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tv   Street Signs  CNBC  December 16, 2016 4:00am-5:01am EST

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hang on a second. it's 9:00. >> it is 9:00. >> we should be offset. >> you know what this is? >> no. >> the sound of the regular presenters tied up. >> this is a "squawk box" takeover of "street signs." >> yes, it is good morning, i'm geoff cutmore. >> i'm steve sedgwick. >> let's talk about actelion. the company closing in on a drug deal, shares of actelion hit an all-time high after reports say french drugmaker sanofi is nearing a bid for the swiss
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group, 275 bi$275 bilper share. >> the italian government is reportedly ready to inject 15 billion euros into monte dei paschi giving the shares a a boost, after the ailing lender reopens its debt swap offer to investors. lufthansa agrees to mediated talks with the german pilots union, telling investors it's confident it can find a solution to the long-running pay dispute dating back to 2012. goldman sachs raises its oil price outlook for the second quarter of 2017, but warns dollar strength could limit the near-term upside for oil prices. with markets i up and trading this morning, it's a mixed bag. we are struggling for escape velocity in either direction. pretty much flat line on the stoxx 600. the individual indices are really not showing a great deal
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of conviction at this stage. the cac is flat. the ftse flat. the ftse mib in italy doing a little better, i guess, than the average here. even so, that's a modest gain as far as europe is concerned. i suspect just a bit of pause for thought at this stage to see how much further european markets can go in the shadow of the strength we've seen in the united states. >> this is the calm before the violence. everything you see at the moment makes it look like people are pushing aggressively on these trades. gold getting a pounding. the dollar having a surge. bonds getting sold off across the curve, people trying to work out where it's safe to hold a bond. building up to inauguration on january 20th and then waiting to see what happens. i can't help but think a lot of tensions are built into the system. >> the comment presupposed is there has to be an impetus to the upside or downside as
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opposed to the general melt-up that we've been seeing. i think we're all intrigued where that interest could come from if it emerges before year-end. any thoughts? >> it's unlikely we'll get impetus before year end. if anything i think we'll going to see some acceleration in momentum of the existing moves amid thinner liquidity than usual. i think the next big thing is to wait for trump's fiscal plans in general, policies on trade, immigration, so we can choose which way on the way down the road he's going, and then filter through the noise and decide whether this dollar rally indeed is very much justified. >> i think we're on the same page. i think if one thing that 2016
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taught us is not to assume a certain set of scenarios on the back of a certain outcome to a key event. that's why when we look at the key political events of 2017, which are already queueing up to be the french election, the jer german leelection, possibly the greek election with tsipras. how do we play the key events of 2017? >> it's difficult to play them out before they actually happen. i seem to be in a state where things are giving me contrasting signals. we talk about the trump's fiscal stimulus, right? everyone gets excited. it will be good for the economy. it will be good to the dollar, the dollar soars. but then again you have to think
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every stimulus is not the same. what matters is the timing as well as the sizing of the still plus. for example, when you inject a sizable fiscal stimulus at a time when the economy is near full employment, potentially that stimulus is lacking a lot of ingredients that could boost structural productivity higher, that implies you may be pushing inflation in the pipeline and real rates of return in the u.s. could go lower and compress. so from that respect, that should not be positive for the dollar. so we just have to wait and see how things pan out. my central scenario is that we're probably going down a watered-down version of the fiscal stimulus that he has announced. we'll see a boost in the u.s. but i see this momentum in the dollar carry on for the next few months, but i think it's gotten ahead of fundamentals. >> today is a day that we're getting some pullbacks. euro is in the driving see the
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against the dollar. sterling doing better against the dollar. this may be a brief respite, how would you think about buying into pullbacks at this stage? are all of these just an opportunity to increase your positions long dollar? >> depends on the time horizon. if you're a tactical player, yes. that's right. if you have a short-term horizon, the momentum now is definitely in favor of the dollar. i think if you're a medium to long-term horizon who believes in fundamentals and willing to stomach the initial volatility and pain, my long-term view of the dollar is that the dollar goes lower. >> you talked about the mix and the quiet trading over the next few weeks, perhaps even up to the inauguration, people have got herd-like positions on these trades. thinner volumes in the market.
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that says to me that incidents could happen aggressively. if everyone has the same trade in thin markets, this could be a dangerous time? >> could be. this could get ugly. you could see sizable and vicious reversals, especially in trades which seemed to have become quite crowded, like dollar/yen. dollar/yen has seen one of the most sizable moves in the last three weeks or so. from that respect it's difficult, because fundamentally you have the yield rates at zero, which supports the trade, for you to be bearish on the yen, but you also have a hugely crowded position. my view is step on the sideline for now. >> what's the potential for mistakes around this limited
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liquidity phase? we already saw the flash crash in sterling a few weeks back. is there a chance that, you know, we need to be sensitive to the risks of a fat finger in the low liquidity? >> there can be very different risks. there is also, as you mentioned, the fat finger, which can be entirely random. it's impossible to predict. the ramifications of that are greatly exaggerated in periods of liquidity. at the same time the other problem i have is that we -- people, there is so much political uncertainty, there's an interpretation of implemented policies by people. this can turn quickly the other way around, just by someone, by trump saying something nasty on china or whatever. i think we have stepped into a period of unusually high uncertainty. >> so beware the whipsaw.
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>> absolutely. >> thank you very much for that. >> italy's government is prepared to inject 15 billion euros into the country's banking sector as monte dei paschi siena, the third largest lender, pushes ahead with a private rescue plan. in addition, bmps unlisted banks popolare di vicenza and veneto banca. monte dei paschi siena approved a last-minute plan to approve $5 billion in a debt swat. a reuters report says qatar is still considering investing in the world's oldest bank. >> if there's anything you and i have to be careful of when we talk about banks, the withdrawal of capital. i think we tried to handle it
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responsibly between 2008 and 2011. so i'm tempering what i've seen. monte dei paschi has seen deposits fall by 6 billion euros, a third of that decrease since the italian referendum on december 4th. this comes after the bank approved the last-minute plan to raise 5 billion euros through a share issue and debt swap. deposit holders will have a mindful eye to southeast region of the eu and what the ramifications were in a previous crisis. >> intesa sanpaolo agreed to pay a 235 million euro fine to new york state's financial regulator for violating the state's laws on money laundering. the state said the bank's local branch employees concealed money processing activities involving iran to avoid sanctions
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violations. some of the activities date back to a decade ago. >> amazing u.s. regulators can find another bank that's doing this given the exhaustive search before. the greek government legislated to give pensioners a one-off christmas bonus in defiance of international creditors. the country lenders said they were suspending offering greece short-term debt relief due to s the money spent. my understanding is this money spent was a surplus to the overperformance of the primary surplus achievement, which is 3.5% of gdp. this was an overperformance amount of money.
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ie they achieved their goal that the international creditors wanted. they were spending this money on pensioners who at most were on 850 euros per month. some of the worst affected people. i appreciate the point, you made during that wonderful show that was before this, "squawk box," about the average age of some of these pensioners, but these are people who are incredibly impoverished. the greek government got its goal. on that fact alone, i have deep sympathy for the situation which also touches upon the key issue of sovereignty. >> and on the issue of political risk. we know what angela merkel said about the departure of mr. renzi. she was quite disappointed with the outcome of the referendum and the fact that mr. renzi decided to go. and it has increased elements of political risk for investors as far as italy is concerned. so, does the commission want to see the back of mr. sipras given
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the fact he's organized down? >> but at what cost. we both know that some would toe the line but or be more akin to toe the line but to think we are talking not only about french election, the german election in 2017, but now with possibly -- i say there's an outside chance, italian and greek elections, it becomes more of a headache for the powers that be in brussels. >> let's move on to some corporate stories. shares of actelion after bloomberg reported that sanofi is in talks to buy the company for $275 per share. that would value actelion at $29.6 billion.
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>> what day is it? must be strike day. lufthansa, this could be good. lufthansa agreed to mediate talks with the german pilots union after several weeks of strikes over a pay dispute. the airline previously said the strikes were costing the company around 10 million euros a day. >> you should be aware of this, if you have travel plans in the uk or are booked with ba that there is an issue -- possible issue. >> looking no this, you might think dacrews doing this or management -- but i think the ongoing story, there's a lot of important issues there. >> impeachment appeal, lawyers for south korea's embattled leader are fighting against the parliament's impeachment vote. more on that ongoing scandal when we come back. you're watching "street signs." >> "street signs." the "squawk box" takeover.
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welcome back to a special edition of "street signs." with jeffrey cgeoff cutmore ande sedgwick. >> it's a takeover. >> yeah. they're all in the -- what is that conversation, leaders of conversation? in the broom closet? goldman sachs revised its oil price outlook saying that a stronger dollar will likely limit the near-term upside. the surprise is that the bank left its wti forecast for $50 a barrel and suggested there will be little evidence of production cuts until mid to late january. goldman sachs believes after the first half of 2017, the global
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oil market will rebalance or remain balanced with brent prices between $55 and $60 per barrel. japan has overtaken china as the largest holder of u.s. government bonds. china's holdings declined to the lowest level in more than six years. china's central bank used its fx reserves to support the yuan. japan's treasury holdings also decreased, but at a slower pace. >> support the yuan? china set the official yuan mid point at its weakest level since may of 2008. this follows the fed's second rate hike in a decade. i didn't think i would speak to pauline again. i'm delighted. >> hello once again. the chinese yuan at an eight-year low. right now trading at 6.591,
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close to that 7 yuan handle. if and when it hits that, you can be sure beijing will be bracing themselves for more capital outflows, as chinese citizens will want to get their money out of the country. the shanghai composite ended up in positive territory, up 0.2%. also the blue chip index of large companies in china up. for the week they are down with the shanghai composite down 3.4%. the csi 300 down more than 4% for the week. that's largely because of insurance companies under a lot of pressure by regulators not to take risky bets in the markets. it's been a currency story in the asian markets. the big winner is japanese exporters as dollar/yen is trading at 118. to put this in context, in september this was 100. this has been good news. nice ride for japanese exporters as the nikkei caps off a 9
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session winning streak. the nikkei up 0.6%. steve, geoff, back to you. have a great weekend. >> possibly good-bye, but you never know. we might be here for a couple more hours. let's leave you hanging there. >> hang on, market watch is after this. >> no, "worldwide exchange." >> "worldwide exchange." >> wilfred and sara decided they have a cold. lawyers for president park have said her impeachment by parliament has no legal grounds and should be struck down by the constitutional court. the court has 180 days to rule on the motion after south korea's parliament voted to impeach park. her lawyers say she is unlikely to appear in person for the hearings. the south korean yuan extended its decline to a one-month low after concerns of capital outflows after a faster pace of rate hikes next year. but merrill lynch has named it
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strong due to its current account and fiscal position. david hannah is with us. you cover that emerging space. good morning to you. >> is that the yardstick by which we should assess our emerging market exposure, look at the fundamentals of the budget and decide whether you think this country can withstand stronger dollar related outflow? >> yeah. definitely. in the long-term, fundamentals drive asset prices. but markets are fast moving. you can see for example, that markets priced in the whole trump story for 2017 by christmas. also when it comes to rankings, korea, top ranked emerging market, super strong fundamentals, but of course the
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strong dollar means the yuan is under pressure, and the korean won is under pressure, too. you can have a weaker yuan and won, but this is a fundamentally strong economy when i talk about korea. at some point it will come back. in the short-term, we are still short the korean won. we like it. there's a short on the russian ruble on the long side. >> interesting to see poland on that list. i know the current administration butted heads with the european commission quite a lot this year. which is, i think, discouraged some people from owning the polish market. you still like it? >> yes, it's very cheap. it's a country that's fundamentally sound. it's -- there's been a lot of political volatility this year. but we think that much of the political risk is priced in. it is one of the favorite trades we have in the european space for next year.
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>> david, i want to go to india. you talked about the commodity shock fading in your copy, but for india paying 30s for oil, suddenly they'll be paying $50, $60 a barrel in 2017 or thereabouts. that's a shock for a country which has had such a fantastic growth scenario. >> among the top emerging markets, india and turkey are the classic example of those vulnerable to higher oil prices and u.s. rates. turkey has seen a lot of pressure, because of that. india less so. that's because india still has reasonably good domestic story. at the end of the day they're posting the highest growth rates among the major emerging markets. but we do recommend and underweight in indian equities because, as you say, everybody has liked it for many years.
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oil prices are going up which is a drag on the market. we think the commodity exporters will be performing better. >> i just realized we spent a lot of time talking about european political risks for 2017, greece, italy, france, germany. but we have stopped talking about political risk in emerging markets. is this something that could rear its head next year? >> sure. it is always good for surprises any time. the question is what is priced in? a couple years ago, yen was expensive, currencies were overvalued, investors were overexposed, then the commodity shock, strong dollar, lots and lots of politics across the board. today em currencies are on average 10% cheap to fair value, which means they're as cheap as about 12 years ago. and normally you make decent returns starting from such level of underevaluation. spreads are quite a bit wider
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than two years ago. you're right t can come back any time this political risk. in particular, brazil is always one where you wonder how long the current reform coalition can hold. of course in china you have the congress next year which may overshadow domestic volatility. it's not our primary concern. our primary concern is major overshoot in the u.s. dollar and then all of these issues that we've been talking about a couple years ago will come back to the fore. >> excellent. thank you very much for your scenarios. very nice to see you. okay. it's time to play the game. the wwe launches a uk and ireland championship. and our reporter, arjun, the closest thing to a professional wrestler at cnbc was given an interesting task.
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>> after the break, i'll be going toe to toe with 14-time wwe champion, triple h. i reckon i can take him.
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what's the time here? >> half six. >> half six? another 2 1/2 hours to go? this is not "squawk box"?
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>> seriously? >> no. this is "street signs." the "squawk box" takeover of "street signs" for one show only. i'm steve sedgwick. >> i'm geoff cutmore. these are your headlines. >> yes. closing in on a drug deal. shares of actelion hit an all-time high after a report said french drugmaker sanofi is nearing a bid for the swiss group at $275 per share. this one's yours. the italian government is reportedly ready to inject 15 billion euros into monte dei paschi giving the shares a boost, after the ailing lender reopens its debt swap offer to investors. lufthansa agrees to mediated talks with the german pilots union, telling investors it's confident it can find a solution to the long-running pay dispute dating back to 2012. and goldman sachs raises its oil price outlook for 2017, but warns dollar strength could limit the near-term upside for oil prices.
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we've got some interesting levels on some of these markets. the dow was up 8 out of 9 sessions in a row. goldman sachs was the most important impact yesterday putting 21 points on the dow. united technologies to the down side accounting for eight points off the index. a great run since november 8th. the futures are indicating a flat start to proceedings on the major u.s. indices. there's been some absolutely terrific moves to the upside. russell 2000 what do you think that's up? >> 16%. 146r7b8g >> 14.3. extraordinary moves. european markets look like this. banks were moving us higher, you have the ftse 100, i will call that 7,000, and the xetra dax at 11,365. both of those indices and the
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mib trading flat. you have a tiny bit of a down side on the cac. one story in town, it's the dollar. with multi-year highs for the dollar index, for the dollar versus the euro, for the pound. what is it trading? 124 as well. every time we see the pound come off against the greenback, we see uk blue chips rally aggressively. something those dollar earners and vice seversa. do you want to look at the bonds? >> we can do. let's fill you in on the bonds. i think there's some interesting stories around the bond market, not least the fact that the japanese now own more u.s. treasuries than the chinese. the other great story, i think, has been around the spread widening that we've seen on the u.s. curve and the european curve. we have seen some movement in
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reflection of the u.s. steepening, but to be quite honest, i think people are looking hard at reasons to continue selling down german paper. >> markets bought a lot on credit. and jim o'sullivan a bit of copy from him saying look, that's fine. there could be fiscal stimulus, growth, regulation cut, corporate tax cuts but the market bought an awful lot on credit and gone up a long way for something that might not hit in terms of when we start to see ramifications until at least the second half of 2016. >> let's talk about how you may take advantage of this gap that's emerging between u.s. and german bond yields. hit the highest level in 26 years after the fed projected three rate hikes next year in light of what pimco describes as a stable but not secure world. the company suggests investors should consider a patient approach and aim for stable
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capital preservation strategies until the veil of uncertainty over future policies starts to lift. let's get out to andrew balls from pimco. good morning to you. that's great if you are that way of mind in terms of investing, and you are concerned about capital preservation and the longer-term trade. if you like something more racy, in the short-term what about strategies to take advantage of this spread widening or, indeed, to play the steepness of the curve. >> yes. in your last piece of news you were talking about the market updates or the moves in equities over the past month, an awful loss has been priced in in terms of good news. our point is when we look at 2017, we see upside risk but also down side risk. we see an awful lot of uncertainty in the outlook,
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including on the u.s. administration. from our point of view, from an active manager, a lot of good news priced in. we are expecting that you will see periods of volatility next year as we've seen this year. so as an active manager you want to take advantage of that. on curve, overall we favor global curve steepeners. we see that as a good way to make money in the current environment looking into next year. on credit and risk assets, we think reduce a bit of risk now, add on future volatility. >> that call, i think, indicates some concerns that the market has got too far ahead of itself. what do you think the anchors are for further momentum on these trades? >> we just have done our cyclical outlook. we talked about three big transitions, difficult
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transitions. as we look out to next year. one is from monetary policy or the central bank easing, unusual policies to fiscal expansion. handoff of monetary fiscal by the u.s. could go very well or poorly. a second one would be the trade and nationalism we see in the u.s. and around the world. one source of risk is u.s. trade war with china, mexico, others. populous politics a ton of elections coming up in europe. and china. china, this week the official news agencies were warning of chinese concerns following the fed move. the start of this year, remember, we had the china move on currency, which dominated risk assets the first two months of the year in china as we move from a peg to a basket to a floating currency over time, a
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lot of potential for volatility coming from china as well. not all bad news, plenty of upside risk as well. our point is the markets priced in the upside. we think you need a more balanced overall view. having donald trump as u.s. president is something that will inject a lot of political uncertainty. it's not a one-way bet. >> will some form of chaos ensue if we get a more hawkish ecb. i'm not so sure i was right about the tapering we did see, maybe you can expand upon this. we have another 540 billion euros to the end of 2017 maximum. anything more hawkish from mario draghi? >> it's unclear what they did a lot of uncertainty what they did, they announced on a forward basis they'll taper. we think they should stop
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talking about it, close to 2% inflation target. clearly they're okay with 1%. the bank of japan has thmoved ay from its inflation target as well. two of the three central banks saying they can't do it either because of the costs and benefits around policy in the japanese case, or maybe in the european case some politics here, a german view dominating the frankfurt-based ecb and they are going to do less because of the overall eurozone politics. we conclude from this be very careful about eurozone assets, about anything which relies on the ecb support. funding italy for less than 2% for the next ten years doesn't offer a lot of value in a world where you have an uncertain and unfortunately looks like a political ecb. >> the three of us will remember 7% just 2011, the danger is then
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from what you're saying that a widening between the core and the periphery. that's an old trade they can start dusting off again if we hear more hawkish language from the ecb? >> yeah. it's a question of real untertcy. w uncertainty? why would you taper now? good luck to them, seems like forecasting the weather three years forward. clearly less desire to be doing long-term qe and a desire to move away from it. the politics in europe is important. we had brexit, we had the trump election in the u.s. were you to have one of these political events in a big european country this would be destabilizing in the eurozone context, the underlying economy, the institutions are weaker,
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everybody focuses on france. again, taking a medium term, three to five-year view, a lot of risk in europe, not as much reward as you got in the past in terms of compensation. we think we can do better with other global alternatives. >> very nice to see you. have a wonderful weekend. andrew balls over at pimco. lovely e-mail from david. he wrote in saying hey, why are you two on now? >> yes. >> in a good way. >> i got a nice one from tom. hi, steve and ross. ross? >> yeah. >> ross? >> yes. >> dear friend ross hasn't been here for a while. it's about time you two lightweights did a full shift. it's so true. so true. i'm not so sure about the lightweights. >> the chairs are comfortable. enjoying this hour. >> stamping our own unique blend on this. donald trump named david freedman as u.s. ambassador to
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israel. freedman is seen as a hard liner who has advocated the annexization of the west bank and questioned the need for a two-state solution. he said in a statement he was honored by the nomination and looked forward to doing this from the u.s. embassy in israel's eternal capital jerusalem. mr. trump says he is saddened by the recent events in syria. speaking in pennsylvania, trump added we are going to help people. and called on persian gulf nations to put up money for a project to rebuild safe zones in the country. larry kudlow emerged as the front-runner to chair the white house council of economic advisers. kudlow was an early trump supporter and served in the reagan administration as a budget official. larry kudlow is also a senior contributor to cnbc. >> no truth you got the job advising theresa may? >> still waiting for the call.
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not quite the end of the year. could still come. >> leather trousers a contentious issue. >> and the kitten heels. >> you got those. >> wearing them now. donald trump pushed back against an nbc news report that vladimir putin may have personally directed russian meddling in the u.s. leak shun. a kremlin spokesperson is saying either provide the evidence or stop talking about it. otherwise "it looks indecent." you can understand why some people are saying, please, show us the evidence. >> that's why the white house is getting questions not only from trump but from the inside, from some democrats saying how much did you know? when did you know it before the election? and why didn't you go public with it? sources are telling nbc that the concern among the obama
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administration was that they would appear that they were trying to influence the election, that they would appear political. at the time they were so confident hillary clinton would win, they didn't want to take the risk of appearing political that close to election day when they thought she had the momentum and was going to win any way which we know now she did not. there were concerns about that inside the white house. a lot of that has not gone public and still has not. on capitol hill, lawmakers are calling for open hearings in january so we can find out what sources have said is this credible and overwhelming evidence that russia was tahackg the u.s. before. the question that intelligence agencies have not agreed on is what the end game was for russia. what was the goal here? were they truly trying to get donald trump elected or just trying to make sure that hillary clinton did not get elected, to embarrass hillary clinton and embarrass the obama
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administration? >> always love speaking to you. thank you very much for your contribution today. tracie potts, nbc news. it's time to play the game. the executive vice president of world wrestling entertainment landed in london to announce big news. the professional wrestler, triple h, is the son-in-law of wwe co-founder linda mcmahon who has been chosen by donald trump to lead the small business administration. we sent arjun along to get the full story. >> i'm here at the 02 arena in london where the world wrestling entertainment just announced a new uk championship. i caught up with triple h and asked what a donald trump presidency means for the business. >> we'll be waiting with the rest of the world to see what a trump presidency means for everybody. you don't know. we're honored as a family that linda is a -- has been asked to
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be in that position. very proud of her for that. i think she'll do a phenomenal job. people forget that wwe started out as a little, you know, kind of tiny company in the northeast of u.s. and has grown to a global brand. she knows a little something about small business creation. we do a lot of things with a lot of celebrities. you know, we have done a lot with donald trump over the years. he's been a great supporter of wwe. a great friend to us. we've had events in his building. he's been a participant in wrestle mania, the battle of billionaires, in our hall of fame. it's great to see him have the success he's having. we'll see where it all goes. >> i want to ask you about the battle of the billionaires. is it in the future to see a battle of the billionaires round two, vince v trump? >> wouldn't that be interesting? see who gets their head shaved. >> that was wwe executive vice
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president triple h, wrestling legend. you know wrestling legends. >> that was another show. >> i think our american viewers may not be familiar with giant hastings. >> if you think triple h is big, 64 inches -- that's the size of the chest of shirley crabtree. >> i thought that was the size of your paycheck. >> 6.4. that was the legend triple h, talking to arjun. we have a few more stories to wrestle with before we wrap up on the program. we will be talking about the united nations appointing the first ever business representative to its general assembly. what does that mean for global commerce? and how does the icc feel about trump's position on things like trade? relations with china? we will spend some time on that conversation when we come back. you're watching "street signs."
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we're back. you're watching "street signs." london will be a smaller financial hub after brexit according to jose alvarez. he says he doesn't think the city will cease to exist as a financial center, but he forecasts a smaller model to the united states where the businesses are split between various cities like new york, chicago, and los angeles. >> there's hope yet. the united nations general assembly adopted a resolution granting observer status to the international chamber of commerce. the decision marks the first time the business organization has been given an official role in the general assembly. delighted to welcome the secretary-general of the icc to the show. nice to see you, john. straight up question what does
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this mean for you guys? why is this so important? >> it's an historic milestone for world business. it's the first time that international business has a voice independently and directly at general assembly to discuss trade rules, regulations, standards, sustainable development goals, 2030 agenda, migration. whatever the subject is we can now speak and have an impact. >> every time i speak to a business leader, seasoned ceos who say i was up with ban ki-moon, they get proud of it massive ceos are so proud of doing it. are you saying their voice has not been unified now and your body can help unify that message? >> we've been there but in the margi margins. we participated in the climbate change last year, but now we can speak at the general assembly to the other members of the general assembly on behalf of world
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business. >> as you look at who is cois c into the cabinet and the tweets from donald trump, he's been active on climate change, on trade, he's been active on china. he hasn't always sounded like a man who wants to do business the way business has been done around these issues. are you positive he will make a positive contribution to global business? >> i think the financial times referred to the cabinet as a cabinet of curiosities. it's unknown how the cabinet will perform and how the campaign rhetoric will turn into policy. with mnuchin, kudlow, swartzman, people who are seasoned, experienced, successful at international business, they understand that trade is essential for business, that tariffs are an impediment to trade. they have the picture on an international scale. you have reason to be positive and confident in that regard that the advisers around
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president-elect trump will understand the international economic dynamics clearly. >> he was brought to power on a wave of populism, largely it's been said by people who felt they have not participated in the wealth that globalization brought. a lot of companies have done well out of globalization. is there a worry at the icc that some of the policies that he's espoused will be anti-trade? will be negative those countries who are trying to just be efficient and maximize return for shareholders? >> globalization has become the catch all punching bag for the world's woes and it isn't. it's only because of the last three decades of trade, more trade that we had tremendous advances in prosperity, global growth and lifting hundreds of millions out of poverty. those there are peaks and troughs, ups and downs, ins and outs, the long-term indications are positive for trade.
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i would hope that trade will continue. whether it's the nafta agreement or the transpacific partnership, all of these are crucial. >> so many contentious comments from mr. trump in advance of rhetoric equal policy, that's a question mark still. but in terms of trade, what about climate? you guys want to drive this u.n. 2030 agenda. there are many -- within the climate lobby, i spoke to a load of them yesterday, who are concerned it's off the agenda falling down the pecking order. how do you feel about it? >> are 192 countries that signed the agreement in paris. >> the and we have done a lot with biggest emitter in the world is wavering. >> yes, but number two and three are still in place. it remains to be seen where number one will come out. it's not entirely clear. there are causes for concern with the appointment of the epa. but it's not so easy to extract yourself from an international agreement. the energy market moved on in the united states to alternative energy. the government still needs to be there. >> terrific speaking to you.
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hopefully see you again soon. >> thank you. quick look at the u.s. futures. they were wavering around the flat line last time i looked. we are slightly easier on the nasdaq. geoff, is it true we're doing "worldwide exchange"? >> i think so. >> we're doing u.s. "squawk box"? >> maybe. you never know. >> let's go all the way through. >> it's been fun doing "street signs" with you this morning. >> it's been fun doing "squawk" as well. after four hours on air, good-bye from me. >> good-bye from him. good-bye.
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good morning. markets now looking like it could be another day to celebrate on the street as the dow eyes its sixth straight week of gains. retaliating against russia. president obama vows to take action in response to the alleged hacking of the u.s. election. and driverless in detroit. gm self-driving cars are hitting public roads in michigan. it's friday december 16, 2016. "worldwide exchange" begins right now. ♪ good

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