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tv   Worldwide Exchange  CNBC  January 19, 2017 5:00am-6:01am EST

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good morning. the new world order, investors look to process earnings, global economic data and the incoming trump administration. we'll turn to carlisle founder david rubinstein for guidance. >> earnings alert. net flex soars amid new subscriber growth. ait's thursday, january 19, 2017, and "worldwide exchange" begins right now.
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♪ good morning. welcome to "worldwide exchange" on cnbc. i'm sara eisen. >> i'm wilfred frost. we are coming to you once again from the world economic forum in davos, switzerland, an annual gathering of political leaders, ceos, bankers and business decisionmakers. our special guests this morning, david rubinstein, he will join us in just a minute. later, tim adams from the institute of international finance and bill browder will join us. all of this as well as investment ideas from jpsjoshua friedman. yesterday we saw slight gains for the nasdaq and s&p. the dow had its fourth negative session in a row.
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albeit slight declines. right now, 27 points on the dow called lower. we did see a rebound yesterday in the dollar, but also in the yields. they pushed higher having hit a low of 2.3% during tuesday's trade. today the yield on the ten overnote is 2.43%. >> it's been 67 sessions and we have not seen a down session. the top stories today, central banks, ecb holding its first policy meeting of the year. a decision due around 7:45 a.m. eastern time. president mario draghi will hold his normal news conference. central bank widely expected to keep the rates unchanged. the ecb decided last month to extend the bond buying program
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until late 2016. as for the euro, firmer this morning, up 0.3% after the dollar jumped back yesterday about a 1% move there. dollar/yen is weaker. the pound firmer as theresa may, the british prime minister, arrives in davos. >> european equities have seen the ftse 100 decline because of the pound pounce back. the rest of europe slightly weak. in the u.s., janet yellen will deliver a speech at stanford tonight and take questions from the audience. in remarks yesterday, a hawkish yellen gave a strong signal that the bank is close to raising raet rates again. as of last month, i and my colleagues, the other members of the fed board in washington, and the presidents of the 12 regional federal reserve banks, we're expecting to increase our federal funds rate target a few
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times a year until by the end of 019 it is close to our estimate of its longer run neutral rate of 3%. >> janet yellen warned any delay in tightening policy could have disastrous consequences for the u.s. economy. >> final preparations are underway for tomorrow's presidential inauguration. we will be watching cabinet con fir ma confirmation hearings on the hill, among them rick perry, and steve mnuchin. mnuchin expected to come under fire from senators because of his banking record in the aftermath of the housing crisis. he will say that accusations that his one west bank was a foreclosure machine were untrue and politically motivated. netflix shares rising after the latest results top wall street estimates.
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they added 7.1 million new subscribers. a third more than expected. shares up 8%. theresa may speaking just moments ago right here at world economic forum in davos. her main message was that she wants a bold and ambitious trade agreement between the uk and the european union. she said she is pro free trade despite the tough negotiations ahead she said it is in britain's best interest that the eu should succeed on its own. >> so it is essential for business to demonstrate leadership, to show that in this globalized world everyone is playing by the same rules. and that the benefits of economic success are therefore all our citizens. that means several things. it means businesses paying their fair share of tax. recognizing their obligations and duties to their employees and supply chains and trading in the right way. companies genuinely investing in, becoming a part of the
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communities and nations in which they operate and abiding by the responsibilities that implies. >> a lot of trade talk here. here to react to may's potential hard brexit plan and how it could impact the global markets, david rubenstein. welcome. >> my pleasure to be here. >> you predicted in the summer that this would hurt the uk, do you still believe that? >> clearly many people like me have been wrong in predicting what would happen with brexit and the uk. the uk economy has not suffered as much as i thought. the pound has gone down a fair bit. i would expect negotiation to be difficult. in the end i think that the uk has made it clear they will depart from the eu.
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i thought in the end they would not. it's clear the prime minister wants that to happen. it will be challenging the first couple of years, many of the economies based in london will have to move facilities out. i talked to some of them last night. many people will move to other parts of europe to relocate. that will be required. it will have some challenge for the city of london. >> we'll get to the u.s. in a moment. on the topic of europe, are you concerned about the outlook for 2017 in europe? lots of elections coming up,i s various people suggesting another brexit-type outcome. >> you have elections in france, the netherlands, and germany. if those go against the conventional wisdom, it would be a shock to people. clearly europe is going through change. and what happens in the united states affects what happens in europe. what the new administration does will have impact. a lot of that is unknown. >> is the u.s. the best place to do business globally right now? >> without doubt. it has rule of law,
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transparency, best managers, best financing opportunities. i think it has the best companies. >> policy uncertainty is a bit higher. >> policy uncertainty is always the case with a new administration. when every administration comes in you don't know exactly what will happen. right now the united states economy is in pretty good shape. >> you said at the goldman sachs conference in december that you did expect comprehensive tax reform but that it wouldn't arrive soon. yesterday your peer, steve schwarzman said on this set that people who don't like change will have a big surprise in the first 100 days. he thinks it will come quickly this reform. do you still think it will be towards the back end of the year? >> i don't want to contradict steve, a friend of mine, but if you look at president reagan or george w. bush, they tried to get tax reform through they did, but it took nine, ten months because the congress doesn't move that quickly. the weighs and means committee
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takes a while, and the house has not begun to think about tax reform. the president will unveil a number of significant policy changes. they won't be immplemented by congress right away. >> how many times have you spoke to the president-elect. steve gets to talk to him quite a bit. does he get further access than you do? we're not looking at things that way. he's known donald trump much longer. i have known him for a while. i did an interview of him for the economic club of washington, which he thought was a good interview. i highly recommend it. it was done about a year ago before he announced he would run. i went down and saw him at mar-a-lago and spent about an hour with him. >> what sort of message did you convey to him? what's important to you as they rethink some policies? i wasn't talking about economic policies as much as the symbols of our country and the
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history of the presidency, those are things that are important to me. >> a headline coming out of the davos forum yesterday is that you were terrified about the strong dollar. does that word capture the severity of your feeling about the move in the dollar recently? >> i don't know if terrified is the right word. the dollar is stronger than it has been. and a strong dollar will make it difficult for american companies to export and hurt emerging markets that have corporate debt. right now there's about $4.5 trillion of emerging market corporate debt that is dollar denominated. if the dollar goes too strong, it's hard to repay those loans. >> steven mnuchin will be testifying on capitol hill today. i hope the senators ask him about the dollar. unusually president-elect trump made a comment about the dollar saying it was too strong and hurting companies. >> the tradition in the united states has been that nobody
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talks about the dollar except the secretary of treasury, and he's allowed to say one thing, we support a strong dollar. now those words probably won't be used by the secretary of treasury as much as previous secretaries have said that. steve mnuchin is someone i do know. he's done a good job in the private sector. a good partner at goldman sachs, i expect he will impress a number of senators. >> what about the comments from wilbur ross yesterday, upping the ante in competition with china. >> i don't expected there will be a long trade war or anything like that. that's not something that we should unduly worry about. >> what is the upshot for you and your business and dealmaking for 2017. sounds like you're pretty optimistic. >> the u.s. economy is in reasonably good shape. we have good signs ahead of us. some change, is that the president will make will probably be helpful with the
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business. business is optimistic about dealmaking and other things that we hope to do. >> top sector picks? >> energy will rebound. energy services will do well. >> what about the regulatory regime and antitrust concerns that were phased by companies and dealmakers in the obama administration. do you expect that to get better? trump ran as a populist. >> we don't know who the head of the antitrust division will be yet. i suspect that person is someone's views are closer to republican views, but i suspect you will see a lot to of dealmaking. >> what about cross border? with the strength of the dollar, do you think we'll see more companies around the world trying to buy u.s. companies and will a president trump allow that? >> the u.s. dollar being stronger, it enables american companies to buy things overseas. there is money coming into the united states from china. that's happening already.
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and japan also will send a fair amount of money. >> you said the stronger dollar could be hurting emerging markets in the year ahead what is your view on china and the risks it poses to the u.s.? i feel like the moves he would seen in the market discount risks from around the world. >> the u.s./china relationship is the most important bilateral relationship in the world. we are the biggest economy, they are the second biggest economy. in our lifetime they will be the biggest economy. while there's some getting to know each other from the new administration to the current administration in china. in the end i'm optimistic it will work out. >> trade aside what is the health of the chinese economy? >> it's pretty healthy. they'll grow at 6.5% this year. they're an economy of about 10, $11 trillion, we're at about $20 trillion. >> we will get a gdp report out
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of china on friday what about xi coming to davos, potentially taking the mantle in terribles of global economy? do you see that shift happening? >> president xi is more attuned to the west than some of his predecessors. he did briefly live in the united states. he is recognizing the importance of the global economy. i hope that that will lead to good relationships with the united states and other economies around the world. i am optimistic about his ability to project a global view. >> what is the likelihood that president trump and his team next year will attend davos? >> i don't know that. it's beautiful here, very nice people interviewing you, great opportunities here, the food is good, i think a number of people are coming. this year they couldn't really come because they were having hearings, getting sworn in. >> don't you think also it's
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against -- he is trying to promote this america first, campaigning in the rust belt states, promising he will go after china and go after global trade. does that really make sense for him to be here? >> i don't think coming here is inconsistent with those things. coming here and meeting people from around the world is a good thing. >> david, great stuff. david rubenstein, founder and co-ceo of the carlyle group. >> still to come, barclays ceo, jes staley says the volcker rule is here to stay and the banks need to get used to it. we'll ask tim adams what he thinks about that next. oura r to
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wes o isved ys b ve cdentare icit. tadirectv now. stream all your entertainment! anywhere! anytime! can we lose the 'all'.
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there's no cbs and we don't have a ton of sports. anywhere, any... let's lose the 'anywhere, anytime' too. you can't download on-the-go, there's no dvr, yada yada yada. stream some stuff! somewhere! sometimes! you totally nailed that buddy. simple. don't let directv now limit your entertainment. only xfinity gives you more to stream to any screen. the future of the global financial system is a big topic here at the world economic forum. barclays ceojes staley speaking to cnbc this morning. >> we believe the banks need to atone for the mistakes, the transgressions made going into the financialclays is prepared t
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price. >> joining us is tim adams from the institute for international finance, a group that represents banks around the world. welcome. >> good to be here. >> have banks sufficiently atoned? i feel like the tide has completely turned and banks are the darlings. >> it's amazing. it's been an eventful decade since the crisis. we raised a tremendous amount of good capital, more liquidity, less leverage, changes in the boardroom. it's a different industry than ten years ago. >> what do you put the rally in the stock prices down to? there's lots of question marks whether it's the simple change in interest rates or whether people are pricing in hopes for deregulation, and earlier today jes staley felt that dodd frank and the volcker rule will not change at all? just greater certainty with respected to regulation and regulatory outlook.
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i think the industry wants certainty and not constantly worrying about regulatory changes. >> have you seen a change in the system? >> we are seeing that banks are a part of the solution. we can play that role. >> the banking picture in europe is that still struggling? i know we removed one of the headwinds from deutsche bank with that settlement with the doj, is it still a tough structural environment? >> it's still a tough structural environment, a downward sloping yield curve, unlike the u.s. there's no capital markets, it's a banked economy. we need strong, profitable banks. >> what about steve mnuchin going on capitol hill today before senators, some say he could face a tough hearing especially as it relates to his bank's role in the mortgage crisis what do you know about him? >> he's a pro. everything i heard about him, he's a good banker, he knows his
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facts. he has a full inbox tomorrow when he shows up domestically and internationally. >> are you concerned about the other roles? . i know gary well, he's fantastic. he will run a tight ship. others in treasury an other areas also positive. >> investors are watching mnuchin's testimony today, for the markets, his comments on the dollar, long-term treasury. you were formerly in the treasury. what's appropriate in terms of how much he should talk about these things and then rip up the script there past administrations? >> i'm much more cautious than the incoming administration. i wouldn't say anything about the dollar now. with respect to longer maturities that needs to be thought out. he may show a bit of an inkling where they want to go, but they need to do it in a comprehensive
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and thought out process. j when you see the president-elect making comments on his view of the dollar, does that change your view for the currency or is it something out of his control? because there's all sorts of other things, most notably what janet yellen is doing, does that alter your view? do you have a slightly less positive view for the dollar ahead? >> i think more volatility, ultimately it's interest rates, productive productivity, but day-to-day the president may decide to weigh in that's different than we've had over the past several decades. >> what do you want to hear from him today on banks? >> what they want to do with dodd-frank, there's a sense of repeal and replace. bazell 3, where are we going? we are waiting on perspective on how they will finalize those regs. i think it's the tax bill. >> could that be positive for banks if we see a repatriation of banks?
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>> it could. there's a different sentiment in washington with new people coming in, the alphabet soup of regulatory bodies. >> tim, thanks for coming. >> in still to come, the future of the u.s./russia relationship a big question in davos as donald trump prepares to take office. coming up, we will speak to bill browder. stay tuned, you're watching "worldwide exchange." truc.
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ryctectimoudeiscag. t ay .e s se ake invoere y gic cuy diisllutnycoand titavo o knito umgsf yooer vo #cr . welcome back to "worldwide exchange." president-elect donald trump says he will propose ending sac sanctioned imposed on russia over its annexation of crimea. he said the offer would be in return for a nuclear arms reduction deal with moscow. with us in davos, bill browder of hermitage capital management, his firm one of the biggest foreign investors in russia until 2006 when he was blacklisted and expelled from the country. he's a clear critic of vladimir putin and russia. before getting to trump/putin questions, how do you rate how the obama administration has dealt with russia and dealt with putin? >> you know, they're trying to make this case they've been
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tough on russia. i've been fighting with the obama administration to get tough on russia since all my troubles began a long time ago. obama had something at the beginning called the reset. they had an official reset button they presented to the foreign minister of russia. and for the longest time they were basically soft pedalling, appeasing, doing that stuff. only in the last two, three months that obama and kerry got tough on russia. >> viewers know you and your history on business news. you can bring us up to speed on where you stand right now with russia? you're not invested there anymore. your troubles. >> basically in simple terms i was kicked out of russia, they raided my office, they arrested and killed my lawyer, and since the last seven years since he was killed, i've been fighting for justice for him. we have legislation named after him in the united states, which imposes visa sanctions and asset
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freezes on human rights violators in russia, which is extremely annoying to putin, he retaliating by not allowing adoptions by american people. >> donald trump has a warmer sense in tone to his rhetoric with russia. >> if what he says he plans to do, it will be a big disaster for the world. to lift sanctions -- very simply, russia redrew the map of europe by invading a european -- a country in europe in the last two years. they put sanctions in place, western europe and the united states, to punish russia for that. if he was to lift sanctions, it says to putin, no problem. invade where you want. >> he would say that he's making a deal. he would get something for it include the reduction of nuclear
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arms discussions which are important to him and reset relations, which under obama administration have not been tough enough. >> well, first, the russians have been engaging in nuclear arms reduction discussions with america for the last couple decades. this is something that's been going on forever. it's not like there's conditions that are required for that. and as far as the reset stuff goes, president bush tried that. he said i looked into putin's eyes, i saw his soul. that was his first meeting. the next 27 meetings he looked into putin's eyes and didn't see anything there at all. he's no fan of putin. obama had the same problem. if trump thinks the charm of his character will convince putten to behave himself, he's mistaken. >> what do you make of his comment that nato is obsolete? >> let's hope it's a negotiating position to get people to pay their fair share. if that's the case, i'm okay.
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if he intends to dismantle nato, we will be at war sometime in the next five years in a world war because that's what happens when you -- >> are russia? >> with everybody. if you remove the security blanket over europe, everybody will start spending money on security, people will scuffle with each other. it's a disaster waiting to happen. >> what are the impact of the sanctions, the ones in 2014 and the new ones opposed by the obama administration? by all accounts money has been flowing into russia since the election, the russian stock market, the russian ruble, oil prices are back up, and the view from the markets is that russia is appearing attractive. >> let's look at this objectively. there's been a 95% reduction in the amount of foreign direct investment into russia since the sanctions were put in place. sanctions have preventeded vladimir putin from going further into crimea and doing
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more bad stuff. that's the most important thing. if you lift the sanctions, we won't have that prevention. >> what do you make of rex tillerson as secretary of state? >> i don't think it matters who the secretary of state is. the policy on russia will be determined by donald trump. it didn't matter whether kerry or hillary clinton was secretary of state for obama. the policies of obama were clearly put through both those people. >> you don't think it makes putin and some of his allies nervous to hear rex tillerson and some other nominees for cabinet position come out against trump's more soft tone towards russia and present a harder line? nikki haley, set to be ambassador to the united nations, saying -- accusing russia of war crimes when it comes to what it's doing in syria. >> i hope the people surrounding trump are the ones who set the policy. i think that the defense secretary is absolutely rock solid person in relation to what russia is about. the head of the cia, head of
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homeland security, nikki haley, a bunch of people. i hope they're the ones who determine policy. if trump is giving a gift to putin, which is lifting sanctions for nothing, can it w be a terrible signal for the world. >> the ruble has been one of the best performing currencies year to dated. will that continue? >> if sanctions continued, it will continued. if oil prices go up, it will continue. there's a lot to of expectation now among a lot of investors that sanctions will get lifted. >> what's your prediction for how the trump/putin relationship evolves over the next few years? >> one thing you have to understand about russia is that putin needs an enemy. in order for him to justify a bad economy and unpleasant situation for his people, he has to say we're fighting against a bunch of western enemies. it's hard for him to be friends with america at the same time have all this bad stuff going on
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in his country. i think that all we have to do is wait a while, the relationship will end up like every other relationship, which is you can't have two very proud tough guys standing there looking at each other and not agreeing on stuff. >> bill, thank you very much for joining us. bill browder. when we come back, the top stories and a round up of global markets, and joshua friedman will be joining us on set. that's when "worldwide exchange" comes right back. mns cakakun - ourn iedicicakroug t singat.vate..comps i.
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♪ good morning. welcome back to "worldwide exchange" on cnbc. i'm sara eisen. no gloves today. >> i'm annoyed she's not wearing gloves, i want to keep mine on. >> one of us is tougher. >> any way, my name is wilfred frost. good morning to you from me as well. we're coming to you from the world economic forum in davos, despite the sun behind us, it is very cold and thus it is still legitimately -- >> it is a balmy 15 degrees. >> here in davos we continue
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with a great lineup of guests. >> our guests this half hour include josh friedman, and london mayor, sadiq khan, and then later james gorman. so much ahead still. all the newsmakers are here, including prime minister theresa may, who has arrived and given a speech on britain's place on globalization and free trade. >> we'll discuss that later that interview with james gorman, the first since morgan stanley's blow-out q4 numbers. share prices decreasing since then. first, let's check in on the global markets this morning. the dow declined for its fourth straight day in a row, albeit slight declines. we are down this morning, but just fractionally.
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european trade is negative. it's down by a half percent, the pound is rallying. the other indices are down just slightly. about a quarter percent for france. asian trade saw a bit of negativity across most of the boards. >> as for the broader market picture, let's show you what's happening with commodities and the price of oil, which has been a bit firmer this morning. up more than a half percent. 51.37 brent, the international bench mark, 54.23. that gap has widened out a bit. as for the ten-year treasury note yield, yields higher yesterday. we saw big jumps whether it's on the back of janet yellen comments or the reversal with the s&p and nasdaq higher. ten-year note yield, 2.43.
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the dollar, big move higher yesterday, up a percent after a few days of weakness. it's weaker this morning. about a quarter percent. weaker against the yen, barely. flat there. the pound strengthening a half percent. as for gold, suffering yesterday, and for this morning down a little more than half a percent. >> the yen bang-on flat you might say. >> you might say because you say that. >> you do now as well. we should switch focus to corporate news. canadian pacific ceo hunter harrison is stepping down five months earlier than expected. he may be in talks about taking an activist stake in csx. >> other stocks to watch today,
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netflix at the top of the list posting the biggest ever quarterly subscriber growth. the company saying it added more than 7 million subscribers during the fourth quarter, that beat estimates of 5.2 million. australia's bega cheese is acquiring some of mondelez's cheese business. it includes the beloved australian spread vegemite. i think you have to be australian to like it. >> i think it's good. vegemite, it's good. >> also includes the zoush salad dressings. another stock to watch, kinder morgan reporting lower than expected revenue for the ninth straight quarter. the natural gas transport volumes falling 2%, but still ending the quarter with a $170
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million profit. netflix, big jump in the stop after hours, up 8%. maybe it has to do with the success of "the crown." you got me into it. >> netflix always has such a big reaction depending on user growths. more stocks to watch, safran launching a $10 billion takeover for zodiac aerospace. they would have a turnover of 21 billion euros, this comes three weeks after rockwell collins acquired be aerospace for.64 billion. safran up 1%. lockheed martin and the u.s. department of defense nearing a deal for a contract worth almost $9 billion. it would bring the price per f-35 below $100 million for the first time. this is in respence to president-elect's efforts to lower prices of military aircraft. and mallincrodt agreeing to pay
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$100 million after it acquired the rights of a drug that competed with its u.s. monopoly. let's talk about investing in 2017. opportunities in the current global markets. with us now is josh friedman of canyon partners. the s&p is up about 6% since the election, nasdaq up 7%. we off look to the credit markets for what comes next and what that is telling us. what are you seeing? >> we could have the potential for significant change for two reasons. first of all, what has driven returns in the last few years has been this relentless global search for yield in a world of shrinking yields. it's driven everything with a yield up and made it extraordinarily difficult to find things that give you an adequate return for the level of risk. we saw in yesterday's announcements with respect to the cpi, starting to see it in
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treasuries, we could be at the end of that long cycle of declining rates. that could create a different back drop. the second thing, more specifically as we enter periods of policyies being uncertain an evolving, you could have more disruption in the credit markets. >> in terms of the headline treasury yields. we had a big correction since trump's election. how far along the line are we on that? >> it's a good question, it's not what we consider ourselves to be expert at. we would rather protect ourselves against those moves rather than predict those types of moves. but the asymmetry of being exposed to those rates those is worse than at any other time in
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the decade so we would rather avoid that. once it starts to move, it picks up steam. a good place to get out of the way. >> where are those potential disruptions? >> there are industries like retail, there are industriesic that are evolving, if you look at media you can see the difference between transmission and content and what's going on in those industries. and then industries subject to regulation. we don't know what will happen in healthcare, whether that's pharmaceuticals, it's difficult to know how those changes will evolve. >> one sector that's affected by regulation is the financial sector, this talk of deregulation. you have a position in ally financial, one of the smaller players. do they benefit more if we see deregulation? is that a reason for you holding that? >> i think all financial players benefit if you have deregulation and you have -- particularly if you have higher rates.
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it's hard as a financial institution to earn a lot of money if rates are as low as they have been. that's one bit of tailwind that those institutions might have. ally came out of a bankruptcy, general motors, so it has an unnatural share shoulder base. that's why we hold that particular one. and there are many companies from the last cycle, that as they moved out of bankruptcy and debt was ecquityizequityized. >> when you talk about retail, you are talking about distressed opportunities within retail? >> of all the distressed areas to look at, i would say retail is the one that has both the most opportunities and the most need for real caution. because in that area it is simple technological displ
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displacement. we see what's happening to malls, secondary retailers. >> you have a big position in yahoo. tell us about that holding. what are the factors you are looking at? will you consider holding it after it becomes altaba? >> well, what we try to find, it's not just yahoo! we see it in mergers and in situations like rite-aid, walgreens, where we do it more through the bonds as opposed to equity, we look for situations where there is a likelihood of substantial balance sheet change and discounts to the asset values which is what we see in the case of yahoo. we expect at some point the core assets will be sold. we knows there an agreement, there's negotiation going on with respected to the hacks. that's why we own that position.
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we feel those things will be resolved, and enough people lost enough money in that situation in the past that a lot of people haven't played in it. >> i wanted to ask you before we go, january this time last year everyone was worried about credit in energy. how much better does that look now? >> certainly looks like the industry is more in a market type of equal lilibrium as oppo to a transition to a different e equilibrium. there are distressed opportunities today in some rig operators. an area for caution but also real opportunity. the commodity itself is one where one always has to compare owning the bonds of operators to opening the actual commodity. there's a bit less in our judgment to do right there at this moment. >> thank you very much for joining us and sharing your
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ideas. josh friedman of canyon partners. coming up, we will hear from london mayor sadiq kahan. whribaetos14 t
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. welcome back to "worldwide
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exchange," live in davos, switzerland. a while ago we heard from uk prime minister theresa may at the world economic forum. she called for multinational business to help restore faith in globalism. >> business large and small are the backbone of our economies. and enterprise is the engine of our prosperity. that is why britain is and will always be open for business, open to investment in our companies, infrastructure, universities and entrepreneurs. >> trying to put that type of positive spin, theresa may having earlier this week confirmed she will be pulling britain fully out of the european single market. earlier today i sat down with london mayor sadiq khan. he said that may's plan to leave the market would be bad for london. >> it's one reason why businesses love investing in london, whether it's finance,
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tech, whether it's pharmaceutical, our access to a single market. it's our able to attract the most talented from around the world and the concern is that some of these business may decide to leave london and go not just to maybe paris, madrid or berlin, but may leave europe altogether and go to hong kong, singapore, elsewhere. so a message to my european friends, it's in your interest, too, to make sure there is not a so-called hard brexit. >> if that is the case that we lose access to sage market, if it's the case that firms leave london, we'll be poorer as a result and future generations will be let down. >> i also got the chance to ask sadiq khan about president-elect trump and his pledge to make a trade deal with the uk a priority. khan said he is optimistic about trump's promise and reiterated that america will also benefit from access to a single market since britain's ability to maintain a good relationship with europe is crucial to its
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economic health. interesting overall the comments really towards brexit. the london mayor has been clear he doesn't want a hard brexit. that contrasts a different guest on cnbc europe this morning, jes staley much more upbeat and optimistic about the ability of the uk to weather that type of storm. another bank ceo who has another tough line on it is james gorman who we will hear from later. >> that's the big question, how much damage will be done to london as the international financial center as a result leaving the eu single market, the passporting. we were there in london, the night before the brexit vote, delivering that plea, and now here is sadiq khan trying to clean up the mess. >> clean up the mess but his rhetoric has softened a bit in terms of points of view on that
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topic. >> i think it helped that the market has run up. still to come, two more big interviews for you. we'll be joined by morgan stanley ceo james gorman and david solomon. >> president and coo is his new title. we'll be back in a couple minutes.
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. about a minute left on "worldwide exchange." want to highlight a few things we'll watch. >> the interviews we have coming up, james gorman is coming up. and in terms of david solomon from goldman sachs, an outlook for ipos and dealmaking under trump. >> and back home watch stocks like netflix surging in the premarket after blowout subscription numbers, stronger guidance and a profit beat.
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could it help the rest of the f.a.n.g. and technology stocks? >> that's it for "worldwide exchange." we'll be here all day for more interviews. i en unmi bac alofrcng d imitedsh b bpark
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good morning. the financi the final countdown. we are less than a day away from the inauguration of donald trump. a live report from washington. and netflix surge. the stock soaring, but is it still a buy at these levels? and could we see a shakeup at csx? it's thursday, january 19, 2017. "squawk box" begins right now. live from new york where business never sleeps, this is
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"squawk box." good morning. welcome to "squawk box" on cnbc live from the nasdaq market site in times square. i'm kelly evans along with scott wapner and steve liesman. becky, joe and andrew are dusting off the snow of the alps and heading to capitol hill. we'll check in with john harwood on that topic in just a couple of minutes. first let's check in on the markets. u.s. equity markets coming off of a six out of seven-day losing streak. four points off the s&p 500 there. seven off the nasdaq. let's look at how we were trading overnight in asia and europe. a lot of news coming out of davos. japan's nikkei up 1% overnight. the shanghai

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