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tv   Worldwide Exchange  CNBC  September 21, 2016 5:00am-6:01am EDT

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. good morning. breaking overnight, the bank of japan announces a major policy overall. the details and global reaction coming up. it's decision day at the fed. we'll talk expectations coming up. and mylan's ceo heads to capitol hill ready to face a grilling over the epipen. it's wednesday, september 21, 2016. "worldwide exchange" begins right now. ♪ good morning. welcome to "worldwide exchange"
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on cnbc. i'm sara eisen. >> do i not get a welcome back? >> welcome back from washington, a whole 24 hours. >> i know. how was it? >> it was good fun, thank you. we'll discuss that story coming up. wells fargo, and another hearing to come today. busy time down in washington and the fed meeting. let's get to equity features at this hour. yesterday we did have a positive close for all three indices, but fractional. just higher about 0.1%. we lost steam during the day. it's been treading water this week ahead of the crucial fed meeting, the bank of japan meeting we'll get to in a moment. here are the u.s. futures, higher by 70 points for the dow. a half percent positive open for u.s. markets. >> after we lost the gains again yesterday, the dow closing up ten points. some trepidation ahead of the big federal reserve meeting, but there is buying this morning. the top market story of the
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morning is the bank of japan rebooting its monetary policy. the boj did not cut rates further into negative territory or expand asset purchases as many economists expected. instead it abandoned its base money target and introduced a ten-year interest rate target. the goal is to stoke inflation fast. the boj will buy long-term government bonds to try to keep that ten-year rate targeted around 0%. following the announcement, the ten-year yield did rise above zero percent for the first time since march. the japanese yen did weaken. a lot of people say that was on positioning, because there was so much skepticism around what the people would do and if it would work. the nikkei closed up almost 2%. that's the japanese stock market. we are in even unffurther unchartered territories.
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they're showing they have ammunition left. but is the credibility there to back it up? >> absolutely right. we have to applaud mr. kuroda today. in the lgong-term, as we say in the uk, proof is in the pudding. >> we say that here as well. >> pudding is different here. we have pudding. >> but they mean different things. as for that, as to whether it delivers performance in the economy, paul donovan for ubs writing that it does seem difficult to expect the japanese consumer to suddenly declare hurrah, the maturity level on the bank of japan bond holdings has been lifted, i will go out and buy that car i wanted. this is finessing things around the edges. will it lead to more than one day's gain? in the nikkei, maybe a week's gain, will it lead to big gains
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for the consumer performance for inflation and for the economy? >> will they be able to keep their zero percent target on the ten-year? >> that will require an already active bank of japan coming in, intervening, buying any bonds that go above that level for any yields. we'll see if it works. that's where the credibility question comes down to. it's just fascinating that eight years since the financial crisis, central bankers are all in and going in further. doubling down. >> doubling down, tripling down, quadrupling down to get inflation up. >> let's look at what the rest of asia is doing. the nikkei, the best performer. that pulled up the rest of the region which is up. hong kong, 0.6%. european equities enjoyed a bounce on this risk-on sentiment that has come from the east. 1% gains for germany and france. european banks doing very well.
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some hope this slight change in negative interest rate commitment might exist in the european central bankers minds as well. let's also have a look at broader markets. oil prices, which have stopped the rot recently. we gained about a third of 1% yesterday. we're up more meaningfully today, close to $45. >> you saw that api number report. the inventory data surprise draw in apis. we'll get the big government report from the eia today on the u.s. inventories number. 1% move there. as for the u.s. dollar, this is the key on this double close of central banking day that middle one. dollar/yen, right now slight buying of dollar and selling of jen. the japanese central bank would probably like to see that move a bit higher with all this ammunition they just brought out. we'll see if we get a move
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higher in u.s. treasury yields, the dollar will follow that. the euro at 1.12, and the pound at 1.30 again. >> the august easing worked, so they're starting to see the effects of that. it was warranted and more easing could be on the cards. >> ten-year treasury yield hovers around 168 right now. still below 170. gold quickly, let's just look on the back of the stronger u.s. dollar. 13.23 an ounce. everything could change. fed decision, 2:00 p.m. bank of japan surprising markets this morning with their decision to keep short-term rates unchanged. but all sorts of changes further out on the curve. let's get a view from asia. akiko fujita joins us from tokyo with all the details.
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>> we saw the markets rally on the initial reports of this decision. the introduction of that yield curve control. but a closer look at this decision as well, the comprehensive assessment shows this is a tweaking of an existing policy. the boj looking to find a little more flexibility, looking to buy more time to reach that 2% inflation target. investors were looking for a deeper cut into negative territory with the rates. the boj in some way admitting defeat in this decision saying they simply weren't able to reach that target in the existing policies they had. governor kuroda said that wasn't the case. he said the new shift towards the yield curve control was a way to bolster the foundation that had been laid down by existing policies. take a listen. >> translator: the new framework
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will be more flexible to prices and financial conditions compared to the original methods of controlling the growth of monetary base and outstanding government bonds. >> that curve control means the boj is abandoning its monetary base looking to buy up longer term government bonds to keep the ten-year yields low. also the boj committing to overshoot inflation, trying to expand monetary base until core cpi reaches that 2% target and stays above that for a stable manner. this is the boj trying to increase that deflationary sentiment which governor kuroda said was much stronger than anticipated. we did see the yen/dollar weaken at 102, but i don't think the markets are convinced it will stay that way with so many external factors weighing on it. >> as we go back to the textbooks and figure out what yield control means from a
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monetary policy, will it work? what are the economists over there saying? >> i think that's a big question. the poj boj is saying they want control the curve, but can they control it on the longer end? can it go above the rate they're looking for? this is new territory for the boj. a lot of economists are septemb skeptical that 2% will be reached at all. >> akiko, thank you very much. in the u.s., the fed takes center stage today. policy decision due at 2:00 p.m. eastern time followed by a press conference, news conference from janet yellen a half hour later. you can catch all of it playing out right here on cnbc. also on the agenda today, a few notable earnings reports. we'll hear from carmax and general mills before the opening bell, and bed bath & beyond after the clothe.
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> close. fedex shares rising yesterday. landon downedy hdowdy has the d. >> fedex posting first quarter earnings of $2.90 a share. that's nearly 10 cents higher than analysts forecast on revenue of $14.66 billion. the shipping giant considered an indicator of economic decisions citing strong revenue in its express, ground and freight business. fedex offering an upbeat assessment for the holidays saying they will benefit from e-commerce transactions and ceo fred smith addressed the one blip on the call. >> the integration of tnt express, which includes more than 200 countries, is proceeding smoothly and on schedule.
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the level of team members engagement is outstanding and very much appreciated. >> shares of fedex gaining about 3% in trading. back over to you. >> great stuff. still to come on "worldwide exchange," drug price outrage. mylan's ceo heads to capitol hill today ready to face a grilling over the epipen. we'll tell you what she's expected to say later. and then later this morning, don't miss a first on cnbc interview with europe's antitrust cop. the commissioner for competition, who just filed that $14.5 billion back tax case against apple. i'll talk to margrethe vestager about it. i'm vern, the orange money retirement rabbit from voya. vern from voya? yep, vern from voya. why are you orange? that's a little weird. really? that's the weird part in this scenario? look, orange money represents the money you put away for retirement. save a little here and there, and over time, your money could multiply. see?
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. welcome back to "worldwide exchange." good morning to you. futures are expected to open higher on fed day. most of this week we've been treading water. yesterday was the same, fractionally higher. today a bit of impetus ahead of the open. about a third of 1%, and the nasdaq is up more, up about a half percent. really in focus today will be currencies. both because of the bank of japan action overnight. no change to the short-term interest rate, but a change of strategy, trying to steepen the yield curve a bit. we did see a bigger move in the dollar/yen pair earlier. it is extently flat now despite
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no clear yen weakness. the nikkei did soar 2% applauding the action by governor kuroda. still keep an eye on that pairing throughout the day as we get to the fed meeting. the pound is around a one-month low, below 1.30. to today's trade of the day. the consensus among investors and traders seems to be that the fed, janet yellen, will not be raising interest rates today, but will be sounding more hawkish during her tone at the news conference at 2:30 p.m. eastern time, hinting that a rate hike could come next. how should investors trade the meeting? our data team crunched the numbers. they found on the day of a hike announcement information technology, healthcare and consumer discretionary names did perform well. among the worst performers, utiltiutiye utilities and telecom. we will be watching those rate
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sensitive areas that have propelled the markets so far. still the best performing sek sectors, utilities and telecoms. a big hearing in washington yesterday. for the second day in a row, another ceo will be facing lawmakers. mylan's ceo under fire for the cost of the life-saving epipens. she'll testify before a house panel this afternoon. our meg terrell is covering the hearing. good morning. >> i guess we're switching places today. heather bresh, the ceo of mylan expected to testify at 2:00 p.m. in front of the oversight xhi committee. the epipen has risen to over $600 from $100. she tries to make clear in her testimony that while the price
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of a two-pack is $60 $8 , that's not how much mylan is gaining. she said looking back, i wish we had better anticipated the magnitude and acceleration of the rising financial issues of a growi growi growing minority of who may have ended up paying the full wac price or more. we never intended this. a lot of charges that they may have misclassified the epipen to get lower rebates. a lot of questions swirling today. people looking forward to not hearing just from bresch but from the fda as well. >> to that point it's largely
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about her and after stu stump yesterday, i wonder if they will go after her personally and her paycheck, which was also almost $100 million while the epipen price has been raised on consumers and whether she has a response to that. >> there's been focus on heather bresch's compensation and the compensation of other executives at mylan, some saying the compensation incentives are outlined and incentivized rising the price of drugs. wells fargo saying there will probably be questions about who made the decision to raise the price here, trying to get to the bottom of who is behind this, and will that put the executives potentially in trouble. people have said there is -- there are so many protections around this management team after they inverted to the
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netherlands t will be hard for them to have pressure to step down. >> no elizabeth warren on this committee, is that right? >> i don't believe so. always amazing to hear from her. that's one advantage that heather bresch has today. meg, thank you very much for that. >> thank you. coming up, the latest from the campaign trail. hillary clinton heading to florida. donald trump will campaign in ohio today. two key swing states. as we head to break, let's find out what the weather is like in those states and closer to home. >> all right. it is the middle of the week, we have some big rainmaking thunderstorms. could be severe weather as well here across the middle of the country. minnesota, iowa, wisconsin, storm also start and finish the day. flash flooding along with strong, damaging winds and hail. an isolated tornado risk a concern here today. it's still raining in the mid-atlantic. fronts, old remnants of what was julia still hanging around, virginia beach, norfolk are some
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of the places dealing with that. the heat is on as well in the middle of the country. even the northeast, temperatures in new york city heading to 85. 85 in l.a. a lot of above-average temperatures. could be a couple of record highs high s in texas and maybe in the northeast. "worldwide exchange" continues after this. it's a very specific moment, the launch window. we have to be very precise. if we're not ready when the planets are perfectly aligned, that's it. we need really tight temperature controls. engineering, aerodynamics- a split second too long
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[chains dragging] [eerie music playing] [crickets chirping] [owl hoots] announcer: if you don't fix them, sparks from dragging tow chains can cause a wildfire. and that could be scary. bye, smokey! only you can prevent wildfires. . welcome back. let's get you up to speed on the market action.
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looking at a rally in u.s. equity futures. dow futures up 60. off the session highs. s&p 500 futures up 5.6. nasdaq futures up 20. this is in between two major central bank decisions after the bank of japan surprised the market not easing further in a traditional way by buying assets or lowering interest rates further into negative but setting a new yield curve target and committing to getting enflags above 2%. that's the dollar/yen rate. the yen weakening a bit. somewhat of a successful policy reaction. the nikkei in japan surged 2%. we will see if the yen holds that. >> long-term. >> long-term there are questions, whether it will boost this economy. i want to show you what's happening with oil, which has been key for the markets lately. rising this morning. 2% bounce here for wpi. back towards $45 a bar well.
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brent 46.70. surprise draw in crude supplies. we'll get that number later in the day. demonstrators protesting the police shooting of an unarmed black man in charlotte, north carolina shut down a small section of interstate highway early this morning. authorities say protesters destroyed some police cars and several officers had been injured. officers went to an apartment complex yesterday looking for a suspect with an outstanding warrant and found a man, not the suspect, with a gun. he was deemed a threat and was shot. the officer has been placed on administrative leave. the unrest follows another police shooting in tulsa, oklahoma. now to the race for the white house. hillary clinton heading to florida today to lay out her blueprint for an inclusive economy. donald trump will be in ohio with running mate mike pence. tracie potts joins us with more. how much do they all pivot towards terrorism after what we have this weekend?
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>> certainly we heard talk about that. donald trump talked about that last night. today he will be asked about whether he mixed personal and charitable funds. hillary clinton today talks about the economy and putting the most vulnerable americans to work. >> reporter: hillary clinton's economy speech in florida will focus on jobs for peoples with disabilities. donald trump calls her an insider. >> she represents the donors, policy hollers, big banks, everybody getting rich off a rigged system. >> reporter: new fec filings show clinton and trump had their best fund-raising months yet in august. clinton raised nearly $60 million. she outspent trump 6-1 on tv ads. trump brought in 40 million, but it's his foundation's money in question now. the "washington post" first reported the charity making
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donations so trump could avoid paying legal fines. trump's campaign claims the story is peppered with inaccuracies and omissions from a biased reporter. >> it's clearly unethical to use charity dollars to pay for expenses that were not to be paying for out of their own pocket. >> trump and pence rally in ohio today doubling down on clinton. >> hillary clinton's sliolutions simple, more of the same. more taxes. more regulation. >> reporter: and our latest poll puts clinton 5 points ahead. now, following the money, those fec filings also show us that clinton's super pac is doing well. raising a lot of money, way out there with the fund-raising. and the republican party has a lot of cash on hand. in fact, turns out they have four times as much as the democrats. >> all right. thank you, tracie potts. coming up this morning's top stories including the bank of
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japan rebooting its monetary policy. stay tuned. you're watching cnbc, first in business worldwide. what's critical thinking like? a basketball costs $14. what's team spirit worth? (cheers) what's it worth to talk to your mom? what's the value of a walk in the woods? the value of capital is to create,
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not just wealth, but things that matter. morgan stanley
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the bank of japan announces a major policy overall overnight. one day, two big fed decisions. next up is janet yellen at 2:00 p.m. eastern. and swipe to the beat, why
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tinder and spotify could be the perfect match. it's wednesday, september 21, 2016, you're watching "worldwide exchange". ♪ hello. >> good morning. >> welcome back to "worldwide exchange." i'm sara eisen. i'm reading up on boj policy. >> it's a complicated policy, you should have done that before the show or during the break, not during the title sequence. >> you can explain it to me. >> good morning. let's get to that top story. maybe i should let you do it, now you know all the details. take it away. >> the bank of japan rebooting its monetary policy. they didn't cut rates further into negative territory, it's abandoned its base money target and introducing a ten-year interest rate target.
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the goal is to stoke inflation. the boj will buy long-term government bonds to keep the ten-year rate around zero. the japanese ten-year yield briefly rose above zero for the first time since march and settled around it, just below. the yen did move earlier in trade but is flat for the moment. did not get the weakening that would have been wanted. if we look at the stock prices, we did get the reaction there that mr. kuroda would have been looking for. a strong close. up 2%. equity market investors applauded the decision. >> the word reboot is interesting. the bank of japan extraordinary to get the inflation up and boost the economy has been buying everything over there. lowering interest rates, changing the monetary base. this puts the ten-year interest rate more in focus, front and center in terms of controlling
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it. they want to keep it at zero. keep the money easy and free. get people making loans, trying to control this and get to 2% or above as kuroda said today inflation. >> and also to try to steepen the yield curve more generally. will that be enough to spur the economy as a whole? does it help the banks and stock prices of those? yeah, but will it lead through to the consumer undfundamentall and get them spending? we'll see. >> they're just scraping the bottom of the barrel. u.s. equity futures are in rally mode ahead of the fed and after the boj. dow futures up about 65, 66. s&p futures up 6. nasdaq up 20. we've seen very little action in terms of the major averages. big end up losing
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team. as for the early action in europe, do see some green on the screen. nearly 1% moves for germany, france. italy is also having a good day. banks have been rebounding this week. >> they welcome the bank of japan decision hoping that sort of attempt to steepen the yield curve might move across -- >> at least they're not further negative rates. >> let's show you the action in asia. the nikkei ending higher by almost 2% on the back of that announcement. green in hong kong and shanghai as well. oil prices stopped the rot in the last couple of days. up more meaningfully today. just shy of 45 bucks for wti. as we look at the ten-year treasury note, it has stabilized this week, just below the 1.7
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level. 1 opini 1.69 today. the dollar similarly just pausing for breath this week in terms of which way it should go, depending on what we will see from the fed. pretty much flat against all the major pairs. the pound is below 1.30 again. >> it has to be discouraging for the bank of japan, they did see it sell off after the announcement, because it has basically worn off into the u.s. session. and strategists are saying it was just positional. they were skeptical that bank of japan could deliver anything, and it flipped the other way. now flat. gold, showing a 5% rise on the back of a flattish to weaker dollar. in the u.s. it's all about the fed. that policy decision due at 2:00 p.m. eastern time. it will be followed a half hour later by yellen's news
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conference. you can catch all of it live on cnbc. today about the fed, yesterday in part about fedex earnings from the company beating the street. revenues topped estimates. the company's guidance better than consensus leading to a 3% move in the premarket. other stocks to watch. microsoft raising its quarterly dividend by 8%. it last raised its dividend about a year ago. the company is planning a new $40 billion buy back program. microsoft says it is on track to complete its current $40 billion buy back by the end of the year. that news giving this stock a boost. adobe systems reporting a better than expected 20% jump in third quarter revenue as it added more users to its creative cloud software. the company forecasting fourth quarter profit above analyst estimates. kb homes beat forecasts. deliveries of new homes, key
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metric there rising 11%. led by double digit increases in the west coast and in the midwest. wells fargo ceo john stumpf enduring more than two hours of tough questioning yesterday. >> when it all blew up, you kept your job, you kept your multimillion dollar bonuses, and you went on television to blame thousands of $12 an hour employees who were just trying to meet cross-sell quotas that made you rich. this is about accountability. you should resign. you should give back the money that you took while this scam was going on. and you should be criminally investigated. >> shares of the bank took a hit during the hearing, hitting the lows of the day around that point but did end the day up still over 1%. perhaps a sign of what this
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means to earnings relative to pr. joining us from washington is ian katz, director and financial policy analyst at capital alpha partners. i'm just looking at the title of your note that you wrote after the hearing. stumpf's testimony to congress goes over even worse than expected. was he just not prepared for this hearing? >> i think what happened was that there was expectation -- i sort of expected as well -- that wells fargo would have some sort of bone to throw the senators. something to offer ahead of time. i was thinking maybe the day before there would be some announcement that maybe he would be taking a cut in pay, or they would announce some scalp for the senators. something to be done to sort of reduce the tension there a little bit. reduce the volume. when he came in and didn't have anything, and he said i will
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defer to my compensation committee, then see what they do. i don't want to interfere or influence them, that really angered the senators. they were expecting something from him. they didn't get it. and it made it difficult for him to play defense there yesterday. >> ian, we were talking about -- reminiscing about the crisis period, when lord blankfein was dragged in, jamie dimon with the london whale. we were wondering, without reading the transcripts f it was as brutal of a grilling and what their responses were to see how this will impact stumpf. >> i think this was worse than jamie dimon when he had to answer questions about the london whale. the goldman hearings were rough and went on for a couple days. you would have to go back to those to find something similar.
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and then, before that, i guess in the aftermath of the financial crisis around 2009, 2010. this was the worst in quite awhile. he just didn't have anything to offer them. it was getting worse and worse. it was no surprise that elizabeth warren would do that, but the republicans beat him up, too. >> the stocks ending the day up in positive territory. why is that the case? is this still, despite how heated that exchange was, is this still a pr issue for the bank in terms of earnings and the future of both stumpf and the company? will they be all right? >> they got -- yesterday morning they got a nice bullish report from morgan stanley saying the stock was rarely this inexpensive because it dropped 8%, 9% in the previous few sessions. there was some feeling in the
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market that it got beaten down enough. there is a case to be made that this is a bigger public relations affair than it is financial problem for them. the dollar numbers in this were not huge. it really grabbed the public awareness and it was easy for lawmakers who are not financiers to understand this. this was pretty simple. people opening up checking accounts, credit card accounts without customers permission, very intuitive and easy for them to gang up on. >> ian, thank you very much for joining us. ian kat skshz. >> we're awaiting this fed decision, where she could be hawkish or surprise the market with an interest rate hike. it's not out of the question. the banks are the only negative
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group for the year. wells fargo is the mopraying fo interest rate hike. >> that's a good point to bring up. if you saw a 25 point basis point hike whether it was today or december t would far blow out of the earnings and what this means to wells fargo. you would see a massive rally. that would feed through to the bottom line. yes, this is terrible pr for stumpf and the company, but we're at the peak of the eye of the storm for it now. i think it will blow over. he and the company will be fine. amazing how ill-prepared he seemed yesterday when you would think he would go into the hearing wanting to put that thing to bed. >> heather bresch must have been watching that closely. she's up today. >> and mr. stumpf has the house hearing to come. brangelina is no more. angelina jolie filing for divorce from brad pitt. the decision is being made for
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"the health of family." there are questions over how the couple will split their asset, which includes a $60 million vineyard they bought in 2012. adele was so broken by the news she dedicated her concert last night to the end of an era. why you are laughing so much. >> i don't know. it's a big deal. almost broke into john stumpf testimony yesterday when the headline crossed. just kidding. >> why are you laughing? nothing to celebrate. you're so mean. >> i think a lot of people -- >> i agree. i didn't know about this until i was on the train back from washington. >> a lot of people are speculating whether he cheated. a lot of people care about this. >> why are you laughing? why are you laugh being it? >> i'm a brad pitt fan. i don't know. i've been reading a lot about this. get to the bottom of it. >> are you a more brad fan than angelina? >> yes, but i want to know what happened with the marriage. i want to know about the
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ones. you will get notifications on your phone even if the chat is muted. that's very complicated. big chat rooms i'm always the first to leave. >> that's the problem with group texts. endless. >> bing bing bing. still to come, today's must reads, tonight, don't miss an all new "cleveland hustles." lebron's team have picked the business businesses. you can watch that tonight at 10:00 p.m. ok team, what if 30,000 people download the new app? we're good. okay... what if a million people download the new app? we're good. five million?
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with $15 trillion roughly on the major central bank balance sheets, with all of these rates at zero or below zero, you have a very delicate situation, which cannot be solved but a sledgehammer. you need some finesse. >> that was elliott's paul singer warning central banks have gotten themselves into unchartered telltory. r territory. if you want to learn more, head to for that full interview. to the must-reads this morning, i have gone for one on the wells fargo story from the
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"wall street journal," whipping wells fargo. picking a slightly different angle. a paragraph that talks about the grilling that the regulators got after mr. stumpf for the journal's editorial board writing l.a. city attorney michael furor says it was a los angeles time story about the accounts in december of 2013 that triggered his investigation years after the bank started firing people for misconduct. mr. feuer said the city was discussing a settlement with the bank when the fed joined the negotiations. this taking a slightly critical angle on the cfpb. it was a united set of senators when they were grilling mr. stumpf, it was more disunited when they were grilling regulators as to whether they should applaud the work of the regulators or criticize them for not discovering it first, getting on it quicker, giving a fine and an admission of guilt.
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>> also it was a little confuses when he was being questioned himself on the timing of when he found out, that came early in the hearing. he didn't give an exact answer. that seemed to frustrate some of the senators. >> that goes back to his hearing. that was disappointing. another extraordinary moment. >> 2013 he kept saying. >> and not sure when, which is weird that he wouldn't have a clear answer prepared. >> when is the house one? >> no date yet. the house has requested the head of the community bank. >> who came up a lot yesterday. >> which is odd that the senate had not requested to see her as well. >> they focused on him. coming up, what the bank of japan decision means for the global markets. we'll talk to chris rupkey next. and later today, a first on cnbc interview with jeffrey gundlach, a fed critic who oversees more than $100 billion. he will join the fast money crew today at 5:30 to digest what we
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heard from janet yellen. that's coming at 2:30 p.m. that news conference after a decision at 2:00. it's all on cnbc. this woman owns this house, with new cabinets from this shop, with handles designed here, made here, shipped from here, on this plane flown by this pilot, who owns stock in this company, that builds big things and provides benefits to this woman, with new cabinets. they all have insurance crafted personally for them. not just coverage, craftsmanship. not just insured. chubb insured. waiter: here's your check. oh! you--you got it. you know, since i got rid of
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we are approaching the top of the hour, the team is getting ready for "squawk box." brian sullivan is in new york today with a look at what's coming up. the fed, boj, the end of love with brangelina what are you know cufocused on? >> have you seen the cover of the "new york post"? basically a giant picture of jennifer aniston laughing. >> thought you might go there. >> and wells chief savaged in congress over fake accounts. on one hand, brangelina and on the other, wells fargo. you did an excellent job making sense of this bank of japan news. >> we're trying. >> i'm not sure i understand how
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fixing some sort of a bond yield in japan will mat othter at all consumers, because their mortgages are not tied to the ten-year yield. we'll get more on that you guys referenced the federal reserve at 2:00 p.m. that decision, i'm the only one out there expecting a rate hike today. that's the place i like to be. got corporate earnings coming out. there's a lot to do. i know we're cnbc, i know brangelina is a huge story globally. probably some financial implications. >> "usa today," their lead story is about the epipen. >> that's right. you have the mylan labs grilling in the house today. so, ceo's mother used post to push epipens into schools. a lot to do no shortage of news on a busy wednesday. >> brian, thank you. see you soon.
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back to the central bank extravaganza and the market impact. joining us is chris rupkey. good morning. >> good morning. >> the bank of japan getting creative here. can you explain what they did and what it means? >> number one, they didn't cut rates further into negative territory. that's good. another day, another stram bace banker seeing the limbs of their power. let's hope janet yellen and her crew can't do anything more to stimulate the economy. at least they're running out of room. we already saw this happening. 30-year yields in japan, the yield curve steepened on the talk that they might do this. that's good. it makes the banks -- it gives a cushion for the banks. the banks were very critical including our own management of the boj on january 29th when they cut rates into negative
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territory. it was hurting bank earnings. now this does away with that by steepening the curve. >> so we have got a 2% rally in the nikkei. we don't have much move in bond yields and much move in the yen. will this hurt the economy in the week or month's time? >> as i like to say, i'm always for team japan. they have a huge ball to roll back up the hill here. dollar/yen was 1.20, came down to 1.00. it will be difficult to get it up to 120 yen to the dollar. they got a gift it was kuroda that pushed it up to 120, it was a crash, the great oil crash of 2014. commodity prices dropping. that's what pushed up the dollar and helped japan so much. they can't do a lot at this
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stage. it's just another central branch facing their limits. >> gearing up for a big afternoon. 2:00, financial decision from the fed, 2:30, the forecast, everything. what would be considered, do you think, a success by the end of the day for janet yellen? >> a rate hike. we're kind of in a difficult position. she has come out at jackson hole and said the case was strengthening. other fed governors put out their decisions -- >> plus the data softened. >> it's only been two weeks. for me i feel that -- policy is in limbo here. not really doing anything at 0.5%. if it goes to 0.75, she can do that and tell us how that is accommodating polpolicy.
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>> that's it for "worldwide exchange." al all eyes on the fed. >> "squawk box" is next.
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good morning. the bank of japan announcing a major policy overall. details and global market reaction. and the u.s. central bank taking center stage. and mylan's ceo heading to capitol hill facing a grilling over the epipen scandal. it's wednesday, september 21, 2016. "squawk box" starts right now. ♪ i will wait, i will wait for you ♪ >> live from new york where business never sleeps, this is "squawk box."
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good morning. welcome to "squawk box" on cnbc. i'm becky quick. let's get to today's top story. the bank of japan rebooting its monetary policy. the boj didn't cut interest rates further into negative territory. they did not expand the asset purchases as some figured they might. instead the bank is abandoning its base money target and introducing a ten-year interest rate target. this is a whole new game. that's not something i saw people expecting. the goal is to stoke inflation, that's the opposite of what you usually expect a central bank to be doing. the boj will buy long-term government bonds to try to keep the ten-year rate around zero. the japanese ten-year yield briefly, briefly rose above zero for the first time since march. right now it's down just below


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