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tv   Street Signs  CNBC  September 8, 2017 4:00am-5:00am EDT

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welcome to "street signs." i'm carolin roth these are your headlines at least five people are dead after an 8.1 magnitude earthquake rocks mexic the pacific snum watsunami warn center says waves as high as 8 feet have been observed. hurricane irma barrels through the caribbean islands while thousands line up for fuel in florida ahead of the storm this weekend.
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president trump doesn't rule out military action against pyongyang. >> hopefully we don't have to use it against north korea if we do use it on north korea it will be a sad day for north korea. good morning it's friday, unfortunately we're dealing with a lot of national catastrophes on this morning mexico's been struck by a strong earthquake the 8.1 magnitude quake was felt in the capital city forcing people to evacuate shaking buildings. at least five people have died the epicenter is located off the west coast of mexico with tsunami warnings issued along the coast of mexico and other central american shores. the pacific tsunami warning center said tsunami waves have
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been observed. we are joined by frank jack daniel can you tell me what you have observed >> the quake struck here before midnight it wuas felt strongly i mexico city. it shook me and me family out of bed. the same for millions of other people in the city who took to the streets very quickly and stayed there until the tremors were over. the real strength of the quake was in the south of the country. most of the damage that has been seen has been in rural towns in the southern states of chiapas >> mexico is no stranger to earthquakes. we saw that destructive one back in 1985. i guess it has not seen, you know, huge tsunamis. what kind of precautions are in place at this point?
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>> some people have been evacuated from the coast i should emphasize that at this stage at night, it looks like this is a lucky escape for mexico from such a powerful earthquake the tsunami waves have been quite small, they didn't believe there was a major tsunami risk even in coastal areas. for a quake of this size, which is -- which seems to have been larger than the 1985 quake, which also happened at sea, the lack of damage so far in mexico city has been striking >> we'll have to leave it here thank you very much for your time frank jack daniel from reuters let's get back to more mundane things like the equity markets. stocks is off by 0.2% after yesterday we did see a rise of
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0.3% banks did suffer once again as the markets seemed to be pricing in a dover taish tapering i do want to show you the equity indices one by one we're seeing quite a bit of selling. ftse 100 off 0.3%. i would say the selling at this point is moderate. but the xetra dax is off by 0.1% cac 40 off by 0.3% now i want to take you back to the sectors, what you'll see is banks have now reversed some of their havenrecent losses, on thk of tapering being delayed due to the euro strength. food and beverages up by 0.3%. autos continued to ride high, up by 0.1%. travel and leisure underperforming. let's get back to the ecb. the ecb held policy steady in the latest meeting and said the recovery in europe is dependent on its stimulus program.
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president mario draghi said decisions on any change to qe would likely be made at its october meeting. draghi refused to comment on specific levels of the euro as he usually does, but says the recent strength was the cause for the downward revision of inflation forecasts. he also added there would be consequences to trade from the high euro and it would take close monitoring >> the exchange rate is not a policy target. it's very -- it's important and very important for growth and inflation. and it's so important that the medium term outlook for inflation was revised downward in the staff's projections, mainly due to the upward position of the exchange rate. so we will have to take into account this element in our information set in our future policy decisions >> joining me now for further discussion, nick nelson head of
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european equity structure and michael kelly from pine bridge michael, let's kick things off with you market reaction was a bit of a strange one. we saw yields moving lower the euro shot up how do you explain that? >> well, i think, you know, it's interesting times. the most interesting thing that came out of yesterday frankly is the language, whatever it takes was code for changing the rules. it was enabled by crisis conditions we heard yesterday that there will be no changing the rules. we're sticking within the capital key, sticking with all that the most interesting reaction as we've seen in the last couple years, most of the action comes to the currency markets, not the debt markets the debt markets have almost been lobotomyized by this legal
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y deluge of quantitative easing. we can't change the rules, we can't bend the rules again so i think the only uncertainty left is the last wave of qe by the ecb, when it stopped, did not lead to a plateauing of the balance sheet. led to a trillion dollar runoff in 2014. we know that's within the rules. we don't know whether plateauing is we'll find that out in six weeks. >> i guess we will nick, i guess mario draghi tried to talk down the euro. he wasn't quite successful t shot up to the tune of % he was trying to jawbone it lower, no availability there, no success there. how damaging is the strong euro for the economy? >> for the economy, not just real growth but specifically inflation. the eurozone is 2.2 last print that's good. running fast in the uk and parts of the uk.
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that's not too bad it's more the inflation side when you come to the equity market, clearly 60% of the revenues for european companies come from outside europe we have a big exposure to emerging markets, the u.s., the rest of the world and the currency translation is a problem when you translate that back from dollars into euros, yen into euros so a drag for earnings for companies, not disastrous but a drag >> michael, are you worried about that euro strength what it does to european companies >> yes so far europe has been -- has become a consensus favorite, earnings revisions are cresting. and there's no doubt that the very strong euro will, with time, be a headwind. the question is how much the strength here is broadening to domestically focused. that's a nice thing to have it will slow down that process. but you don't want to be a consensus overweight and favorite with a peaking of
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momentum that's centsly what we're looking at going forward >> he said t we're seeing a peak when it comes to earnings. you said earnings have peaked in may. do you think european earnings can continue to drive higher >> yes in may you had the best earnings upgrades for seven years for europe and the q1 reporting season was the best in seven years. the best is it's tough to keep beating your beats we did lose momentum in july we saw downgrades. august has seen downgrades, not too dramatic that momentum in the pmis, the pmis in august were up from july we had that fade europe is off about 5% since that peak may 10th i would argue that's allowing for that cresting of momentum. we think the consensus number this year, 13%, very stable. next year, 9%. so maybe three percentage points coming off because of the euro
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there's been a pause in momentum, but the underlying growth rate we should not forget this is the first year in seven years that europe is giving earnings growth. what sector do we want to be exposed to in this environment banks have had a tough time, even though the year-to-date performance is impressive. now that we're pricing in a delayed tapering, how much does that really hurt the banks >> sure. the banks wanted higher interest rates clearly, they're key beneficiaries of the stronger euro they're not exporters. they are a domestic sector with 10% of revenues coming from outside of europe. in contrast drug companies, half the revenues come from the u.s., or industrials, they're much more domestically exposed. that's a good place to be. one reason the euro is strong is because the data in europe has been strong. if you can get exposure to
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domestic and sicyclicality, thee a healing process going on, improvement northwestern i mmen banks. >> you downgraded pharma because of euro concerns michael, do you agree this view? >> i do. i think financials are the most misunderstood sector because everyone is looking at them too much as a play on interest rates. they are, but the bigger story is we at pine bridge believe we have gone through an important regime change. we've been in a post-crisis private sector deleveraging phase for seven, eight years that's ended in the united states and europe. it is segueing into releveraging it's a low process, but the banks suffer greatly on the top line while going through the de-leveraging process a
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on the bottom line, costs were jammed on to the income statement by a regulatory backlash that was quite severe that's gradually tapering. both sides of that are fearing off. revenue is picking up, costs are getting in shape they have a great beat in the second quarter it's the first quarter of a very long run i agree completely >> michael, help me make sense of the market overall. this year has been an easy year to make money, whether invested in treasuries, in gold, or even in equities. why did all of them go up in tandem >> great question. again, in this regime change argument many people say it's very late in the game, seven, eight years into an expansion. it's been seven or eight years at the starting gates. we've been statistically growing. but so slowly it was just waiting to start we have now begun a sin expansi,
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the first the imf has seen in ten years. earnings around the world are accelerating as a result, because we're in a global savings glut, the yield curve cannot back up at the speed earnings are accelerating. it's a bullish back drop then there's the valuation police yes, above historic averages of high inflation and low inflation. it's high. but if you actually look at when inflation has been in a 1% to 2% band, pes are typically even higher than they are now if you go from 0 to 1, 1 to 2, pes go up. 2 to 3, they go up even more that's the sweet spot. that's the direction we're going. >> michael, thank you very much for your thoughts. >> michael kelly from pine bridge back to corporate news akzo nobel is out with a profit warning. the cfo is taking a leave for
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health reasons to return in a different position the coo quit in july also for health reasons following a fight over a takeover bid by ppg which akzo nobel ultimately rejected akzo off by more than 2% this morning. and stmicro will replace nokia in the cac 40. the move will become effective on the 18th of september a bit of buying in the run up to that change. we're seeing shares up by 0.9% and volkswagen is seeking to sell non-core assets comprising as much as 20% of the group's revenue. speaking to the "wall street journal," the chief executive said a dedicated team was working to shed assets no longer deemed critical. he also commented on media reports that volkswagen is considering a tie up with fiat chrysler calling it speculation. e-mail the show. the address is i love seeing your tweets.
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you can also follow us on twitter, streetsignseurope@cnbc and tweet me at @carolincnbc. we will go for a quick break, coming up on the show, an explosive situation with no solution in sight. we'll bring you the latest on north korea as the region braces for another potential missile launch who knew that phones would start doing everything?
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for north korea if america has to take military action. that's the message from president trump who refused to rule out using force at a white house press conference take a listen. >> military action would certainly be an option is it inevitable nothing is inevitable. it would be great if something else could be worked out he would have to look at all of the details, all of the facts. we've had presidents for ta yeayear years 25 years talking and talking, a day after an agreement is reached, nuclear work begins in ppyongyang. >> let's go out to chery kang. how much worry is there as we head into founders day over the weekend? >> that's right. i'll be on a north korea watch this coming weekend, of course, potentially an icbm launching.
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that's what many media reports are speculating at the same time that's actually based on the defense ministry as well as intelligence services, intel that was shared right after sunday's nuclear test by north korea. in the meantime what we're getting, at least here in south korea, this growing dilemma for the south korean president yes, he just finished his russia trip in the meantime during his trip overseas, the thaad deployment was completed. there was a need for that because there was concerns in south korea but the closest country to north korea, because of north korea's missile as well as nuclear threat. since the nuclear test, and he's been coming off a little stronger than his initial stance so calling for sanctions and pressure in order to engage with north korea.
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domestically he's facing resistance i'm sure you saw some of the video footage of residents of the thaad site calling -- saying no to the thaad deployment and also he's saying he's getting a lot of criticism coming from the left leaning population in south korea who actually cast a lot of votes for him. of course there's a china factor, which is a country very much unhappy over this decision. in the meantime, the presidential office in south korea came out with a statement today saying the thaad decision was a necessary one in order to bring back north korea back to dialogue certainly he's feeling that squeeze coming from so many directions at this point the north korea threat that has kept the safe haven plays in demand over the course of the week may be much longer than previous episodes because that h-bomb test last sunday that was
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really quite severe. let's look at the swiss. the swiss is at the highest level against the u.s. dollar since august 2015. this is the euro/swiss, and the yen has had a good week once again. let's move on to the yen if we could. the yen, there you go, 1 107.69 let's get back to nick nelson head of european equity strategy at ubs how much anxiety are you seeing on the part of your clients when it comes to the north korea situation? >> i think people find it difficult to price that risk let's be honest, there's a load of unknown factors there it's geopolitics, it's complex, it's not like you can put an economic model or evaluation model to it. i would say volatility, be it the vix in the u.s. has been very, very low so whenever you see these
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shocks, you see a spike up there. we are pro risk in the sense that we have a cyclical position one of the safe havens, the actual equity market was attractive the dividend yields for switzerland relative to the rest of europe is at a decade high. maybe if you're nervous in the short because of this politics, because of issues, risks around the macro, then that's the place to look. in general we prefer a strong pro cyclical position. >> wouldn't a strong swiss hurt the equity market? >> it could. you have a load of international exposure there, you have some banks as well. credit suisse and what have you. but you're right, the international exposure will have an impact from the currency. we would not hedge the position. >> wanted to return to the european story that you're bullish about, and you said before earnings can continue go higher yes, they peaked in may.
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we're still seeing strong momentum i want to tie back in the euro strength are we not at risk for major portfolio reversals when it comes to the european story? there was so much fanfare about this when pop ligs wulism was rd what's the risk? >> in the flows, the u.s. flows peaked back in may all that did was unwind all the selling we had last year we had 11 months in a row of net selling of european equities last year. i would argue this is just reversing the selling from last year we don't have a huge euphoria in europe now >> do you think the portfolio flows into europe can continue because there are no other alternatives right now very few people want to continue to invest in the u.s. equity markets because they seem to be overvalued. em may be tricky once the fed starts reducing its balance sheet. is europe the only place to go in a way >> europe seems the value place it has not performed, the valuations are attractive.
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the problem is the strong currency if the dollar starts to stabilize, emerging markets, which have had an amazing run, we would expect them to start to pull back and people may look at europe rather than emerging markets. that's the pivot, should you be in emerging markets or europe when you look outside of the u.s. >> nick, thank you very much for those thoughts nick nelson who likes banks in europe and downgrades pharma to neutral. nick nelson from ubs. coming up on the show, insurance company prepared for irma's impact. we have the latest on the deadly disaster hitting the caribbean coming up on "street signs." thankfully, the breakthrough in prevagen helps your brain and actually improves memory. the secret is an ingredient originally discovered... in jellyfish.
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welcome back to "street signs. i'm carolin roth these are your headlines at least six people are dead after an 8.1 magnitude earthquake rocks mexico the pacific tsunami warning center says waves as high as 3.3 feet have been observed hurricane irma claims 14 lives as had barrels through the caribbean islands, while hundreds line up for water and fuel in florida ahead of landfall this weekend. president trump declines to rule out military action against
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north korea amid fears pyongyang could use its national day this weekend to launch another test missile. >> hopefully we don't have to use it against north korea if we do use it on north korea it will be a sad day for north korea. just waiting for some uk data let's look at the sterling/dollar pair sterling/dollar up by 0.3% for the day. 1.3134 we have uk manufacturing growing at the fastest pace this year. also the uk posting the biggest goods trade deficit since the month of march industrial production for july up by 0.2% for the month, up by 0.4% for the year. manufacturing output up by 0.5% for the month. a nice beat on the year. the manufacturing output for july is up by 1.9% we're not seeing a huge reaction in sterling/dollar at this
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point. i guess the strength of sterling/dollar, much of it is down to the weakness of the dollar at this point let's have a quick look at u.s. futures. yesterday was a fairly mixed session. we didn't really have any major driver apart from the media sector and disney. disney responsible for the 30 negotiate sieve dative dow poins the dow jones seen off by 30 points s&p seen off by 4 after it fell less than 1 point yesterday. it was pretty flat session for the s&p. as far as european markets are concerned, we are lower today. running out of steam at the end of the week. the ftse 100 is off by 0.3%. the dax is losing 0.2% the euro strength is playing into this. speaking of the euro, let's switch over to the currency markets, we're seeing that the euro once again is above the 1.20 handle. that's post the ecb press conference yesterday where mario draghi told us that october will
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be the month where we will see the announcement on tapering up by 0.2% yen still doing pretty well. up by 0.76% against the u.s. dollar given the latest aggression coming out of north korea. that's why the likes of gold are doing well gold now trading at one-year high, up by 0.4% as this safe haven bid is quite permanent now in these markets we had a spate of bad news from around the world when it comes to catastrophe mexico has been struck by an earthquake the 8.1 magnitude quake was felt in the capital city forcing people to evacuate shaking buildings. at least five people have died the epicenter is located off the west coast, with tsunami warnings issued in the region. the pacific tsunami warning center confirmed waves as high
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as 3.3 feet have been observed. more than a dozen people have been left dead as hurricane irma pushes through the caribbean with florida in the cross hairs. the category 5 storm is roughly the size of france packing winds up to 160 miles per hour. jackie deangelis filed this report on preparations underway to protect the florida cargo and petroleum terminals. >> reporter: as redesidents lea, officials are protecting the city >> on a typical day, we have 10, 15 ships arriving, cargo ships, petroleum ships or cruise ships. we're working with all of our operators, whether container terminal operators or petroleum operators to ensure they're
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ready and can orderly shut down facilities as opposed to a rush shutdown. >> reporter: this port is florida's largest port by revenue representing 1$163 nil n ondo million dollars last year. also the state's second largest petroleum port >> what people don't realize is that port supplies the petroleum for about 18 southern counties, so initially, you're going to see a further shortage of petroleum because of the what's going to come through the port >> reporter: gas will be crucial as residents evacuate. >> we're monitoring fuel and have connected emergency fuel equipment providers for fuel simply and equipment we're moving as much fuel as fast as possible and the state is working as quickly as possible to bring fuel to communities. be considerate of your neighbors. take what you need to evacuate don't take extra >> reporter: meantime ten major cruise operators also come in and out of port everglades with 40 different ships. some of those trips being canceled or delayed. right now, the storm st is still
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a while away but precautions are being taken as the majority view is it's better to be safer than sorry. for cnbc business news, i'm jackie deangelis in free-thrif . lauderdale, florida. insurance losses to date have put them on pace for the worst week since january 2016 industry leaders tried to make assurances that they can handle the financial impact the chief of the insurance information institute says the sector is ready to withstand any natural catastrophe. and exxonmobil's ceo darren wood says his company is ready for hurricane irma refineries are in the process of being resumed after hurricane harvey woods described his team's strategy in response to both storms >> we had a team set up working on the response to hurricane harvey when irma started to form that team formed a subgroup that
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started working on making sure our supply operations going into florida were robust. we've been working that for several days the strategy now is to make sure all the distribution system is as full as it can be and we're getting fuel distributed to the points as much as we can, so if that hurricane hits we have inventories high enough to aid in the recovery once the storm passes through >> i want to take you back to the impact of irma and harvey on the insurance sector with andy worth, executive director for insurance at ey. thank you very much for talking to us. how big of an insurance event are these two hurricanes >> this is very significant. but before i go into that, let me say my heart goes out to those communities impacted by the devastating images we've seen on television in the last 24 hours and the concern for the people in florida georgia, and the carolinas may be feeling as irma heads that direction in terms of the impact, we do
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expect, unlike harvey, an earnings impact, hurricane irma f it plays out like people are expecting to ab somethibe a sigt capital event. >> capital means dividends will be impacted, pricing will be impacted what's the difference? >> what we'll see with -- if irma plays out as we expect, we see a lot of capital calls people are forecasting that harvey was about a 15 billion to $30 billion loss and an overeconomove economic impact of $100 billion. if hurricane irma plays out as expected this could be a 1$100 billion loss for the industry. this is very significant you have had a whole generation of underwriters grow up who have never seen an event of this magnitude.
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>> there's been a lot of reports about underwriting, especially when it comes to re-insurance underwriting having been too lax in that area because we have not seen these kinds of events in the past would you agree with that view >> certainly it's been a soft market as the industry calls it for the last few years you had a combination of benign catastrophe period, and the market has been overcapitalized. there's plenty of capital there. insurance and reinsurance is still creating returns, which investors have found attractive compared to other marketplaces i think the interesting point about this is whether this event f it plays out like people expect, it's going to just impact catastrophe rates as we saw with hurricane katrina in 2 2005 or if it will have a broader impact on rates like the world trade center a couple things may be different this time. there's a lot of re-insures wh sat on the sidelines and have
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not been overexposed to florida. if any capital is taken out by this event, it can be quickly replaced we also live in a sustained period of low interest rates there's a lot of cheap capital out there that could replace the capital impacted by this event >> you talk about pricing getting tougher. it's been soft so far this year. we've seen expectations for the monte carlo round and maybe for january renewals, that will see a 7% to 8% fall in prices and rates. do you think that will change drastically because of this event? >> i think if this event plays out as it is, i think it will certainly reverse that forecast. i think there's interesting angles on this what's grown up the last 15 years is the insurance linked security market. so the nontraditional coverage this is the first time that market can be tested so it will be interesting to see investors reaction to that when they suffer significant capital losses there's a sort of london angle
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to this. the uk government worked with the london insurance market to create a market here one product they want to create, which is not currently provided by the market, is foreign aid cap bonds. it's interesting to see if these bonds accelerate that market >> if you're talking about a number that i still quite can't believe, 1$100 billion in potential insurance losses are there any insurers at risk of this? would any of them go out of business do you think the industry will survive as a whole >> the industry i'm sure will survive as a whole it's extremely well capitalized. there's plenty of money there. within that, you may see some smaller players who have found themselves overexposed so there may be casualties coming out of this as an overall market place, it is a well regulated and capitalized industry >> andy, thank you very much for that airlines are adding flights
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out of florida as people look to escape from hurricane irma american airlines confirmed it had added 16 flights from miami. norwegian air confirmed some of its flights have been impacted by irma and said it is working with authorities to minimize the disruption. klm passenger traffic rose by 6% in august compared to a year ago they had 8 million passengers over july and august boosted by strength in european roots sri spoke to klm's ceo he said the hurricane is causing significant disruption and damage >> it's a human tragedy and disaster for all the people living there are what we saw yesterday in st. martin, the dutch part and the dutch french part of the caribbean are terribly hit the people are devastated. we try to help where possible. but obviously it will have a dent going forward.
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another thing they're keeping an eye on is brexit. >> the uk is an important market one out of five passengers in our network goes to or from the uk we have 18 points here in our network in the uk. in fact, we do serve out of amsterdam more destinations in the uk than ba out of health throw. it heathrow >> what's your estimate? a two-year process or longer >> would be difficult to predict. when we speak about aviation and the bilateral agreement, we would fall back on that, still a liberal situation between the uk and the netherlands. so i don't see too much of an issue. emanuel macron called for greater european solidarity.
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speaking in athens, on a hill believed to be the birthplace of democracy, he laid out his vision for a new improved europe with stronger democratic institutions and a eurozone budget >> translator: we need a brave europe, a europe in which we will support social convergence, fiscal convergence only in this way when today's disparities do not exist can we find a strong government in europe which will strengthen european sovereignty, with a european budget, and with a eurozone parlment that it will have to answer to. we are joined by gimani. i find it difficult that greece would want a stronger europe they've been put through so much hardship by the europeans, specifically by the germans. what's the feeling >> so long as they're part of the good side of europe they wouldn't have an issue with that this meeting is symbolic it's the first state visit that president macron has done since he got elected
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it took place, the speech he gave was at the birthplace of democracy. that's symbolic in itself. the whole pretext behind it was twofold. the first was to affirm support for greece, and re-emphasize its role within the eurozone, to encourage investment the second thing is it's an opportunity for macron to spell out further what his vision for the eurozone is. he's encouraging more integration there, and emphasizing structure reform, not only domestically because they have introduced their own french labor reforms, but in the eurozone as a whole. >> he wants a common budget, common parliament, common executive this goes far. i can't see how angela merkel and the finance minister stays in place, mr. schauble will agree to this. they want more europe but limited burden sharing i guess the two will be at loggerheads.
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>> at the end of august merkel did endorse macron's plans softly she did say that she would definitely consider discussing the topic. the elections are coming up. so i doubt we'll hear anything before then. definitely something on the agenda for the next couple of months macron himself said in the next couple of months he will unveil the road map of how he see there's a integration to play out. let's talk about greece more specifically the bailout for this country ends in a year's time. how are the prospects looking? it's exited recession finally after years and years. how are they tackling the issue of debt sustainable? >> that's the big question that everyone is asking, including tsipras. it's an interesting time for greece growth is on the up. economic sentiment is also on the rise and they recently issued their first bond to the market for the first time in a couple years it cleared very well
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there's anticipation that they will issue a few more come the next six months or so. really the ultimate goal is to regain full market access come the end of the program in 2018 for them to do that, they need to reassure investors about the long-term prospects of debt sustainability and prove they can keep growing on one hand you have investment and growth prospects picking up, on the other there's the subject of debt relief, whether ultimately the germans will play ball >> good luck to the greeks we'll see what happens with the germans. those pesky germans. thank you very much for that which u.s. city will win over amazon to become the home for the company's second hq? stay with us for more on that story after the break.
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finally let's talk tennis. sloan stevens has defeated venus williams landing her against fellow american madison keys in the u.s. open women's final. both players will make their grand slam final debuts tomorrow the men will square off in the semifinals nadal goes head to head with juan martin del potro. the u.s. open men's grand slam will be held on sunday in other news, credit report giant equifax has warned as many as 143 u.s. million customers were accessed by hackers between may and july shares fell nearly 19% in after hours trade on the back of what could be one of the biggest u.s. data breaches ever equifax says criminal gained
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access to social security numbers, birth dates and addresses. amazon has kicked off competition between american cities to become the home of its second headquarters. the retail titan says it plans to build a $5 billion hq2 it is looking for a city of more than 1 million people with an international airport, mass transit, quality higher education and an educated work force and solid business climate. dallas, houston, st. louis, and miami are some cities committed to a bid head online to read more about the cities which make the cut for the amazon headquarters criteria. and boris johnson says finding a solution for the irish border after brexit is not beyond the width of man. speaking at a foreign minister's meeting, johnson said he had rock solid confidence that david davis would strike a deal with europe the comments on ireland come after the chief brexit
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negotiator, michel barnier, said he was worried about britain's plans for a border arrangement. capital economics chairman roger budel says the eu's track record for trade deals leaves a lot to be desired. >> no, i don't worry about that at all this is an argument that was doing the rounds in the run up to the referendum that the eu has got clout, the uk much less clout. that's right the question is how important is clout? because there's something else besides clout. there's the difficulty of getting agreement between 28 member countries let's look at the record has the eu been a good negotiator of trade deals? answer, no it's been an appalling negotiator switzerland and singapore have done far better than the eu, even though they got less clout than the eu. >> let's take you back to our top story today. more than a dozen people have been left dead as hurricane irma pushes through the caribbean
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with florida in its cross hairs. the storm is roughly the size of france packing winds of up to 160 miles per hour sarah is in miami with the latest >> reporter: here in downtown miami it's a calm morning. check in with us about 24 hours from now, things will be different. all eyes are on hurricane irma's path the buildings behind me, this is an evacuation zone tsh, it seems like not many people are here. we are in a hurricane warning in south florida. mandatory evacuations in place bus evacuations already underway airports are shutting down today. we have seen people trying to make a mad dash to get out of here people are heeding the warnings.
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pacific is backed up on the roadways long lines at gas stations and people are boarding up windows good news is there are shelters in place for people trying to seek refuge. people all over south florida even places that will accept pets while this storm is predicted to hit miami, it could impact both costs a big concern in this area is storm surge those water levels rising and that could make things very catastrophic here in south florida. so all eyes again on hurricane irma and when it is set to hit here and what happens afterwards mandatory evacuations in place for the florida keys, also for low lying areas in south florida. when it comes to buildings, i'm in downtown tampa -- downtown miami, rather. there's a lot of tall buildings behind me. after hurricane andrew strict building codes were put in place to make sure these buildings could withstand hurricanes the designs were made to withstand category 3 hurricane
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winds. as we know, irma is much stronger than that so officials are warning people to get out now it's not worth taking any chances. >> thank you very much for that. please do stay safe over the weekend. before we wrap up this show for this week, let's look at u.s. futures and they're indicating slightly negative start to the trading day the dow jones seen off by 33 points the s&p 500 would fall by 4 or 5. the nasdaq seen off by 8 points. yesterday was a mixed session. not a lot of momentum or direction. we did see negative news out of the media sector disney down after a warning of weak results a quick look at european markets. the cac cac 40 is off. xetra dax is also off. the euro/dollar strength rising to a 2 1/2 year high post the
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ecb conference yesterday where mario draghi confirmed that october would be when we get confirmation for tapering to start probably early next year so the market is bracing for that and pricing that in speaking of the euro, let's look at current levels. >> 1.2064. getting back to the 2017 highs of 1.2070. up by 0.4% on the day. still catching a safe haven bid as is the swiss against the u.s. dollar that's it for today's show i'm carolin roth, "worldwide exchange" is up next have a fantastic weekend see you on monday.
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the dollar index drops to the lowest several since january of 2015 a look at what's behind the move straight ahead. irma taking aim at florida the category 5 storm roars in the atlantic as hurricane jose poses a new threat. and historic hack. equifax breached exposing more than 140 million americans to identity theft what you need to know coming up. it's friday, september 8, 2017 "worldwide exchange" is coming up right now good morning


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