>> welcome to "on the move". we are counting you down to the european what we are talking about today. we have a great interview. you are not getting this anywhere else. with iancoal talking taylor. out of thats conversation on where oil is going. a mining conference in cape town. a big one. they are talking about consolidation. we will have that conversation and take you live to south africa. barclays should be broken up. that is the call of one analyst. we will walk you through the logic of why this bank needs to be broken up.

why it is in the best interest of shareholders. let us get you up to speed with everything else. caroline: china's foreign reserves have fallen to a near for your low. -- four your low. haspeople's bank of china tried to shore up the yuan. through fiscal easing and structural reform. the saudi arabian oil minister says he has held successful talks with his venezuelan counterpart about ways to walk rate. he did not reveal steps producers should make to shore up prices. the door to opened parking a ballistic missile defense system on north korea's door. it comes after north korea launched a long-range rocket over the weekend. the denver broncos have won super bowl 50.

von miller was named the game's most valuable player as americans most-watched sporting event, advertisers played -- paid hugely for their ad spots. 28 minutes to go until the european equity markets open. let me tell you how we think that open will turn out. let me show you what we have. this is a fair value calculation. what is it telling us. the ftse 100 is likely to open up points seven of 1%. 7 of 1%. the overall picture in europe is of 1%.nd .4

that is consistent with the s&p. that is what we are looking at in terms of the equity market. let me take you to the other boards. we have the north korea missile launch overnight. let me show you the market applications about that story. losing a little bit of ground, unsurprisingly. you have also seen the japanese yen coming after a massive week last week dragging the knee guy ikkei last week. we have got to talk about so much that we have to talk about crude so much this week. let me take you into that conversation now with the toll. oil prices could stay low for as

long as 10 years according to the world greatest traitor. we go to ryan chilcote. a rare interview. vitol ceo ian taylor. a cap on any price rally. is toosituation we have much of supply. the balance is due not look like they are tightening up yet. say that we can say for sure that the price has bottomed out. aan: if you had to put number, the brent price at the end of the year would be? $48. you can come back and kill me because i am sure it will be wrong. ryan: you don't see a sharp rebound in prices? >> we don't because there is so much stock now built up in the world. we believe it will take a lot of

time to work off that stock. it will happen over time. no one will wake up and suddenly see there is no oil left. the world continues to have plenty of stock of oil. ryan: how long will it take to work through this stock? and get back to $100 oil? >> there is so much more supply. are all being more efficient. the u.k. consumption of oil is going down, not much but it is going down. efficiency in cars is going up as it is in airplanes. there is a possibility that you will not necessarily know back above $100 ever. ugly andam old and have been in the business far too long but if you think about the last 40-50 years, we have only been above $100 for a few years. and china has changed. huge growth in china.

very dramatic. in the past, we did not have shale. ryan: you said that you see the oil price at $48 a barrel. the year after --where do we move? >> i think we really do imagine a bandage. between see that $40-$60. you can bet60 come that we would bring back on some of those oil fields. aboutmounts of discussion the u.s. shale. ar us, it looks clear that lot of the oil that will be shut down in the next short while because it is too low a price,

could come back. we see that possibly at above comesr sure if bakken back on again. natural the climb year. i can see the band lasting 5-10 years. guy: sensational conversation. you're not getting that anywhere else. a rare interview. let us talk to the man who helps manage over $2 million in assets. good morning. next 10ollars for the years is what mr. taylor is saying. equity markets so correlated to the price of oil. what is the reader cross of that story if he is right? $60 -- thets to

context is interesting. looking at gdp growth. they are rebalancing the chinese economy. 80% of the loans in the chinese market -- one third of local chinese markets -- chinese companies and half of the foreign ones. rebalancing will take time. it will help inflation marginally. we're not talking about deflationary fears. i think it should be seen as a positive but no one is fooling themselves by saying prices will go higher sooner. have we really seen the

direction of oil prices at the pump? i don't think so. you're not seeing the same correction at the pop as you are seeing in the oil market. also, you tend to save it does you are unsure about the economy. you spend it later. ryan: what will it take to crack the correlation? when does that start to break down. ? futures on the bloomberg are trading higher. because oil is higher. >> a lot of that has to be the market structure as well. who is trading in this market? the market has moved away from the fundamental guides. have volatility.

we don't know how it will change because there is more money flowing in. we will all have to deal with it. the market structure itself has changed. moved by 1% market every day for the last three weeks. thank you for starting the conversation for us. coming up later, we will be taking -- talking about an open letter written to barclays ceo suggesting that they break up the bank. good news for the shareholders and the bank. we are looking for to that conversation. it is coming up. shortly. ♪

guy: a welcome back. let us get a bloomberg business flash. address: they will

investors and bankers in cape town today. it will be the first public appearance since revealing an audacious overhaul plan in december. the commodities around 70% of the companies value in the last year. the platinum division says it is suspending dividends until the financial position in groups great -- position improves. creditsqueeze -- brady suisse. a casino has agreed to set its stake in a time supermarket chain. 3.1 billion euros. it will cut casinos debt in half after a short seller attacked the french retailer for understating its debt. exploring its options for

growth which could include acquisitions. hans nichols is in berlin. he has more on this story. more independents coming. what is the plan? volkswagen the truck division want to look at china and north america. this is coming from an interview from the head of the trucks division. they are looking at potential he did not provide specific. he said we are keeping all options open on our way to becoming a global champion. the long-term, the north american market is interesting for us but it has to be a good fit for us as well as for our possible partner. -- those areets two companies to take a look at. one sort of thing and you will

excuse the pun to put the brakes on the talks are potential growth talks in north america. it looks like there will be an ebb here. for this volkswagen division come up truck division which has not been harmed by the diesel scandal, they are looking for growth, potential acquisitions in china and the states. let us get straight back. what is the view from cross bridge on where the banks go? i put up these charts. best metrics of evaluating. the banks have hard -- have had a horrible time since the beginning of the year. value, is there

value in these institutions? >> there is nowhere that says the banks are not cheap. the banksking at having a hard time unless you see sustained gdp growth. we invest in banks like ubs. they have had a massive outflow. these are some of the places you want to be. sustained gdpa growth, i don't think you should be investing in banks. forced sellers in the market? sovereign wealth funds have acquired huge stakes in the banks and they are the ones selling to raise cash. that is also depressing their prices at the

end of the day, if you're talking about banks and the economic growth and we are not seeing economic growth in europe. those things have to be taken into account. there are people now talking about whether the banks should be in every market as they are or should they get out of it. if those things do not come out and it doesn't add to the equity, they will continue to be unloved. guy: you are saying don't go anywhere near them for now. they are trading at depressed levels. you were to break some of these institutions up, is there more value? is there a breakup value? separate investment banking from retail banking from some of the skills that these banks do. where with the value be higher or lower? >> there is some setback to

globalization. does that mean you should be in every market? maybe you shouldn't. some value in that and that is something the banks will have to look at. guy: let's talk up -- let us talk about trade. the u.s. banks have been enough. less so than the european banks. -- thek at the economy area's things that are positives. had the u.s. banks in overly -- been overly beaten up? >> the banks are overly oversold. in the last seven years in the u.s. and europe, you still have an economy with a large unemployment rate. if the economy grows slowly for a long time, the prices and

wages will fall. inflationary pressure. this is what is happening in the u.s. and europe. between u.s. and europe, i do feel that there is some slack in the markets. so prices will adapt. a lot of slack remaining in the european market. look at the unemployment rate. the u.s. banks will perform better much cerner -- much sooner than the european banks. guy: we will talk about the fed. if you want to find these charts on what is happening on the book value of these banks go to the website. minutes away now from the open. we are going to look at the potential corporate move gold.ing the minor, rand minors areke the going to outperform the fair

value calculation of the bloomberg .85 higher. decent performance coming through. that is what is coming up next. the market open. ♪

guy: 7:54 a.m., london. we are into the countdown for the market open. let us get you some of those stocks you need to be watching. caroline: i am kicking off with one of the best performers in the entirety of europe. randgold. they have more good news. gold has climbed 9% this year. seeing the results living up to expectations as well. a record amount of gold production. they are digging more out of the ground. it shows you how the share price is phenomenally exceeding where analysts expected the stock to go. this is your overall average price target. it is well below where the stock

price has managed to rise two on the optimism that money is moving to gold. watch randgold. we are also seeing casino to be watched. a bit of a jump in this stock. the french retailer selling off a stake in thailand. a supercenter. one billion euros to help pay down some of their debt overall. the nominal moves seen for casino as well. imagination tech as we go into the open as well. into the countdown to the equity market open. looks like we will have a fairly positive picture going into that. we not seeing a huge new that -- huge move that we have seen in recent sessions. the dax looks like it will be a little bit of a laggard.

price line you want to watch. that is where dax futures are at the moment. coming up next, the cash open. ♪

guy: welcome to "on the move". in london, moments away from the start of european trading. the world largest energy trader says low oil prices could persist for a decade. more with the vitol ceo throughout the hour. yellen's balancing act. breaking up barclays. we will speak to an analyst who thinks the ceo should make the big decision to spin off its investment bank. whoe of already indicated,

-- we think we will get a positive beginning. as we head into the open, what should we be watching for? let us find out what is happening. over the caroline hyde. caroline: china goes on holiday and we suddenly get a bit of risk appetite in the trading. some of those concerns, the north korean is a launching, the science of china's slowdown. the back burner managing to brush off risk aversion. money is moving into equities. after we digested the labor wages. the rate hike come december? a 50% probability that we will see one by december. ftse 100 opened 6/10 of 1%. randgold pushing harder.

rolls-royce one to keep an eye on over concerns of its dividend. money moving into the equity market. we are also seeing money move into the u.s. dollar after the data. it slumped phenomenally last week. today, up by about a 10th of 1%. holidaysia generally on at the japanese market is open. the yen turned weaker against the dollar. galvanizing money into the japanese trading day today. equities higher. u.s.-dollar push higher. north korean launch of the long-range rocket impacting the korean won ban. any moving into the french and german debt and out of the u.s.

debt. i want to focus on some big moves in randgold leading the charge on the ftse 100. your best performing dock in europe so up -- so far this year. up 28%. keep on going to driving higher. casino, a big jump for this french retailer as it gets rid of its stake in a tie super seller. thai supercenter. tact, you are back to keep an eye on this for later. you are likely to see it fall -- to they lose their see see it fall 15%. i want to come back to that randgold. long-term charts.

the data disappears off of my screen. an amazing performer. the basic materials sector is up very strongly leading a positive picture across the sectors. everything in positive territory this morning. all of those sectors on the front for this morning. the basic materials sector is doing well. we are heading to the minor conference very shortly. taking you back to friday. the session we saw on friday, 151,000 jobs were created in january. a disappointment compared to the consensus but the unemployment rate did drop below 5%. this is what we are saying about the chances for more fed rate hikes following those job numbers. good for mainstream and it will be good for wall street over the longer-term. is important, the

yields are higher in the start market is lower -- the stock moke -- the stock market is lowered. the number it would want if i were janet yellen. the numbers came in below expectations. there were a few components that were better. were a hourly earnings bit better than expected. i think this is tough are them. >> -- for them. >> the current cyclical high in this cycle. that is already discernible. in the u.s. economy. is worrying. drags on growth. they will be sitting on their

hands and do it very well for the foreseeable future. guy: clarity from janet yellen. front -- she in testifies in front of congress on wednesday. it will be interesting to see what she has to say. the event of the week. let us bring back in our guest. i want to take you to the work function. you have to get down to the back end of this year, december to get above 53%. is the market pricing this correctly? >> i believe so. luckily -- lucky to get a rate hike. the average hourly earnings. you had some big states like

massachusetts and california minimum wage. a lot of it was driven by high wage earners and that increased the average hourly earnings. i don't think the fed will raise rates in march. if you look at the broader measure of unemployment come it is still at 9.9%. i think it is hard to justify given all of the data. tightening financial conditions. that makes me believe that the fed rate hike for march is off the table. you may get one in june. if we get a surprise in gdp growth, the fed will look into it but march is off the table. guy: let us dig more into the slack in the economy.

the chief economist is making the point that there are plenty of other metrics if you look at unemployment, population -- there is an implication that there is much more slack in the economy. what number do we need to get down to before we start seeing a wages?ad into higher >> we can't ignore the top number. we can ignore the unemployment rate number. the average hourly earnings is the key figure to watch. we have to see a sustainable increase in wages. until that happens, we don't prefer to go ahead and raise rates. the economy is getting better. is theask anyone what

job growth of a central banker i think that is a mindset that everyone is in. fantasy inflation coming on is not the case. i believe that average hourly earnings is the number one should look at and unless we get a sustainable average hourly earnings come we should not be looking at a cut of the slack. -- if theis is wrong , is theber is wrong dollar going to increase significantly from where we are now? >> not very high. people who are pricing for hikes were getting excited about long dollar. -- if you have an economy

growing at a slow pace for a long time, it brings around inflation. unless you get the growth higher -- how do you do that? you will see any policy action until after the election. income inequality. income peoplew rely on wages and not on bank loans. , ands those things happen those things won't happen until after the election. there is a policy vacuum. i believe there will be slower growth. we will not get more than two hikes. guy: what does that mean for mario draghi? mr. druggie has to come out with his own policy measures. has to come out

with his own policy measures. from -- sell more frontloading's from qe. he will have to come up with his own response. you cannot rely on the fed to do their work. weakening the euro more and more. guy: and the boj? we are trying to figure out how they fit together sequentially. interesting. the week before they said they are not going to do anything and then they came back and did it. easing is abank thing that will continue. there is no other option and the only game in town. unless you have concerted fiscal response coming from everywhere. we will see during the next meeting if there is some kind of coordination.

if we see some form of coordination which brings back gdp growth, the central banks can step back. unless we have that, the central banks are the only game in town. guy: this is the stoxx 600 chart. how significant is that? mid 1990's and this is 2005 and this is 2015. >> i would put it down to cycles. a correction cycle almost every three years. have one correction every three years. guy: are we going back down here? >> i don't think so.

even if you accumulated earnings and even if you apply a measure which is low, i don't think that will be a low number to go back to. up next, a deal to cut oil production is a real possibility. the world'sview of largest oil trader. that interview is coming up next. ♪

guy: welcome back. you are watching "on the move". china foreign currency reserves have fallen to a near four your low. they drop $99.5 billion in january, continuing a slump from 2015. it as pressure on policymakers to strengthen the economy through fiscal easing and structural reform. the saudi oil minister has said he has had successful talks with his venezuelan counterpart. he did not reveal what steps producers should take to shore up prices. the u.s. has opened the door to parking a ballistic missile defense system on north korea's doorstep. it is a move that could reshape the region's security system. the denver broncos have one bag super bowl 50.

von miller was named the game's most valuable player. about $5res paid cbs billion for a 32nd stop -- spot -- a 30 second spot. is a real possibility of an agreement between opec and non-opec countries to cut production. that is the view of the world's biggest oil trader. in a rare interview, the vitol ceo ian taylor told ryan chilcote it still matters to the oil market. a group of very important countries. it is relevant. ryan: wide. -- why? they have not done it recently.

what you think about the idea that opec countries could get together with non-opec countries and cut? do you see that happening? >> it has always been a possibility. it is only fair to stress that it seems to be the case a year ago. is saudi's said the market getting long and we are having to work together with everyone providing everyone takes their fair share of any change. obviously, it was not possible to do it then. opec was looking for cooperation inside opec as well as non-opec and that has not happened. it is not easy. the countries have different oil interests. of a big probability deal between opec and non-opec countries is what? >> come on. ryan: we want numbers.

againstbly slightly 60-40 against. it is a real possibility. ryan: those people are very dismissive of that idea. the oil market took off when the russian oil ministry -- minister said there may be some corporation in february. >> on the production side. given the fact that it looks like it will last a big longer and the stocks are bigger, those producers have to consider whether they want to have low prices for such a long period of time. ryan: will the saudi's be less confident about their approach than they were a year ago? i don't really know. ultimately, the lowest cost

producer. they will eventually -- others will go. ryan: is there readiness or more of a readiness in saudi arabia effortider a coordinated to reduce their own production? >> i am sure handled correctly they would still consider a coordinated cut. that is the point they have made, it has to be coordinated among everyone. so far, there has not been the willingness of everyone to do that. joins me now. a fantastic conversation. interesting to hear what he had to say about opec. he'll so had some interesting things to say about price. pretty bearish view. in the oil industry sees a recovery. it is beyond that where he says you have got this natural buffer

of shale producers coming back if prices rise allowing them to come back into the business plus the absence of china as a huge driver. really keeping prices down for an extended period of time. that was interesting. also saying he was not sure that the oil prices have bottomed out. this idea that even if, he assigned a much higher probability that i have ever heard anyone talk about, 40% for an opec, non-oil -- not opec deal, but even with that it does not change his fundamental view that we are in a low price range for a long while. marketsck look at the as we head into the break. we are seeing a little bit of a turnaround.

we thought we would get a positive open. we got that but now we are beginning to fade off a little bit. significantly more than that but it is fading a little. 1/10 of 1%.up turning into negative territory part correlations between what is happening with oil and how that ultimately turns the story around. oil still higher come wti still treating at nearly 1% at 31.60. talking of oil, bets on oil reached records. regardingsagreeing the direction it is going. we are going to look at the data to see who will win, the bears or the bull on the price of crude. that is next. ♪

guy: welcome back. bets on the price of oil have risen to record level but investors split on which way it will go. let's talk to caroline hyde. this is the chart that matters. caroline: fascinating. the complete lack of clarity in which way the market will go with oil. we have seen record amounts of betting on oil but they are pretty equal as to whether they will be short or long. at the moment, net long wins

out. still, they are both picking up. you have also got short bet at the moment out there. both are picking up. short bets rose about 9% in the last week. long bets picked up about 4%. million contracts being taken out on futures and options . splithe market is pretty on what will ultimately happen. when you look at which way the momentum is come -- the momentum is, can we extrapolate anything? caroline: it is difficult. it was a winning week for shorts last week.

overall, net long still wins out. the balance of the market thinks oil will pick up in terms of price point. at $30 a barrel that is not surprising. it paints a picture of complete lack of clarity. what a fascinating conversation. $40-$60 aing about band. that will cause significant changes. $60 come the market will pick up a little bit. -- $60, the market will pick up a little bit. the world's largest mining conference picks up -- kicks off in south africa. we will talk about randgold as the stock is really surging at the moment. we will take you to south africa. we will also be talking about show.ys later in the and african story there.

that is all coming up next here on "on the move". ♪

guy: welcome back. you're watching "on the move". we want to take you down to keep down for the conference taking place. some headlines coming out from the keynote speech. some really interesting lines. nice quotes. he is saying -- if we don't dance we will perish. in interesting line on the china's story as well. it will be a bumpy ride. talking about the evolution of the chinese economy it will eventually go through. 2016 will be the toughest year gap for the industry. let me show you the markets. the equity story. faded the early rally a

little bit. the stoxx 600 on the flat line. the london markets up by 2/10 of 1%. a little bit of an outperform her. -- outperformer. the mining sectors. absolutely fascinating as we watch what is happening at the cape town conference. randgold front and center. let us find out some of the stocks we need to be watching. caroline: randgold is the one i am kicking off with because this is the best performer in the stock system. just behind casino. the best performer in the last year to date. up about 28% so far. randgold continuing to gain today because numbers coming in better than had been forecasted.

record overall production being set. 1.2 million ounces being dug up from the ground. 6% year on year increase in terms of production. money coming out of the ground for them. there are for your profit was down in the fourth quarter. prices actually fell. in the first quarter, gold prices are at about 9%. this bodes well. prices on the upset. randgold has surged above the expectations. an outperformance and that continues to date helping by the dividend rising some 10%. keep an eye on casino as well. spiking up. the best performer on the day for the stoxx 600. this is a french retailer that has been under stress recently. this is an area of shortselling. a company betting that this company has been us -- under

estimating its overall debt load. to be able to cut that mammoth debt load they currently have. keep an eye on casino as they get rid of one of their big stake sales in thailand. they are selling off that to cut their debt. imagination tech. this is falling some 10% this morning. on the downward trajectory. it is a chip related that. they are being hurt because there is a slowdown in the number of smartphones we are buying. the is a great function on bloomberg, supply chain analysis. royalties are going down because -- are chip companies not buying them anymore. getoelectronics come revenue of 8%. feeling the pain of what is a

slowdown in the chip market. imagination tech says goodbye to its chief executive as well today. the world largest mining conference is starting in cape town today. it has been a tough year for commodity suppliers. they have been pummeled by falling prices. colin, what can we expect to come out of this conference? the we hear about prize assets being shaken out. will this be a story of shuffling the deck chairs a little bit for the commodity sector? >> i think in the commodity sector, we are bringing things ahead. we have been under pressure for the last 3-4 years. knowingoving past that we have to do something about this. that is being driven by the

financial sector. that does mean that we are starting to see talk of some of these assets coming up for sale and companies doing what they have to to get balance back in order. guy: how long will that process take? we've got to go through the divestmentopment -- cycle first. there will be some winners but some assets will not be sold. the other side of the equation is the chinese angle. they are talking about supply-side reforms and putting targets on. steel, coal. that is a longer-term process for me. 3-5 years. , we will beime shipping deflationary pressures to these commodity markets. guy: the demand side story. back to the supply side. whichascinated by

commodities in particular will benefit the most. as you look across the complex, where does it start, where do you get the biggest bang for your buck? >> a lot of people would still be looking for copper assets. assetsre not many prized of for sale. -- up for sale. quantum andirst what they have to do in terms of asset allocation. the gold side. gold is doing very well. there is some decent stability in the u.s. dollar. these companies are starting to make quite a bit of money. guy: we spoke with ian taylor earlier. $40-$60 beingt the oil range for the next 10

years. seeing inhat we are the commodity sector will be priced off of oil? oil -- the industrial metals come we don't have the demand cycle coming through. in oil, there is still demand. shows signs of bottoming out, you will see more investor interest coming back. range,ook at the $40-$60, we will have to see what happens. we are almost back to the old days, 20 years ago. we have shorter-term commodities. anden by investment lags demand.

that type of market is all about who can run their assets the best. lettuce wrap up the conversation. us wrap up the conversation. where are we not going to see some consolidation coming through? we have to lose a fair -- [indiscernible] they have structural overcapacity. desperatelytrying to survive.

guy: enjoy the conference. [indiscernible] oil is holding up ok but we are definitely fading the rally that we saw first thing this morning. on the equities. they are all in the red right now. u.s. futures are also turning a little bit negative right now. acrossory is rippling the atlantic already this morning. it looks like we are fading a little bit. oil is holding up a little bit. that correlation story is not working as well as it has in the last few sessions. a banksbe joined by

analysts who says it is time for barclays to break itself up. he has written an open letter to the ceo saying sell the investment banks and the african business and you will get a better evaluation -- a better valuation. ♪

guy: lettuce get you up to speed. on course.e is

to open up its first store in india. the chief executive officer is seeking growth opportunity there. casino has agreed to sell its supermarkethai change. it will reduce borrowing. credit suisse ceo is taking a substantial cut to his bonus. last week, the bank reported its biggest quarterly loss. should barclays be broken up to cut losses and reveal some value? our next guest has written an open letter advising the ceo to make this big decision. walk us through the essential

case you are making. when your earnings are going up. bank the an this value trap for investors for a long time. the retail business in the u.k. which is a great business. it is a disparity. it makes it part very difficult for investors to invest in any one of these. africa, ito invest in would buy standard bank. the sense for barclays is to keep it together is absolutely zero. now is the time to do it. .5 -- trading at .47.the price is at love one trick

ponies. what i've written in the letter is let us take africa. you only get questions when africa is blowing up. what is the point of having it in your portfolio? the complication doesn't make sense. what i is said is now is the best time to do it because you are trading where you are. ceo. now is the time to do it. guy: .47. what was the business be worth -- you break it all up -- you run the numbers -- you have a bull market-bear market view right now. that will take you from here to

.7. and then, if you have the breakup. and you have the african business. for the investment bank, is as zero right now. if you put in a separate entity and you put in a separate management structure you're -- the u.s. has the capacity to take one more broken dealer. dealer.r you get a separate set of investors and i think you will catch a bid. i think it will take about 4-5 years. you don't have to capitalize the u.s. bank because of u.s.

regulation. this is, why,t right now? you are spending anyway. whole hog. well go home walk me through the u.k. business. is a lot ofe investment that will have to go into this side. work?es that business >> barclays is the best technology platform you have in the u.k. that is why investors invest in the stock. not because of the investment bank. -- it has is that always had the best technology platforms. you're not been able to showcase

its. they actually have a very good u.k. platform. platform. good a very good platform. it is impossible to find the value by going through the investment bank or the african business and finding the gem at the bottom. just bring it up. guy: you expect the chart to reverse if you do that. >> absolutely. difficult to take a strong decision. it means moving heaven and earth. right now, it is absolutely the right moment. there are plenty of banks out there. deutsche bank is the extreme. is there a value you could run the numbers on? >> deutsche bank is a fixed

income. this is a great franchise in the u.s. which was bought by a european investment bank, a retail bank and after that, they have not invested in their franchise. they have a natural home in the u.s., very different from deutsche bank. doing -- deutsche bank does not have a proposition. guy: the worst performing sector since the start of the year in europe. >> we are revising the macro. let us take last year. u.k. te hikes in the the brokers have got much more

head because broker investment banking has become a fixed cost business. especially in europe. it hits your earnings massively. that is why they are printing all of the reds that they are. guy: great conversation. great analysis. up next, we will preview the week ahead and it is unexpectedly about this lady. what is she going to say posted payroll. the market is on tenterhooks. ♪

>> there is softness in the global economy. china is going through a transition. europe's economy is still slow. a lot of the emerging markets are still challenged. those are operating headwinds for a lot of companies that do business overseas. we have got to pay attention to this and take smart steps this year to continue progress. that was president obama talking about the global economy followed the payroll numbers on friday. let us talk about what will happen next. it will be an interesting week. the u.s. economy is very much in focus as well as u.s. politics. tomorrow, new hampshire, the

first primary of the presidential campaign. london, wehere in kick off the national week. it is always an interesting week very at a time when we are seeing oil as low as this is -- at -- as it is -- and we get onto the main events. testifies before the house and the senate on wednesday. thursday, what will she say. rounding out the we come up we get u.s. retail sales on friday. let us talk about the week. it is about yellen, isn't it? >> absolutely. quickly about the payroll number, if you go beyond the headline, which was disappointing, some of the

details were ok. 2% and thes&p down nasdaq down 3%. everyone is waiting for what the chair has the say this week. it is a strange dynamic that you would have thought that with a good unemployment number, with the wage number being where it is, equities should -- affect.re is a one off is that legitimate? >> you would be hard-pressed to find someone to say that wages in the united states and in the u.k. are racing away. you understand the reticence there from investors. yellen will be a big deal this week for markets. guy: the retail numbers will also be a big deal. that is the number that needs to start racing ahead. you could argue that the

american consumer is the engine of the american economy and therefore is the engine of the global economy. retail sales will be very important. on what the chair says about the path of interest rates this year. guy: if you had a question to ask, what would it be? i would asked about the disconnect between what the market inc. and what the fed says. thinks and what the fed says. guy: in cape town. are the commodity stories not going away? you get a sense that we are finding a world when we need -- where we need a band. >> it will be difficult. every rally in oil has been met with heavy selling. i have not seen that dynamic change yet. guy: european equities have

faded a little bit. we are finding a floor right now. that is it for bloomberg "on the move". pulse is up next. ♪ we live in a pick and choose world.

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european markets open flat after losses. cutting projections for the s&p 500 amid a $2 trillion rout. the new year begins with old problems for the pboc, as the fx reserves fall to a four-year low. low for longer. the bloomberg exclusive, world's largest energy trader says the phrases could persist for a decade. more from him throughout the hour. welcome to "the paul's," live from london,