than turkey is dependent and then we depend on turkey's well being of course we depend on it but we have the better carts and that should be the condition for a fair deal that we are aware of our possibilities and our influence and how much do one needs europe and the west to modernize turkey to stabilize turkey and to get sea economy going again and then these are the conditions for a fair deal and turkish would be interested in it we should be interested in it but we shouldn't make a shift to cheap the of from our actually a good time to to help turkey to get back on the democracy trappy ya first on the economic stability track and then of course. democracy how it works in germany and france i don't think it's realistic to expect that this is the way turkish democracy will look like on the other one in the next years i mean he just it's a country he's a new assault on he's he's almost an autocratic leader said. is no longer going to be honest not all this talk of pious conditionality is not going to be listening he's going to be looking the other way no no he is listening and you

despite all the negative factors turkey's public sector is still strong turkey does have a high international debt but it's coming mainly from the private sector and the public finances are very sound and as a matter of fact among the soundest in europe as so a total financial meltdown is very unlikely at this moment dittrich why specifically is what's happening in turkey affecting emerging markets the way that it is well but because emerging markets in certain ways in similar situations as turkey is it's a precarious situation you are trying to stimulate economies and there's always the risk that you war beyond rational limits but in turkey this has taken place do you want to the editor or the president therefore there is the risk that others through in order to be affected by the way . we are in europe very much into twined in particular germany with turkey. economy could be and therefore there is also the risk that we buy suffer to a certain extent by far not as much as turkey but to a certain extent we would we expect. at one to visit us in september eleventh serious discussions we are pa

and in turkey. mile in question would be if you had different leadership with different political rhetoric, whether there would be a shift in the public or if that is the deeply held. >> i agree, i think opinion deadly change which takes me too my next question, something that puzzled me, how countries and political identities are not immutable. we think they are, but they change. finland was considered easter pinion until it became nordic. recent turkey were considered western europe, greece became southern europe in turkey became middle east. with that in mind, turkey now on the question i will take you to is their desire that came up in a couple presentations. with this new trick in mind, maybe a full shocking that turkey is embracing its european partner but i'll ask you how you think it works and if it works. but maybe we will take the opposite order. unico first? >> do you want to go first? >> sure. >> sure. >> i'm happy to go first. >> and very confused. >> the reset with europe is not entire

and turkey are engaged in a period of political tensions makes the situation with turkey worse. >> it's like the situation with greece when the situation was going down, people were like why do we care about greece? it's the high levels of debt ratio to gdp and the current account deficit. how confident are you this will be then contained? >> fairly confident. it's understandable why investors are taking a more cautious approach. that might contain until turkey engages in more traditional types of measures. >> gdp coming out from the eurozone 0.4% for the second quarter. 2.2% annualized. those are not great numbers. not terrible how do you read them >> having not seen the details on the surface that type of annualized number is quite good relative to trend growth just on the surface without seeing details, it puts to rest some concerns we've had about slowing growth >> do you think turkey, the eurozone, the trade spat with china, does that influence or change our federal reserve well, we don't know what will happen with this stuff, let's ratchet it back. >> it's always going to be think

fred and pop most of turkey still economically strongly linked with turkey to domestic leaf through that three million turks in germany we will try to do our best whether it be enough to have probably the help of the commission the e.u. commission. major pot those like france in the e.u. and people to our business that's all because i hope it depends also on the flexibility on. these participating in this all right we are out of time so we're going to name there because. i want to be optimistic. dietrich. major gun sorry to interrupt what we have run out of time thank you very much we're going to have to leave it there so thanks very much to all our guests osborne look at dietrich von cow and egg skin and thank you too for watching you can see the program again any time by visiting our website al-jazeera dot com and for further discussion go to our facebook page that's facebook dot com forward slash a.j. inside story you can also join the conversation on twitter our handle is at a.j. inside story from name how much influence on the whole team here by for now. the philippines is one of th

but turkey to his scenes turkey is not a backwater anymore turkey's economy has grown it is a number of the g twenty if you know it when you actually take a look at the relationship between turkey and not it's the it's not between century turkey depended on u.s. aid to property economy that is no longer true the largest trading partner that turkey has today is the european union that trade is worth eighty four point seven billion dollars with the united states it's only nine dollars and if you're actually keeping a look at what we're turkey's interests lie. why is much more are we not only you got countries that have been pouring a lot of investments and business into turkey i totally agree that the united states and the mutually need each other turkey is in a very rough neighborhood it's in the backyard of russia if borders syria iran and iraq and i have to say here that the united states actually should really can reconsider what its policy and its strategy towards turkey yes right now i don't see the trumpet ministration having a coherent strategy not only to turkey but to the mee

deal with turkey all of. this is. to say because it's a german way of looking at things that somehow people states and leaders of states are rational actors they're not look at putin look at trump. look at some of the things our own leadership has done look at greece i mean you know. look at venezuela look at mr maduro rationality does not impinge on politics especially not on autocrats therefore if turkey goes down the drain just turkey the this is will not mean the end of mr i don't just give him an opportunity to ramp up his his autocratic way of dealing with society that everyone i mean it's. people in times of stress people to dictators when they feel a little better they think about democracy that's the way things go and this idea that we're all rational actors is just not borne out by reality so the point is now we are interested that turkey doesn't go down the drain economically that's a prime interest because if it does go down the drain economic everything else goes down the drain now if we help them will th

turkey's government violates human rights turkey has arrested german citizens turkey. has scorched earth as we heard. has. prevented german parliamentarians from visiting troops in the field serving for nato in turkey and you'll saying there should be a softly softly approach and also for the sanctions on took as i understand it -- yes i am firstly the softly softly approach. seems to work princes with my colleague dennis you showed was imprisoned on trumped up charges -- no pun intended -- accused of spying simply for doing his job when there are hundreds of others did in prison who don't have a german passport possible is that is did. and and and you know i mean it's it's it's it's it's horrible but i still think. arm that -- we have to somehow at the same time is helping them economic helping turkey economically which important country mustn't break down. and is another reason for this and when a country goes into economic downturns by like in venezuela revolution doesn't happen. that's when people are so busy scrambling for about politics and changing regime it's w

here punishing turkey for policy decisions that turkey has taken that the u.s. does not agree with we know that in the past few years they've disagreed on a range of issues from syria as the most recent one turkey continuing to buy natural gas from iran even after the u.s. sanctions were imposed on iran. well i think that is partially correct but i also think that the additional factor is that for years turkey has used the most abusive language against the united states and its leaders and really generated a historic high in anti american sentiment inside a turkey turkey seems to have taken the u.s. for granted for a number of years as if they could play the u.s. for its for their own benefit and that somehow the americans would take it so i think that this one incident which is minor in and of itself is also a test of the relationship or at least two countries going to treat each other with respect focus on their interests are not well erdogan speaking of the relationship has said this he said his country's partnership with the u.s. is in jeopardy and he may st

but turkey to his schemes turkey is not a backwater anymore turkey's economies grow and it is a number of the g twenty if you know it when you actually take a look at the relationship between turkey and not it's the it's not between a century turkey depended on u.s. aid to prop up its economy that is no longer true the largest trading partner that turkey has to date is the european union that trade is worth eighty four point seven billion dollars with the united states it's only nine dollars and if you're actually keeping a look at what we're turkey's interests lie. why is much more are we not only you got countries that have been pouring a lot of investments and business into turkey i totally agree that the united states entered the new she needs other turkey is in a very rough neighborhood it's in the backyard of russia if borders syria iran and iraq and i have to say here that the united states actually should really can reconsider what its policy and its strategy towards turkey yes right now i don't see the trumpet ministration having a coherent strategy not only to turkey but to t

what you do with turkey? alix: we are seeing the rush and the rest but not as much as we thought. 15%.es were up today they are negative but off the lows of the session. see a 1.10 on it i euro-dollar. the 10 year yield getting a little bit of safe haven not the type of move we saw on friday. oil state pat. david: it is a big story. the question for today is how far it will expand. now it feels like it will not expand quite as far. alix: if you find up -- if you want up having more, what do you have to sell? i do not know if we are there yet. today feels more like we want to look for opportunity. today, the media will get to meet the astronaut scheduled to travel on spacex. 2:00 this afternoon, the congressional budget office releases an update to its economic projections for the next 10 years. on thursday, brexit talks resume in brussels and over the course of the week we will get retail earnings from home depot, macy's, walmart, jcpenney, and nordstrom. we are joined today by bloombergs romaine bostick and

turmoil in turkey. each day brings new twists as investors looked on with alarm. >> the market reaction tells a powerful story as to the insufficiency of the latest move. >> turkey is trying to rewrite the practice management chapter in the playbook for emerging markets. >> the u.s. and china resume talking about trade talks. cryptocurrencies go on another white knuckle ride and elon tesla plan to take private puzzles the market. >> the sec is taking this to the next level. it has become a more serious investigation. >> tencent and walmart lead a parade of earnings reports. >> we are seeing this first profit drop in a decade send shockwaves. >> this is likely the earnings peak in retail earnings. >> the challenge of getting excited about equities, all the investing in e-commerce. >> it is all straight ahead on "bloomberg best." welcome. i am david westin and this is "bloomberg best," your weekly review of the most important business news from bloomberg television around the world. in the market -- momen

contagion emanating from turkey? i don't think so but the question is going to be these waking up from the risks is it going to be that confidence inducing, you know, shock? i don't think so, but that's the risk >> ambassador, what do you make of the geopolitical implications of everything that's happened in the last week, particularly today when the president trump doubled down on his tariffs. taking on china and russia is one thing. turkey is a member of nato, nearly a member of the eu. is this an unprecedented attack on a supposed ally >> i wouldn't call it an attack. i think that first round of sanctions was very mild. it was designed to induce the turks to go ahead and make the deal that they already had agreed to. and mr. erdogan only has one tool in his box and that's his nationalistic image. and he tries to defend the currency with a flag that's not possible. so the truth is the solution to this is to let the pastor go, let the other employees who have been arrested go and do what's right for the economy. so

when european union behaves turkey that on the turkey needs european union turkey needs european union and european union needs turkey we are everywhere of this but some european countries unfortunately don't see the fact so why so you don't leave you any man or you said your needle tongue trees in the european union actually against turkey your membership may beat my shirt off the e.u. countries you member states actually are in favor of turkish actually you know one membership anymore he said and you struck not you have the accuracy of the reactions yes or the reaction of the country who has been waiting at the door for sixty years ok sixty years so i was away that it is turkey is a mistake so why they said yes so why threaten europe in march last year when the diplomatic running what can what kind of threatening in march last year when there's a magic route with germany was at its height your president said that if europe continues this way no european in any part of the world can walk safely on the streets that's what he said. that's a threat that's a direct threat no it is not a t

ran european union it behaves turkey that on that turkey needs european union turkey needs european union and european union needs turkey we are everywhere of this but some european countries unfortunately don't see the fact so why say well you don't need any man or you set your needle tongue trees in the european union actually against turkey your membership may be my shirt off the e.u. countries you members this actually are in favor of turkish if you're going to actually you know one membership anymore he said and you struck not you have the accuracy of the reaction just see the reaction of the country who has been waiting at the door for sixty years ok sixty years so as a way that it is turkey's mistake so what is right here so why threaten europe in march last year when the diplomatic pressure on what can what kind of threatening in march last year what is the sematic route with germany was at its height your president said that if europe continues this way no european in any part of the world can walk safely on the streets that's what he said. that's a threat now it's a design or ra

that turkey has basically. the means in line to be very successful and to create a boom and what you saw at the beginning of this of the century it was that turkey came out of crisis what with hyper inflation which you don't see right now and after that had a decade of brilliant growth so that there's a lot that still speaks for turkey as you point out what needs to be billed as the trust of the trust and for rockets into turkey it's basically basically that frank kaiser the german chamber of commerce in turkey giving us the insight thank you very much thank you very much. and before we go as more and more countries decriminalize the use and possession of marijuana the market for legal cannabis is growing and the industry has just seen its biggest investment yet u.s. wine and beer maker constellation bought shares worth four billion dollars in pot producer canopy growth the company is based in china where we'd will be legal as of october spending on legal count of his worldwide is expected to more than double t

and turkey in the nato as nato allies isn't good in the first place and that's specifically after turkey decided to purchase s. four hundred missile systems from russia that obviously didn't bode very well with president trump and the white house here so you could say yeah there is some limited concern as of now i would say it's fair to say that the concern is not too big yet since relationships within the nato with the ally or between allies u.s. and turkey are so strange that anyway. and washington thank you. all right let's get the view now from turkey correspondent doreen jones reporting for us in istanbul dorian turkey's foreign minister has said further pressure will only hurt bilateral ties he's about retaliation but how much worse can relations get while the potential is to get a lot worse currently u.s. forces are working with a syrian kurdish militia just across turkey's border turkey considers that militia a terrorist organization and if they so wish they could put a lot of pressure on those u.s. forces and the kurdish militia they're working with that would ratchet up tension

turkey is tiny. comment that fabulous on twitter saying that turkey is worth something like netflix or amazon. it is small. what does that mean for you and me? john bilton is with us from jpmorgan. i want you to explain to us mere mortals, so what? why do we care? john: good morning. you are right that calibration is ever important in looking at these issues. turkey does have domestic factors that are causing this slide. we should be concerned about contagion channels. we should put them into context. if we look at msci emerging 0.5%ts, turkey is around of emerging markets. an make upchina 50% of that. they are growing stable he. should we be concerned about emerging markets generally? a little bit, to the extent that the catalyst that brought problems that turkey is the rebound in the u.s. dollar. we have seen a rebound in the greenback. that means that last year we saw an opportunity for all emerging markets and much of the world economy to appreciate and assets to be generally supported. as we see

and turkey would ultimately be and what that meant for turkey's economy. however, small it may be there were talks in washington this week at the state department between turkey and the u.s. they resolved nothing. they were on trade they were also on the detention of the seven american citizens, including the evangelical pastor, andrew brunson, which the president is following closely. interestingly, where the president tweets this new policy we don't have a press release from the department of commerce which is running this investigation and running this policy and we would expect that would be formalized in that channel. and it also appears to be a somewhat arbitrarily arrived at number we know the president likes big round numbers on trade there needs to be a lot of evidence behind the decision to make policies like this. otherwise it would appear ripe for a challenge at the world trade organization so we'll see what the end game is for that policy and what eventually happens and what commerce eventually says about how it has arrived a the official deci

and turkey on friday u.s. president donald trump announce he is doubling tariffs on turkish minion turkey warned it would be retaliated against a u.s. move they are fears the dispute could hurt turkey's economy more the turkish lira has hit record lows against the dollar in recent days the row is related to did that then sion of u.s. pastor andrew bronson on terror related charges in turkey but the differences between due to nato allies have been widening over a number of issues kimberly hackett reports from washington. it was just the beginning an unsuccessful twenty sixteen coup against turkish president recha tie up to one and when the u.s. refused to extradite the cleric for tula glenn accused by ankara of leading the attempted overthrow and who resides in the united states things got even worse this is the worst crisis and us turkish relations since the us congress imposed a total arms embargo on turkey right in the at the height of the cold war. on friday u.s. president donald trump tweeted that he was d

guy: turkey turmoil.

between the two and between turkey and the united states it includes turkey's purchase of as four hundred missiles from russia it includes well i mean it's includes differences between the united states and turkey even it comes to syria and actually the whole of the middle east it includes public opinion towards the united states in turkey and public opinion towards turkey in the united states so i would not call it a problem between the presidents idea trick is the u.s. turkey crisis beyond repair at this point or do you think that it can be mended whale to tripes special tides if you want to put it to egomaniacs getting at each other a quiet squarely feeing what i think about the two. that's always difficult in particular because they are both determined by. let's see the messy policy consideration in the united states for instance that they have in the elections. and the bible belt the pot store the bible belt it is important they stopped in the united states as support for president trump and his party so we'll have this aspect and i would say that to the the parts store who is of the

last week and we discussed this peter what we saw in turkey was a turkey that is exploring its options we saw there going to the brics meeting we saw russia in all the brics members very happy to have turkey on board and we're seeing turkey now even examining even examining it considering its nato membership and this is huge is the geo political earthquake to see turkey it's like greggs it shifted it's like my friends it it's a it's a brags that here it is flirting right now it's the in the bazaar right now because i don't see them leaving nato any time soon but it's planting the seed we have options we have friends that's already been excluded from the united states weapons program i mean it's syria and all of that rhetoric between turkey and the you of was all full in the last few months so basically all of this adventure in the me there was that mr obama stopped it you know when he basically support the insurgency against the syrian government it backfired terribly because what did the united states want to do from their point of view of interests of the united states they wanted to

member but turkey to his scenes turkey is not a backwater anymore turkey's economy has grown it is a number of the g twenty if you know it when you actually take a look at the relationship between turkey and not it's the it's not between a century turkey depended on u.s. aid to prop up its economy that is no longer true the largest trading partner that turkey has to date is the european union that trade is worth eighty four point seven billion dollars with the united states it's only nine dollars and if you're actually keeping a look at what we're turkey's interests lie. why is much more are we not only you got countries that have been pouring a lot of investments and business into turkey i totally agree that the united states entered the new she needs other turkey is in a very rough neighborhood it's in the backyard of russia if borders syria iran and iraq and i have to say here that the united states actually should really can reconsider what its policy and its strategy towards turkey yes right now i don't see the trumpet ministration having a coherent strategy not only to turkey b

on turkey tariffs. we had tweets from president trump that he will be doubling tariffs on certain metals with turkey. we will keep an eye on this throughout the market reaction . julie: we are watching another volatile market situation. this having to do with tesla. directors of the company are moving ahead with their review of elon musk's bold proposal to take the electric carmaker private. cnbc reporting that directors plan to meet advisers next week and are likely to tell must to recuse himself while they consider his plan. for more, let's get to david welch. david, in the meantime, there is the sort of anti-short quest on the part of elon musk that does not seem to be succeeding. david: no, it doesn't. the shares initially gained quite a bit, but they have given all that back. it really is not driving them to the brink. it did not succeed in the first place either because the shares got as high as 300 $79, which is well short of the $420 buyout offer. the market did not see this whole thing is very

even though she does not have a travel ban to enter turkey right now. we will have to see if she will go back or not while top of course is not the only journalist who is arrested in turkey on terrorism charges her husband also is facing similar charges he unlike tolu does not have german citizenship he's a turkish citizen and he's still not allowed to leave the country. what does citizenship what kind of world does that is your place in fact and how journalists in turkey are being treated well yes there are more than one hundred forty journalists still in prison. husband is still in turkey of course that makes the situation difficult for her which is only understandable and of course if you have a german citizenship then the german government can step in but it takes time as we've seen in the case of as we've seen in the case of and also michel the total so it does take time for german government to help activists or journalists get out of the country there are still seven german citizens being politically charged in turkey so it is very difficult for

'srket close, and turkey crisis. metals, andd oil, caused the biggest emerging market etf to plunge. su keenan has all the action. where do we begin here? su: we started the market higher , and then it was all about turkey. concerns at into trade war concerns. let's go right into the bloomberg. gtv is where you can find our library of charts. the two-year rising faster than the 10 year bonds. it is an inverted yield curve. and short, what it means generally, pain in the near-term theories the financial are being broken and that is an understatement here. doubled tariffs on turkey on friday. president erdogan signaling the finance, lashing out at the u.s. country, heme his says. the lira plunged. turkey took higher rates off the table. while it took steps to bolster its banks, analysts are wondering, was it too little, too late? the lira lost a quarter of its value, pushing down turkish assets, kicking off a selloff. let's go into the u.s. reaction. the market snapshot says it all. mentioned, that punished commodities

between the two and between turkey and the united states it includes turkey's purchase of as for on the us from russia it includes well i mean it it includes differences between the united states and turkey when it comes to syria and actually the whole of the middle east it includes public opinion towards the united states in turkey and public opinion towards turkey in the united states so i would not call it a problem between the president's idea trick is the u.s. turkey crisis beyond repair at this point or do you think that it can be mended whale two types. special tides if you want to put it to egomaniacs getting at each other. squarely seeing what i think about the two and there that's always difficult in particular because they are both determined by. let's say don't mess with policy considerations in the united states for instance that they have a november elections and the bible belt the pot store the bible belt it is important they stop in the united states as support for president trump and his party so we'll have this split and i would say that to the parts store who is o

the united states and turkey. no negotiations until a detained released.astor is it signals be standoff between the countries will continue as turkey's financial meltdown spreads to emerging markets. we have a reporter on the ground. the turkish ambassador in turkey requested this meeting with the u.s. officials. what can we expect from the security meeting? pointed --is is a this is a pointed reminder that turkey is fighting a standoff over policy credibility with international u.s.tors, and also the pastor being held in turkey. there were no dramatic results from this meeting. their heels deeper into the ground. while the turkish government was still taking a public position on this, the united states slapped tariffs on aluminum and steel, warning signs they are willing to go further into the conversation. for furtherential to your urination, or even a another set of sanctions -- further deterioration, or even another set of sanctions. anna: how likely will this last? yousef: nothing short of remarkable. this ha

i dug deep into turkey. this is the tanker index, i have gone back from january and since the beginning of the year, this is down by ward he 2%. today -- by 42%. today, down by 10%, the biggest decline since 2003. the blue, the large-cap turkish lenders have fallen since then. as you know, there are issues, they of got $50 billion worth of foreign-exchange liquidity. in foreignpanies currencies, they sit on this debt pile equivalent to about 40% of yearly output. this is the fear centered on the turkish banking industry. what i thought i would do is compared to the european banking industry. the yellow line shows that, the stoxx 600 index, down by 13%. the white line is down by a mere 19%. measure, iteresting brought up the shanghai composite, the second worst-performing engine mark this year. the worst benchmark of this year in the whole world is the turkish benchmark stock index. becauseon turkish banks they are under the cost right now. tough one. is a mark, yours is timely and i like the idea that we hav

this is due to be a new slot for less turkey fights to contain a crisis as its currency plunges to a new low the president says his country's financial system is under attack by the central bank has promised to do all it can to stabilize the lira but it is unclear if the measures will be enough to stop the spine also coming out of edging towards peace accord and south korea agreed to hold a third summit in september but worries remain over the nuclear standoff between the north and the u.s. the debate about muslim headscarves comes to a head ache sure in germany. tell you twelve minutes they say you have to leave you had skull fight saying no it's my choice you can't tell me what to do you know my parents you don't have custody of me and you can't make my decisions for me. should the government be allowed to ban the wearing of headscarf spike girls under the age of fourteen. and in sports marketing begin the new season with an emphatic victory over frankfurt in the german super cup will bring you the highlights from the game . playing. i'm see me so much got to thank you for joining

turkey's currencey crisis continues. the white house denies responsibility for the economic turmoil but president erdogan accuses the us of a "stab in the back." good news for football fans in eight south asian countries, as facebook signs a deal allowing subscribers to watch top flight spanish matches for free. investors head towards safe—havens and away from emerging markets, as fears grow turkey's crisis could spill over into the global economy. and president trump signs a new law which strengthens the america's power to review and veto business deals involving foreign firms. a warm welcome to the programme, briefing you on all you need to know in global news, business and sport. vienna has been named as the world's most liveable city, knocking melbourne off top spot. we want to know what important things makes a city liveable for you 7 is it good transport? restaurants? culture, or green spaces? tell us what you think. just use the hashtag #bbcthebriefing. reports from afghanistan say the humanitarian situation is

sovereign has kept turkey prosperous a lot kept turkey away from a lot of threats facing east and north and east to palestinian protesters have been killed and two hundred seventy people have been wounded in demonstrations to the gaza israel border fence palestinians have been staging protests every frighting since march the demanding a right to return to ancestral lands that they say their families were forced to leave they also want an end to the israeli blockade of the gaza strip. the united nations says more money and un personnel should be used to protect civilians in gaza and other palestinian territories the un secretary general has been asked to look for ways to shield palestinians from what's being described as excessive and indiscriminate force by the israeli military also in jordan has more from the united nations. the u.n. general assembly ordered the secretary general and tonio good tenors to come up with the report of recommendations so that there could be new ways or perhaps a reinforcement of old ways of protecting palestinian civilians in the ongoing dispute with the is

turkey is going expected to face going forward but any hope that turkey can turn to moscow and receive tens of billions of dollars in support instead of from the international markets in europe in the u.s. it's just seen as illusionary they just russia doesn't have back kind of capital to lend to turkey it has its own problems another possibility is china now china does have deep pockets in moscow and the turkish president has been making comments about how turkey increasingly see parallels with the way china runs its economy and does see that there is possible synergies to be had but even that china is expected to ball at the size of the bailout that it would have to give to turkey to sustain its column e. so at the end of the day turkey will have to look to europe and the u.s. to sustain its economy otherwise it is facing a come the fall and a possible complete meltdown in the country briefly before we let you go you've been covering this story all day today the turkish president has not mentioned the name u.s. president donald trump one time in all of his criticism is accusations ab

president donald trump has stepped up his pressure on turkey with new tariffs sending that country's currency into freefall washington is doubling tariffs on turkish steel and aluminum imports apparently over ankara's arrest of an american christian pastor on terrorism charges the liras nosedive saw a european markets tumble president rich of time on is calling it an economic war and promises turkey will emerge victorious. the. president tried to reassure a nervous public saying his government had the situation under control he promised turkey would ward off what he called an attack from abroad and called for an international struggle. if anyone has dollars euros or gold under their pillows they should go exchange it for turkish lira is it our banks this is a national domestic battle this will be my people's response to those who have waged an economic war against us. president trying to impose sanctions on turkey because of its refusal to allow an american pastor andrew bronson to return to the u.s. try and strengthen the sanctions in a twitter announcement which adds insult to inju

when european union behaves turkey that on the turkey needs european union turkey needs european union and european union needs turkey we are everywhere of this but some european countries unfortunately don't see the fact so why so you don't leave you any man or you said your needle tongue trees in the european union actually against turkey's membership made big my shirt off the e.u. countries you members this actually are in favor of turkish if you're going to actually eat a woman bishop any more he said and you struck not you have to love the accuracy of the reaction to this is the reaction of the country who has been waiting at the door for sixty years ok sixty years so how does the way that it is turkey's mistake so why do so many years so why threaten europe in march last year when the diplomatic president what can what kind of threaten in march last year when there's a sematic route with germany was at its height your president said that if europe continues this way no european in any part of the world can walk safely on the streets that's what he said. that's a threat that's a d

so qatar already is a very important investor in turkey even planning to expand more. let's take a step back and talk about the turkey effect emerging market currencies from india to argentina to indonesia hit major lows why is this a turkey's economy is relatively small it only accounts for about one percent of global gross domestic product to find the answer we have to go back nearly a decade ago after the end of the global financial crisis record low interest rates in the developed world meant it was cheaper for developing nations to borrow in dollars or euros about forty trillion dollars was added to the debts of emerging markets since then that's according to the institute of international finance but we are now entering an era in which central banks like the u.s. federal reserve on keeping rates low anymore and that's lending support to the dollar so as the dollar rises it is now costing those developing countries a lot more to repay their debts. well joining us now from london is timothy ash a senior emerging markets sovereign strategist with london based blue b

of waging an attack on turkey's economy. the latest from istanbul -- speeches defined the conversation in turkey, starting with president herder one, making it clear he -- president erdogan, making it clear he felt the u.s. was responsible for the recent turmoil, saying turkey has come under a coordinated attack and they would do anything in its power to defend themselves. as a result, he that they would be boycotting american products, shifting specifically for iphones to other alternatives and domestic options. we heard from the finance minister, who called the u.s. dollar a tool of political punishment. that shows you how the broad conversation has escalated a little notch. we will have to wait and see if the u.s. response again, either with sanctions or tariffs. we did see a recovery in turkish assets, stocks, bonds and the lira posting a bit of a rebound, but liquidity is slim, so not necessarily the best reflection of the realities of the market. the coming hours will be a test for the country as they look for sustaina

dollar paper in turkey or turkish lira paper in turkey? we have seen sharp dollar but first and foremost, the currency run is taken a huge hit on the turkish denominated paper. that's the main concern at this point given the size of the move we see. 56% depreciation this year. the pain is still concentrated their and that's why it's so crucial for monetary policy to step up and for orthodoxy to return. francine: when you look at the contagion, we saw a move in korean won. if you don't handle turkey correctly, how much will the contagion be amplified? fortunately, we have seen somewhat of a decoupling between turkish assets and other e.m. assets over the past several months. there is lower correlations and low linkages. certainly there is some measure of contagion but it's not as big as it was in the last decade. we have all been saying with the president of turkey should be saying. is it going to be a domestic audience? it's such a tough balancing act because he has received so much popular support from the population in standing up to the

i want to turn finally to turkey. there are a number of issues with turkey that i know the state department is very concerned about. one of those is there continued pursuance of the s 400 air defense system from russia. obviously, it would be in violation of half the law. can you talk about what the administration is doing on that front and if turkey does except delivery of that system, when would we invoke sanctions? >> thank you for that question. i have been very engaged with the turks on this. it is a very serious matter. we have been clear in all of our communications with the turkish government that acquisition of the s 400, which we would assess to have occurred when there is an actual delivery of the technology, we have been clear on multiple occasions with the highest level of the turkish government that there will be consequences. we will abide by the rules and when we determine a transaction has been made, we will impose sanctions. we have also been very clear that across-the- board, an acquisition of as/40

, that washington wants erdogan to fail because turkey's adversaries do not want turkey to beme great. unfortunately for turkey, parts notthe population ar necessarily buying into what reality is, but what reality is made for them by theer populist le erdogan's -- sanctions might t hu economy but they might strengthen his base and power. rajini: is there any way forware to maktions between the two countries improve? t ner: absent andrew brunson's release, i don'e how trump will have an agreeable relation with turkey again. he might push for sanctions until he secures the release of the pastor. rajini: thanks for coming . soner: my pleasure. rajini: president trump has called for nfl players who kneel o ring the national anthem suspended without pay. in a tweethe said footballers they should "be happy and cool w and find anoth to protest." it is the latest in an ongoing row between the president and many nfl stars. on thursday night my number of players raised a fist before preseason game as a way of bprotesting leatality towards african-americans and to highlight racial inequities. th

turkey or would it would it have further consequences. so it is no exaggeration that turkey is moving towards a financial collapse because it's a tragedy how can an economy stabilize the exchange rate and the current account by keeping this high growth rate so there is no signal that there is a political will to reduce its kinds onsen based growth rates at the same time if this collapse comes of course we have a large amount of loans in italy and we know at the same time that italian banks have been in troubles for months or just remember after the elections how critical the situation was in europe and if turkey the financial system collapse in turkey the central bank in europe has also again to bail out italian banks and that will trigger a political conflict again and europe so in this bigger picture. destabilizing turkey is not in the interest of the european union i don't they are saying thank you very much for this analysis. and iran demand remains high for stay healthy on industrial equipment but a growing number of companies and po

turkey's currency in freefall amid a diplomatic spat between washington and ankara the euro plunges to record lows after donald trump ramps up tariffs on turkish imports the turkish president aired a one is a defiant saying his country would emerge victorious in an economic war. you are. welcome to the program i'm mary and i haven't seen. hundreds of people have been injured in clashes between police and anti-government protesters in romania tens of thousands rallied in the capital bucharest and other cities to demand the resignation of the government they blame the ruling social democrats for endemic corruption and. thousands of furious romanian ex-pats also joined the protesters ranks based say corruption and poor financial prospects forced them to leave their country. hundreds of people needed medical attention after anti corruption protests turned violent and bucharest. police used water cannons and tear gas after some protesters tried to force their way through to government buildings. romanian president close your highness condemned the police quote disproportionate use of force

problems turkey is going to expected to face going forward but any hope that turkey can turn to moscow and receive tens of billions of dollars in support instead of from the international markets in europe in the u.s. it is seen as illusionary they just russia doesn't have that kind of capital to lend to turkey it has its own problems another possibility is china china does have deep pockets in moscow and the turkish president has been making comments about how turkey increasingly sees parallels with the way china runs its economy and does see that there is possible synergies to be had but even that china is expected to ball at the size of the bailout that it would have to give to turkey to sustain its column e. so at the end of the day turkey will have to look to europe and the u.s. to sustain its economy otherwise it is facing a come to fall and a possible complete meltdown in the country briefly before we let you go you've been covering this story all day today the turkish president has not mentioned the name u.s. president donald trump one time in all of his criticism of accusation

i think it is turkey. turkey tends to be just an excuse, trish, because if you look again behind the scenes you have maybe some doubt about the midterm elections, about the house flipping over and the dollar strength too. 50% of s&p earnings, my friend come from overseas. those get repatriated back into dollars. those hurt earnings. trish: that makes sense. christina, are people looking for a reason to sell here or should they be worried about some systemic problem a la what we saw with the european debt crisis? >> we saw this in a lot of emerging markets. you saw that in the currencies. we can bring up the index showing emerging markets, there you go. comparison with the s&p 500, it has been down quite some time. tracking this for a little bit. saw the rupee, in indonesia, south africa with the ren, starts back with the u.s. dollar trish: exactly. >> like nicole mentioned with gold going down. when gold goes down investor think the fed will be more hawkish and therefore strengthen the dollar even more whi