tv Worldwide Exchange CNBC September 26, 2014 4:00am-6:01am EDT
it's friday. welcome to "worldwide exchange." i'm wilfred frost. >> and i'm carolin roth. welcome to "worldwide exchange." >> european markets open in the red. it's the worst day for u.s. stocks in nearly two months. apple takes a bite out of the nasdaq. loses nearly $23 billion in market value despite defending its iphone 6. uk joins the war against
isis. british lawmakers look set to vote in favor of joining u.s.-led air strikes against islamic targets in iraq. >> announcer: you're watching "worldwide exchange," bringing you you business news from around the globe. hello, everyone. i'm seema mody. the ryder cup is under way. we get into the swing of the tournament with our very own europe versus u.s. competition. blackberry earnings before the bell, we speak to one analyst with a whole recommendation on the stock. you about is the hand setmaker due for an upgrade? and as the indian prime minister touched down in new york city, we ask if this visit will open a new era of relations between washington and new dehli. >> announcer: you're watching "worldwide exchange," bringing you business news from around
the globe. you don't want to miss our ryder cup ball at 9:30, but move important than that, i must admit, is the markets. this week, very much in the red and now in the red for september, as well. >> yeah. but we're going into october. rbc put out some interesting research this morning, seema. they said usually in october we hit the highest level of volatility. but stocks usually fair pretty well, despite the fact that october gets a bad rep. >> absolutely. i think what was surprising yesterday was the scale of the sell-off. the dow seeing its first 1% drop. the s&p 500 and the dow trading below their 50-day moving average. a lot of concern. is it the global slowdown catching investors by surprise or is it the geopolitical tensions weighing on inest haver
sentiment. the big question, will the sell-off continue into today? >> so let's update on markets. the stoxx 600 is down 0.2% today. this follows a big sell-off in europe. the dax is down as much as 1.6%. that continues into u.s. trading. seeing big falls there and also into asia. that means some carry through into most markets in europe today. the ftse 100 is down 0.2%. an important vote coming today in parliament as to whether the uk joins in those air strikes on iraq and syrian soil. germany, as i said, was down 1.6% yesterday. the afternoon was darchbt story, a big sell-off. continuing today down 0.3%.
france and italy relatively outperforming just up so far today. >> individual stocks and a bad print for the world's top commercial bank note printer dela rue after the company issued a profit warning for this year and next year. it's down 26%, a massive fall there. air france shares off nearly 3% after it dismissed union demands for new unit to have full air france pay. jeffries cuts its rating on the stock to underperform. lloyd's just in the green today. it's basically flat after selling 161 million pounds worth of fares in its lenders tsb. and shanks tanks, it's down 14%. the waste management company warns the full year results will be 15% blow estimates and cites difficult trading conditions in belgium. let's have a look at bonds. we've seen quite a big movement in bonds in the last ten days or
so. it was only about ten days ago that the u.s. ten-year yield was above 2.6%. it's now 2.49%. and yesterday that big sell-off in equity markets did see a corresponding movement upwards in bond prices and a fall in yields. the ten-year bund was on the 19th of september it was above 1.1%, now 0.95. similar story for the uk which was around 276% about a week or so ago, now 2.42%. the ten-year greek yield we mentioned earlier in the week crossed 6% for the first time since early august, 6.16%. quick discussion on forress. the u.s. dollar started slightly weak yesterday and finished at a new four-year high against the basket of currencies. the euro/dollar dipped below that crucial 1.27 level for the first time in 22 months. it's now just above that level and trading roughly flat so far
today. interestingly sterling, we'll see if that move as the uk commits to action in iraq and syria. now let's check on markets in asia. mr. jegarajah is standing by for us in singapore as ever. sri. >> let me kick things over with the japanese markets. just got some important data from the country. it was august cpi. that really told us that the japanese -- the bank of japan, the central bank needs to do more in order to keep this 2% inflation target by that six-month break. we could see further stimulus. remember, this is important because the bank of japan will be meeting next week.
many of these stocks are going ex dividend today. so broadly, as you expect, even the tumble we saw on wall street, we are seeing some negativity. a lot of these markets seem to be gaining a degree of composure. they're flat lining right now. not so in the indonesian market. that is the laggard today, down by 1.7%. we're bumping along the session lows here. and it's really down from local factors. partment there, the direct election for governments and mayors. spain, this was a big setback for democracy. international investors not like that news and that's why the market is down. hardly surprising given the fact that we continue to see a big glut of iron ore hanging over the markets and driving down the
price of the steel making greens to fresh five-year lows. that's why the miners in australia, big laggard today, bringing the broader index lower. back to you now in london. >> sri, thank you very much for that. let get more perspective on the markets we're seeing. francesco, good morning to you. are we reading too much into the sell-off of the markets we saw yesterday? it's usually a tricky month for the markets, isn't it? and on top of that, we have month and year-end positioning. this is normal, isn't it? >> i think it's normal. there's nothing concerning about it. even if the market goes down a few points, it's not the end of the world. the s&p has moved tight lined, anyway.
>> i disagree with that. markets in the u.s. have moved more than 3% every day. three days it's been down and one day it's been in pup that's a hell of a lot of volatility in equities markets. >> i don't look at this particularly different than that. >> what do you do with your asset allocation towards the end of the year? if we look at u.s. stock fund flows, it's off $5.6 billion and inflows, that tells me investors still want to be exposed to u.s. stocks, still want to expose to equities overall. essentially, there's no alternative out there. you can't get into bonds, can you? >> well, i think that we like europe, for example, on the equity side because we are super negative about the economy. and the big game changer in europe is deflation. you know, deflation is -- two years ago, deflation was 2.6%.
it's 0.3% in europe. today, the inflation is zero. there is no rope for inflation premium applying to bonds. so the cap is closed down with fundamentals receive already. so bonds are above today in europe than they were two years ago. and actually at 1.9%, it's not bad. it will go probably below japanese levels. i think bonds are probably not a bad choice in europe. i would be more concerned about the equities in u.s., for example. >> italy and greece with your
two favorite markets. the last time i checked, italy is back in recession. >> greece, for example, is incredibly cheap, especially on the banking sector. the equity at the moment, not in the banking sector. the banking sector is rock bottom. it's never been cheaper than today, pretty much. it's done a lot of things, taking care of this fiscal deficit pretty well, has been on the banking side they've been raising a lot of money. there is a number of good news. the big capitalist event and now we've been waiting for italy for all year.
good or bad, it will go away. >> francesco, stick around. we'll talk more about what places you like, what places you don't like. do send in your e-mails, your questions to our guests today, email@example.com. and coming up next, we'll cross live to westminster as uk lawmakers look set to give their approval to britain joining the fight against isis. stay tuned on "worldwide exchange." when change is in the air you see things in a whole new way. it's in this spirit that ing u.s. is becoming a new kind of company. one that helps you think differently about what's ahead, and what's possible when you get things organized.
u.s. officials says they have no evidence of an islamic state planning attack on the u.s. nbc's kate snow reports. >> enhanced security today at new york city subway station after the iraqi prime minister said his country uncovered a plot involving isis fighters from france. virtually every major u.s. law
enforcement and intelligence agencies from the fbi and cia came out quickly and emphatically saying they had no evidence of any such plot against the u.s. >> from the u.s. intelligence community perspective, there simply is nothing in the near term from this threat that is truly credible. >> officials scrambled to he sure citizens their cities are safe. >> weblt that our state of preparedness is higher than it has ever been since 9/11. >> mr. mayor, there are no security checkpoints going into the new york city subway system. how can you assure the public you're not facing any threat? >> you may be asked to open your bag. until we have something we believe is credible, with we're
not going to use all the measures we might use if we were to have a credible threat. >> the fbi director said the terror threat to the u.s. is about the same today as it was last week. he also said isis is still a worry. it has many americans on edge. >> some analysts have pointed out that perhaps iraq would have incentive to talk and pred word about terrorist threats because if the american public is more concerns, perhaps they'll be more supportive of u.s. military action taking place against isis. >> now our middle east correspondent hadley gamble has more on this from westminster. >> good morning, will fred. essentially we are in the same place we were almost a year ago. that time david cameron went home with a serious beating from both his party and his opponents. today members of the torre party, labor are very much in
favor doing something as they go forward and they try to combat this isis threat. it's training and aid, as well. but you have to also remember the foreign second earlier today saying if that force needs to increase, it will. i asked him if there's a potential of british casualties could he rule that out. >> first of all, we have to step up here. many of our partners have undertaken to carry out air strikes and it's right and proper that britain should shoulder its share of the burden.
this will be an air operation. we are not expecting that we would see anything like the casualties that we've seen in previous conflicts where we have had ground forces involved. >> so there will be no mission increase? >> look, we will be very careful about the level of our commitment. we will make sure that we do what is necessary for us to do, what it makes sense for us to do. but there are many countries involved in this coalition. different countries will carry out different parts of the commission, what we're talking about is a british commitment to carry out air strikes in party of the government of iraq. >> i have to ask you about the isis excuser. do you know he is a british citizen and are you worried about terrorist attacks from the isis imminently? >> obviously, we're concerned about attacks in the west from
isil, either by returning foreign fighters or by external attacks that they've planned from the territory that they control in iraq and syria. that's why we're on a very much heightened state of vigilance in the uk at the moment. on the question of the fbi, we've worked very closely with our american colleagues since that came out. it's an ongoing police investigation. we wouldn't expect to comment in detail on it. >> they expect to begin this debate on iraq in the form of air strikes and other aid and training. in about 30 minutes to an hour from now. this is a vote on iraq. this is not a vote on syria. we're not talking about doing something in syria to assist opposition forces. this speaks to a broader question about the legality of whether or not the uk can go in there and assist opposition
forces. that goes to the bigger question of whether this will approach the overthrow of assad. >> hadley, thank you very much. we've also had a flash come out from russia to say the ruble is now at a new historic low versus the u.s. dollar. in general, do you think politics will still be priced into the markets? >> i think it is. i am quite positive about geopolitical. it's to send off with the west of ukraine. they've been in a difficult business for so long of a time, it's difficult to say there's any. look at what happened to the oil price. north africa including ukraine, as well. $92. it includes going down lower
even know. russia is a different thing. but we think we're above about it because we think decisionmakers, it's clearly only russia. it's in the best interest of russia to find a solution. as the next few months go by, comp miegz will be found. more than $700 billion. inflation is creeping high he. in 1998, when the last defaulted, not a long time ago. i'm not saying they will default as in 1998, but because of that, we think russia will set back some points. >> can i move you on to japan?
this morning, we have some cpi numbers out. the market has somewhat lost trust in abe-nomics. i know your short-term view difference very much from the longer term view. >> yes. we think it will go to 20,000. the only one to mon size that will be the value, the value of the yen. we see the yen at 1110, 120. why is that? clearly because of monetizing. it's already higher than the federal reserve. japan is only 35% of the u.s. economy. so going through in japan is monumental. we think it will be reconfirmed for next year.
japan has not yet improved their own targets. inflation, for example, they get to the cross inflation. they pay more for information. they're quite desperate. we don't think they will do anything else than what they did so far. inflation will not seek higher, particularly. and i'm not saying they will fail. i think they might fail. companies trading at net debt at the spread of 20 for four to five years. that is unsustainable. >> how do you position yourself accordingly? >> if you have inflation and -- >> when you have deflation or
the threat of deflation in europe and significant easing, how do you structure your portfolio accordingly? >> long equity and long bonds. that is probably not a bad match. within the ecb, behind the curve, they will need to step up their game from here. >> gragdy has said 1.3 billion euro back to 2012. higher to 1.3390. we think it's going down at the end of the year. out of italy, it will be a melt up scenario in our opinion on equities. any bad news is good news now in europe these days. the cap is low. in italy, they will need to do more through sovereign qe. the germans would be in agreement.
and all the parties in european country ves adopt today german agenda, anyway. >> they're two fundamentally different nations at the end of the day. >> it is unjustifiable, the euro at 1.27. inflation numbers, from the trends, it doesn't make any sense. they're too strong of a currency. too much debt. the counter measures are too small. they will be ramped up. i'm positive about it.
at the moment, it is not big enough. >> thank you very much for that. still to come on the show, is the barrel on an unstoppable downhill roll? we talk brent's decline and ask where it goes from here. we'll be back in two. your customers, our financing. your aspirations, our analytics. your goals, our technology. introducing synchrony financial, bringing new meaning
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foreign secretary phillip hammon tells cnbc the country should shoulder its share of the burden. >> it's firm about attacks in the west from isil either by returning foreign prices or by external factors. that's why we're on a very much heightened state of vigilance in the uk at the moment. >> here is a quick check off european markets. we're slightly under water today. that said, we are close to session highs. we're still tracking the declines in u.s. and asia. the ftse 100 is off by 0.2%. we're seeing some green to the cac 40 1k39 ftse mib. we're close to one-month lows. for this year, we're on track for the biggest weekly drop in almost two months. and in bond markets yesterday, this fall in equity markets was accompanied bay slight rise in bond prices. yields have ticked lower kwuns
again. the ten-year treasury in the states is at 2.5%. germany is at 0.96%. guilt 2.34%. and in the currency markets, the dollar has settled overnight, but has recovered since dollar/yen close to six-year highs again. up by 0.3%. euro/dollar pretty much unchanges since yet. but it's all about the dollar, isn't it, ahead of the final reading of second quarter gdp. that is expected later on today. and the dollar index close to those highs. russian companies sistema has seen issues regarding shares in bashneft.
definitely a big mover in today's trade. brent crude has fallen around 16% since its peak in june. and in the last 30 minutes, iran's oil minister has called on opec members to join efforts to keep the price from falling further. ian joins me now. what i'm seeing in the oil markets right now is fascinating. we're seeing a huge supply discount, but not necessarily a geopolitics premium. why is that? >> the premium has been erode i by the fact that we have the shale boom in the u.s. shale oil, in terms of underflying supply itself, it doesn't make a big difference. the very fact is that the u.s. are buying less middle east oil, therefore, we need to find other markets for that oil. and that has been emerging
markets, particularly china. until this year. but demand in china has been much lower than expected. but they've not been as bad as we thought they would be. the third thing is your correlation of the u.s. dollar versus all commodities. the dollar goes up. >> usually the opec meetings, they're nonevents. but in november, we have the hawks and the doves comes together. we just heard iran saying maybe what we need to do is stem prices from falling further. do you think saudi arabia is careful going forward? >> if you decide to cut oil by, say, half a million barrels, he could be sending the wrong signal to the market.
instead of stabilizing prices, they cut by 500,000 pounds a day, you're suggesting the underlying demand is weaker than it is going forward and maybe continuing for, say, another 12 months, let's say. therefore, i can you could end up putting the oil price lower than higher. if you are clever, and i think the saudis are quite clever, is talk about doing the cut and don't actually do the cut. givenlg that we've got oil prices below 100, is there complacency about where supply and demand is going to be in a couple months time? >> it's an extra 2 million
barrels a day. louisiana, light sweet, that is a substitution. that is not taking place. you find another market for brent, which has been china, as i mentioned. but not this year. it's been very difficult. in addition to that, some of what i mentioned before like libya is going forward. what has the largest impact going forward? >> i think think isis and libya. clearly, once you start to get things like the israelis getting involved, it all becomes
tentative. but the neerm term marketist has more to do with supply. you close down refinery, you don't need the oil. when it comes to the fourth quarter, and you start to look at your starts on your central heating, that is when your oil price tarts to move. >> we're going to watch the price of oil closely over the next 12 months. ian armstrong, thanks for your time. >> russia's finance minister has accused kiev of avoiding a $3 billion debt held by moscow. it follows reports the kremlin could be looking at ways to see foreign owned assets on russian
soil as a way to retaliate. ann curry sat down and asked how russia will cope with the upcoming winter. >> what we already did, we launched the low from the european union and substituted russian gas with the road from the european union at 60%. that's not enough. we need another 5 billion for natural gas to be precious. if no, it would be very difficult to go through the winter. but in our storage facilities, we have about 17 billion cubic meters of natural gas which allows us to pass through the
winter not to be frozen by russ russia. >> intel is paying up to 1.5 billion for a 20% stake into chinese mobile chipmakers. both chinese firm ves ties to the country's government. spoo. apple has released a software patch for iphone users who reported a number of glitches after downloading the latest system. it will release 8.0.2 in the second few days. the tech giant has rottedly its lens on bendgate. shares in apple took a hit on thursday on the various set backs, ending the day down nearly 4%.
a couple of glitches and the stock falls. but it doesn't really hurt them at all. we've seen glitches three or four times. each time after that glitch, the iphone outsold its predecessor. i'm sure it will happen this time around. >> they'll sold over 4 million and ohm nine people xwland. >> given the coverage, you would think it would be more. >> we'll see if that bounces back in trade. meanwhile, nikkeiky reported earnings of $1.09. the share boasted estimates of 88 cents a share on revenue of 7.9 billion. nike's ceo said the company will
continue continue its wearable device on software for the future. shares of nike are trading up around -- sorry, nike i've been reminded to say for our u.s. audience, shares of nike are up around 6% in frankfurt. those results beat expectations signaturesly. >> and they were especially strong in western europe and germany. that makes you wonder did it actually gain market share? we know adidas has been under pressure. >> in different sports, running, basketball and global football driving growth for nike. interestingly enough, its women's line glowing faster than men's. interesting trend there. >> send us your e-mails. tell us what you think of nike versus adidas. >> the eu's banking regulator is
gearing up to clamp down on banks. that's according to sources cited by the financial times. carth rin joins us with the latest. >> it's really, really interesting. interesting from a uk perspective because the uk lass hopes that he's their top man in europe. he would be able to help limit this bonus cap to something that people in the city here are really, really worried about, in fact, quite a few banks that may disincense phi them. and it looks as though he hasn't been able to secure the pyre they hoped he would. obviously corporate govern nance comes under the justice department within the eu, too. but it still seems like a
fairley odd move. you said to the uk prime minister, you tried to blom my appointments. >> it might be an issue that nigel could discuss today. >> i think you'll see that. he's been campaigning on just how limited the uk power is to really affect things in europe and, of course, whether the uk should even stay part of the eu. it is something that would really worry markets if mr. cameron was forced to hold a referendum and a worry that the uk could then lead to more banks leaving the uk obviously even for ireland. till so come on the show, can the mites of mcilroy measure up? we'll take a light hearted look
at the economic lessons from the ryder cup as it tees off in scotland. stay with us on "worldwide exchange." i love having a free checked bag. with my united mileageplus explorer card. i have saved $75 in checked bag fees. priority boarding is really important to us. you can just get on the plane and relax. i love to travel, no foreign transaction fees means real savings. we can go to any country and spend money the way we would in the us. when i spend money on this card i can see brazil in my future. i use the explorer card to earn miles in order to go visit my family which means a lot to me. ♪
the ryder cup is under way with europe taking on the united states. playered teed just just over two years ago. it marks the first action of the weekend at the moment. europe up in three games and down in one. >> absolutely. that is for this year's competition. they may say that taking part is all that matters, but we know that's rubbish. it's all about the winning. let's look at some recent statistics. we're focusing on 2008 to date because it's a pretty important year in our industry. there have been three ryder cups since 2008. 16.5 points to 11.5. in 2010, a victory for europe. it was a very close battle. and that repeated itself in 2012's miracle at medina. so i'm delighted to inform you,
seema, that since 2008, we, europe, are winning 2-1. >> wow, well, you enjoy that. but perhaps we should focus on business, on the economy if you were to compare business versus the u.s. let's take a look at the chart. europe still not winning many prizes. s&p up around 114% since 2008. so you are might be winning on the game front, but on the economy, the u.s. is the clear winner. >> i wonder how things are going to play out as we move forward. >> thank you so much. how will they perform moving forward? that's what we should be focusing on. which captain will be victorious? mcginley says he's sticking to
success established by his predecessor. and someone has been doing a lot of work on this and found some striking similarities. mean while, merkel has won three elections in a row, '05, '09 and -- >> they're very, very similar. >> meanwhile, the u.s. president barack obama entered law school on the same year watson entered the hall of fame in 1988. >> for europe, we've got rory mcilroy, the world number one. similar perhaps to mario draghi.
i think he's much better than janet yellen, don't you think? >> i'm going to my comment there. >> golf purists, down to the players, whereas the ryder cup says the captain does haven put. we would like to think elected leaders have the biggest impact on the economy. what dournlg is driving the economy? giveses your thoughts on this year's ryder cup team. will the captain make the decisive out outcome? get in touch, firstname.lastname@example.org or via twitter @cnbcwex. sticking with the ryder cup, the use of social media at porting events, including the ryder cup, have been an important way to reach users. to talk more about all things social media, let's bring in
carl. >> carl, how important of a role is social media? >> social media is huge. it's the first time you can engage with the people in the business. now you can actually see behind the scenes and actually see what, you know, your people are actually doing and following. >> but does it have an automatic relationship in terms of sponsorships? the european ryder cup team, they have 1 million in place but the u.s. only 360,000. does that automatically translate? >> sometimes it does. it depends. but they're sports fans.
they don't want to just be given constantly more brand information. they also want to see the details wind the scenes of the people that they follow. >> in 18 to 34-year-olds, 54% use their phones as their main source of social media device. on the bottom line, who monetizes that? is it the hand setmakers or advertisers? >> today, obviously, the advertisers get to reach out to the customers. and, you know, from my view, social is mobile because it's in your pocket at all times. this week in europe, we're
seeing instagram come in, as well. >> a lot of names like nike, under armour, using these sporting events to advertise their brands. >> in, times, with audi, you know, you have the -- you know, all the events that they take part in, they're able to interact with all of their fans and change customers from being just customers to long-term fans. >> facebook now may be the leader, but the monetization is falling.
is that just a trend we have to accept or do you think there will be a turn around in that pricing? >> it's a completely new market. brands and businesses that believe we're taking this desktop have it completely wrong. we are just at the beginning here. the pricing will go up. we have more brands in the world than we have desktop computers. therefore, there's more choice and more activity. therefore, is it just about price? >> let's stick with our theme, mobile. we know that it's more consumers as well as advertisements over their mobile phone. how is that changing the way our clients are positioning themselves and advertising to those customers? >> it has to be xhoebl first
now. more importantly, how you inter act with the customer who is happy with your brand or dare i say not happy. >> u.s. social media advertising revenues, 30 million users and only $11 billion in revenue. have advertisers got a long way to catch up to make the most of the number of users there are? >> it has. you can't just put a big ad on there like we have on the deck top. therefore, we have to start thinking of new methods and new ways to interact with customers and work out how you're going to get into those customers lives. with the mobile phone, it's a small screen, different format. yes, it's going to catch up and it's going to take time. >> by far the best right now is
facebook. they have taken the lead there. twitter is coming in, as i say now, instagram is going to do a great job. >> thank you very much for joining us. >> remember to get in touch with us. would do you think is going to be driving the outcome of markets? publish dwrans or central bankers? or give us your thoughts on this year's ryder cup teams. will the captains or the players decide the outcome? join the conversation here on "worldwide exchange." get in touch, email@example.com. or by twitter @cnbcwex. carolin, who is going to win the golf? >> i don't know. to be fair, i know 100% more about golf than i did yesterday. >> who is your favorite player, then? >> i really wouldn't know. let's stick with tennis. why don't we do that.
look, politics don't matter to markets. it's central banks. >> and it has been. it raises an interesting question as to whether in the future perhaps central bankers will have to be elected, you know? >> don't have them elected. we do want to hear from you. firstname.lastname@example.org. from central banks to the markets, u.s. stocks witnessing their worst drop since july 31st. the russell 2000 once again under pressure. what does that mean for your portfolio? we will discuss next on "worldwide exchange." xkç
welcome to "worldwide exchange." i'm seema mody. >> and i'm wilfred frost. these are yours headlines from around the world. >> u.s. stocks indicate a mixed open after one of the worst days for wall street in almost two months. >> apple loses nearly $23 billion in value despite its bendy i phone. nike higher prompting a number of broker upgrades. u.s. attorney general eric holder announces his resignation after a turbulent six years with
the nation's chief law enforces. president obama says saying good-bye to him is bittersweet. >> you're watching "worldwide exchange," bringing you business news from around the globe. i'm carolin roth. coming up, the wait is over. the ryder cup is finally under way. we get into the swing of the tournament. blackberry earnings due before the bell, we speak to one analyst with a hold recommendation on the stock. but it's the hand setmaker due for an upgrade? and as the indian prime minister touches down in new york, we ask is this the story of business that will open a new era of trade relations for washington and new deli. >> announcer: you're watching "worldwide exchange," bringing you business news from around the globe.
>> welcome to the show. just a week ago, we were saying how september is shrugging off that rally. now we're in the red for both this week and for is september. suddenly, everyone has gotten very bearish. >> and it's hard to put a nail down on what is contributing to this loss. fears about a slowdown in china, rise in geopolitical tension. economic data out of the u.s. continues to surprise to the upside. but that's causing some to think the fed will raise rates sooner than expected. interestingly enough, implying a move to the upside, dow moving about 45 points in premarket trade. the nasdaq up about 9. to its lowest levels in over five weeks. yesterday was the first 1% drop for the dow. the s&p 500 since july 31st. quickly, looking at the ftse
cnbc global 300, we're currently down about .13 points on the day. let's look into the european markets. when it comes to europe, a weaker than expected manufacturing data we got out earlier this week weighed on investor sentiment. today we're seeing a bit of a pick up here in france and italy. both markets showing a bit of a green. the xetra dax down about 27 points. germany, a major trade partner with russia. the implications are further instability in russia and what that means for the german markets and their corporations. that, of course, a concern for investors. taking a look at the ftse 100, currently trading down about 23 points or about 0.4%, carolin. so a mixed day on friday as you wait for that u.s. market to open. >> absolutely. i guess we're seeing a degree of stabilization in these markets. in the bond markets, we're seeing prices higher across the board. it's actually been a really good week for bonds. partly because of the safe haven flows because of geopolitical concerns and also because of quarter end repositioning.
the ten-year bund yield back below it's 1%. 0.935%. ten-year treasury yields, below that 2.5% not too long ago. up ten days ago, as will pointed out, above 2.6%, currently 2.49%. now ten-year gilt year, 2.4%. i want to take a quick look at the currency market because we saw a bit of a stumble in the dollar overnight, but it has quickly recover. euro/dollar, pretty much range bound at 1.2746 unchanged on the day. let's get out to skree jegarajah for the asian markets update. sri, do you miss me yet at all? >> every day, carolin, every day, my dear. i have to console myself with the fact that i get to talk about these asian markets. the nikkei 225 down by almost 1%. yes, we did get cpi, at a
nationwide level for the month of august. that's half than what the market was expecting. that implies the bank of japan still had some work to do. similar expectations riding high. probably won't get it in next week's boj meeting. hsbc saying we could see additional stimulus auction in april 2015. we are watching that yen level very closely, as well. i have a sneaky feeling it's going to hit 110 against the u.s. dollar next week. if it does so, that will give some relief to the exporters. remember, a lot of stocks went ex dividend today and that accounts for about 19 points of decline in the nikkei 225. at one point, the composite was down 1.4%. 1.3% down currently.
it undermines the reformist agenda pushing through the legislation in parliament. when he assumes the presidency next month. but all in all, a fairley negative day for asian equities. it will be important next week when we look at geopolitics and the nonfarm payrolls for the month of september at the end of next week. carolin, back to you now. you'll have a very good weekend because i'm be back on your show next weekend. >> and it's a bad day for us because you're leaving "worldwide exchange" next week. >> sorry to leave you. >> it's a great loss for us and a great gain for sri. let's talk about markets. this week has been extraordinary. we've had four days in the major indices, moving more than 1%. three days down, one day up.
what do you think is driving it? >> someone called it erratic behavior. but others would say maybe this is in response to the headlines coming out of syria and iraq. how do you assess what's happening in china? what does that mean for global growth? >> i think this is month imd, quarter end positioning. keep in mind that we're going into october and october usually we see much higher volatility. this is what rbc pointed out this morning. we saw two huge crashes. october is generally a stable one for equities, with the dow and the suspect i believe up by around 2% each month. >> i think this is the start of a bigger construction. big macro factors moving
markets. this week, it's the first week it's set in to significant volatility for equity markets. i think we would do that in terms of volatility and potentially down side. >> to add to that, you take a look at the cboe volatility index fighting by around 20% indicating a rise in investors uncertainty. that's never a good sign when it comes to the markets, of course, we'll continue to watch the s&p 500 bumping to its lowest level in over five weeks. there's a sern level of a stekal analysis that market watchers are watching. the as much s&p 500 trading below that key support level. you have to wonder what that means for the markets going forward. >> absolutely. such interesting volatility in ekd markets. the one market that has continued on you say is the u.s. dollar. the basket of currencies is now set for its 11th straight week of gains. that is an astonishly strong run
for the u.s. dollar. >> finally. at the start of the year, everyone was spething that. it never materialized. they were so disappointed, really frustrated. >> some experts say that the next earnings season could be impacted by those currency headwinds. multi nationals that do business overseas, stronger dollar makes their dollar less competitive. what to watch on the trading day in the u.s.? we'll get a final read on second quarter gdp forecast to rise 0.6% from the previous 4.2% along with a michigan consumer sentiment index. which economists are expected to tick higher? both could potentially tick higher in today's trade. we'll get blackberry earnings at 7:00 a.m. eastern. tune into squawk alley today at 112:00 a.m. eastern with wlb's ceo john chen. that will be something you'll want to watch. >> absolutely. let's take another look at today's other top stories.
president barack obama announced attorney general eric holder will be resigning from his post after six years on the job. he has agreed to remain on board until a successor has been determined. he is one of the original members of obama's cabinet and one of the last few officials to have stayed in place. several have been hoping to out holder for quite some time now because of his involvement with the notorious fast and furious scandal and other high profile controversies. british lawmakers are set to vote on air strikes in iraq later on today. let's get back out to our middle east editor hadley gamble. now, the uk has entered a war against terrorism before. at that time, they didn't have a clear exit strategy. do they have one now, hadley? >> that's a very good question. certainly one that these members of parliament are going to hope for in answer. we spoke with the foreign secretary this morning and he didn't have much light to shed
on that question. today, we're just voting on iraq, we're just voting on air strikes, aid to that country and assistance and training for iraq forces. we're not even talking about syria. that debates would come in the coming days and that debate and that vote would come in the coming days. we're hopeful on that. the foreign secretary did say earlier this morning that he felt that the u.s. case for action in syria was robust. but, of course, this is a question of legality. many would say the previous iraq conflict was, in fact, illegal. certainly something we need to watch in the coming days. i asked the foreign secretary if he could rule out british casualties and if he could rule out the possibility of a mission increase. >> first of all, we have to step up to the challenge here. the isil represents a real threat to british national security, british citizenes and to british interests and the coalitions have come together, many of our partners have undertaken to carry out air strikes and it's right and
properer that britain should shoulder its share of the burdens. but on your specific question, we're not putting ground forces into iraq. this will be an air prais operation. >> so there will be no mission increase? >> look, we will be very careful about the level of our commitment. we will make sure that we do what is necessary for us to do, what it makes sense for us to do. but there are many countries involved in this coalition, different countries will carry out different parts of the mission, different parts of the task. what we're talking about, what we're debating today is a british commitment toer ka out air strikes in support of the government of iraq. >> the fbi saying they have identified the skooug excuser.
do you know he is a british citizen and are you worried about terrorist attacks on isis? >> obviously, we're concerned about attacks in the west from isil either by returning foreign -- or by external attacks that they've planned from the territories that they control in iraq and syria. that's why we're on a very much heightened state of vigilance in the uk at the moment. on the question of the might be fbi, we have worked with the americans closely citizen the investigation came out. it's a detailed investigation and wouldn't expect me to comment in detail on it. >> he also said this morning if the force needed to increase, that it possibly could. that speaks to the broader question, whether they will increase that action in iraq and whether they will take a vote in syria in the coming days. the debate whether or not to go into iraq with these air strikes, with this training and
assistance will begin in just a few moments, carolin. and hadley, he took a beating last year after that humiliating -- in parliament. >> he did take a beating, didn't he? just a year ago, i was standing right here and saw after overwhelming defete for the prime minister. it looks like today he's going to get the support of all parties to do something about this. because of the fact that essentially the narrative has changed. the west is very much worried about this threat coming home. i think you're going to see that argument going forward. the iphone is getting the bend. why is it it helping the stock move up? more on that after the break. your customers, our financing. your aspirations, our analytics.
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the s&p & has upgraded india's outlook to stable. in response, you're seeing indian equities move to the upside. the indian rupee continues to strengthen against the u.s. dollar, currently trading around 61 the last time i checked. this is really interesting that the new prime minister has come to the helm in india. since then, you've seen investors move on the hopes that he would be able to improve the economic back drop. there's hope that he would be able to increase india's growth rate and bring inflation down and that, perhaps, being looked at by s&p, citing improved political setting as a reason to upgrade india. >> isn't s&p behind the curve here? didn't we know that all along since that big election win? the market has priced this in and this is the criticism that wove seen towards the ratings
all along. there's hope that he will bring change. we haven't seen the result of that. i'm still waiting for that. >> the last three weeks, it has come off. as you say, these great reforms have been talked about and having really come through. >> but they've been priced into the markets. that is why yush seeing some investors hesitate. >> we'll discuss all of those topics and more. >> mikey shares, the apple giant reported earnings of $1.09 a share but estimates of 88 cents per share on revenue of 7.98 billion against expectations of 7.84 billion. nike's ceo says the company has got a complete offense and is continue to go leverage. nike announced earlier this year
that it would discontinue its wearable device and focus more on software for the future. shares in frankfurt are up strongly after about 5.8%, following gains yesterday. this is a really impressive set of results from nike. a lot of apparelmakers struggled recently both in the u.s. and emerging markets. but strong results across the board. >> they're focusing on their core products, apparel as well as snus and it's working well for the company. >> but you know what the problem is? we don't have a major sporting event next year. the world cup is over. unless i missed something. >> the iwatch has come out. that will lead to innovation. nike and company, maybe in a year's time, we'll all know exactly where we've gone, the
times we've got, what it means. and it's an interesting space. >> i still think a sporting event is a stronger advertiser than the wearables. u.s. "squawk box" is up next with an exclusive interview with robert diamond, barry sternlicht and larry summers. and still to come on the show, struging smartphonemaker blackberry reports earnings in just a few hours. are investors buying into the turn around? as we go, we'll leave you with u.s. futures. we're expecting a positive open after a big sell-off yesterday. [ male announcer ] some come here
poib. blackberry shares closed down more than 6% yesterday amid a broader sell-off in the nasdaq. keep in mind, the stock is up about 40% to date. the ceo john chen will be speaking to cnbc post earnings. that will be on squawk alley at 11:00 a.m. eastern. bringing in the equity analyst at s&p capital i.q. to get a look at what investors can
expect when quarterback does report earnings, angelo, what do you think about this? will we see that turn around that john chen has been promising investors? >> well, not yet. i mean, when you look at the most recent results, i think the key here is, you know, three things, really. one is how does the business model look relative to prior quarters? john chen has done a great job, we believe, with really cutting down the costs. it will be interesting to kind of see if they -- they slow down some of the cash burn that we've seen in recenters. that's going to be the first key. the second key is going to be on the hardware side of things. have they done enough here where they've stabilized the hardware business and can we see some sort of pick up here in the coming quarters. and then the third and final thing is going to be any talk on new product branch, especially on the software and services side where the company is starting to focus a lot more on -- and it's something that
they're transitioning into relative to the hardware side. >> the last time i attended blackberry world, the company was trying to push mobile device management as the next hot space for the company. do you think, though, that blackberry will be able to make a big push into mobile device management? there's a lot of competitors in that space, including good tech. >> yeah, absolutely. so it's a fierce very competitive landscape. you've got good tech, mobile air watch, it's a highly competitive area. we think that this is a good yeah for them to ramp up on. they've got some, you know, great resources that they can use. overall, you know, we're positive on it. you know, it's going to take time and monetizing that business is really going to be key for them. but, you know, it's something that john chen needs to focus on and something we need to see here in the coming quarter. >> just a quick one, they tie their devices closely to cyber
security and including calling the new one the passport. do you think that's enough to differentiate them from the big names of apple and samsung? >> i think the passport is a good pruth. is it going to be enough? probably not. bl they can get to that 10 million level, that remains to be seen. still to come on the show, s&p upgrades india's ratings.
it's friday. welcome to "worldwide exchange." i'm seema mody. >> and i'm wid fred frost. apple takes a bites out of the nasdaq, loogz $23 million in value. >> dominating the feel, nike shares jump after hours as it beats earnings expectations. a number of brokers jupd grade the stock. >> and u.s. attorney general eric holder steps down after six
years at the helm of the justice department. >> announcer: you're watching "worldwide exchange," bringing you business news from around the globe. >> and if you're just tuning in to "worldwide exchange," thank you for joining us this morning. we had a volatile date of trade on wall street. the s&p 500 and the nasdaq plummeting to their lowest levels in over five weeks. the russell 200 on 0 continues to underperform the broader markets. the nasdaq in toef, down about 2% in yesterday's trade. investors selling the winners. in fact, ten of the biggest losers on the nasdaq 100 yesterday are all up on average about 60% over the last year. so investors taking the opportunity to brush out their portfolio and sell some of the winners. right now, though, futures point to go a higher open.
on that note, take a look at the cnbc ftse global 300 index. you can see we've come off of session lows of the day, but still down about five points. diving into the european markets, we've been seeing a lot of moment in intraday trade. off our session lows. we're now looking at the italian, the french and the german markets moving higher. the ftse 100 continues to lag just about flat down about 1 points on the day. carolin. >> how do you make money in these markets? here is what some of the experts have been telling us this morning. >> i still think the right price is right in the middle of the range since the low a couple of times above. somewhere around about there. >> by big call is interest rates
going lower. my trade has been long u.s. fixed income. my call on the equity markets always been second half this year. the peak to trial correction will be 25% to 30%. that is correct. >> for example, on the equities side, it would be super negative above the economy. we think the ecb will have to do something about it. and the game changer in european deflation, two years ago, deflation was 0.6%. negative for most of the european countries. we think something will be done about it. >> india in focus, standard & poors has revised india's credit outlook from stable to negative. the news sent stocks in mumbai into positive territory. the rupee, though, that's where you're seeing the action ticking up against the u.s. dollar on the announcement trading at 61. now, this comes as india's prime
minister touches down in new york city today in its first ever visit to the u.s. highlights of the trip includes a private dinner with barack obama and a with 20,000 pooed people in madison square garden. on that note, let's bring in the ceo of kkr india to get his view on where there are opportunities in the indian markets since sanjay modi has become prime minister of india. there has been a lot of optimism that he will be able to revive india's economy. have you, as the head of a private equity firm felt the difference in the investment landscape at all? >> well, not imminently. this in terms of getting to the answer to your questions. and there is no magic to a venture activity or investment
economy. there seems to be having a real sense of purpose and clearly giving an impression they're open for business. i think the second thing that is happening is there is definitely a cyclical recovery going on with commodity prices being low and the fact that, you know, oil is far more subdued. you're seeing, i think, a lot more on the recovery side. i would say, you know, put those two things together. i would say that getting to kind of a gdp level of 5.5% looks hikely achievable. and that's not home run, as we know. there's a lot of work to be done after that. i would say that not getting complacent with just the initial hard working with the sense of purpose that are there because of commodity cycle as well as some of the --
>> i'm very sorry. i'm going interrupt you briefly, sanjay. we're going to listen to prime minister david cameron speaking in parliament now. >> destroy what president obama has rightly called this network of death. mr. speaker, there is no serious an issue than asking our armed forces to put themselves in harm's way to protect our country. and i want to set out today why i believe that is necessary. if we are to do this, then there is a series of questions which must be answered. is it in our national interest, in particular is there a direct threat to the british people? is there a comprehensive plan for dealing with this threat? is the military element necessary? is it necessary for us to take part in military action? is it legal for us to take part? will we be doing so with the support of local partners? and will doing this add up to a moral justification for putting the lives of british service men and women on the line?
and above all, do we have a clear idea of what a successful outcome will look like and are we convinced that our strategy can take us there? i want to address each of these questions head on. first, our national interest. is there a threat to the british people? the answer is yes. isil has already murdered one british hostage and is threatening the lives of two more. the first isil inspired terrorist acts in europe have already taken place with, for instance, the attack on the jewish museum in brussels. security services have disrupted six other known plots in europe as well as foiling a terrorist attack in australia aimed at civilians including british and american tourists. isil is a terrorist organization unlike those we have dealt with before. the brutality is staggering. the heading, crucifixions, the gouging out of eyes, the use of rape as a weapon, the slaughter of children, all these things
belong to the dark ages. but it is not just the brutality, it is backed by billions of dollars and has captured a territory. has already attacked -- and boasts of its designs right up to the turkish border. this is not a threat on the far side of the world. left unchecked, we will face a terrorist face on the shores of the mediterranean and bordering a nato member with a declared and proven determination to attack our country and our people. this is not fantasy. it is happening in front of us and we need to face up to it. next, is there a clear comprehensive plan? yes. it starts at home with tough, uncompromising action to prevent attacks and hunt down those who
are planning it. as the house knows, we are introducing new powers. these include strengthening our ability to seize passports and to stop suspects traveling. it includes stripping nationalities from all-nationals and ensures air zones comply with our no fly list. we are being clear about the cause of the terrorist threat we face. as i've said before, that means defeating the poisonous ideology of extremism by tackling all forms of extremism, not just the nonviolent -- not just the violent extremists. we are banning creatures of hate, inciting organizations that incite terrorism. now, of course, some will say that any action you take will further radicalize young people. i have to say this is a cancer of despair. the threat of radicalization is already here. young people have left our
country to go and fight extremists. this -- two questions he's now put to himself, how long will this war last and when will mission creep start? >> let me answer that directly. this is going to be a mission that will take not just months, but years. but i believe we have to be prepared for that commitment. and the reason for that is i think quite rightly america brightan and others are looking at not putting boots on the ground, but -- in terms of mission creep, i would address directly and later in my speech why we are discussing what is happening in iraq today and -- >> that was david cameron
speaking in the uk particle many, outlining the case for air strikes in iraq. we want to go back to sanjay talking about where there are opportunities to invest in india. looking at the investment landscape in india right now, which sectors look attractive to you? >> seema, i can't really comment on specific sectors, but i think there is going to be a lot of need for long-term capital, both debt and equity in india. i would say you will see the core sectors. if the confidence on the indian side comes back to grow and invest, i think there's capital in india. so we should see a lot of opportunities from pretty much all sectors where the companies in india want to go and reach and distribution and become world class companies. so i think we will see that across a slew of areas.
>> prime minister modi has been on a foreign offensive. he's in the united states right now. do you think there's a clear sign they're going to open up foreign direct investment opportunities in india? >> i think so. in a way, it means sectors will open up. i think they're going to be a lot more targeted at the way they want to help strong countries like china and india. the supply side is weak. getting some government based funding, whether it's the private sector or government
backed sector, it's an extremely way of getting in huge dollar productivity and capital into india. i think that's the overall game plan from what i can make. >> even if all of this happened, what happened in the face of tienting by the u.s.? your country was one of the biggest victims of the tapering last year. >> yeah. i think we're in a much, much different position right now. you've seen the rupee between 60 and 62. i think there's been a lot of dollars coming into india for the last nine, ten months. there was neshusness and then you had the taper talks.
not to mention the current account deficit is at a low. and i would say finally, the commodity cycle is pretty low and that benefits india, as well. i think india will go through that in a much morrow bust fashion. i feel more confident we see a stable rupee now. >> sanjay nyer, thank you so much. all eyes on prime minister modi to see if he can revive india's economy. apple has released a software watch for iphone users who reported a number of glitches after downloading the latest operating system. the company says it will release ios 8.0.2 in the next few days.
the tech giant has broken its silence on bendgate. apple says only nine customers have complained about the bendiness of the iphone 6 or 6 plus, only nine. blackberry reporting second quarter earnings at 7:00 a.m. eastern. analysts will expect the company to report a lost of 16 cents a share on rev $9 million. yesterday's trade miss today broader sell-off in the nasdaq. john chen of blackberry will be speaking to cnbc post earnings on squawk alley at 11:00 a.m. eastern. nike shares getting a boost yesterday after boasting a strong first quarter earnings. they reported earnings of $1.09 a share versus estimates of 88 cents a share on revenues of $7.98 billion. analysts were expecting revenue of 7.84 billion.
nike's ceo says they're continuing to will have raej the power of digital. nike announced earlier this year it would discontinue its wearable device and focus more on software for the future. shares of nike trading higher in frankfurt trading. still to come on the show, can the might of mcilroy measure up to super mario? we take a light hearted look at the economic lessons we can learn from the ryder cup as it tees off in scotland. stay with us.
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welcome back now for a sportsup date on "worldwide exchange." >> let's look at recent statistics on the ryder cup. 2008, a pretty important year in our business. there have been three ryder cups sense then. the usa won in 2008. europe, we won in 2010 and also in 2012. i'm delighted toni form you that we're 2-1. >> perhaps in golf you might be. but let's get a real look at business. we are, anyway, a business show. it's not only about golf. let's look at how europe has performed versus the u.s. in real gdp in 2008. not so great. the u.s. winning there.
if you look at the stock market, europe still not winning many prizes. the s&p up around 114% since 2008 versus 23% for the stoxx 600. so you might have golf, but the u.s. has the economy. >> exactly. and all eyes over the weekend to see who whips. >> we'll find out on monday, guys. in other news, plenty -- from the u.s. attorney general eric holder is stepping down. let's get more on that story. that was a controversial issue, wasn't it? >> it certainly was. attorney general is the fourth longest serving attorney general in the united states. holder served as deputy attorney
general under president reagan. it was president reagan who nominated holder to be a superior judge in 1998. in a speech yesterday, president obama highlighted some of holder's key achievements doctoring his career in public service including hundreds of cases and the largest mafia takedown in american history. but holder leaves a mixed legacy, especially in the republican paert's eyes thanks to his involvement with several high profile cases such as the irs targeting scandal last year and the fast and furious gun operation several years before that. for the time being, though, holder has agreed to remain on board until a successor is named. "the wall street journal" reports several key potential candidates could include former white house counsel catherine muller, massachusetts governor
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a new promise... to help all those wishes come true. cvs health. because health is everything. we're now joined by ben lichtenstein. we're going into a huge week next week with the jobs report and the ecb. >> no question. and if you take a look at the fact that yesterday we were able to break some key technical levels. i think the market is definitely under pressure. there's a lot of moment across the board. we've been seeing wide range trades over the last couple of weeks. basically, this fall has brought back the energy that everybody over the summer was lookinger to in slow but steady grind higher.
recently, volatility associated with it. two sidedness associated with the market. i think you can attribute that to the dollar activity that we've been seeing. we watched trade up above into that 85 level this week. and the currencies are on the move, the bonds are on the move. you've been seeing crude oil on the move, the gold and silver on the move. why not see stocks on the move? that's all that this has been. i don't think this is any major pullback, if you will, at this point. while we have breached the major significant levels of support, if you will. when you look back at this market going all the way back to the last couple of years, if you will, every dip that we've seen has been bought. so, again, i'm still on bullish type camp if you will and giving the benefit of the doubt to the bulls. i don't see why anything is any different right now. there is concern about higher interest rates down the road a little bit. but again, for the most part, stocks are king right now and i don't think that this bullish trend that we've been seeing has been derailed, if you will. >> stock may be king, but you've got to point out yesterday's sell-off was surprising for
some. what do you think contributed to yesterday's loss? was it concerned about china, escalation in geopolitical tensions, or that better than expected data out of the u.s. that is pushing some to think that rates will rise sooner than expected? >> well, we actually saw durable goods orders come in significantly lower yesterday. it was expected they were going to be lower, but even lower than expected. i think they were looking for around 17.1. they got around 18.5. i can't believe the exact numbers. but that was part of it. the other thing, you know, there was some rumor circulating around the trading floor that there was a hedge fund liquid e liquidating a large position. there were some websites across the internet posting some major activity in the stocks. i don't know if that's really been able to be stashated. but for the most part, high energy-type activity and weakness and a breach of a major technical level. that's really what we saw. >> ben, thank you so much for that, ben lichtenstein, president at traders audio. that's it for today's show. i'm carolin roth.
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good morning and welcome to "squawk box." the nasdaq took the biggest hit. apple with all the conjecture about recent glitches and bending phones, that was down 2%, the nasdaq. bend gate, it's not going to provide a fix for the fix. and nike just providing positive news, stronger than expected results. that stock is surging this morning. we could use it. it is friday, september 26th, 2014. "squawk box" begins right now.
good morning, everybody. i'm becky quick along with joe kernen and andrew ross sorkin who is in nantucket this morning. he has some big guests coming up. andrew, good morning. >> hey, becky. we are at the nantucket project this year again. this theme this year, art and commerce. we have some big guests coming up for you over the next thee years. we're going to have bob diamond, former ceo of barclay's. we're going to talk markets with him and the strength of the dollar. weakness of the euro. i imagine he has sauce on that. then we're going to get barry sternlicht's thoughts. he highways $30 under management. right after we get the final second quarter gdp numbers at 8:30, we're going to be talking to larry summers who will give us his perspective on those numbers as well as where the econom