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tv   Street Signs  CNBC  September 16, 2016 4:00am-5:01am EDT

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hi, everybody. good morning. you're watching "street signs" and i'm louisa bojesen. >> and i'm carolin roth. >> miss selling mortgage securities. >> shares in the german lender stumping to the bottom of the stoxx 600 leading to a wider banking sector. >> big risks are more so now than before the crisis. larry summers warn that regulators have made financials less safe.
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>> we need to recognize that those regulations have in a sense been working in an opposite direction to the ones that promote capital. they're opening their doors in central london as diehards wait to get the iphone 7. shares are poised more so than in five years. welcome. you're watching "street signs." it's friday. you know what, louisa, i was woken up by thunderstorms at 4:00 a.m. in the morning. >> i slept right through it. >> you did? so happy for you. >> it's so nasty out there and people are waiting for the iphone. >> it is nasty out there. stocks out there, more headache. >> a lot more. deutsche bank, an interesting one. we'll be looking at that in a second. we'll be talking about the banks throughout the show as well. by all means get involved aet
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the top of the hour with any of our guests. we're on twitter @carolincnbc and @louisacnbc. >> we're currently lower by 0.3 of a percentage point. when it comes to our european market, you're seeing the same except for the danish markets and the obx. by and large it's just off half a percent when it comes to the ftse. the banks, carolin, just glancing at what's taking place, we've got a couple of bigger stories making the rounds. the people in the u.s. looking twice at the financials with the wells fargo unraveling and here in europe, of course, it's really gone to deutsche bank today. >> and still the financial crisis, we're eight years out
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and these banks are still dealing with it. as mentioned the shares of deutsche bank are falling after the german lender was asked to pay $14 billion to the u.s. department of justice to settle an investigation into mortgage securities. in a statement the banks said they had no intent to settle, quote, anywhere near the citing quoted. they have only $4 billion ear marked for regulatory enforcement and that still includes some of the russian transgressions. if we see a huge fund there, it will become really problematic for deutsche bank. also remember $2 billion or $3 billion is what deutsche bank cited they could probably cough up. if it's more than that, $7.5 billion sort of the cut-off after which deutsche bank would have to go to the market and probably raise capital. that's when it falls below 7% to
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10% and that's when concerns go higher. at the same time their margins are getting squeezed because of the rate environmental we're in as well. they're also dealing with that very delicate balancinging at too. and when you look at the share price, too, they're trading at a quarter book value. now shares are worth one-tenth what they were in 2011. they posted an almost $7 billion loss. the imf is calling it the riskiest globally risky institution. >> maybe citibank, they can afford a $12 billion fine, maybe jpmorgan, they can afford a $14 billion fine. but $19 billion, come on. >> well, it's also setting an example, right? the regulators have to set an example and say this isn't acceptable. it's unfortunate for deutsche bank because it's in the position it's in. there's the eventual tie-up and the rumors going around, pouring
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fuel on the fire saying the sector doesn't need to consolidate and people taking it to mean deutsche bank is involved in there somewhere. >> i want to bring in mark at this point. >> as you just said trading is there. the fact that europe tends to be overbanked at this point and those negative interest rates so something's got to break. one of the things we're looking for is the way japan -- will they move toward it. that might make banks a bit more attractive. >> still we're expecting more from european banks because of the steepening of the curve. that's got to be a big positive
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for the u.s. banks once that actually happens. >> yeah. you can see that in the market, right? you can see the way. and when the curve steepens, the hedge funds have already started to get into a lot of these u.s. financials. but, of course, this goes back all the way to the financial crisis where the u.s. really worked hard to clean up the banking system and has benefitted along the way. >> okay, mark. we're going to continue that discussion in a little while. we're going to talk about some of your top calls. you like u.s. equities still. you're still over grade. we'll talk about those and emerging markets. most of our guests like emerging markets. >> including russia. european markets have hit back. this is according to bloomberg which says that countries led by germany and italy, they told the committee on banking supervision that it needs to slow down and dilute its proposed changes. some officials reportedly said
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they would refuse to adopt the current set of proposals thereby threatening and underrating the regulators' authority. larry summers warns that a too big to fail outcome still exists. speaking to cnbc in a first-on interview on the anniversary of the lehman bankruptcy -- it has been eight years -- the former u.s. treasury secretary of state had mo to say. >> i don't think one can simply be complaisant and assume that we've now created some kind of system where because we measure less leverage in a regulatory context we can assume the institutions are far safer. summers also said that new rules were hurting the profitability in the financial sector. >> i think some parts of the
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regulatory effort have operated to remove many sources of income for banks and that has had the effect that when you have a reduced future income flow, your safety declines. >> now i, that i've called for strukt cal changes as the structure of fake accounts holds. they hold a resolution proposed the banks split the roles of chairman and chief executive and beef up oversight management. shares have continued to fall in the wake of the revelations. >> now, speaking to cnbc, outspoken wall street critic and massachusetts senator elizabeth warren criticized wells fargo's senior management. >> it tells you something is wrong with wall street when someone who can be the person responsible, the one in charge,
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have a whole lot of fraud take place on their watch whether they actively encouraged it or passively encouraged it and then they get to stuff their pockets with money and walk out the door while everybody else gets fired? that's just fundamentally wrong. >> i want to bring you some news. crude hitting a five-year high. exports the highest. that's been reported by reuters. india now topping china as the number one iran crude buyer with record vacuum in exports, rising 48% from july to 60030,000 barrels per day. once again, that doesn't bode well for that algerian meeting, does it? >> no, no. i although, i wonder fit's all talk, no action up to this meeting. nobody's interesting in them right now. >> no. >> yes. >> let's take a quick look at the forex markets.
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to be honest, there hasn't been a lot of movement. the euro/dollar was pretty much unchanged. dollar/yen pulling back from the levels we saw earlier this week. we're anxiously awaiting what they're going to do. keep in mind we're still seeing steepening of the yield kufr and that was 2 1/2. the ten-year treasury yield at 1.67%. let's get back to mark haefele. mark, now that volatility is back in the market are you still come pham rt with your overweight u.s. equities or do you want to rethink that? >> it's overweight concerning sovereign bonds. we don't think the bond market run is going to continue. we think it's going to continue but in part it's because of that curved steepening. relative to the bond the equities look good. we like the u.s. because the
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u.s. consumer despite the retail sales number we still had is still going strong and this is the fed's game to move. prudence means not headache hiking rates. if they stay on top of that game and they let inflation and the growth continue, wi think the u.s. equities can still go higher. >> i want to come back to the steepening of the yield curve. it's not necessarily because we're seeing better growth numbers. retail sales were pretty poor. the only thing that's going very well, that's the labor market. isn't that about the ineffective monetary policy and because of that shouldn't we be worried about the steepening? >> i think this is a fantastic point. i think it's one of the reasons we had a volatility fall and the markets do so well after the summer. a testify brexit, mark carney came out and said, look, the central playbook still works. we're still able to use quantitative methods and it
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flattened rates across the boards including in the united states. now we're seeing other things like japan is looking to steepen the yield curve. this is clearly a global play and what happens in one market will affect the other. so you're right that this is a global play theory. >> what do you make of the corporate bond buying that we're also increasingly seeing more via the central banks. we heard noises that others may be looking at similar as well. do you think it's going to work? speaking to a guest yesterday, they said it has the potential to work but the potential to backfire. >> well, everything that the central banks are doing has the potential to backfire and as they diverge in their policies, we think it's more important that you diversify your portfolio because we don't know which things backfire. it's pretty clear. if you look at the spreads in europe the way they come down, that is having an impact and that's lowering borrowing costs from around the world and that
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should be stimulative of growth and that should continue for some time. >> and we're going to see further negative rates as well. >> that's a little unclear. we saw kuroda say these actual rates are having an impact shorter term on japanese bank earnings and that was also a signal that, hairks maybe they're starting to get it. also mark carney really kind of helped the uk market when he said, look, we get it, we're not going to go to negative rates unless we really have to. >> what about the e.m.? is it a bubble? is it something that could potentially blow up? we're seeing all these inflows into emerging market bonds again. once the fed finally hikes again, september through december of next year, it's bound to blow up, no? >> the fed situation, think we can both agree, is very important. and certainly if the fed hikes too much and the dollar was to really appreciate, that would be
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negative for e.m. but there's a lot of other factors. first of all, e.m. in the past few years has been taken out of shot. the second thing is it's very dependent on commodity price which has also been taken out of shot. we think oil will be higher in 12 month, maybe the same level in six months, and that's going to help e.m. and e.m. earnings start to recover. what we like in e.m. is we think the earnings have bottomed and will start to recover. >> we're going to talk a lot more e.m. particularly russian coming up in the show. you're staying with us, mark. get your questions to mark here. their e-mail address is >> you can tweet us directly. >> we're going for a quick break. as european leaders gather,
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donald tusk says it's time to face the reality of a pro-brexit world. >> the discussion i can start here today with a kind of blissful conviction that nothing is wrong. okay. yep. stirred it... mm-hmm. drowned it again... mm-hmm. and now just feel if it's cold. yeah. cool. [camera shutter clicks] [whistling a tune] smokey just gave me a bear hug. i know. i already posted it. everyone thought i was crazy to open a hotel here. everyone said it's so hard to be a musician, but i can't imagine doing anything else. now that the train makes it easier to get here, the neighborhood is really changing. i'm always hopping on the train, running all over portland.
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welcome back to the show. asian stocks edging up after u.s. economic data came in below expectati expectations. weak factory sales have reduced the chances of the fed rate hike next week. meanwhile japan's prime minister says he's working with the boj, bank of japan, to beat inflation, but that's up to the central bank to decide on territory policy.
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sri joins us. what do you think? >> yeah, don't hold your breath on this one. i think that there are a number of options that the boj can perceive. having said all of that, they are running out of road. there is a big conversation about yield curve, engineering, some kind of policy to give the beleaguered japanese banks some sort of income. that is gaining a little bit of traction though. it's really blowing hot and cold right now. there's also bound to be a conversation. i don't think it's going materialize at this particular meeting. then, of course, there's no negligible risk that boj can sit in the hands, do nothing, and put the ball of responsibility in the court of them and crack on with it. elsewhere, the broad market sentiment right now is positive. the markets are out of action. close to holiday, so usually caveat supply. low conviction, low energy, and a degree of caution ahead of the
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boj. we send it back to you. >> sri, thank you very much. have a lovely weekend. we'll chat next week. britain's prime minister theresa may is notably absent from today's eu summit. leaders have gathered in the wake of the uk brexit vote and what the european commission has called, quote, an existential crisis. let's take it out to nancy hulgrave. >> that's exactly right. donald tusk picked up where he left off saying we must acknowledge the message that brexit has sent. he went as far to say it's not just a british prosch. there are problems in essentially countries, we have to address these issues on top of ongoing concerns over security and, of course, the migrant crisis. the migrant crisis continues to
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divide many of the member states facing political members from the far right in their own countries. we heard the prime minister talking about failing and now criticism within the eu has been directed at hungary. in fact, luxembourg's foreign ministry says they should be kicked out of the eu. i had a chance to speak to luxembourg's prime minister and here's what he had to say. >> we are family. we are one family. >> that was the mention from xavier bettel. that's often hard to achieve. he's also come out and said he admires donald trump's and some of donald trump's policies would be right for europe that.
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has really ruffled their feathers. i had a chance to speak to sweden's prime minister and ask him whether or not that praise was concerning. here's what he had to say. >> what they have done in ukraine, they have -- crimea with the actions in there and it worries me. they should safeguard the european order. >> coming up with the security is one of the big topics for discuss here as the eu looks toward the possibility of perhaps a joint military headquarters, joint investment funds.
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not all parties are convinced on that one. so, guys, the leaders coming from brussels, they are keen to build unity. in fact, president tusk saying we must not waste this crisis. it's an opportunity to make the eu bigger and better than ever before, that getting all 27 members on board is a different story. back to you. >> all right, nancy. thanks so much for that. >> glancing at a little bit of news passing our way, shares falling to a new record low and being suspended on the back of that move and this, of course, is coming just days after they appoint this new ceo. we heard the official announcement yesterday, marco morelli. again, they held their shares off on that hold. >> don't think necessarily there's any major news flow, i think it's probably in line with the rest of the banking sector which is really banking on the deutsche news. >> i totally agree. it's amplified, right? >> a nice penny stock maybe.
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anyway, let's move on. they have cement a letter urging her to make a final push to save the transatlantic party. many countries did not sign the letter this as those across have threatened. meanwhile u.s. is looking to seal a deal with canada in the next final months. let's get final thoughts with mark haefele. does europe have a future right now? >> we all hope we walk out of here today and have a future end to the weekend and europe as well. how bright it is, how much they're in control of their own destiny is up for grabs aet this point. you're right. we're going to sit down today and war game some different scenarios, particularly around how europe stays together and grows and how this refugee crisis can be a hindrance or help to europe going forward. >> what do you think brexit
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does? >> well, one thing about the -- about the uk is they have a tremendous navy, and it could help europe to control this refugee crisis and stay on top of it. so it's a difficulty. right now it hasn't had such an impact, but certainly it will be felt as the articles are triggered. >> and that's the difference between the uk's power versus switzerland's power. i disagree with your notes. i don't think you can compare them. anyway, we'll have to leave that. mark, thank you very much. mark haferly, ceo of wealth management. the bang of russian is expecting to cut its banking rate by 50 points. they maintain the bank will continue its monetary policy adding last week that it could hinder a slowdown in inflation. the senior associate is with us.
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good morning. could they surprise? i mean it seems everybody is anticipating this 50-basis-point cause, but some are also saying there are lots of arguments for them to stay on hold especially given the ruble strength. >> as you mentioned whether or not they cut the rate by half a point today is not going to affect or change the overall policy of the central bank which is to maintain high interest rates and to focus on it. certainly nobody wants to rock the boat two days before the election. >> no, of course not. how much can we read into that? >> you know, it's interesting. we're very used to think about russia in terms of vladimir
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tyut tyutin. as margaret thatcher said f you want something done, ask a woman. now it rests on two women. she's a very safe pair of hands and she is very respected but there's only so much she can do because just as electoral fraud is the tip of the iceberg when it comes to the political problems, inflation is only the tip of the problem when it comes to rush's deep rooted economic concerns. >> you mentioned the parliamentary vote. last time we saw it in 2011 we saw major protests. i guess the russians are now keen to avoid that. how much of a rif success there around this parliamentary vote? >> you're absolutely right 2067811, people are still having nightmares in the correct limb what happened then with thousands of people on the street. but they're doing everything possible to keep a lid on
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things. they're using a combination of carrots and sticks and actually they're trying to not use the sticks. what they're trying to do is make sure first of all appoint ing someone to replace her. she said i will resign if there is any actual tampering with the vote. so this is giving confidence to e.m. some of the key figures associated with some of the unpopular politic os testify past have been quietly taken out. a very unpopular customs head has been shelved after a corruption probe. so they're hoping people's energies are going to be confused. most importantly they're moving the election forward. >> speaking of elections, if trump is elected president -- at this point it's not entirely unlikely -- how dramatically will that change russia's narrative?
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>> i think many people in russia's government are hoping to save the situation and a trump victory would offer exactly the out they need. >> vadim, thanks. >> we need to take a quick break, head to world markets live. it's our blochlgt lots more on there. you can find carolin and myself. @carolincnbc or @louisabojesen. we'll see you in a minute. before a bch of dreamers looked up to the sky and said, "why not?" for actual rocket scientists. d the launch crew met for a momentf reflection.
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welcome. you're watching "street signs." i'm carolyn rocket >> and hi, everybody. i'm louisa bojesen.
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>> shares slumping to the bottom of the stoxx f 00 leading to a selloff of the wider banking sector. >> crude oil extending its office. >> and apple opens its doors in central london as diehards there are waiting to get the latest iphone 7. shares poised for their best week in five years. good morning, everyone. it's friday. let's take a quick peak at the futures. the s&p 500 seen down by 7.5 points. dow jones could lower by roughly 14 points and nasdaq. the dow up by 1% breaking a two-day losing streak. apple was one of the big gainers, up 12% this week on pace for the best week since
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2011. and the nasdaq also higher by 1.5% yesterday, within a whisker of its all-time high. we did get the weak data, and that once again supported the view that there won't be a fed hike at least in september. it's also tripping witching today, so do keep an eye on all that volatility toward the close. here in europe, the za tra dax. it seems like we're ending this week on a more bearish note. i want to show you what the sectors are doing this morning. they're down sided by banks. once again this all comes back to the deutsche news with the doj asking them for $140 billion. it's probably not going to be that amount. deutsche is hoping anything closer to $2 billion or $3 billion. once again that highlights the risk if you're still invested in
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banking stocks. oil and gas by 1% or 2%. in terms of the green sector, health care and telecom, really the defensive stocks. in terms of the bond market, we saw the steepest yield curve in the u.s. in 2 1/2 years. we're seeing the u.s. yield ten year at 1.67%. they did fall a little bit off at 0.87% and the german yield still barely in positive territory. buying in bonds today. that's quite a nice change from the route we've seen in the last two weeks. >> nearly three months on from brexit, paris is trying to rival london as a new capital of finte fintech. julia joins us with a french junior minister for digital technology and innovation. hi, julia. >> hi, louisa. thank you so much for joining us
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this morning on cnbc. let's cut to the chachlts is this france rolling out the red, white, and blue carpet for startups for fintech here in london? >> i think we don't need to. i think the country has become attractive enough to have to send buss in to tell the startups to come and see what's actually happening in france. the startup scene is booming. the amount of investment from it is on the rise. what i'm saying is come and have a real look at the reality of the innovation ecosystem in france. >> i want to dig into more details about just what type of details you've built in france. let's face it. you're not known for it. but i think at this moment, it's not a time to be coy. there is a lot of uncertainty
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about brexit. the germans have already said, look, we're interested. the germans have said it. the irish have said, look, hey, come here. how have you differentiated yourself in france? >> it's a progressive silent change that has been undergoing throughout the society. it's almost a cull montreal shift. it's being taken over by the young people because they want to be in power. they want to shake up things. and they have a right to do so. what we actually did was you're the ones to decide look at the startups. we told the authorities. we told the big companies, we told the mayors, you know, work together with the startups because they're the economy of the future. they're the ones that will create jobs. and this has really changed the way we produce work. >> i mean two-thirds of fintech firms actually operate in london
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and they don't come because salaries are cheap because it's easier and cheap to live here. they come here because of the flexibility, because it's a financial sector and funding. >> yes. >> and you're also not known for having access to venture capi l capitalists in the way that london or even germany does. is that changing, too, or is that still a limitation? >> no. the funding market is really opening. there's more competition, which i believe is very good. we're attracting foreign vcs. and not only in paris, they're really spotting the best startups all over the country. this is thanks to one program that we launched. it's called the french tech. it's not just another governmental plan. it's network. it's a network of entrepreneurs who want to get together. think global. and so we really put into place
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various mechanisms to help them grow and help them grow and create jobs in frns and europe. >> what incentives are you offering startups wlrks it's tax breaks? what is it? >> one important tool is tax credit on it. this makes france attractive to any company that wants to innovate. then we've also put tax incentives for employees when it comes to sharing the value create, which is more difficult and telling for startup than for a big company. we're about to create -- i really hope this is going to work out -- a status for entrepreneurs reinvesting their money in the startup ecosystem. it is going to be a very strong tax incentive as well. >> obviously the issue for startups in any business in the uk is the political situation here, but obviously political stability important, too, in france and you do have a
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presidential election coming up. can i ask you as a member of the government do, you think it's time for president francois hollande to step back and let someone else run for president. i look at some of the popularity stats an wonder if him going ahead with this is handing it to the center right? >> we'll see what the results of the elections are, but i'm convinced we need political stability and the president has shown how he can handle the international situation. we're in a country that faced massive terror attacks for the first time ever to that scale. this really was and still is extremely hard for the french people, and we still have huge security challenges ahead. and in that period, together with the necessity to put down the deficits, and we now have a good balance tochl have an economy that creates jobs, we
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had to face employment levels so the contract was extremely difficult and we went through it. when we look at the economic figures, they're all better. i think when this -- this is a track torl profound change and we do need stability. >> a crucial part of that in tackling the labor market was former economy minister to mack kron. are you concerned that if he steps up here and goes for a presidential bid, actually he splits the vote, the socialist vote? >> well, that's the risk, clearly. he did things for the economy and i think putting more flexibility in the labor market is going to be fruitful for everyone because now the decisions will be taken between the employers and the pleas of the company. we'll be refleekting the needs of the enterprise.
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but the decision of him to be a candidate in the elections might have a very harmful effect on the capacity to make tan that stable environmental because the number one risk to my political family is to have a second term so the lead over the extremist populist national front will be with us in the run and i believe that would be -- i believe that would, you know, really threaten the future of the country, and in the aftermath of the brexit, really there's so much uncertainty. i'm in london. we talk with the people. don't know what's going to happ happen. we don't need that. >> a bold situation. thank you very much.
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axelle lemaire speaking to us there. >> appreciate. meanwhile iphone 7 has developed and released markets. today apple share prices have surged by 12%, weak today. let's get out to ar jen co-pull of cnbc who was look at all the excite meant. was there any skrexcitement. >> well, carolin, when we got here, there was some excitement but it was down. now there are huge lines, everybody coming for they appointments to pick up their iphone 7 or 7 plus in whatever color. we heard globely they've sold out of the i-7 plus and jet black out of stock. investors seeing this as a positive sign when before the
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apple iphone 7 there was a concern that actually we may see a decline from sales. many nasts have revised their forecast. so overall there's a bullish sentiment toward it and apple's share price clearly reflect thad this week. >> ar jen, thank you so much for that. it goes on sale. head online to take a read. now samsung has announced they'll replace or refund a million galaxy phones after getting reports of batteries overheating. they've recalled 2.5 billion overwide. the new replacement phones, that e're due to be available in most u.s. retail locations no later than the 21st of september. hillary clinton was back on the campaign trail on thursday speaking in greensboro, north carolina, at rally where she sought to highlight her plans to help working-class americans.
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clinton struck a more positive tone in her return saying, quote, i want to give americans something to vote for, not just against. the democratic nominee also emphasized that her health was not going to be an issue going forward. >> people 'accuse me of all kinds of things. you probably have seen that. but nobody ever accuses me of quitting. and i will never give up. i'll nerve walk away, no matter how tough the going gets. >> meantime republican presidential nominee donald trump has revealed his plan to cut $4.4 trillion in taxes in a detailed economic plan. and he promised the penny plan by shrinking government prapgs with the exception of defense by 1% each year. now, trump also refused to
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acknowledge that president obama was born in the united states. in an interview with the "washington post" trump said, at the right time. i just don't want toance answe yet, he said. later there was a statement released assuring the public that the nominee does, in fact, believe that the president was born in hawaii. i can't believe we're still talking about this. >> i know. >> nbc's tracie potts is in washington, d.c. i just said, tracie, i can't believe we're still talking about this. >> yeah, but here we go again. it was five years ago that trump pressed for that birth certificate and this morning the campaign said that's why he should take credit for this. interestingly while his campaign released a statement saying that trump does not believe that president obama was born outside the united states. he's not a birther. trump when asked in this interview said i'll address that at the appropriate time but right now i don't want to talk
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about it yet. so the question remains, his campaign says he's not a birther. trump says he won'tance the question. back to you. >> i'm sure we all saw jimmy fallon and the hair. >> yes. >> let's get to it. he made an appearance on "the tonight show" perhaps attempting to put all those rumors about his hair to rest. there you go. it looks like it's real. a lot of people said it's a toupee. but, hey. i still don't know. >> i do think it's his hair. >> there are many important things to talk about. hey. our own jeff and steve, they had a hairy moment as well. >> i want to thank you for watching. up next -- >> what do you think?
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what do you think? >> i kind of like it. >> i think it works. >> i promise you i won't do that to your hair. >> i know you spent a lot of time on your hair this morning. i won't do it to your hair. >> this is kind of how we look before we go to air, right? then we look like this for three seconds and then we go back to looking like that. >> no. it makes jeff look ten years younger, doesn't it? >> it does. >> we shouldn't say that. he's probably still here. >> he's still here. >> he looks younger. still. going up on the show, there's more on high lighting the hinckley agreement. more on that after this short break. wait, is that your car? uh oh! yeah, i saw that coming. that will throw you off track. you're looking at around ten grand in fines, legal fees, and increased insurance rates. let's try this again. smart move.
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because buzzed driving is drunk driving.
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hi, everyone. you're still watching street signs. quoting a japanese cabinet official saying that bank of
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japan's kuroda has said the uncertainty over the september fed rate decision is affecting the global market moves. there's no market decision on this. they say 20 and 30-year reveals, that rise is reflecting various market expectations over the next few weeks. they had this comprehensive review in place for next week during the bank of japan's meeting. >> and we're expecting a further ride into negative rates. >> yes, exactly. >> we'll see whether it makes any difference. fiat chrysler is recalling vehicles due to safety issues that has caused three deaths. despite the setback shares in both its u.s. and italian issue ended the session higher boosted by a stronger european car sales
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numbers. cnbc's phil lebeau has all the details on the defect. >> the u.s. auto making is recalling 1.9 million vehicles worldwide, 1.4 million of them here in the united states to resolve a condition that may prevent the airbags and sweats from working during certain crashes. the company says it is aware of three fatalities and five injuries related to this defect. the vehicles impacted, they're made mainly between 2010 and 2014. we're talking about the chrysler sebring, chrysler 200, dodge caliber, dodge avenger, as well as the jeep patriot and cam pass. and, again, fiat chrysler is recalled 1.9 million vehicles. those are the models that they're recalling. about 500,000 of those were sold outside the united states. we're talking in canada, mexico primarily, a few down in latin america. but, again, this is a huge recall by fiat chrysler due to a
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problem with the airbags and seatbelts not working during certain collisions. phil lebeau, cnbc business news, chicago. now, the uk government has approved the building of an 18 billion pound nuclear power plant at hinckley point. it's a joint venture with edf and the chinese government. meanwhile general electric has won a nearly $2 billion order to supply the new venture and that's according to roy turs. the first deputy ceo and he's with us in the studio. good morning. >> good morning. >> being rush's corp rachlgts before we talk about russia, what you do make of that? >> first about hinckley, it's good news. it's not just a that, the
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british government is ready to support. as you know nuclear is blamed to the very high cost and it can create not a good image, but in general in use it's very important. first of all, russia is not booming but we global for it. it's very good. there are approximately 58% of our revenue is export. we feel ourselves very well, and our net profit increased.
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>> shufrmt let's go back to the hinckley project. it is this joint venture. who you do think the winner of the deal ultimately will be? >> it's a very complicated question because it depends how they structure it. it's not just in process of financing but in process of construction. they're supplying to the united kingdom. >> kirirr, ykirill, you mention weak the russia economy is. to what extent did you have to cut your investments? >> we have a new plant. every year we commission something year. for example we have commissioned the first in the world nuclear reactor generation c-plus and it has the capacity of 1,200
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megawatt. definitely gives us the opportunity to produce more electricity and in the last three years we increased every year the production of electricity it has increased. for a rear here, for us we plan to produce approximately 200 ton kilowatt hours. >> a record for you. elsewhere in the world we're seeing the construction of new nuclear power plants. we're seeing a lot of activity in china who had just six nuclear reacteders and now it's 30. it's only 5 1/2 years of fukushima. are we not forgetting about the security risks? >> first of all to the first part of the country, yes, we are number one in nuclear construction. 36 outside of russia and eight in the territory of russia. about china and new construction, there are requirements that are now
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important and obliged for each and everyone there, and i do not see any new nuclear power plant constructed in the world, not in accordance with the standard and basis of safety. there are special measures of security. that's why i have no special doubts that this growing nuclear industry can have some negative effect. >> now that you are present globally, i note, though, in south africa, they have a very big nuclear tender outstand. there have been meetings between president putin and zuma. russia had been considered the leading candidate and now the head of south africa's nuclear agency is saying that russia's not the front-runner, it never was, and that that by and large is down to that they don't want this build, own, and operate model. they want to learn at the same time. they want to mack sure that manufacturing and maintenance isn't kept with one company,
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mainly yours. >> first of all, they didn't allow the official process of tender. that's why it's not known what kind of requirements they will ask for, but for each and every kun trirk it's not just a source of electricity. first of all it's a huge socioeconomic impulse for the growth of the whole economy if the construction is duly organized. it means if each has arised to participate and have a significant pachlkt for example in our projects generally, we have around 60% to 40%. 60% goes to russia, 40% is a local share. but if such a country like south aftrica can launch a huge program, it can increase the participation and it's definitely a company ready and able to provide the support. >> thank you very much. the first deputy ceo at rosatom.
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the big story in the markets in europe is the banking sector. it's tanking today. let's have a look at the euro stocks off by 1.8%. as we mentioned deutsche banks are falling after they had been asked to pay $14 billion to the department of justice to settle on the investigation of the selling of it. deutsche bank says they have been talking to the authorities but they're not willing to pay an amount close to 14 billion. i think it's going to be closer to 2 to 3. and european markets are also falling today. led lower by the banks, u.s. futures are looking like this. it's scary when the lights go out. people get anxious and my office gets flooded with calls. so many things can go wrong. it's my worst nightmare. every second that power is out, my city's at risk.
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good morning. deutsche bank under pressure. the u.s. department of justice wants them to pay $14 billion, we'll tell you why. sales from apple. if you went to sleep early you missed the new york jets beating buffalo bills live in football. twitter live streaming the game first time ever. the highlights coming up. it's friday, september 16th, 2016. "worldwide exchange" begins right now. ♪ you are the one thing in my


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