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tv   Street Signs  CNBC  August 24, 2017 4:00am-5:00am EDT

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welcome to "street signs." i'm carolin roth these are your headlines tough call trading is halted after shares of dixons carphone plunge after the retailer issues a profit warning on the back of a difficult environment for the uk mobile market. republican leefrsd aders on capito hill reject president trump's threat that he could shut down the government house speaker paul ryan says the extreme measure is not need ed to force congress into approving
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a border wall with mexico. >> i don't think a government shutdown is necessary. i don't think most people want to see a government shutdown ourselves included airline asset. lufthansa reportedly submits a letter of intent for airline air berlin's niki unit, as the german carrier looks to expand its spanish routes good morning it is thursday, and the stoxx 600 is not doing too much. it is inching higher up by 0.2%. still a cautious mode here as we head into the jackson hole symposium in wyoming, and we are getting the mario draghi at 8:00 p.m. uk time on friday we will look at european markets one by one the ftse 100 is up by 0.25%.
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the big story today, dixons down by roughly 30% we'll get to that story. the xetra dax is flat. and the cac 40 is up by 0.2% by in large some small moves here to the upside when it comes to the sectors, the picture is retail off by 0.6% travel and leisure off by 0.25%. construction utilities eking out modest games back to the corporate story i told you about dixons carphone shares plunged after the company delivered a profit warning citing challenging conditions in the mobile market. the british retailer said currency fluctuations made new devices more expensive and customers were holding on to ha handsets longer. dixons expects pretax profit in the range of 360 million to 440 million pounds below analysts forecasts let's get more from ben richie from aberdeen assets and
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standards is this something investors that have seen coming? >> good morning. i'm not sure it's about dynamics in the smartphone market, but it's about the broader economic trends that are playing in the uk we have an environment of rising costs, particularly from legislation, but also from currency we have a tough outlook for real wages. against that back drop retailers of all kinds are having a more challenging time especially in relatively large ticket items. >> i think many other analysts or watchers in the market would say this is a smartphone issue this is not a brexit issue i know that the cost for the producers and for the manufacturers go up, the costs for the consumer goes up as imported prices rise then all the other consumer goods companies should be coming out with profit warnings i don't see that happening so far the uk economy dodged the recession. is this more of a company
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specific thing dealing with those currency costs >> could do with the smartphone market itself. i think when we look across the board from retailers, they may not be producing profit warnings, but trading remains tough. we have seen that from next and various others where you may be seeing top line growth, like with dixons, you are seeing pressure on margins >> ben, stick around just want to continue with a bit of news in the smartphone market galaxy smartphone. it has a dual camera and is expected to be priced below $1,000 that seems cheap compared to what the iphone 8 may be priced at the meeting of the mines kicks off in jackson hole, wyoming today as the world's top central bankers gather for the reserve bank's economic symposium. janet yellen is preparing for what would be her final jackson
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hole as fed chair as she seeks to address growing worries over f financial stability with fed watchers hoping she will reveal a plan for the central bank to unwind its balance sheet investors are not expecting shifts in monetary policy to be announced by the fed or the european central bank. many are keeping a close eye on ecb president mario draghi's speech where he could offer clues as to when the bank will taper. this after he delivered more dovish comments to a gathers of economic noubl lawyer rble laurn lindau ben, do you expect anything substantial to come out of jackson hole we saw this reuters report a couple weeks ago saying mario draghi will not be speaking about monetary policy. do we have to wait until september? >> i think he's in a bind at the moment the culture of the ecb is
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looking to tight rates they have always had a hawkish angle to their outlook certainly the comments eventually have been around currency strength. if anything, he will talk today about moderating that. i wouldn't expect anything other than a dovish tone from mario draghi today >> do you think tapering will be a huge risk factor for the european markets the favorite trade is long european equities, maybe underweight u.s., because those equities have had a good run do you think tapering could be a substantial headwind here to that positioning. >> i don't think so. i think invests. >> reporter: positioning themselves toward positions that may benefit from rising rates, like banks, insurance. but we'll see a fairly steady unwind of tapering, and at some point a rise in interest rates i don't think we're looking at anything in the near-term in that direction certainly more likely to see upward monetary pressure in other markets like the united
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states, and unemployment and inflation levels remain in areas that shouldn't be putting that much pressure on monetary policy it's about a normalization of extraordinary measures >> i want to tie in the dixons carphone news into what we've been talking about brexit is hurting the consumer it's hurting the companies do you think the ecb might be tightening too soon given that there's so many risks in the eurozone the uk has its own issue and central bank, but maybe we're overlooking the risks out there, maybe italian elections, maybe we're not all in the clear >> when you look across the board, central banks globally when faced with challenges have opted for a more dovish stance we saw the federal reserve defer raising rates for a long time. normally when there was a difficult decision to be made they decided to pass it. i see no reason for the ecb to do anything other than that and to err on the side of caution and let the recovery take hold
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and grow is a more likely outcome than a rush to raise rates. let's talk about a couple sectors you like or dislike. we heard from wpp yesterday, highlighting the difficulties seen in the fast-moving consumer goods sector in the u.s. are you worried about that sector in the u.s. or globally >> yes it's quite interesting we've seen a challenging environment there. a number of companies have come out with quite weak reports. initially citing relatively specific factors, like weak sun season in sunscreen sales for bayer, but generally seeing a competitive market not so sure it's about weakening consumer trends. i think it is about intensifying competition in those markets from new entrants, new ways of doing business that's the pressure. the u.s. tends to be the area where these models develop first and are ahead of other areas we are seeing those pressures coming through >> ben, you do like healthcare you like a couple names here,
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talk us through why you like that sector? and the niche players within it. >> i think we like the long-term dynamics in health care. it's acyclical it is a seshctor that is global and has fast-growing areas to tap into we're more cautious on the traditional drugmakers we see pricing pressure and patent pressures as well but among those servicing those companies, selling in niche instrument such as tcan or offering reagents and various other services and products which are more stable, we see some interesting and attractive companies. italian sort of hearing aid retailer ampliphone is global in its nature, selling into a market with good long-term growth prospects not too expensive and good prospects. >> and a look at luxury names.
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a difficult time for the overstocking in hong kong and it seems like that's on the mend for swiss watch exports has risen three times in a row do you want to go long these names again? >> swatch is one of the biggest names in our portfolios. we hope we've seen the turn. it's ban difficult time for them they compared that by the long-term view they take they haven't cut costs during the downturn tlachlt positi we are seeing a pick up in demand and we are working through the inventory issues we expect to continue to see steady tick up in demand in china, hong kong, other emerging markets and positive developments while it's been a tough time for swatch, we're optimistic about the medium to long-term prospects. >> ben, thanks for your time
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cnbc will have live coverage from jackson hole this afternoon. first up, an interview with esther george, and rob kaplan coming on to the show talk to us e-mail the show, streetsignseurope@cnbc, find us on twitter, and tweet me directly at @carolincnbc i love reading your tweets in the morning. if you have any ideas what the central bankers will be doing in jackson hole, what they probably won't be talking about, get in touch. still coming up, competition in the skies for air berlin. we're in frankfurt for the latest on those talks. stick around whoooo.
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you coming from opec a joint opec/non-opec committee say they intend to invite libya and nigeria to attend the next panel meetings in september. they say that that meeting will be held in vienna on september 22nd the joint opec/non-opec joint ministry says all options including an extension of supply cuts beyond the first quarter of 2018 are left open to ensure market rebalance equally they say oil commercial stocks fell in july, floating storage also on a declining trend. the market is hoping for rebalancing. we're not quite seeing that yet. wti crude off by 0.4%. brent crude off by 0.3%. 52.38. amazon has won u.s. regulatory and shareholder approval for its takeover of ho whole foods clearing two big hurdles it needed to close the $13 billion acquisition. the federal trade commission decided not to pursue its
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investigation into the proposed merger further, a few hours after shareholders voted to back the deal the two companies expect to finalize the agreement before the end of the year. google and walmart are teaming up to take on amazon the partnership will allow walmart shoppers to do their shopping via the google home virtual assistant. joe fryer has the details. >> reporter: alexa is getting more competition as two big companies team up. starting next month consumers that have google's home assistant will be able to place walmart orders for hundreds of thousands of items by using their voice. google already partners with about 40 retailers, like target, costco and whole foods, walmart is the first to offer linking your purchase account history with google's home assistant allowing shoppers to simply order detergent. prompting the assistant to offer you tide plus febreeze liquid
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laundry detergent 92 houns ounc based upon what you ordered before amazon's alexa assistant already has the intelligence of your account history. >> three, four years ago, it was clear that amazon wa the leader of retail, and now you have walmart aggressive in becoming more innovative than amazon it's gone from one person leading the pack to a two-horse race >> reporter: only about 11% of americans use a voice activated assistant one time or more a month. but of those that do, more tha 70% are talking to amazon's alexa. less than a quarter are talking to google. >> over the foreseeable future, you will see more voice ordering and that may be the new mobile as you go down the next five to ten years. >> reporter: i asked walmart's
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mark lore how accurate the voice ordering is. he said it's sketchy, but as it continues to get better, i do see this as a primary way for consume e to shop under certain use cases. while walmart will get the benefit of being the first to order history with google, brian elliott tells me there is nothing preventing other retailers from doing the same, even, he says, if amazon wanted to be an order option on google home courtney reagan, cnbc. in other news, general electric and abb reportedly resumed talks over an industrial solutions deal according to reuters, ge is exploring the possibility of selling the unit for over $2 billion, we starting negotiates that ended last month over price agreements this as the new ceo carries out a review of the company too's portfolio. fiat shares have hit a high
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over speculation that great wall motors could be looking to acquire part of the firm fiat could be looking to spin off its maserati and alpha romeo brands. and lufthansa confirms it wants to take over air berlin. the german flagship carrier is interested in air berlin's niki unit as well as other parts of the insolvent airline. annette is live from frankfurt it seems like lufthansa will be the big winner this chase for the assets we know ryanair is also a jet they're interested in. but it will all good to lufthansa or am i wrong? >> it's not going go all to lufthansa, that's against the competition laws we have in place in germany lufthansa is now a dominating player on the german market. today with air berlin they were dominating more than 90% of the
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aircraft or whatever you want to call it, the market in germany so, reportedly lufthansa has put a letter of intent on the table yesterday when creditors were meeting who are going to decide who is going to win the asset sales. the letter of intent was as you were mentioning were for niki airline and other parts of the business, but there's no form decision taken yet there's an interview with the insolvency manager or administrator where he says he doesn't see a decision before september because it's quite complicated with all the different parties and there needs to be a lot of decisionmaking taking place. >> at the same time i guess air berlin is running out of time. they have a bridge loan from the german government. how much time do they have
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>> well, there are various estimates flying around. one is saying perhaps into september, the end of september. others are saying it could happen actually before that, they need more cash because as you were saying, they're burning cash by the second or by the day. that's what the insolvency manager is saying. the longer it takes to find a solution, the more it will hurt the existing asset base because, of course, nobody would book a flight in three months time with air berlin that's the problem we are facing now. so i think they're working very hard to find a solution very soon in order to actually derail the attractiveness of the existing assets of air berlin. >> i think it was ryanair who wrote a letter to the eu commission and said hey, you guys need to look at this, because it seems like lufthansa has been favored all along in this deal to snap up most of the assets of air berlin then we have this entrepreneur from germany who also says it
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seems like lufthansa is the prime beneficiary of this. does it seem like this was set up a long time ago you know, what are the rumors in germany? >> well, it seems like that. lufthansa actually was talking to them a lot earlier than anybody else the fact is that the current air berlin manager or the previous ceo or the ceo still in place was a longstanding lufthansa manager. he served with lufthansa for more than 18 years so there's a clear connection between air berlin and lufthansa. and it's fair enough that the others complained. they should be invited to the data room. we don't know who has access to the data room it seems as well condor's interested, as you were saying, and of course ryanair. we don't know who has access to
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the data room and who will be making a bid or issuing a letter of intent. it's all a little bit still up for grabs. back to you. >> annette, thank you very much for those details. let's come back to the uk. british prime minister theresa may has apologized after the home office sent nearly 100 letters to eu nationals in the uk ordering them to leave the country or face deportation. may described the incident as an unfortunate error. the story went viral after a finnish academic posted the contents of the letter she received on facebook the united kingdom unveiled its post-brexit plan to leave the director of the european court of justice britain detailed its wishes to negotiate an agreement to enforce its own laws and vowing to guarantee the rights of european citizens living in the
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country. separately the uk financial sector is set to propose a mutual access trade deal with the bloc after brexit. the white house is reportedly considering a ban on trading venezuelan debt. this would be the latest in a series of sanctions against president maduro's government following the dus putdisputed election last month. the bond touched a low not seen in 18 months and tropical storm harvey is set to roar ashore threatening the texas and louisiana coasts right in the heart of america's oil refining business. forecasters expect harvey to reach hurricane strength soon bringing powerful winds and rain about a third of u.s. refinery capacity is in the expected path of the storm if you live down there, do stay safe dutch police believe they foiled a terror attack on a
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rotterdam concert venue. they have a man in custody driving a van packed with gas canisters. a tip came from spanish police, but authorities don't think the plot is linked to the deadly attacks in spain last week we will go for a quick break. before that, want to show you what the european equity markets are doing this thursday morning. we're roughly 1 1/2 hours into the trading session. we're seeing quite a bit of green. ftse 100 up by 0.30%, despite the negative new s from dixon carphone. disruption in the desert we're live in dubai talking fintech, that's after this short break. chances are, the last time you got a home loan,
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welcome back to "street signs. i'm carolin roth these are your headlines republican leaders on capitol hill reject trump's threat that he could shut down the government house speaker paul ryan says the extreme measure is not need ed to force congress into approving a border wall with mexico. >> i don't think a government shutdown is necessary. i don't think most people want to see a government shutdown ourselves included tough call trading is halted after shares of dixons carphone plunge after the retailer issues a profit
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warning on the back of a difficult environment for the uk mobile market. airline assets lufthansa reportedly submits a letter of intent for airline air berlin's niki unit, as the german carrier looks to expand its spanish routes all right. welcome back to the show just look at second quarter dgp out of the uk. that's the second reading, that was unrevised at 0.3%. what we're seeing in the breakdown we're getting is that household spending was weak, and that is pretty much bang in line with some company results that we have seen this morning but also in the last couple weeks, obviously dixons carphone was one of the big decliners given the profit warnings. once again you have second quarter gdp unrevised at 0.3%, up 1.7 % year-on-year. quick look at the currency markets, looks like sterling/dollar is not impacted
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too much by this currently trading at a two-month low, at 1 tnt 1.2793 when it comes to the other fx pairs, the dollar is staging a comeback against the yen it did fall quite hard yesterday, that was on donald trump's threat of the government shutdown but today it is up by 0.3% elsewhere we're jackson hole watching throughout today and tomorrow when it comes to the european markets, this is a friendly picture. ftse 100 up by 0.3%, despite the dixon carphone warehouse news. the stock is down by a third today. the xetra dax is up by 0.2%. cac 40 is also seeing modest gains here when it comes to u.s. futures, we're looking somewhat mixed dow jones seen up by roughly 19 points s&p 500 seen off by a fraction the nasdaq seen down by three points this after the dow and other main markets did struggle in the trading session
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it was all about the trump comments, about this government shutdown, and a lot of republicans talking this down. but let's get more on that story. president trump sparked criticism from fellow republicans after declaring he would be willing to shut down the government in order to build a border wall with mexico. congress has until around the end of september to make a debt ceiling deal that will keep the federal government going now, house speaker paul ryan said he is in agreement with the president over the need for a border wall. but he did warn that a government shutdown would be both unpopular and unnecessary he also stressed the need for the gop to push ahead with its tax reform agenda. >> lessons from the healthcare debate is unify between the house and senate and white house, nail down understandings, get on the same paj age and go forward together that's the big lesson. that's what we've been spending the last few months doing.
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as far as how to make the numbers work, you have to broaden the base to lower the rates. take away special carve-outs, loopholes, more income is subject to taxation, that allows you to lower tax rates for everybody. >> sbs sbs hcnbc has an exclusi interview with paul ryan tune in at 19:15 cet. u.s. president donald trump and senate majority leader mitch mcconnell say they are united on key goals, that's from a white house press release despite a major falling out between the pair the president has been vocal in his criticism of mcconnell since the obamacare repeal failed to get through the senate president trump is also renewing his call for party unity amid fresh reports of republican
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infighting peter alexander hat has the details. >> reporter: tonight more white house whiplash at the american legion national convention in reno, a declaration of unity. >> it is time to heal the wounds that divide us. >> reporter: a presidential 180 from last night's unbridled offensive in arizona. >> repeal and replace! >> reporter: repeatedly taking aim at the media. >> the very dishonest media. and they're bad people they don't like our country. i really believe that. >> reporter: president trump abandoning the discipline displayed just 24 hours earlier. his scripted afghanistan speech. instead accusing the press of misrepresenting his highly criticized response to charlottesville. >> they don't want to report that i spoke out forcefully against hatred, bigotry and violence and strongly condemned the neo-nazis, the white supremacists and the kkk >> reporter: but mr. trump omitted his own most controversial words. >> hatred, bigotry and violence
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on many sides, on many sides you also had people that were very fine people on both sides >> reporter: former director of national intelligence, james clapper, who briefed the president during his transition, now questioning his fitness for office. >> i worry about, frankly, you know, access to nuclear codes. >> reporter: on stage playing to the crowd like an aging rocker delivering riff after riff threatening a government shutdown over his border wall. >> believe me, if we have to close down our government, we're building that wall. >> reporter: outside, a wall of resistance thousands of protesters. inside the president even antagonizing members of his own party like senator jeff flake. >> who is weak on borders, weak on crime. >> reporter: house speaker paul ryan tonight calling for his party to come together. >> i think it's important that we all stay unified as republicans to complete our agenda.
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the dubai international final center has launched the fintech excaccelerator program the first of its gin in the gki gulf difc joined with banks who are seeking fresh investments as they expand into the middle east and africa willem marx joins us dubai doesn't strike me as a fintech hub. maybe they want to become one? >> they are working on that. we are joined by the ceo of req bank, peter england. what's the opportunity the accelerator space opened from your perspective what does this precept to you as an opportunity? i think the fintech -- first of all, we're proud to be a part of
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the founding members it's a great opportunity for us to work with the entrepreneurs and the technology practitioners who are developing technology which is disrupting our industry it's a great source of talent and stability to interact and see how it can fit into your areas and work space that's real opportunity to look at and bringing value to customers which is different from what it is today. >> peter, i met people this morning from all over the world, from the u.s., from the uk, from the region, from europe. i wonder, you're an australian, you worked in banking australia, malaysia, now here in the uae. is this an opportunity with dubai as a global cross roads for you to meet young talent as a bank involved in this inertive that might be able to come up with ideas that will help your business is that the point? >> absolutely. for us, we're just a aushgs uaek
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only, so it's an opportunity for smaller banks to go ahead and do something completely different rather than i think many banks see it as a threat, i see it as a fap tantastic opportunity, bee we can develop new ideas and initiatives in a way that we wouldn't be able to do if we were just on our own >> is that about increasing the offering for current customers, trying to find new customers in new markets? a bit of both. >> i think it's a bit of both. we're predominantly a sme bank, not a wholesale bank even in wholesale, i think of fintech more about retail or sme, a number of companies we talked to here give us tremendous opportunities in that space. that's good example of how we can accelerate our growth in
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wholesale in a different way to how we would tra traditiditiona that >> africa is a huge growth area for mobile banking what do you hope to get out of this accelerator in terms of ideas for in products, collaborations, new penetration options. >> what we're looking at, the areas where we're interested, artificial intelligence is one robo advisory is the third cybersecurity is the fourth. there are tremendous amounts of work happening in each space and the opportunity that this one gives us is going to give us a balcony view of what's happening with the people really working day and night, and take some of these ideas and share what our experience has been in different parts of the market with them. we met a few of them before this program. they're also looking forward to interacting with us and getting some ideas from us and we learn tremendously of what they're doing and how we
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can apply across markets to your point, this acts as a gateway for this particular center, for the area that i manage >> is this an opportunity for these young people often runnin these start-ups to get your expertise and understand what the market is looking for? they might have a great idea, but are you trying to help shape them as to where it will be useful. >> absolutely. part of the program is the whole mentoring process. it's very much a two-way street. we get fantastic ideas from them, and what you said, the whole idea is that we can help them transform these great ideas into something practical and work in this market or other markets. yesterday we had a fantastic speed dating session with the ten plus successful companies, it was a brilliant opportunity for them to showcase what they had, and then after that my team sat down individually with each of them and started working on
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how they could start developing their business plans, how they could help put pitch books together this is a process that will go on for a few months. rakbank and other key partners are involved in bringing the ideas to arket >> standard charter is more than one of 1700 fim institution fin institutions inside the dubai border do you think this is an excitein opportunity they are offering. >> absolutely. this is a journey which just started. this is the first phase of it. i can only see how this can grow into a much bigger opportunity as more and more players get involved not only do we sort of actively interact with them, share our ideas, we are also opening up our own doors and giving them space in our institution to come and work with us so that really is a great opportunity for them, and for
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us so it's a mutually beneficial arrangement. i can only see this becoming a lot bigger for this particular reason in particular >> peter you mentioned you don't have huge budgets to send on necessarily developing new technology is this an easier option, working with accelerators and developing these tools in-house. >> absolutely. for us, as i said to take on global banks, that would be extremely challenging. the whole point about fintech is exactly this it's the opportunity to do something with not spending a massive amount of money. and come up with great new ideas, new initiatives that is not necessarily about money, it's more about different views. you look at the guys from the fintech companies, they're not bankers. we're a bunk of och of old bori bankering who have been doing this for years >> you know, you're responsible
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for middle east, africa, standard charter famous for operating in frontier markets. the penetration of mobile banking is down 35% in this region how do you change that what are the tools you currently have, and what are the tools you need to get into those markets you're not in at the moment. >> i think that's a great question as far as we're concerned, we are present in most parts of subsaharan africa, and in the uae in particular and bahrain. clearly the things that we need to work on and which we're working on, payment space is a specific area, a tremendous amount of progress is happening with multiple parties, there are players who are not banks at all. what we need to figure out is how do alliances work, how does new technology work, and how do we converge that to the benefit of the ultimate customer at the end of the day, customers call the shot. if you want to be involved, you
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need to be with that individual and they are voting with the wallet we need to partner with the right alliance, be there, and increase our penetration in those perspective markets. >> peter, this accelerator just opened this week if i was to come back in a year's time, how would you as one of the banks who decided to get involved in this measure success? >> on a number of fronts success both ways, one for the fintech startups, secondly for the organizations that may end up using their services. so i think it's a two-way street for us it may come down to us getting involved in equity investments in one of the companies or ten of the companies. and also, you know, using services and if nothing else just learning from the ideas they have, and doing our own thing. so, no, i think to me it's a win-win for everyone i think success will be measured
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by what we each get out of it. >> peter, thank you very much. thank you very much. that is peter england and also j.d. gupta joining us there. >> thank you very much for that fas facinating discussion. coming up, the galaxy 8 launches we'll have the details after this short break
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welcome back uber technologies posted a 16% rise in second quarter bookings. the ride hailing company saw a smaller loss than in the previous period as it attempts to inch towards profitability. it lost 6$645 million, down 9%
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from the first quarter as it sought to clamp down on excessive spending for all of 2016 it lost about $3 billion. samsung launched the galaxy note 8 smartphone. the successor to the troubled note 7 the device has a massive 6.3-inch display, dual camera and will be priced below $1,000. seema mody went to the launch event in new york. >> reporter: this launch is seen as samsung's redemption moment yes, samsung made the screen bigger and the new galaxy note 8 has two rear cameras for the company, it's about a lot more than a smartphone last your's global recall of 4 million galaxy note 7s was a black eye for the company. exploding phones went viral,
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costing the company $7 billion now samsung is hoping to extinguish those fears with one of the largest devices on the market >> i think it's a very sexy phone. i think it's a good rebirth of the note brand samsung has figured out a way to make larger and larger screen devices without making the device really large. they kind of invented the fablet category, because everyone laughed at large phones beforehand, and they stumbled terribly last year >> reporter: but one of samsung's biggest challenges is whether it can stand out from its competitor >> i use an iphone now, so i will hold out fo the iphone 8 or 7-plus i like to see what's out there before i make a decision >> reporter: apple is expected to launch the next iphone in september, while both tech giants continue to face pressure from their counterparts in china. >> apple and samsung have been competing at the high end against surging chinese for several years now. i don't think that's anything new. >> reporter: according to the latest data from gartner, both
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samsung and apple lost market share in the first quarter of the year to chinese players, making this launch a test for the future of samsung's entire note line. i'm seema mody, new york. samsung is poised to launch the gear smart watch next week at the efa consumer electronics show in berlin head online to find out everything you need to know about the latest gadget. the bitcoin rally gathered steam once again trading above the $4,000 mark. the cryptocurrency has been one of the best performing asset classes of 2017 with its value more than quadrupling year-to-date matthew van nikirk joins us now. you are active in developing blockchain applications. blockchain linked to cryptocurrencies let's just delve into the craze around cryptocurrencies now and
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the icos going on. do you think it's a bit of a bubble >> i think with it being -- if we're to call it a bubble is a bit of a stretch we're at the dawn of a new era of financing for start-ups, the difference between vc financingt you're investing in more than one currency for a vc, when you get into a company, you're in it for the long haul. either they make it or they don't. with a token that you buy for an ico, with that, when it's listed on an exchange, you can get out early. you can set a stop loss as a vc. so the risk premium is much lower. >> should we not be asking questions when this ico frenzy means that so far this year, 3 $1.3 billion has been raised for icos it's easier to get money for icos than for venture capital
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funding. should we not be more skeptical. >> it's the beginning of a trajectory will there be ups and downs? definitely will there be corrections in the market of course. a lot of that will be driven by new regulation that comes into support on the one hand, also constrain the growth of the market but there will be ups and downs. that's for sure. >> some experts saying this correction could be coming as soon as october after the next wave of icos is over do you think it will be as short-term or near-term as that? do you think this is something we're looking at in a year from now? >> i really do believe that as a new form of financing for companies involved primarily in the blockchain and crypto space, we are at the beginning of a long curve the icos are not going away. will there be corrections? of course. this year? we're looking longer term.
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frlts that >> that's ahard to say. my issues is it's the currency of the dark web. the currency often used for this sort of ransomware attacks how do you work around the legality of it >> i think it's a bit of a -- something that gets attention. if you look at what is the most predominant forms of exchange use for buying illegal goods, it's not bitcoin, it's cash, cold, hard cash. if you look at it relatively, it can be used for that but the difference between that and cash is you have a traceable form of currency being used toek exchan, whether for nefarious purposes or other purposes. >> it seems blockchain technology is wide ranging this is not just affecting the finance industry this could impact governments,
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too. >> sure. i think when you look at this technology, it's essentially a new foundational layer for the internet we have today the internet of information. this is the internet of value and transactions what you'll see as the technology matures is that adoption and other industries will take on a similar basis within the financial services sector where it's interesting to look for is the intersection of a number of different fourth industrial revolution type technologies if you look at big data, iot, artificial intelligence and blockchain acting as a fabric to tie that together, that's where the real excitement happens. where you have new businesses being developed utilizing those technologies >> should every bank and every business that wants to be a driving force use blockchain or are you behind the curve if you don't? i think you definitely run the risk of being behind the curve if you don't there's always room for
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fast-followers, as they call them when the tsunami wave is coming, the safest thing to do is head towards it if you're in a boat, you don't run away from it or head back to shore, run towards it. >> that's a nice analogy thank you. quick look at u.s. futures before we wrap up the show looking mixed. the dow jones could add 30 points at the open the nasdaq seen up by 3. s&p seen down by a fraction. that's after markets across the board were down yesterday responding to the threats from donald trump about a government shutdown that's it for today's show i'm carolin roth "worldwide exchange" is up next. see you tomorrow your brain is an amazing thing. but as you get older, it naturally begins to change, causing a lack of sharpness, or even trouble with recall. thankfully, the breakthrough in prevagen helps your brain and actually improves memory.
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wall street looks west as the annual fed summit in jackson hole gets underway facebook's big bet the social media giant putting one of its most important executives in charge of hardware the reason coming up. and we have a winner one lucky person is 7$759 millin richer today after hitting the powerball jackpot. it's thursday, august 24, 2017, "worldwide exchange" begins right now. ♪


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