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tv   Street Signs  CNBC  December 20, 2016 4:00am-5:01am EST

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times or two times and then he shot directly. i hid myself behind the table. >> reporter: the assassin was an off-duty turkish policeman. he used his badge to get into the russian-sponsored event. this was revenge for russia's participation in attacks on aleppo where evacuations of civilians continue tonight. russia and syria have been widely criticized for their brutal military campaign against good morning, everybody. the city. it's unclear if the gunman was welcome to "street signs. sent by a terror group like isis "these are your headlines this morning. 12 people are dead and almost 50 or was just angry and plotted on his own. in moscow, vladimir putin injured after a truck plows into crowds at a busy christmas market in berlin in what police promised to revenge his amb are calling an intentional attack. a despicable provocation. ambasder's killing. >> reporter: russia is not vladimir putin says the murder likely to respond militarily against turkey, but can and of ambassador in ankara -- probably will escalate the war it is already fighting in syria. russian air strikes there already described as media set moves to the indiscriminate could get more stock. 600 in europe after the french intense now.
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all right. conglomerate will raise its let's turn it back to business and take a look at what we're stake in the media group to 30%. seeing on our european equity lloyds agrees to buy bank of markets early this morning. we were called relatively flat america credit card business mbna for $1.9 billion in cash. and the ftse was called lower than other markets and hanging on to slight gangs outperforming good morning, everybody. and again having been called to welcome to the show. the down side slightly. plow under to a christmas market in berlin killing 12 people and injuring 48. the ireland trading in slight berlin police say initial evidence points to terrorist negative territory, as well. when it comes to the sector attack and a suspect has been stories and where we're seeing arrested near to the scene. what we're looking at here are rejigging. banks trading a bit higher and the live shots coming through media is up on the back of the from berlin this morning as this deal pushing ahead. revision to some of the terms authorities continue to deal and you've got telecomes up by with the aftermath of the attack. now, nbc has more. 0.7% and food and beverages. >> reporter: tonight witnesses let's talk to steven isaacs. he joins us here in the studio describing the horror as a truck at the top of the hour. chairman of the investment jumped a curb and drove through
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a crowd in central berlin. committee. good morning, steven. a magical christmas market >> good morning. let me get your initial turning to mayhem. >> just went past me, my thoughts, first of all, to what girlfriend and missed me by we've seen in the first 24 hours. three meters and missed her by be it in zurich and turkey and berlin, as well. five. >> reporter: happened at 8:00 yet when we look at the market reaction, there is no market reaction right now. p.m. near off of berlin's most it seems like, again, we're, fashionable shopping streets. >> saw one guy being dragged unfortunately, very used to away with blood on his face. these events happening more and more in europe, as well. >> reporter: emergency >> well, there is a reaction to responders rushing to the scene, the dollar. finding chaos. the dollar has pushed little the damage to the truck, severe. testifying to the carnage it forward which is why some extent created. the front window smashed, police european stocks have been lower say a man suspected of being the this morning. you're right, a degree of driver in custody, but they aren't releasing his identity. complacency or just kind of the a passenger in the truck died at realization for some time that the scene. german police not yet calling terrorist event come and go and this a terror attack. they haven't really impacted on but it follows a state the business community. department warning about the i mean, they are impacting upon possibility of attacks at the political agenda. holiday festivals, events and and looking forward into 2017. outdoor markets. one has to say that the market's and tonight's incident comes after that isis-insmired attack still taking an awful lot for in nice. a truck tearing through a granted. the french elections and german beachside avenue, 85 killed. elections are all going to pass
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the rampage ending when the suspect was shot by police. off without any drama. you know, we will see. but in berlin, the driver we are in a different world. i think we will have to survived and will now be recognize that. >> do you think we are take it questioned. >> when did it pick up fuel and for granted or do you think when exactly did it go into that we're just accepting a new market and how did it go into that market because that will normality. that we are accepting that we determine whether it's an accident or whether it was are moving farther right and looking at more coalition deliberate. >> reporter: tonight authorities in berlin says the danger has structures or more influence passed, but germans still on coming from some of the more edge. right wing parties even if hunts nickels, nbc news. they're not in power. >> the consumers are more the turkish president and his russian count counterpart resilient or perhaps they are vladimir putin agreed to ramp up resigned to it. the result that populism if it cooperation in fighting terrorism. this following the killing of comes bad for markets. the russian ambassador in if you look at brexit and trump ankara. the u.s. embassy in the turkish and yet somehow they've been capital has said that its translated into pretty decent missions in ankara, istanbul bull runs to the market. perhaps the end of december will be closed. rather wary traders are just saying, you know, bring it on warning viewers you might find for '17. some of the images in the report we'll see. from richard engel disturbing. want to talk to you more about some of the latest market
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>> reporter: speaking at a calls and what you think we should be doing. heading into a new year, steven photography exhibit and never saw his killer. staying with us. moments before he shot him in coming up, though, here on the back. with the ambassador down, the the show, credit suisse is killer shouted in auerbach and paying the price in the u.s. then turkish. we'll discuss the latest find and another day for italy's embattled banks, as well. find us on e-mails and you can also find us directly on twitter and it's always nice to have your insights and your thoughts. we'll be right back.
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good morning, everybody. welcome back. i'm louisa bojesen and this is "street signs." they have agreed to ramp up cooperation in fighting terrorism pisttea terrori
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terrorism. a gunman identified as an off duty police officer. richard, what is the latest on the events that took place yesterday? >> well, moscow has dispatched a team of investigators, an 18-member team that is on its way here to find out exactly what happened. the body of the turkish ambassador is expected to be repatriated to moscow later today at a small memorial service held here in istanbul. security across ankara has been intensified because it wasn't just the attack on the turkish ambassador. a gunman carrying a shotgun also fire under to the air outside the u.s. embassy in ankara. the embassy there is closed today. the u.s. consulate is closed here in istanbul, as well, amid the heightened security concerns. we're also learning more about the gunman himself. a 22-year-old member of the riot
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police force. he was dressed as a police officer in the typical uniform of a diplomatic security, a black suit, black tie, a police lapel pin. white shirt. he was standing behind the minister the u.mi minist minister. the embassy was promoting russian culture. as the minister was giving some remarks he pulled out his pistol and gunned him down and made a statement in turkish for his involvement in the brutal military campaign in aleppo. >> a lot of speculation in regards to motive and if he was acting on his own as a lone wolf, as it were. have you heard anything on your
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end? do authorities think he was acting on his own? way too early to say. just a couple hours after the incident, we have to remember that, as well. >> the motivations he explained, he spoke for quite a long time after he shot the ambassador in the back at almost point blank range and then gave a statement. there were journalists assembled in the gallery and he said that he was doing this because those who attack syria would have to pay the price. i think the quote was, unless there is security in our regions, you will not feel security in yours. but, whether he was linked to a group or if he was just self-radicalized and saw this opportunity, that is a main focus of the investigators right now. some members of his family have been taken in for questioning. also some of his friends. but turkish officials have not
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been saying what they have been learning from those interrogation. >> richard, thank you very much for being with us. richard engel joining us there via nbc news. head of research at renaissance capital. good morning, michael. >> good morning. >> we just heard some of the latest facts there from richard out of turkey. what are your initial thoughts when you look at this from a geopolitical perspective and with a turkish angle, as well. >> obviously, very unfortunate. thankfully turkey/russia relations were normalizing after what has been a painful year. the turkish economy has been on its knees partially because of the russian sanctions. and the tourist sanctions had already been removed. so, we've seen numbers down 80% in august year on year. and basically flat in the most recent data. so, you know, thankfully at least it's come at a time when both countries have a vested interest in sustaining the relationship, as opposed to a time when they had heated
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rhetoric and could have led to some sort of spiral or escalation. >> some were saying this was an act to try to obscure the relationship between russia and the turks. could it actually act as doing the opposite and bring the two parties closer together? >> based on the initial comments from both governments, yes, i think it's a possibility. but, at the end of the day, this -- it's another incident in what has just been a series of incidents in turkey. and a relatively unstable period. you know, largely because the country itself has no political equilibrium right now. you have the most powerful guy in the country trying to achieve power on paper. and throughout this entire process, i mean, the immediate response from the turkish government was that typical, they already have, you know, accused this individual so it fits into the coup narrative. it is, how could i say?
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it can't be, it's an isolated incident most likely. but it can't be viewed of everything else that is going on in turkey. >> i understand all the arguments and all the theories, as well, that emerge here, again, hours after the event actually took place and a part of me looks and says, well, this is a 22-year-old boy who committed the crime yesterday. what's been taking place in aleppo, it does, you know, it touches many of us humanitarian perspective. i was looking at some research, as well, talking about something like a third of people who act in a lone wolf mannerism that they're mentally unstable and could this just be a kid who's upset about what's taking place in aleppo with all the pictures that we see streamed every day and there is no bigger plot and reasoning and no bigger reason as to why -- there's no political background, in other words. >> no, of course. you have to assume it's what you
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said. right. this is just an individual. but i think what the backdrop speaks. if we think about what, you know, in a sense -- >> he's 22 years old. >> the most hostile probably in the world to what the russians have been doing in syria. but the fact that the response and the desire for a stable relationship with russia right now is above that, you know, is in one sense, you know, pulling at straws a little bit encouraging because, you know arduan is in a very ugly place. whip sentiment up to create votes. this would be a vote-winning issue. not this, bout the attacking russia. you know, generally for what it's been doing. there is a pragimatism here. painful for turks and i'm getting a lot of calls right now from investors saying what will go wrong if turkey is on its
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knees. the economy is very weak. and a lot of investors how is it it can go wrong to invest at this stage. it is a very volatile period. one of the windows that erdogan is giving us into his mind right now in terms of how he behaves with russia shows an underlining pr pragmatism. but it is to say that once erdogan has his power we need to take a step back and say does he show a pragmatic streak or, you know, is the narrative just permanently painful, i guess is the word. >> sure. >> and it's very, very possible that once he achieves his executive presidency, this sort of pragmatism that you see at times when he is whipping up sentiment to win votes could be reflected in how he wins after
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he wins his executive presidency. >> michael harris head of research at renaissance capital. the u.s. department of justice has reportedly asked credit suisse to pay a fine of $5 billion to $7 billion to settle an investigation into the bank's sale of toxic mortgage securi securities. this is according to reuters saying that the bank has resisted settling for the amount. met with the attorney general loretta lynch a sign that the negotiations might be reaching their final stages. vivendi will continue to buy up its stake in italy's mediaset. before investors have to launch a takeover for all remaining shares. the french conglomerate said it has followed and no further details were disclosed. lloyds has agreed to buy credit card business mbna from
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bank of america for $1.9 billion pounds in cash. the deal will be funded through organic capital generation. the accusation of around 100 million pounds and expected to close during the first half of 2017. and euronext is in talks to buy french regulated subsidiary. the talks are being held to proactively address anti-trust concerns previously raised by the european commission with the london stock exchange. and chemchina has took over for syngenta. the state-own company is seeking approval for the deal from the european union. excuse me. early last month chemchina extended its offer for the syngenta group unit till the fifth of january. steven isaacs is still with
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us. steven, as we were heading into break you said you're calling the top of the market. >> let's just be straight up there. >> what makes you say that? trump isn't going anywhere and markets seem to be steaming ahead. >> i think there were a couple of points. first, trump is being presented a as pro-business leader with a pro-business congress. and i think that's probably a fair assessment. but if you contrast where we were when reagan came into the white house. i think he's a very good comparison. you'll see the problems he faced. first of all, income tax rate under carter, top rate was 70%. reagan cut it to 28% by over 40% cut. for trump, he's already at 39% and talking about cutting it to 33%. is that how much the differences are going to make. secondly, debt to gdp. reagan 31% and trump is inheriting 105%.
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consumer debt reagan was inheriting 65 and trump is inheriting 106. monetary policy, reagan was inheriting a funds rate of 18%. it went a little higher, but it was very near to the top and, hence, a huge amount of monitor easing was to come. trump is inheriting 0.5% and as we have been told by janet yellen, a complete different interest rate trajectory. this is why i believe when rsas are above 90%. last comparison ratios where are we now 20 plus. so, the market is expensive. the market is assuming that trump is going to perform a miracle. even if he does, what he's working with is far less than what reagan was able to work with. >> but you're also seeing a market, the environment that trump is taking over. the economy that trump is taking over is very, very different to the economy than bus was taking
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over, for example. bush passed on to obama, as well, right? eight years ago. janet yellen yesterday in her speech to college graduates at the university of baltimore. she was talking about how people who graduate now that they're entering the strongest u.s. job market in a decade. job creation is strong and wage growth is picking up and there are more openings, as well. she is still cautioning that the economy is weak in certain areas. but, without mentioning monetary policy, though, it is still a stronger economy than the economy surely that obamas had to navigate through during the financial crisis. >> this is called late cycle. that's what it is. the average length of the u.s. cycle is five years. we're now past seven. so, it's possible that the donald with a bit of confidence can kind of borrow another year or so. but a number of credit signs are showing deterrieration if you
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look at things like consumer loans. greater delinquencies. i am afraid i believe the business cycle hasn't gone away. late cycle anyway. the numbers are strong. >> so you would actually advise people to take profits now. you don't think it's too early and you don't think we're going to ride this for another six months, for example. you think the change is coming early next year? >> in the summer we tell people to sell their bonds and we're telling people now to sell their equities. absolutely. the ftse peaked and it took 16 years to reach that peak, again. no reason the market can't peak around here and i think it's absolutely prudent that people take a lot of profits here. >> okay. let us know if you agree with what steven is saying. you can find us on e-mail good morning, everybody. good to have you with us, as always. many of you regulars popping up.
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steven, thank you for your time this morning. joining us from alvine capital. we need to take a short break and check out our blog. lots of good stuff on there and we'll see you after the break. we'll be talking more about what's going on in the affects market and get the latest out of japan. see you in a second.
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hi, everybody. good morning. welcome to "street signs."
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i'm louisa bojesen. 12 people are dead, 50 injured after a truck drives into crowds in what police are calling an intentional attack. vladimir putin is saying the murder of the russian ambassador in ankara was a terrorist plot aimed at destroying the country's two attempts. after french conglomerate vivendi will raise its stakes to 30%. the department of justice will demand between $5 billion and $7 billion in fines from credit suisse that the bank continues to hope for a better solution. good morning, everybody. if you're just joining us plowed into a christmas market in berlin last night killing 12 people and injuring 48.
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berlin police say initial evidence points to a terrorist attack and that a suspect has been arrested near the scene. nbc news dan has theliest from berlin. >> reporter: the popular christmas market was filled with a mix of tourists and locals. german authorities said a suspect was arrested near the scene and that a co-driver of the truck died at the scene. the nationality of the suspect is not yet known. police are still investigating whether the incident was an or tan attack and the u.s. state department issued a statement condemning what appears to have been a terrorist attack. german stopped security officials said initial evidence pointed to an intentional act. video showed emergency vehicles converged at the scene and debris from the market strewn. fear of an incident like this for a while now. comes just after a u.s. state department issued a warning to
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terrorists of potential attacks on christmas markets. nbc news. the turkish president and his cushion counterpart vladimir putin and this follows the killing of the russian ambassador in ankara by a gunman identified as an off-duty turkish police officer. three men were wounded in switzerland's financial capital of zurich after a gunman opened fire on people praying outside a mosque. the attack took place just after 5:30 p.m. near the main train station. authorities say that the suspect was around 30 years old wearing dark clothing. he fled the mosque right after the attack, but the motive remains unclear. a body was later found nearby. police wouldn't comment on any link with the incident. when looking at our markets this morning here in europe. we have a slightly mixed picture. the implied open on the right-hand side of your screen
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pointing towards a slightly positive start. if you're getting up right now in the states and you want to see what's going on. this is what the futures are pointing towards. of course, everything can change as we see sometimes, but that's the picture we have at that moment. our european equity market slightly mixed. very flat to slightly lower. lower than some of its counterparts out there and you'll note within the last hour and a half of trade trading higher by 0.5% and both off by a couple points and the cac 40 hanging on to some gains. mixed to flat markets this morning. you've got euro dollar right around 103 just shy of 104. the dollar against the japanese yen higher and you saw rates being left on hold in japan and governor coroda talking about his long-term yield target. taking a more slight upbeat view
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on the economy. and the u.s. dollar making some gains, as well, yesterday after the fed chair janet yellen told college graduates they're entering the strongest u.s. jobs market in a decade. speaking to the graduating class that university of baltimore, yellen said that job creation is strong, wage growth is picking up and that there are more openings. she did caution, though, that the economy still faces weak productivity and low growth. steve liesman files this report. >> reporter: stay in school and get that degree. at a commencement speech yellen told graduates a pay gap has widened from just 20% in 1980 to a whopping 70% now. but graduates only get those benefits if they, well, actually get the diploma. >> research shows that a large share of the benefits i
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described from higher education comes only to those who graduate. even those completing three or more years of college benefit much less when they don't get a degree. >> reporter: for example, yellen said that college graduates usually find jobs that allow them to pay off their student loans and there's more. >> beyond these advantages, research also shows that a college or graduate degree typically leads to a happier, healthier and longer life. >> reporter: those college degrees will be needed more and more because of globalization and advances in technology. the fed chair offered a fairly upbeat assessment about the u.s. job market overall. she said the u.s. has the strongest job market in nearly a decade and job creation is solid, wage growth is picking up and the layoff rate is steady and more job openings. but she cautioned the economy still faces challenges including low economic growth and weak
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productivity gains. yellen made no comments on monetary policy, but a fed chair who sees a healthier job market is more less inclined to hike interest rates. steve liesman, cnbc business news. >> as i mentioned, the bank of japan kept its monetary easing policy unchanged. it became more optimistic on its economic outlook citing stronger exports. joining us from the nikkei. they left rates on hold as br d broadly anticipated, but slightly becoming more optimistic by the sound of things. >> yes, it certainly did. just to recap. the central bank ended its two-day policy meeting today announcing that it will keep its negative interest rate policy in place and it will also continue buying japanese government bonds to keep long-term interest rates at around 0%. what was different, however, was the assessment of the country's
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economy. it dropped the phrase that said exports and productions have been sluggish. effectively marking the first upgrade since may last year and the decision came as the banks saw an improvement an exports. boj governor said in a press conference that these improvements were due to economies overseas regaining strength including the u.s. and europe. he touched on the effects of u.s. president-elect donald trump saying that expectations that the incoming administration will be business friendly with lower corporate taxes and aggressive public investments may have given a boost to financial markets. but he stressed that it had nothing to do with the bank's decision this time. now, since the u.s. election, the yen has weakened sharply down more than 10% against the dollar. he said it was the dollar that gained strength against most currencies and the yen's current level was not of any concern. the bank will continue to pursue its target of a 2% inflation and in a rash of commitment said the
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bank will stick to its powerful monetary easing measures to achieve that goal. that's all from the nikkei, back to you. >> thank you very much. now, strategist is joining us and we're just having a little chat of what is taking place in the various corners. charles, let's kick off with what's going on with the euro dollar and janet yellen's comments, as well, which seem to lend some support to all this strengthening after she talked about job creation and that wage growth picking up and more openings indicating that kids that are graduating now that they're heading towards brighter times, as opposed to graduating a couple years ago the higher the financial crisis. >> yeah. i think one of the change that we've seen over the past two weeks is probably the fed being a bit more optimistic on the outlook. changing slightly their expectations to rate hikes for next year. so, there's that wind of
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optimism that is helping and also it's helping, also it's helping the dollar and yields to move higher. so, the question is, when do we start to be at a level that the dollar is strong enough or the yields are starting to be too high and start to have a negative impact on that outlook. i don't think we're there just yet. >> around, what, a year ago, when everybody was expecting that the fed would be hiking massively and i was thinking surely not. surely not you're going to err on the side of caution and see what happens with the general economy and what happens with links to europe, global economic strength, as well. now we hear that the fed, according to a lot of fed watchers, that they might be hiking by something like three times over the course of the next year. although i note that a vast majority of economists they think that is overrated. they put out a poll saying that they're suggesting that we'll see two times next year. two times hike from the fed.
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why would they hike by two or three times? aren't they going to be slowly and surely and we'll see what happens? >> well, i think there are a lot of viables that enter into the decision. one of them is what will president trump do when he comes into the office? what kind of fiscal stimulus do we get? how much tax cut and spending on infrastructure we get. that is a big key variable and we won't hear about that until q2. and then the question, how strong does the dollar get? we know the fed over the past two years that a dollar that appreciates too rapidly and goes too strong has a negative impact on financial conditions and warrants the fed to take a much lower pace. so, that's why i think it's probably a good benchmark going into 2017. but the big key will be how much fiscal stimulus do we get? >> and the fed wouldn't have a problem sitting with interest rates at a percent 1.5% in a
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year's time, two year's time with europe sitting at zero. wouldn't that differentiate? >> again, it's always a condition of what is the condition within the u.s. because the fed will put monetary policy in line with the u.s. economy. so f the u.s. economy is running strong and the gap has been closed and the unemployment rate continues to decline, they will have to hike. then the question is, as i was saying, was the feedback into the u.s. dollar and could they need to be -- >> what do you make of the correlation between the dollar and the oil, as well. traditionally when we see strong oil we see weak dollar, right? does that still hold this time around? >> there is always that normal, i would call it the fundamental relationship between the dollar and the oil. the oil is priced in dollar. if the dollar appreciates, oil needs to decline slightly to keep the price in other
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currencies constant. like everything was constant in the world which was never. but then there's also other things. you've had also periods where, well, in recent period what you're having is that the u.s. is starting to be a much more, a much smaller net importer of oil. oil production in the u.s. has been increasing rapidly over the last few years. increase the length where stronger oil prices needed stronger imports and a weaker dollar. so, you kind of rejuiced a bit that correlation over the past few years. something that will probably need to be monitoring in the coming years to see if that relationship continued to hold and that the correlation between oil and the dollar may have faded a bit. >> if you were a betting man, where would your money be? heading into q1 in 2017? >> i would say continue to be long of the dollar. still some room there and i
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think also looking into some of the cumodacy currencies. the economy is not doing very well, but oil prices are set to increase. we've had that opec and nonopec agreement a week ago. so, there will be some upside pressures on oil prices that should benefit for the canadian dollar. >> the yen? >> the yen is also driven by yields that continue to increase in u.s. yields and continue to push dollar yen higher. >> the comments that are coming through from all of you. fantast took hear from you. keep your comments coming in. good morning to you, gary. good to have you with us, as always. you can also find us on twitter @louisabojesen. glad you had a chance to take your family to copenhagen. dress up warm. coming up here on the show,
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crude realities. are we starting to see the effects of the opec deal. we'll take a look after the break. we'll be getting to your questions and comments, as well. keep them coming through.
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good morning, everybody. welcome back. still watching "street signs." keep you abreast with the news developing out of it turkey and the kremlin is now saying that a group of russian investigators have arrived to ankara after the envoy's murder after the murder of the russian ambassador to turkey yesterday. the kremlin saying that the murd urban fts those who want to drive a wedge between turkey and russia and keeping in mind that the person who shot the turkish ambassador was a 22-year-old young man. the kremlin was saying that
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putin had ordered intelligence services to come up with extra security services for the u.s. embassy abroad and will not hurt the efforts to get a syria peace deal done. a lot of speculation where we're heading with regards to a syria peace deal at all at this point in time. donald trump has secured his official victory in the presidential election defeating hillary clinton in the u.s. electoral college. mr. trump won more than 270 electoral votes. the required threshold to take office on the 20th of january. the vote, which is normally just a formality saw the highest number of faithless electors in over a century. but more democrats than republicans they voted out of line, pointing to political fractures in america. also worth noting that trump has said in the past that there was a landslide victory for him, but actually with the electoral college vote tally, it means that he ranks 46th out of 58
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total u.s. elections. and also he lost the popular vote by almost 3 million, as well. imf managing director won't face punishment and will be keeping her job despite being convicted of negative charges during her time as french finance minister during 2008. the court ruled that she failed to contest an award of 440 euros which equated to a misuse of public funds. but the lead judge decided against sentencing owing to her strong international reputations. speaking after the verdict,mize lagarde said she will not be making an appeal. >> i have been held negligent but without penalty and sanction and without registration of the decision. i am not satisfied with it. but there's a point in time when one has to just stop, turn the
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page and move on and continue to work with those who have put their trust in me. so, i'm very happy to not appeal this decision and to focus all my attention, all my time, all my efforts, all my energy and enthusiasm to my mission as head of the imf. >> now, italy's bank rescue fund has decided to go ahead with this purchase of bad loans from the struggling italian lender. now shares closed yesterday's trade more than 10% lower after news emerged that the atlan lat fund. however, the fund clarified on monday evening that it still with its planned investment in the mps. sell a portion of its loan portfolio to fortress investment group.
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the exact deal has not been made publicly but saying upon closing that the agreement will represent europe's largest ever nonperforming loan transaction. and bp has brought a 62% controlling stake in u.s. energy company gas exploration fields off the coast for $1 billion. bp said the area would become an important profit center its upstream business. bp removed its 40-year participation in abu dhabi-based company. taking the spending spree to $3.4 billion over the last three days. saudi arabia's crude exports fell by according to data from the data initiative. this follows an opec deal earlier this month to cut since 2001. brent currently around $55 a
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barrel. a bit over 52. james is an oil product analysts at energy aspects and with us this morning. hi, james. >> good morning. >> why are we so scared now that deal won't happen. >> a deal has happened. >> yes, following through with it. >> follow through. exactly. the deal that happened on the 30th of november was actually bigger than anybody really thought. it came in at 1.6 million barrels a day. now, as you say, the new challenge, if you'd like, is were they or will they comply with the deal? will they cut? in the past we've seen compliance around 07%. saudi arabia turns to be good and other countries can be less good. but we're positive that opec will comply to the tune of around 80%. >> which should have what impact? >> i mean, we're already seeing an impact. we think prices have failed to rise. we've already seen a flattening of the forward curve.
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we think prices need to rise further to draw product storage. the space that we're looking at here. we're looking at the markets pressing to draw product from storage to plug the gap left by the opec cut. >> and how much further do we need to rise? >> we are looking at somewhere in the region of $65 a barrel by the end of q2. on top of the -- >> another $10. >> we see another $10. obviously volatility, particularly to end the of the year now. liquidity going after the market and everybody is going on holiday. let's not forget at the same time that on top of the opec deal, we have since had a nonopec deal. we have had a double whammy and on a nonopec front we are also relatively positive. that's a 560,000 barrel a day cut on top of the opec deal. 300,000 barrels a day of that is russian cut. we think most of that will
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materialize. it's still being negotiated as we speak. we think 200,000 barrels a day of that is probably structural declines that are happening anyway. won't make any difference to our balances. but, overall, we are relatively positive. >> how quickly do you think libyan and nigerian oil will come back on to the market? >> i think that's a key variable. obviously, lots of moving parts. nigeria, i think, people have probably been too bullish about the speed of a potential comeback. as we speak for oil terminals are currently closed. and industrial action and, at the same time, it's been very quiet on the delta front with militancy and attacks. arguably, more downside. >> sorry. more downside than what? >> more downside in nigeria equally on the libyan front.
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we thought two yields were coming back two days ago. that would have brought 400,000 barrels a day back. it hasn't happened again. >> so, i'm getting ahead of myself. i'm lisening to the time count and i want to hear the end of your answer and i am looking at e-mails coming through. simon wants to know how you think 2017 oil is going to compare to 2016 market? >> we think it's going to be very supply -- people have already forgotten about demand. amazingly we think people are going to be trading headlines, half headlines. part of that comes from the fact that tracking oil volumes and tracking compliance is actually very difficult. there's no one single service which says saudi arabia has loaded x, y, z in terms of precise volumes. what you really need is bills or inspection documents, which are often confidential. what you'll have is competing
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news wires, consultancies and putting out scraps of information, rumors. price is higher. >> james, thank you very much. >> you're welcome. that's it for today. thank you so much for being with us. we look forward to your company again tomorrow. same time, same place. more to come. "worldwide exchange" up next. bye for now.
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good morning, markets shrugging off and key earnings
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are on today's agenda. breaking overnight, an optimistic bank of japan leaves interest rates unchanged and the details and the outlook straight ahead. plus, rise of the robot. mark cuban goes public with a high-tech investment advice for president-elect donald trump. it's tuesday, december 20th, 2016. "worldwide exchange" begins right now. good morning and welcome to worldwide exchange on
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