tv Street Signs CNBC July 7, 2016 4:00am-5:01am EDT
good morning, everybody. you're watching "street signs" and i'm louisa bojesen. european stocks trading higher after a three-day losing streak. appetite for acquisition. shares get a boost after the french yogurt maker looks to expand u.s. presence. baby foods close to the stock six hunter as the reta retailer.
renzi to the rescue. prime minster hits back of criteria ikts of the nation's banks saying other european lenders have much bigger problems. >> good morning, how are you? >> you look great. >> you watched it. >> yes i did. >> flipped between wales. >> i went to the movies yesterday. >> did you? what did you watch. >> the secret life of pets. >> i know. it's an animated. >> i like animated movies and i also like the kind of lighter stuff. sometimes it's good justice to have a laugh, watch something light, giggle wl a girlfriend. >> and you enjoyed it. >> i did. actually recommending it. >> she says it in an embarrassed way. >> you're not supposed to say as an adult you watch animated
movies really now and then, but after you watch like 12 really very movies. let's look at the market this morning. stocks up up just shy of 2%. we're seeing a little bit of buying back into stuff has been sold off over the last couple of sessions. you take a look at the sectors as well, you'll note we're seeing a lot of green across everything. auto is back up. basic resources bouncing to the upside. our main european equity markets trading positive. all of them trading higher after the moment. let's check on the markets of asia. dan is in singapore with us. high, dan. >> reporter: hello to you both. a wit of an upset yesterday. we did see a recovery today. a large part of this was basically driven by those stronger overnight leads. now, today we have malaysia and
indonesia both off for a public holiday. chinese markets trading mixed. and interesting it was the kos my that led the gains today. we're going to take a dive on what we're seeing today. the heat map catching this quite well. a .7% decline. interesting what we're looking at right now is this dollar yen strength. it has been a key beneficiary of all of that safe haven trade post-brexit and the strength we're seeing in dollar yen is weighing on key exporlt stocks recently. major automakers managed to bounce back. keep watch on this dollar yen. 101.3 is where we're tracking at the minute. this is where we saw a lot of impact.
take a look at yields right now. japan's entire yield curve turniturn turning negative today where the exception of the 30-year. i wanted to flag with you developments in australia as well. .6% gain here. we don't have an outcome from the federal election over the weekend. sovereign credit outlook to negative. does cast some doubt over australia's prized triple a rating. back over to you both. >> dan, thank you very much. nobody is buying american organic food producer white wave
food. the 12 and a half billion dollar bill will boost the yogurt makers mood portfolio and double the size. robert wald smith joins us now on the phone. thank you for joining us. is this the growth driver we've been looking for and are they paying too much for it. >> it's going to be a diversification of growth for the business. on the call today they called out a 50 basis point to is 100 basis point depreeshs. it does diversify them away from europe and business as well which has been a key concern for investors. to your point on returns and however they're paying for it, it is going to bring up memories of the numko transaction.
they're going to return to current levels in year three and company expects it to cover cost of capital buy year six or seven. those will come back. personally for me i think it's a good deal. a good deployment of capital into diverse area and bring much needed growth. >> the fact it's going be 100% debt financed and said they want to hang on to their investment grade rating. how are they going be able to balance those two things? is that a concern for you too? >> i think the first point there would be they have firm commitments for the financing in place and they have obviously spoke on the the rate agencies with respect to that. i suspect the rating algencies will look through the original to get the dollar ratio here. they're going to have to deliver strongly on the 300 million in cost energies and revenue to get the cost down.
financing is critical to the eps in this equation as well. >> is this the norm looking to go healthierer or is it a u.s. market play or both at once. >> it's both at once. has been viewed for some time as a pure play health and wellness business. they have been flagging in europe. this gives them exposure to organic nongmo, nondairy products. it's one of the fastest growing markets. it diversifies them away from slow to no growth europe and some of the other troubled growth markets. >> just briefly, how do they compare now with the likes of other main competitors out there. >> with this deal, they show their commitment to continuing build and diversify their health
and will wellness if they carly fiorin deliver thd revenue you're going to see a bottom line here. a real criticism of management over the last few years. >> we're also looking at ad foods today. they also added the decision to exit the eu created uncertainty. i just want to get your thoughts on this too. our understanding sg pri mark buys their clothes in the u.s. the weakest dollar is going to huhemthere. >> i would say first that the trading statement is very solid and should really reassure
investors who have been concerned. what is important to notice is they do dollar source from actually the emerging markets in china in particular, but only 50% of their sales and their estate is really located in the uk. they have discrete programs for their continental stores. those stores are unlikely to face the hit from the weaker sterling. they forward bought for this year. it's going to hit margin next year. they have a strong store roll out program. even though marge i understache a hit, they're going to see business. eu sugar stocks are at very low levels and we're going to see those impacts come through into
fiscal 17 as the profits come through because currently sugar is contracted for this year. >> robert, thank you so much. head of consumer research at lee brum joining us on the foin. the italian prime minster renzi has hit back at critics. speaking during a meeting with sweden's prime minster. said derivative problems were 100 times more risky than italy's nonperforming issues. when looking at the italian banks and they've sold off a lot the last couple of sessions. he has a point. it's not just the italian banking sector that deserves scrutiny. there's more than one issue. >> doesn't make that issue less
of a problem though. >> of course not. >> the amount they spent to recapitalize the bank. it's around 18% of gdp. something needs to be done. >> do we need to relook and dig a bit deeper into our european banking health issues. >> bill: i've been saying it for years. i'm not a particular fan of european banks simply because they never went through the capitalization that the u.s. banks had, which has made the u.s. banks a lot more healthy. we just seem to think it's wasn't an anglo sax son problem, not a european problem. that's not the case. the markets are currently telling regulators and governments they need to have another look. >> is there a likelihood that italy's bank situation becomes a broader problem for europe, a systemic problem in europe?
>> i think we've got a specific issue with the italian banks and their nonperforming loans, but you've got other pockets of problems elsewhere. >> we've got deutsche bank, ubs all trading at record lows here. are they priced for what is out there, i guess is the question. >> i think we're seeing they are getting there in their pricing. i think some of it may be overdone in some examples, but broadly speaking and may believe not those big banks, but others do need to look at capitalization levels. >> more work to be done there. let's bring it back to the uk. poll sigss have to decide whether they want britain to stay in the market. made it abundantly clear that unfeu unvetted means ago access.
>> the british have to make a decision what they want. the uk has voted on the referendum. there are different announcements. nobody can force the uk to make a motion. that is a decision that kl only be made in the uk. the european commission and european counsel have rightly said we will talk about the conditions when this motion is made. we won't talk about that as long as the motion hasn't been made. there have been intense negotiations before that referendum between the uk and eu to agree upon certain adjustments. prime minster cameron was very delighted by this outcome. this has not led to a majority of people vote lg against the exit. now we will have to see what happened. >> good sterling reach participateparody with the dollar? speaking to reuters, the chief economic adviser said the pound
is facing a quote double whammy with no strong anchor. said the bank of england could not provide a floor by raising interest rates. now, keeping that in mind and also at the same time just looking at what the response has been so far to abrexit looking at the market response. i feel like we're hearing the r word more. we're hearing the potential for a recession a lot more. do you think we're heading in that direction. >> i think we're heading for a low down if we put our ears to the ground we hear all the project s being put on hold. that is going to slow down the economy. whether that is going to go so far as pushing us into recession, we don't really know yet. i think compared to what was just said there, we -- the most
positive i can take away from the current situation is that the markets decided not to have a tantrum yet. >> but how about the property fund and look accident at the freezing that's taking place of some of the property fund right now. is that -- i was speaking to somebody yesterday who was saying why friez it essentially if you're not selling or rather it seems to be a move that is going to protect the shareholders that don't want to sell. >> it's a concern, but at the moment that's very much a uk retail issue that whenever with property fund everybody heads for the exit then the issue is kbauz you actually holding very liquid assets you can't really provide daily liquidity therefore in order to protect the remaining shareholders you have to close the fund temporarily. whether that drives down property as much as it seems. uk property has become quite attractive particularly in terms of yields.
> . >> we're going to talk about this more in the show, but i want to come back to recession risk. do you buy the bounceback that we've seen in stocks even with the ftse 250 which is more uk focused. there a they are only what, 4, pennsylvan5% of the referendum. >> i don't believe in long-term. no, sorry. >> thank you very much. at the on the tatton investment. you're staying with us. get your questions and comments through. you can find us on twitter. the twitter handle @street sine cnbc, @louisa bojesen. >> just mentioning it tlp frozen
hi, everybody. welcome back. you're still watchings "street signs." bow vis bovis is up. too early to assess the impact of june's referendum on the uk housing markets. >> sharing soaring after the retail market said it was considering a buyback program. this after seeing a worse than expected drop in annual profit. blamed on negative publicity.
>> spencer has reported a quarterly sales. the uk retailer says consumer confidence weakened, but it also added it was too early to quantify the brexit. >> abus booked 183 orders in the first year. putting it behind boeing. the french group said it sold 183 aircraft between january in june after adjusting for cancellations while rival boeing sold nearly 90 more. airb let's just take a quick look at uk home builders. it's been quite severely punished since the referendum vote. down more than a third. seeing a bounceback today. you can see up more than 4% today. >> aberdeen asset management has
joined pierce in blocking the uk funds. set to lift at 1300 cet today. this as the fund manager alpplid a discount to the funds trading value after consulting with an independent valuation advisers. aberdeen joining colombia, thread needle and being among the latest managers to suspend trading on uk property funds. over half of the uk 25 billion pound sector has now gone on ice since monday. michelle pierce co-founder and chief investment officer at. why are funds dating. >> number of funds have closed over the last week or so. these funds they hold real physical property underneath them. it's very hard to trade out of
property funds at short notice because the commercial properties we're talking about, offices, warehouses, big retail spaces. now the fund themselves offering daily liquidity so there's a real mismatch between what the investors are able to access compared to what the fund is able to access. typically the fund have liquidity backers in there around 20% cash in case people want to take a redemption. if enough try to head for the exit at the same time, the funds have to sell down some of the property. causes to have to put a stop. >> my point earlier to protect those who don't want to sell, essentially, is that right? there are people that don't want to get out. >> yes. >> the interesting question at the moment is we're seeing a lot of buyers in equities and all other assets in the uk yet property they're all rushing for the exit. i think for the lay investor it doesn't seem to make sense. it's only when we look at the
longer term valuations we detect there may be a repeating pattern that we've seen before. it running really well for a kouchl yea couple of years and the moment there's a fear of economic downturn, everybody rushes to the exit. >> they shouldn't have been open ended in the first place. >> that's been talked about before in 2008. this is the last time we have seen property funds having to gate their investments. a lot of people feel this isn't the wright structure and may be trade of property funds could be a better option. >> if you tell a retail customer you have 24 hour liquidity. they may not invest had they known. what do you make of the 17% from aberdeen. >> well, cheeky i would say because the dilution goes back
to the funds. if you get enough people rushing for the exit you get 17% of them. you sell the properties perhaps at a discount: you're great lly producing the performance of your fund. >> that's smart. >> i don't think that's small just not good for the industry. >> you have seen pockets of buying after this. what's the difference between a good property investment at this point and one that is not so good? can we kind of divide the sector into two? >> i mean, i think what is happening at the moment is very much in the commercial space that we're seeing. that's an important point to differentiate between residential and commercial property. so a lot of these funds we're talking about are investing in commercial property. that's what is being affected at the moment and is going to be affected. it might have an effect in terms of sentiment. that's what is being impacted at the moment. >> the way we look at it is you've got property funds that are more in uk in london, office
space and those who are more in sort of warehouses all over the country, shopping centers and so forth. how would you distinguish between the two. the those who are investing in london property that more highly priced and more exposed to a promotional brexit when it comes with the warehouses and shopping centers should be a bit less. i would differentiate there, but we are greatly concerned that if we get a downward spiral in the commercial property market just because of that selling pressure that is coming from the retail market, that could have an effect. and therefore what you said earlier should these funds be with daily liquidity when these sort of things happen, i think the regulator needs to have another look at it. >> can we get a bit of perspective as well. what puortion of the real estat market is encapelated in these funds. >> 30 billion. >> it's about 5%.
>> yes. >> more general question on commodities actually to get your view on something else as well and something that could impact the uk consumer and their spending power. tweeting yesterday and oil is going to do go 20. we're heading to a global slow down. back to recession talk. you on the other hand said we're going above 50. >> that's in the shorter term that we might be going above 50. the oil price at the moment is where we think the economy is heading globally. let's not forget with london and brexit on the cards everything seems quite doom and gloom. the global economy might surprise yus and be more resilient than we thought. if we have a recession we have a massive supply of oil and prices will slide.
>> so all ger rhythms. that's going to be starting point for how we determine our investment process. it's not entirely all ger rhythmic, but it does take a number of input from the market. looks at oil price and other fundamental. >> do you feel like there's a negative perception about using algorith algorithm. >> there can be. they can't be scared of an computer running off and making all their investment decisions for them. that's why we have a human on top of that. >> thank you very much to you both for coming in. my sh thank you to you as well. chief investment offer at tatton investment managements. we need to take a quick break. check out world markets live.
welcome back to "street signs." your head lines this morning, european stocks trade higher after a three-day losing streak boa boosted by travel and goods. >> french yogurt makers looks to expand u.s. presence. purchasing white wave food. >> uk retailer raises guide saying sales were benefit from a lower pound. and renzi to the rescue. shares in italian banks rise after prime minster hits back at critics of his country's banks
saying other european lenders have much bigger problems. >> so we've got some data from the uk economy this morning. industrial output data coming in at 0.5% on the month. putting that down so better than expected in terms of the year. that's 1.4% on the year. expert testimo better than expected. quite significantly on that industrial production data. what about manufacturing output. the same. down 0 .5% for the month of may. once again putting that down 1%. some resilience here for the manufacturing output and industrial output. this would have been collected prior to the referendum vote and
resu result, but at least better on output. >> u.s. futures how we're indicated to open this afternoon, showing you what's going on there. a couple of days we've had a negative start. implied open today is slightly higher and as it comes to the european market the. >> we are higher again. the banks really lifting us here. i can give you a sense of individual markets what is lifting is the banks across the board here. the italian banks as well also seeing a bit of a bounce back after several session of losses. renzi saying today that never mind the italian banks. everyone has problems. it's also across the board. oil boinsed yesterday and lifted the u.s. markets. risk appetite and commodities higher today. >> we're just talking about the italian banks a second ago. bring you some flashes we're
getting from the wire trade. month depash. down 4%. >> shares in samsung rising after the electronic giant said second quarter profits rose to a two-year high thanks to stronger smartphone sells. he is head of research at northern trust capital markets with us. hi, neil. good to have you back with us. looks like a solid set of numbers. >> samsung it is for apple. let's face it quite simply, samsung's gains are coming at expense of apple.
>> getting the cost in check as well. seems to be issuing wog on that front. >> absolutely. seeing that with a substantial increase in guidance that has come out. they were expected to have a good quarter, but actually it's been better than expectations out there. it's a great execution in terms of performance of the company. not one word of brexit in sight. >> i see various reports coming in to this investment spend and they are benefitting here because they're managing to sell display business or screens, whatever it is to other makers. >> absolutely. this is the key differential for samsung itself. the intensity is required to create a affect for them. the displays which are a key feature for the samsung its. we'll see those in iphone eight.
i think there's still negotiations going on, but apple required that technology. they're behind the curve. >> the was a premium gap there. has that close. >> duane: >> the valuation gap has closed. i think that has room to run actually. primarily because the hype and expectation on the iphone 7 will actually prove to be short lived. i think the iphone 7 will disappoint substantively. >> they're not switching to android, are they. >> the iphone users themselves are showing the replacement cycle is lengthening. it's gone out past two years. that's a big piece of the market as well. think of where the growth is. it's not in the western market. it's in asia. if you don't have goes
disposable income to pay $700 for a phone. they don't have a lot of presence there. if you're a consumer and you want to watch videos on youtube, you don't care what the hand set is itself. >> they dropped into fifth place in terms of market share. it's around 10%. they're going in wrong direction. >> we go back a year, q 1 last year, china grew 81% for apple. it's not gone negative. meanwhile continuing to gain market sheer in a domestic market. apple doesn't have the great technology. it doesn't have the usp it had previously and it's a big issue. not just for apple, but for its supply chain. >> in terms of what we're seeing with samsung, is it just the high end users that are upgrading. it's part of the product cycle we're seeing, replacement cycle. >> that obviously is a threat.
we have to keep a close eye on. they have a full sweep of products for one thing and even at the higher end of s 7 the secnology and head to head technology of apple they beat. also, it may sound a little unclear, but actually if we think about it, many of the replacements are coming through from smashing phones or dropping in a bath. those kind of things. at least with the s 7 it's waterproof and smash proof. >> i haven't brought mine into the shower or bath yet. haven't tried that one. when it comes to apple its, do they have anything extraordinary that they're going to come out with? it seems there's nothing new from apple to surprise us, at least that we know of in the short term. >> i agree. they're going through screen fatigue. where do they go next. they haven't broken into the tv market as we know. so the next great hope allegedly is the vehicle, but of course that's a long way off and
probably will destroy their own margins and i think there are other companies better to take the advantage. there's a huge trend over the next five years. we shouldn't get caught up in crashes involving the auto pilot system. which is a human error, as opposed to technology itself. it will be huge the next five years and great companies exposed to that in the tech world, but one of those is not apple. >> long samsung, short apple. still got room to one. >> great to chat with you. head of global research at northern trust capital markets. the final verdict from a scathing report for uk involvement in iraq. uk invaded iraq before all peaceful options were exhausted and criticized the planning and
intelligence of tony blair's government. he responded by defending his actions by saying he did not have the option of delaying intervention. >> i only ask with humility that the british people accept that i took this decision because i believed it was the right thing to do based on the information that i had and the threats i perceived. and my duty as prime minster at that moment in time in 2003 was to do what i thought was right. however imperfect or indeed the process. >> it's so painful to watch the presenting of that report yesterday. chill cot himself given the loss of life and given what we know now. chilkot the decision to invade and occupy iraq in march 2003 was the most significant foreign
policy decision taken by a british government in modern types. it divided this house and set the governs the day against the majority of the british people as well as the weight against global opinion. the war is not a last resort. frankly it was an act of milltarial aggression launched on a false retext and has long been regarded as illegal by the overwhelming weight of international legal opinion. it led to the death of hundreds of thousands of people and displacement of millions of refugees. it devastated iraq's infrastructure and society. >> now from uk to u.s. politics, donald trump and the gop ramped up fund raising in june taking in $51 million. the trump campaign called june it's first major fund raising month after trailing hillary
clinton at the end of may. meanwhile clinton maintained a substantial lead in money raising, raising $68.5 million in june. >> meanwhile the justice department says it will follow the recommendations of the fbi and not file charges against hillary clinton over her private e-mail use while she was secretary of state. republicans have called on the fbi director to testify before congress about the investigation. nbc edward lawrence has more from washington. they can get him to testify in congress. it just feels symbolic at this stage. clinton is in the clear. >> as far as the investigation goes, clinton is in the clear. this closes the chapter for her. because of the strong language from the fbi director, not for republicans or donald trump himself, now the attorney general loretta lynch let with the fbi director as well as the agents and prosecutors who were involved who says she accepted
their unanimous decision not to charge hillary clinton with his handling information. she attacked donald trump for his casino business which went into bankruptcy. still the fbi director called her handling of classified information extremely careless. he says that she did not handle that information well and laid out a blistering attack on her judgment as secretary of state. donald trump piled on that saying this em controversy shows she doesn't have the judgment to be the president of the united states. donald trump continuing his attacks with the republicans. the fbi director will be in front of an oversight committee in front of congress today for a emergency hearing. next week attorney general loretta lynch will be in front of the same committee and same lawmakers answering those same questions. back to you julia. >> i saw a tweet the other day,
yesterday saying with regards to the trump funding why is the figure that's $20 million less than clinton and $56 million less than romney in 2012, why is that gasp worthy. aren't people looking at the figure and saying wow, well done or looking at the numbers and say compared to everybody else, that's a poor showing. >> i think the answer is both there. the republicans are saying well done. he started with basically nothing. $2 million or something like that to gip with. he was very far behind. he self funded his campaign up to this point so now he's gone out and trying to raise the money. $51 million on the republican side. they're saying wow, that's a great figure, but it does peale in comparison to hillary clinton. folks are bringing in money left and right on the democratic side. donald trump has some ground to make up, but at this point the republicans believe he's going be able to do that now that he's
starting to accept donations. >> edward, thank you vincent velasquez mu-- very much. edward lawrence, nbc news. >> that's a big anything your. >> it is. >> especially after the judge remark. >> will it's hard to raise money regardless. >> coming up on the show, rowen does says the dragon . keep your tweets coming through. we'll see you in just a second.
market and prices. the full cost now 43.81 a barrel. now, moving on to blow the cobwebs off this one. minutes from the federal reserve june meeting. members are divided on the economic outlook for the u.s. and when it will be ready for another rate hike. >> uncertainty dominated the feds last meeting. the committee thought it would be prudent to wait for the outcome of the brexit referendum before deciding whether or not to raise interest rates. the consensus was the vote could generate turbulence that could affect domestic performance. that is exactly what ended up happening. jobs were the other area of uncertainty. almost all participates judged that the surprisingly weak may report increased uncertainty.
many remarked they were reluctant to change their outlook materially based on one economic data release. most participates judged in the absence of financial shock there would have to be more economic growth, job gains and inflation to warrant an increase. however several participates expressed concern a delay in further increases would increase the risk to financial stability or would raise the potential for overshooting the committee's objecti objectives, but other people were uncertain. also interestingly several participates expressed concern that the committee's communications had not been fully effective in informing the public how incoming information affected the committee' view of the economic outlook, it's degree of confidence in the outlook, or the implications of project ri in market policy.
for cnbc business news. >> at the wealth consulting group joins us now from las vegas. the take away from that is the bias from the fed is to be extremely cautious with regard to future rate rises. >> absolutely. good afternoon, ladies. sorry for the football game yesterday, but i was rooting andy murray on. with the feds been saying their independent and job support may put a damper on the idea of raising rates soon. we'll get numbers this week. important report, but with the brexit event and with the election coming up, you know, rate hikes who knows if we're going to get one this year. >> don't mention the football. it creates a level of depression in the studio i can't cope with. what about payrolls? what are you expecting on friday and particularly what you said about the protection vote and implications going forward.
how important is this going to be for risk app site. >> it's going to be very important. we have mixed data. fairly good news after the disappointing may number. i'm not sure what to expect on friday, if it's positive, it's going to put a lot of pressure on the feds to raise rates. on the other hand if it's negative, you don't know what you're going to get out of the fed and what the outlook is going to be for a rate hike. with brexit it caused a lot of uncertainty on a slow global economy. the good news in the u.s. is we're looking for earnings recovery possibly in the second half of the year. that could support a rising stock market. >> that's great except that's not what the bond markets are telling us. you're from the wealth consulting group. what do you tell people you talk to, do you say look at the bond marks we're heading towards recession or look at the equities we're going to be bouncing. >> obviously there's a lot of
uncertainty out there and investors don't like that. the bond market is telling us to watch out for potential shot or the economy is growing slower than we think. all year long telling investors to be bracing for a lot of volatility volatility. we have been telling our clients that our long-term investors to brace for volatility and take advantage of dips to dollar cost average and get your money back into the market. >> and precisely where do i put that money? >> well, i think it should be diversified. right now part of our portfolio we manage follows momentum and we've been using consumer staples. we think there's momentum there. always recommend to be diversified. don't get stuck in any one type
of asset. some of to property funds you were discussing earlier. be diversified. make sure you have a plan with goals and stick to your plan. >> jimmy, before the brexit vote you were already telling us look, trim your nonu.s. exposure here. be where are you willing to sit in in europe or outside the u.s. where are you willing to hold risk? >> i think it's prudent to have an allocation for a u.s. investor to overseas investments. a lot of great investment opportunities overseas. you have to the cautious you're not trying to be too aggressive. it's okay if you misa part of a rally. >> where, jimmy? i understand you're saying hold some diversificatiodiversificat specifically outside of the u.s. are you actually holding money at this moment? >> we do hold assets diversified across the international
marketplace and we've actually added some exexposure to emerging market this is year, but diversified across the entire international marketplace and maybe trimming the exposure a little bit into the uk until we get a little more certainty about the brexit and how the process is going to go. >> keyword, diversification. great to have you on. >> now, football. it was heart break for wales as they crashed out of the european football championship. a nervous start on both sides. christian know ronaldo broke it in the second half with a powering header. sealed after ronaldo's drive was deflected. portugal will be facing france or germany in sunday's finals. tonight is a big one. france, germany. on the phone now is the ken
skates. good to have you with us, ken. first of all. >> great to be with you. >> is there some type of a secret model in terms of how you produce a bale type. >> i wish there was. we would certainly copy it and sell it around the world. bale has been the best performance. it's great to be the fairy tale team of the tournament. >> sure, the match last night, i mean many are saying that it's the pinnacle of welsh sport. does this mean the welsh may not consider football to be their number one sport. has it overtaken rug by at this stage? >> this is an ongoing debate. i think we have at least two
national sports, rugby and football. football attracts more than just the players. small country, just 3 million people. to have 1 million registered to play football is quite impressive. we have also seen significant growth among people playing sports. every confidence that football is not just at a great point, but also will go from strength to strength. this is a fantastic way to go into the world cup qualifies. we went into the tournament 26th in the world. it's all possible, probable that we'll be in the top ten of the planets best performing nations. that's something to be proud of. while there is disappointment at last night's results. people of wales excited by what will come and it's a young side as well. this is a young team. they played cohesively.
they're young enough to stay together for the world cup. we've now got high expectations. >> ken, congratulations because commiserations on last night. we couldn't see a bigger contrast between what happened with england and what happened with the welsh team. why do you think england played so poorly and is there something to learn from your team. >> yes, it does come down to that word team. our players played so well together. you need to look at some of the videos on youtube. they play as a team. they lift as a team. great respect for one another. there are no egos there. they were determined to win, not just for themselves, not just for families, but for the country. we also have calmer who is a fantastic treat. he of inspired them, motivated them to go out there day after day to win for wales and to show the world we might be a small
country, but we are becoming the giants of football. >> ken, very quickly, who is going to win. >> your guess is as good as mine. i'm tempted to say portugal because they beat us, but i'm not yet convinced they will. as they knocked us out, i'll be supporting them because the eventual winners. >> thanks ken. great to chat with you. >> who do you think is going to win? who would you like to see win. >> let's go with portugal. >> i was thinking germany france. >> oh, france. >> u.s. features quick are we going to do it, no, we don't have time. there you go guys. >> we'll see you tomorrow, same time, same place for more "street signs." have a lovely day.