'm looking at an index. this is over the past year. what has happened is today, this has risen to its highest level in two months. this is compared to the shanghai composite, which has been pretty flat. you can see this gain of 484 stocks. filled with technology and biotech stocks. this benchmark has rallied 73% this year. that is compared with a 4% gain in the shanghai composite index. been tryingnt has to boost spending in the technology industry in the effort to offset the faltering industrial sector. we got that growth debt that yesterday that came in better than expected. it was still the slowest quarterly expansion since 2009. it showed a two speed economy
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with the services sector moving ahead of the more traditional, manufacturing, industrials, and exports. can tell you investors traded 5 billion shares on october 16 on this index. that is more than any point'on thint on this year's rally. has beenhai composite moving downward, on the other hand. guy: thank you very much, indeed. anna: let's get back to geopolitics as the chinese president receives the red cartman treatment. we have been speaking to businesses who cap chinese customers among their most in portent clients. -- their most important clients. howael board explains to us they drive high spending in the british capital. represent about $.20
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of the money spent. we are a hugely important part of that. it is driven by trust. they want to know they are getting the right brand and the right price. it is going home to their family with the fact that they bought -- saying, i bought this winter wonderland and adopted in paris. that is -- and i bought it in harrods. valuation.most the e all of the evidence shows that the a person goes to milan, largest percentage of goods bought are from an italian manufacturer. for thee same united kingdom. if a person goes to paris from
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milan they are less likely to buy albury or burberry. what they want to do is pay homage to that heritage. he want to go to where the history and culture is, surrounding a manufacturing. for burberry, that is in london. guy: we are joined from another london landmark, buckingham palace. caroline, what do companies want the government to do to boost chinese spending? isa'sine: make the thv easier. harrods represents 20% of the chinese spending. he says, in europe at the moment, if you go to milan, in chinese74% growth from
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tourists. in london and the u.k., just 4% growth. are toocause visa's hard to get. they are too expensive. he once a level playing field when it comes to the european travel and the u.k. travel. says the economy could be boosted by 1.2 billion pounds per year. u.k. wantsine, the to do more trade with china. there is some work to do to improve trade balance with the chinese economy. caroline: of course, this is why i am outside buckingham palace. already, crowds are building with the red carpet for the chinese president. we are expecting billions of
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pounds of trade. jinping visits us for four days. what struck me is how much we availability and exports. in china.sy importers we tend to find that we have a deficit. we could fed a $13 billion deficit in terms of trade. showstest data germany has a surplus. why are we still lagging behind? why is foreign investment so much bigger? we invest six times the amount in china than they invest in the u.k.. that is a huge thi unbalance, compared to the rest of our european peers. we need to strike more deals and allow the chinese to come in and invest. allow them to come and make the
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yuan hub for europe the transaction hub. all of this is just to try and help every industry group -- retail, tech, autos. you look at,stry they want to drive more exports from here into the chinese consumer. it is the second biggest economy and soon enough, it will be the world's biggest. anna: let's bring in our next guest. david, good to see you. ceremonypomp and around the arrival of xi jinping. though, what is of most interest? the trade conversation perhaps? we -- or trade with
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china in the last six years or so. -- we doubled our trade with china in the last six years or so. a few other people across europe want to invest in the nuclear industry. infrastructure investments there. the development of the link with china is going to be key. one of the things the chinese is thenking about liberalization of the capital account. that is key. if they can get that anchored. big part of the development. that will be a big boost for the financial services exports. guy: if you are looking into the future and would compare and contrast the german economy and the u.k. economy, regarding
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industrial goods and high-end engineering, when you look at the concentration risk both have, where does the biggest risk why? acrosswhat we have seen europe is clustering. germany has clusters of capital goods. it is also the capital goods that have allowed china to build things. and the u.k., our specialism is finance. sure we want the capital goods but i thinks well, it takes advantage of the financial services that will dry up u.k. economy further. the risks -- that drive that up the u.k. economy further. we have just come out of a banking crisis. we know very much what the risks are for the banking sector and to build further upon that will increase the u.k. risk to global systemic issues. time, that is what
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the u.k. has been a good at and it is what europe needs. if europe is going to succeed, it needs an increased concentration of each of its members. from the u.k. perspective, that concentration is a risk? b meetinghave an ec this week. fascinating conversations about what we are going to get and when. david: because the european economy, because of its crisis and the slow movement of the 5-6 years, wet are more likely to see growth driven by the cyclical economy. see unemployment fall. we are starting to see household incomes rise. the fall in inflation has helped . the fall of the euro is helping
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to boost corporate earnings as well. it is the cyclical drive that will lay the groundwork for continued subdued recovery. we see 1.5 this year and 1.5 next. perhaps, some of the risks to the downside are seen as less now. certainly, we don't think that the ecb was to provide more stimulus a gehead of the federal reserve's decision. northern europe is talking about their concerns about inflation. they strip out all the volatility with everything else. it is still lagging. cannot seem to get it moving at
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this stage. david: core inflation excludes them. inflation always has a lagging impact. what we will see from headline inflation in the next month or so is the turn. also start to improve the outlook for foreign inflation. that also concerned the ecb. we have seen janet yellen dismiss inflation expectations. ecb takes that a little bit more to heart. it sees downside risks and warning signs. if the inflation expectations rise in 2016, that will ease some of that. anna: thank you, david. emissionsxt, could be
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scandal cost vw their empire? ♪
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anna: welcome back. 'ceo hasted airlines taken medical leave. he has been in charge for a little over a month. has not said how long people need to be a way. anna: mistakenly, $6 billion was sent to an american hedge fund in june, before recovering the money a day later. deutschemember of the bank sales team mistakenly sent
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a payment that was much higher than it should have been. guy: that came as the latest traitor for "star wars, the force awakens." anna: content is the new cruise. ins allows musicians to cash by reaching millions of users. bloomberg caught up with him. >> a couple of years back, when you finish her album, the studio
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you take it to. you meet the distributor. they distribute your music for you across the country. was lessworld digitalized then. in the last 3-4 years, it became digital. , it isu think of music different. about 1.8 million people in nigeria can finally have access to my music.
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the market has been waiting. it is ready to thrive and consume. the industry is growing so much. able toos have been allow the content format to groqww. we have the proper exposure over the past 3-4 years across the world. we have certain publishing deals with big publishing companies. that is when i realized, wow. then, you bring it back to africa and nigeria and put it in your system and to see how you can make it walk. you work out something for them. the value of the content can be
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just like it is in the western world. anna: a fantastic story. later.alk to tim coulter no pressure, tim. let's talk about some of the big stories on the website. we are not going to ask either of you to sing. we have been talking about vw a lot. the story has been dominating the headlines. the story takes a look at whether or not this multi brand strategy can survive. many of them are as high as multibillion euros. they have a lot of cash. many of the ceos will look at the many platforms and say, do we really need all of these? does it really make any sense manufacturer to own something like ducati?
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anna: they have 12 brands, don't they? >> yes they do. somehe is trying to mount type of campaign to bring himself back into the full, or reinstate himself as chair. kind of depends who is in charge. a new ceo, yes. you wonder or not the original plan is still in place. new guy is there and with new people, come new strategies. particulate when the company -- particularly when the company is under construction like this. goinghink the pressure is to be coming from shareholders. the board is going to have to listen to them, even if the
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family controls the company. anna: he said he does not think that vw needs a revolution. he is delaying nonessential projects. feels like it does need one, from the outside. >> that white bold moment -- that lightbulb moment will probably come at some point. the have five stages to go through. they are probably still in denial. guy: yang liu: you probably -- guy: you probably can't sell vw. you can't sell porsche. those are both family names. >> bentleys? they don't really need those bentleys, do they? lamborghini? there are a lot of these brands. ferrari do you think far will price today? >> lamborghini could follow the
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errari.rategy as for ou >> it is obviously very hard to work out what the reputation the is going to be. that will be the interesting thing. the backlash could be quite harsh. to otherreactions german goods will be one of the key points. at this point, you will have to say it is a risk, but not our central view. just because a company in germany has done what it is done, you are not going to bypass washing machines, for example. that is probably not something we say. there is a risk. the other key risk is the implication across europe.
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it is not just about vw produced in germany. guy: we just went through a list of brands. >> there was an interesting piece of research yesterday. they surveyed 40-50 dealers around the world in different countries and the feedback they were getting was that the dealers were not, so far, seeing huge impact. at least for the 2016. anna: when you have the september registration numbers, we spoke to an analyst who said there is a lead time involved in ordering cars. perhaps that was too soon. she also said, there is not much evidence of a slump in the secondhand market. that would show this more readily than the new car market what. probablyrception has
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taken a long time for diesel to shift its perception. it will take a lot of time to recognize the downshift that vw has had. the past few months or weeks is probably not the time to see this. that to then transfers into a diesel story, rather than a vw story. >> that is not an awakening for many people. boards start to diesel, theyth will move in a certain direction. guy: that's will be interesting. that is the tough things for companies like ferrari. you get outside the big brand. anna: thank you, tim coulter. speak with up, we
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andy housman and his first interview of the day. ♪ ♪
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(ee-e-e-oh-mum-oh-weh) (hush my darling...) (don't fear my darling...) (the lion sleeps tonight.) (hush my darling...) man snoring (don't fear my darling...)
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(the lion sleeps tonight.) woman snoring take the roar out of snore. yet another innovation only at a sleep number store. for xi. cameron looks forward to 30 billion pounds of deals. weighs in onliams the rate hike timeline. we will bring you that bloomberg exclusive interview. anna: the bank is said to have mistakenly transferred $6 billion to an american hedge fund. the money was recovered one day later. guy: welcome to "countdown." i am guy johnson. anna: i am anna edwards. it is 7:00 this tuesday morning.
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we have earnings coming through. let's look at what is happening to markets as we speak. guy: let's take a look at how mixed we will be in europe. this is the early look. we think the market will open fractionally lower, not very much. 1/10 of 1% is the prediction. and we started trading have a first look at where we think these markets will be opening. we will continue to update you over the next hour as we work our way toward the european open. anna: it looks to be in line with estimates. profits areretax coming in at 291.3 million pounds. let's talk to the company ceo. --y harris and joins us now
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andrew harrison joins us now. it is great to have you on the program. tell us what has been weighing on the business in the last period. is the strong pound hurting your business? andy: it is very much a u.k. based is nice. we have delivered a good set of results. we have double-digit results in our profits. we are very pleased so far. guy: good morning. over your tenure you have tripled the share price. how easy will it be for your successor to do that? company by a good now. it is even better. i am absolutely certain my successor will take the company to new heights. next thing tothe go for?
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is the future and hotels? in coffee? where will be businesses be growing next? andy: we have already laid out plans, which will become prevalent in the u.k. by 40%. we have strong international abitions. the company has great track record of success and we have a fantastic group of people at whitbread. the future is really quite something. guy: people are curious about the future of chris rogers, of costa. then what happened with recession planning. the rumor going around is that you are prepared to spin that business off. andy: whitbread has demonstrated that it is a really good owner of costa. we have grown the costa profits by 28%.
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we have made plans to grow the business by 80%. what we are doing at whitbread is concentrating on delivering the plants we have laid out. that will generate tremendous profits for the shareholders. guy: have you had any thoughts of spinning off costa? it could be a great stand line business. you could deliver value for your shareholders by crystallizing that. andy: we have thought about it and the board does think about it, but we decided it was not the right thing to do and that we are going to concentrate on delivering the plants we laid out. -- the plans we laid out. anna: can i ask you about the minimum wage. has it been criticized by other bosses in u.k. business? this news, embraced getting ahead of the legal obligations.
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what impact will it have on your business? will it stop you from hiring new people? are you hiring fewer people? is a strongead supporter in the increase in the minimum wage. we think everybody should benefit from economic growth. theplans laid out by government do represent a strong increase in cost. we are in houston heavily in our people and our systems. heavily innvesting our people and our systems. we can cope with this. anna: you have talked about raising prices to cope with this. who kind of price increases can you sustain? have ise main focus we on efficiency and productivity. we are investing heavily in systems and training. we are spending 12 million pounds on training our people. the cost increase the government has announced will rise by 35%
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over the next five years. i cannot rule out price increases, but with that success, we have delivering great value. price increases is the last thing on our minds. guy: in 1914 henry ford shocked to the world and double what he was going to pay his staff. he went up to five dollars. as a result, he thought his staff would work harder. do you think you will get a similar effect? been leaning to that, as we pay more, we should get better people. at the end of the day, depends on what the competitors do. we just announced a 10% increase in pay for the baristas in costa. are at thes in costa heart of the success of our business.
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it is the right thing to do. we will be announcing our christmas menu in a week's time. inre will be no increases the christmas menu. i am very busy and enjoying what i am doing. anna: we wish you well. thank you for joining us. guy: tripling of share price, an impressive performance. state with bloomberg -- stay with bloomberg for impressive interviews. we have an exclusive interview with ian mccafferty. anna: we are getting used in the online fashion world. reporter: we're looking at the biggest online only retailer. screen, as it used to be called. 1.1 5 billion pounds for a four year revenue.
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1.16 billionwas pounds. 27 percent, versus international sales, up 11%. the strength of the pound has seen sales rise there. if we look at sales growth for the final year, we are looking at 20%. we are ushering in a new era or izod. we recently saw a ceo change from one nick to the other. the new nick is nick bateman. it is now about the nuts and bolts for the company, as compared to ideas and expansion. back to you. anna: thank you very much. u.k. lastanded in the
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night for the red carpet reception. it is not surprising that he will be given the red carpet welcome. the visit will bring 30 billion pounds. caroline hyde joins us now at the buckingham palace. where do you think the benefits will be felt the most? mean, phenomenal stats. 30 billion pounds worth of deals and 4000 jobs created. every sector is set to win out. this retailer already has a presence in china. we are expecting one billion pounds worth of deals, to help other retailers export to china. then, they can manage to sell goods to the consumer in china. struckill be big deals in infrastructure as well. this will also occur with technology.
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and itoing to be energy is going to be finance. if you think about the energy deals we have already hard about, the chinese are already helping not only finance, but build and design new nuclear reactors in the u.k. we have already seen 40% of the financial guernsey market in the u.k.. to be thee yuan trading hub here in london. already, we see the central bank of china, the pboc, selling the yuan denominated debt here. the government is selling sovereign debt here in the u.k. and we are already winning out. caroline, what is planned for the day ahead? carpets: phenomenal red
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aplenty. xi jinping and his wife will come out behind me to meet the queen, accompanied by her son, prince charles. we'll beat be state dinners and a gun salute. in the best hotel in london -- the buckingham palace itself. they get the royal salutes, but also the government will be laying out a lot of wooing. david cameron will travel with xi jinping. we will see travels by george osborne, taking the president to the imperial college. xi jinping will actually be talking himself in the house of commons. oddnow there could be the protest in london. there are humans rights concerns, animal rights concerns, and steelworkers concerns. we are seeing potentially, 5000
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the a steel industry in u.k. due to the floods in china. we have concerns about some awkward conversations here today. a diplomaticrs of freeze after he met the dalai lama, i think david cameron once to keep the red carpet rolling. anna: thank you, caroline. guy: where do you think he will start? anna: what do you think? tell us on twitter. is: the senior economist still with us. we took about how important this is to the u.k.. on u.k. maybe focusing less steel and more on financial services. when you think about where the u.k. should be focusing, is
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china the place? or should it be elsewhere? should it be on the relationship with the rest of europe, or improving relationships with brussels? >> we need a balance. we still export 40% of our goods and services to europe. we are questioning whether or not we want to stay in the eu. we do need to be looking elsewhere throughout the globe. china is going to be a very strong growth market. not so much an industry anymore. perhaps the era of exporting is changing. the chinese economy can boost our market. i think it is right to move in this way. anna: what about canada? we had this shock result for the liberal party in canada.
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this is going to change the debates in canada regarding infrastructure spending. this global debate has been raging for 7-8 years, since the great financial crisis about how you stimulate growth in a economy. this economy is very different. they are an interesting comparison. canada road the financial crisis very well. it had already gone through a .rocess that really cut down it already had in place, a number of measures to regulate its banking system in a way that is different to europe. , is thet canada faces external headwind of falling commodity prices and the fact it is a commodity economy now. that is coming back to haunt it. how does the government respond?
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the canadian dollar has obviously felt that. that will provide some stimulus. it does not seem to particularly the appropriate to provide that boost. it will be interesting to see how much investment is used. it will also be interesting to see the global blueprint. globalo see the conversation. thank you very much. guy: next, reaching for the sky. we will speak to the president and ceo of this luxury brand. ♪
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anna: welcome back to "countdown." liberal party has
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swept in with a surprising majority. this marks the biggest comeback in the election history of the country. the nation needs to return to running the deficit, triggered by the oil price collapse. guy: the chinese president will bring 30 billion pounds with his visit to britain this week. the prime minister says that will create 4000 jobs in the u.k.. meeting with the dalai lama plunged the country's into a two year stall. yuan remains below an appropriate evaluation. it has been saying this for more than three years. the first report from the obama administration from when the pboc had the biggest
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devaluation in 21 years. anna: already, they have announced plans to launch new trips to these guys. -- the skies. ofare joined with the ceo crystal cruises. edie, it is great to have you on. going into the skies, why? you seem to do everything in water. edie: our global guests tell us they want to experience crystal in different ways. in 28 nights,s but our guests tell us they want to visit the world and 15 nights. companieswe hear from
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like burberry is there is a slow down in global demand for luxury. what are you not experiencing that? e why are you in a different market? edie: people still want a vacation. at crystal, we have a 25 year history of many repeat guest, as well.new guests we are just meeting the demands of our loyal past guests. anna: are you a business that has to take into account concerns geopolitically. businessesf cruise have to think about where they stop. itineraryublish our three years in advance. obviously, geopolitical circumstances change by the minute. we can redeployed them and curate the itineraries. we have a mantra, not only in
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crystal, but in the cruise industry of safety first. we have redeployed itineraries based on geopolitical situations. anna: where have you done this? edie: people don't necessarily want to go to turkey. anything can happen anytime, anywhere. they went on my own holiday to stumble recently. when people hear these things, they want to avoid these types of places. does the average demographic that goes on one of your cruises? what are the factors that determine their spending? whether they spend more and less. -- more or less. edie: in general, first when they make the decision to go on crystal, they are willing to spend more. value is a term like ut. it is in the eye of the
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beholder. they realize we are in the top of the market. demographically, we have guests -- our average age, it all depends on the itinerary. a seven night mediterranean voyage in the summer, the average age is 45 and a very chic clientele. our guests come from all over the world and have to become purple with english as a first or second language. our guests have to be ready to the fabulousoff of destinations we take them to. anna: thank you very much. guy: the federal reserve is progressing toward its mandate to raise interest rates. so says john williams, the president of the federal reserve in san francisco. she was a little coy and how he voiced this meeting. not williams: will
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speculate my views on that meeting. we have a process of the deep dive briefings that starts tomorrow. i spent a whole week preparing for the meeting. listen to my colleagues. i will not decide on that today. the senior economist is still with us. everybody is hanging on to the fed. all the bankers want to know and on the markets want to know. what should they know? the data changes and in ofs the open the markets. we have been consistently taking our foot off the accelerator a little bit. there is a pause. the risks the federal reserve
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are not yet summer manifested. and yet, they are sometimes at the u.s. economy is softening. what we will see is a preloading if the guns in the october meeting next week. members will the start to nail down whether or not they want to push ahead. this is not whether or not we will move from the 0% rate. it is whether or not it is the right time to move off the floor to signal to markets that we are going to come through. that is certainly what they want to do. it is probably what the economy will let them do. anna: is it really time to regroup so quickly in time for a rate rise in december? in september was not a pause. it was a delay from the start. one suspects, given the consistency of the message, until last week, there was a message in september.
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let's wait and see, but our insage is to still move 2015. were was always going to be, are going to move in december. the u.s. economy might be catching them up on this. guy: the coalition between what happens between the dollar and the interest rate hike is something we analyze. the euro has started to climb back. where do we go next? are we looking at a fed rate hike this december? and then, for the euro? david: we've got payrolls. the economy has given as much
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evidence regarding its strength as we are going to see. anna: thank you, david. that is from access investments. guy: after the break we will be talking. ♪ .
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guy: 7:30 a.m. in london. the stories you need to know. anna: in canada, the liberal party with a surprise majority. the biggest election comeback in the country's history. a vindication of the liberal's campaign. trudeau said the nation these return to a budget deficit to combat economic woes. david cameron said president chinese xi jinping will bring -- it will create
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almost 4000 jobs. the u.k. is striking an accord after cameron meeting. the countries into a diplomatic freeze. s is for a parent to separate the u.s. and chinese businesses. that's according to people with the knowledge. plans to break down the business said to be advanced and could be announced before the end of the month. guy: what is moving asian markets as we wrap up the session? david is standing by. david: absolutely. , thenutes from the close chinese market, japan has been close and south korea. i think this is as mixed as you can get. most of the markets are higher. a look at the declines in australia and in hong kong.
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the dropscale of across some of the sectors within the markets. enough to pull the original benchmark -- there we go. 0.5 -- 0.2%. not seeing clearly. let's break it down. very quite as far as eco-data. when you have a look at the volumes across the region, the low 10.15. with the exception of korea. how do we break this down? a look at financials. mostly flat. higher in japan. the big story in the equity market is the continue selloff in commodity prices and commodities related stocks. we saw industrial metals, the weakest from the u.s. seat into asia, contracts for copper and things like aluminum. getting down. seeing basic materials is where re.minor them -- miners
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names.at the oil and gas look at austria and chinese state owned giants, they are bid down as well. 23 of the 28 are seeing losses. enough to pull down the regional benchmark. very quickly, let me wrap up things with the fx market. dialer---re with the dollar-yen. there we go. following rba minutes which came out early this morning at about this time. back to you guys in london brent anna: thank you. towards a european open in 27 minutes. what we are looking at, what were looking at right now. fairly flat open, slightly negative in europe.
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that is what the bloomberg terminal is telling us. slightly negative open. euros stocks are down by 0.2%. anna: deutsche bank for unit mistakenly sent $6 billion to a u.s. hedge fund in june before recovering the money a day later , according to a person briefed on the situation who is here with the details. relative to how it could have -- run us through how it could have happened. reporter: we spoke to a person briefed on the matter and found out, yes, deutsche bank mistakenly sent about $6 billion to a u.s. hedge fund client engine and we did hear the money was recovered a day later. how did it happen? a junior member of deutsche sales to shades process a trade using a gross figure rather than a net figure prompted a payment that was a magnitude higher.
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fat finger. the client was not recognized but a market reaction. deutsche bank's american receipt almost wiped out there gains of the day but they quickly rebound. according to the report, deutsche bank recorded the incident to the conduct of authority, the ecb, and as he said but with not -- and if the fed but will not got any word from the regulators. this comes a day after we saw the stock rise after the biggest management reshuffle in more than a decade. more than a dozen departures and changes of position at deutsche bank including without cohead of investment banking and trading unit resigning. we will see how the shares open later today. this might not be a big blip for the company is one thing is for
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sure after the moment, the ceo, a co-ceo that is trying to reshape the bank and rebuild trust with regulators for something like this would not have helped. anna: thank you, nejra cehic. .uy: it was impressive what we saw. let's go from fat fingers tell fall fashion. annual results. -- two fall fashion. revenues in line with estimates. senior analyst joins us now. read between the lines, charles. is interesting how difficult it is and this fall fashion area and how the temptation for on on the companies to choose sales ahead of profit. we saw it last week. profits and lie but the margin is way down two or three years ago.
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anna: they are talking about investing $50 million in warehouse and technology and further amount of money in new financials. charles allen: is going again up to $80 million. how much is it software? over $50 million, more than 60% in intangibles which is computer software, developing a mobile app. and one of the points for asos, they are in so many different countries, each mobile app has to work in a local language in each of the countries. sometimes in china, russia with a different script. anna: the u.k. business was growing strongly. charles allen: one of the interesting points about asos, how the u.k. has come back. it has slowed down and become just about the fastest-growing part of the business again both in terms of customer numbers and in terms of sales. guy: are we seeing the limits of the model? charles allen: probably not yet.
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interesting they broadened out there target a bit from being she of the twentysomethings and now 15-34. everybodythink almost 25 -- anna: a soft age. -- also as guyuy awful lot of people in this space. you see a new one on the side of the bus almost every day. guy: that's what i find out. anna: on a tuesday. a new ceo. charles allen: he is new but not new. mr. baker has been in the business for a long time. it is just about how this is now that nuts and bolts of retailing and nitty-gritty, opening warehouses, making sure the software is working, and understand where that is growing
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-- capx is growing. anna: charles allen, thank you. guest who said so china's slowdown is not worrying. chief investment officer, mr. jeffrey. good morning. let's take a step back. in a world where we are watching the fed and the data very carefully. glass half-full or glass half empty? guesstimate yes. it is about that. guy: at that point? guest: a lot of people expect the world economy to grow the india prior to recession. normal butt it was it was abnormal. five or 10 years before the reception was abnormally asked. if we get back to that, the problems we had. excessive debt buildup. a slower growth period and taking time for most people in
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the real economies in the world and investors to tune into the implications. obviously, not as much demand around. system tough the where there's a lot of overcapacity in commodities. room forch commodities. china is not important as much but not exporting as much to the west. western demand is not wrong as rapidly. the entire system has decelerated. anna: how do you invest around that? richard jeffrey: i think it is quite difficult. what people are looking for is more cyclical activity. burn.ike slow what you are trying to do is look at the areas through inflection points and picking up speed. most recently in the west perhaps, looking back over this year, we started to see europe began to gain more momentum in terms of domestic demand. doing ok but at
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that was exporting into european countries. that was outside of the area. now, more dynamic growth within the area. that is the theme. guy: we have glass half full and ltra, interest rates. you have to wonder how you get at the other half full if you're talking by raising rates. i am wondering -- his new normal with interest rates here, this much of growth. how we are to get to the glass being full? richard jeffrey: the risk is it gets a little too full. interest rates at -- the panic levels. they should have been raised already. the fed is at that idea. looking at what happened in the past. not thinking of about what is happening now unlikely to happen in the future. western inflation looks quite low. it looks low not because of what
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is happening within our economy but because we are importing disinflation through lower oil prices and weak manufacture prices and lower food prices. if you look at domestically generated like economies like the u.s. and u.k., it is rather high around 2% and maybe slightly higher. that is what the authorities should be focused on. if that was a policy mistake they made prior to the recession. fewave low inflation a years before. the authorities took advantage and said we will cut interest rates into that. anna: they should be putting it down? : growthrichard jeffrey as more normal. against that backdrop, you should be raising interest rates. what happens if we hit a bump in the road? as we will in some states. cannot cut interest rates any more if they could pump more liquidity.
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where armored a wash. qe1 knocked out further impact brief -- we are already on watch. anna: richard jeffrey, thank you. guy: we will bring you the stocks we need to be watching in advance of the open and the stories you need to know. see you in a moment. ♪
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anna: welcome back. here are the stories you need to know. guy: in canada, trudeau's liberal party swept into office. ousting stephen harper and the biggest election comeback victory in the country's history. it is a vindication of the liberal party to reject harper's austerity. it was triggered by the oil price collapse. prime minister david cameron said that president xi jinping will bring deals in his visit.
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that will create almost 4000 jobs. the u.k. is striking a tom after cameron meeting with the dalai lama plunged the country's into a two-year diplomatic freeze. wars" story for "star san, desperate is -- fans to see a movie that does not open for months. trailere as the latest of "the force awakens" was released. franchise for $4 billion back in 2012. anna: moments away from the start of european equity. you do not want to talk about that? how many tickets have you bought? guy: ivanov bought any. anna: there is more. -- guy: i have not bought any. and of a the companies you need to keep an eye on. juliette: this is a swedish
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phone carrier that is the target of a short seller, muddy water that cut the earnings after a profit decline in operations in asia and former soviet countries pretty it said it will exit to focus on europe and the home market. we will keep an eye on the stop falling 16% through monday. next, deutsche bank. just stop is not really called that stock is not really called -- stock not really called pretty it sent $6 billion to u.s. hedge fund client in june. the fort exchange unit doing that mistakenly. it recover the money a day later and a big move is american depository. and finally, i want to talk about a swiss drugmaker. a company it will buy
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and race of the forecast lifted by a new drug for lung disease. mark: the federal reserve toward the mandate a maximum employment that should raise interest rates in the near future said president of the federal reserve bank of san francisco. he spoke to bloomberg television. my view it's basically on the employment of mendes, we have seen huge progress on the job market. we have seen and huge progress on the job market. inflation below our target. we understand why that is happening mainly due to the strong dollar, the decline in oil prices. i do seem economy that is strengthening and we are at one of our mandates. ande are still risks uncertainty. an important thing to thing about not only offers move to raise interest rates what we will need to accommodate a
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monetary policy for another few years. even when we start the process of raising rates, it will still be the case that monetary conditions are pretty accommodative and supportive of growth. reporter: would you vote for an interest rate increase on the 28? will notiams: i speculate about my views on that meeting. we started the process other deep dive briefing starting tomorrow for us. i had a whole we prepare and we will get a lot of materials and listen to my colleague. i will not decide on that today. reporting the 10 year young to reporter: the 10 year bond yield is at -- what we need to do is focus on economic fundamentals, where is the economy? and where we see the economy going over the next couple of years. an important consideration is it
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takes about a year to four monetary policy actions to have the full effect. we have to look to the front window and not back in the rearview mirror and thinking about the policy. it? when will they do richard jeffrey is still with us. you are in the police it is time to get on with it. what are the unintended consequences of getting on with it? not thinkffrey: i do we fully understand. you never fully understand at or leavingof change interest rates unchanged. the positive decision is the right one to take. it is self evident that the american economy has picked up momentum. probably going to grow this year, next year between 2% and 3%. a reasonable rate area perhaps faster that can be maintained and the longer run if a guest to the 3% area anna: and the u.k.,
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do think we see a rate rise in early 2016 or do we not and risk getting caught up in the conversation around brexit and not going anywhere? richard jeffrey: that is a risk, isn't it? if the policy here was on the ball, they will look at numbers that interest rate should go up now. were only tell by edging up from 0.5% and will not have a dramatic impact on the economy. it is a signal that lending to households not for mortgage purposes buffer consumer spending is growing in excess year on year. that is quite fast, double the rate of income growth. it should ring alarm bells. the debt to income ratio are rising in this area. quite a bit of inflation coming through in the this is within, the consumer price index. almost 50%.
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rising 2.5% year over year above the target rate. guy: what is the gap between the first inter-rate -- interest rate rise of the second? once been your: first, how quickly and where to? the best assumption is 0.25% every quarter of the year. 1%, probablyime, the best baseline. guy: richard, thank you. richard jeffrey. -- anna: richard, thank you. richard jeffrey. equities open in six minutes and does not look at the exciting. plenty to think about. our guesttalk with and a lot of corporate news. jonathan: plenty. of the shoresit
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of the u.k., the united kingdom. a weeklong visit and the tagline is a golden era. a golden era for whom? the fiveand loses and decades to come? bank controlled for $6 billion mistakenly to a u.s. hedge fund. and as the next day, get it back. that happens quite a lot more than what people expect but not on that scale and raises question about oversight at deutsche bank area and then we rate hikes.out john williams looking for a rate hike. fundu look at fed's future, the market is not expecting a hike before the end of the year. will they surprise in the market? of questions about who are pulling the strings. jonathan ferro. ratey more on the fed
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hike. as a $6 billion. 24 hoursou haven't for for 24it -- have it hours, how much money will you make? anna: i'm sure somebody did the math. guy: when we looked at, we were negative. we have climbed a little bit. a flat open. at a bank look at the swiss drugmaker. -- anna: look at the swiss drugmaker. making the news. ♪
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jonathan: good morning and welcome to "on the move." i am jonathan ferro. moments from the start to european trading. the golden era, chinese president starts is weeklong visit of the u.k. fat finger, deutsche bank is said to her mistakenly transferred $6 billion to a u.s. hedge fund. the money was recovered a day later. team 2015, the president of the san francisco fed weighs in on the rate debate. the exclusive interview with john williams. ahead of the open, 20 seconds
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away. futures are pretty much dead flat. as our dax futures. it will be much more exciting with that. see if itc: let's will be exciting. three days of gains for european stocks pushing europe's equity benchmark to the highest level since august. we have seen it rally so far this month about 4.7 percent. let's see what the equity market is doing the opening. it's like a mixed picture at the moment. a lot closed. trading pretty flat. cac 40 unchanged. toll waiting for the dax open. yesterday and today has been largely about corporate earnings. a look at some of the movers in terms of the stock we have been watching. i want to start with auschwitz phonecarrier -- a swedish carrier. th

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