i'm christine tan.

chinese sovereign wealth fund cic is looking to up its overseas investment twofold on signs the global economy is on the mend. >> and i'm ross westgate here in europe. we have the idea of a tax on financial trngzs. >> and i'm mike huckman in the united states. investors will get a revised update on the list of cic and the fdic updates the list of troubled banks. >> welcome to cnbc's "worldwide exchange." the ftse cnbc global 00 is just down a point. european stock markets one hour into the trading session, we had mild losses at the open. we have mild gains an hour into the session. the smi is down 0.16%. maybe we're just consolidating right now around the levels that we've got. on the currency markets, the

dollar/yen is weaker against the yen, 93.67. euro/dollar, low 1.42. sterling is weaker against the greenback, 1.62. and euro/sterling is trying to nudge up toward the 0.88 level. christine, good to see you. >> good to see you, too, ross. lots of concerns about the state of the global recovery, where the economy is going to be headed. that's the risking aversion. the nikkei 225 is falling 176%. the kospi falling 0.9%. the shanghai market down 0.7%. once again, concerns about supply coming back to hone this market. and the sensex in india, only market trading on the up side right now, up 0.3%. overall, a weak picture here in terms of crude oil and nymex crude. down 21 cents. concerns about global demand

weighing on this, nymex, $71.22 a barrel. brent is falling, as well, down 30 cents, $71.35 a barrel. mike, good to see you. how are the futures looking today? >> good afternoon, christine. good to see you, as well. and the futures at this point are looking like the dow is going to shoot for straight eight with seven consecutive days tying its longest win streak of the year. it looks like we could have a mixed open at least in about 5 1/2 hours time from now. moving on to the treasury market on the back of another relatively successful auction yesterday of two year notes and ahead of another auction today of seven year notes, we do see the bund yield creeping up at 3723%. yesterday, the price went up just a little bit on the benchmark ten year t-note and the yield came down and that trend is continuing, although it's basically unchanged with

yesterday's close right now at 3.43%. and then moving on to gold, it dropped just 20 cents an ounce yesterday to $934 an ounce. today right now, you see it's down 75 cents at $944.55. a lot of analysts think gold is locked in a range new mexico after the united states labor day. >> joining us right now. we have our panel dibie and daniel. gentlemen, thank you very much for being with us. daniel, let me start with you first. a lot of risk aversion here in asia. how bumpy is the road ahead going to be for equities?

>> i think it's going to be reasonably bumpy. valuations are clearly extend at about 9 1/2 times earnings. your risk/reward from these kind of levels is poor. back testing is a guide. also, i think there has to be concerns about the economic cycle here. it's clear that the u.s. consumer is doing nothing, that the spending is still very weak, both in the u.s. and europe and that is going to undermine the global economic cycle. and i think sentiment towards it could weaken in the months ahead and asian equities could drop 10% to 15%. >> we're getting news that china's sovereign wealth fund is looking to increase its joe seas by this year. surely, they must view that things are bottoming out. >> even at the six months horizon, the economic news flow will be very supportive for equity markets. but equity markets have already

bought the story of a very strong growth in inldsys and an inventory led recovery will show that business equipment is currently leveling out. this is also the case for the housing sector. all in all, we should not -- of a very firm gdp growth during one quarter, for instance, during the first quarter, the u.s. economy may expand at 5% the annual rate. having said that, this is for the short-term. in 2010, as daniel mentioned, on the consumer side, we have to look at what is going to happen on the job markets and the job market will remain weak. the unemployment rate looks to increase. balance sheets will remain under pressure and all in all, i would say that we expect a bumpy profile for gdp growth.

we expect a bubble for equities because we do not share the optimism for 2010 and we expect lower growth next year than -- we do not expect, for instance, gdp growth in 2010. that's why equity markets have reacted as it is. >> daniel, this is mike huckman in the states. yesterday we got really good economic data on new home sales and on factory orders for durable goods and the markets kind of said, so what? show me more. is this a sign of fatigue in this summer rally? >> i think it could be. up until roontly, you're getting upside surprise, i think that's

reflective of valuations. valuations are now pricing in a robust economic outlook. and if there's any disappointment in terms of that outlook, i think markets will drift lower. >> and speaking of upside surprises, didier, today we're going to get revised second quarter gdp numbers as well as weekly jobless claims. what are you looking for, upside, downside surprise, what do you think the market reaction will be? >> for the second quarter, the gdp growth will be revised lower due to inventories. but this is good news for gdp growth in the third and fourth quarter. because you will see an inventory led recovery. so i mean, it is expected. i think we have to look at the jobless claims. we'll tend to indicate that job losses will dmanish over time.

so the news flow will remain ç positive in the coming weeks, will remain positive and supportive for equities. having said that, valuations are strange and a bumpy profile for classes should be expected. and there is something which is quite puzzling at this stage of the economic cycle is the fact that bond yields remain so low. so this is something that we should monitor closely. we should see pressure on long-term interest rates in the coming weeks. >> why is that puzzling when every central bank is telling you they're going to keep policy excessively low for some time to come? >> yes, you're right. and i guess it will become a hot topic in the coming months. and at some point, markets will have to find, you know, the

correct level of long-term interest rates. currently, i would say that even our expectation was for gdp growth and inflation. for instance, in the united states, 3.5% for the long-term and for the ten-year bond yield. this is too low. 4% would be something more convenient. so i would say for lower risk aversion, we should see pressure on long-term interest rates. they agree with you as long as central banks maintain their rates for an extended period at a low level, this is something that explains this. it cannot last for long periods. >> and daniel, we've just had data out here for the euro zone, m3 data. they say private sector loans up 0.6% versus up 1.5% in june. the m3 numbers are lower than forecast.

there's not much credit going into private sector. whether it's because they don't want it or because banks aren't lending it, but it's another sign that consumers are going to stay pretty weak. i wonder, therefore, whether we should be much more focused on an asian consumer rather than western consumers. >> absolutely. if you're looking for consumer demand globally, i don't think you'll find it in the west, you'll find it in the east. but the issue for asian markets is they depend very much still on the developed world consumer. if that area of the world remains weak, which i think it will, then that is problematic for asia's economy and asian markets. >> no dislocation between the two inner opinion? people are saying, look, we are de coupli decoupling, but you don't think that's possible? >> there's an element of

decoupling, no doubt about that. i mean, the chinese consumer has held up incredibly well through this downturn. part of that is due to income growth remaining strong in china. so if you are looking for domestic demand growth in the world, you'll find it in asia and you won't find it in the west. to that extent, there is a degree of decoupling going on. the question is how much of that is priced in. for asian markets, part of the demand, part of the earnings story is for domestic demand in asia. the west remains weak. it's difficult for asian equities to trade at a large premium to historic leverages & one would argue. >> daniel, thanks for that. good to see you, daniel mccormack and didier, thank you for joining us, as well.

share in credit agricole are one of the top gainers today after the bank reported forecast beating second quarter profit. the figures were partly saying the high earnings in investment banking division, net profit beat forecasts of nearly $490 million, almost three times last year. the banks says it is well placed and feels confident about the future and says it won't need the second phase of help from the french government. >> you viewers in europe will see able to see the interview on closing bell, but wherever you are, you'll be able to see the interview where else? cnbc.com. the chairman of fsa says he will back bank taxes. lord turner said capital requirements against trading activity will be the most powerful tool in eliminating

profits, but says if those measures were inconsistent, then he personally would consider taxes on individual trngzs. >> ross, china's sovereign wealth fund, cic, may be going on a global shopping spree. according to various reports, cic is looking to expand its joe seas investment this year by ten times the previous year on signs the global economy has bottomed out. cic is reportedly eyeing companies and property in japan. elsewhere, in focus, china telecom is dialing in with slightly stronger than forecast second quarter results. quarterly profits are down 30% from a year earlier on higher net were cost and marketing expenses from its new mobile business. china telecom did not pay an interim dividend, but says it will revisit the issue at the end of the year. this is how it did in hong kong, down 1.1%, three hong kong 87,

mike. >> christine, thank you. fdic chairman sheila bair, or chair bair will give an update on the number of troubled banks. that number shot up to 305 in the first quarter, the highest since 19 the 4. bair will discuss how much is left in the fdic's deposit. the board voted wednesday to ease restrictions on private equity investments in failed banks. regulators lowered capital requirements and drop measures forcing buyers to kick in more capital after their initial investment. 81 banks have failed so far this year, but only two have been bought by private equity firms. and president obama's pay czar, dan feinberg, is expected to formally approve the pay package for aig's new ceo next week.

robert moss is slated to received $10.5 million bucks. ben mosh has reportedly reached out to former aig chief hank greenberg for advice. greenberg tells reuters he believes ben mosh has the best chance to succeed at rebuilding aig. aig shares rose 4% in after hours trading yesterday. you can get more news, videos and blogs as ross mentioned at cnbc.com. >> absolutely. still on the program, another twist in the opel drama. could the german government be forced to refinance? investors will be looking at a u.s. revised gdp data due out today.

a mixed association right now for global equity markets. adam will wrap up the asian session for us, stephane is in paris, sylvia is in frankfurt

and first, becky is in london. >> it has been a bit mixed today. ierpan markets did open a little lower. let's check, as well, on some of the earnings news that we've had out this morning so far as we watch the ftse going higher by about 0.2%. we are tracking biaggio particularly. that company came out with figures showing earnings rose by about 10%. they cut their outlook and that move does seem to push the shares lower. we expect to the ceo of diaggio earlier on "squawk box" in europe, let's hear what he had to say. i think the world is stabilizing. i think things are sorting themselves out. what we need to see now is a recovery in consumer confidence which appears to be taking place. however, we have to bear in mind that the real crisis hit many

consumer products companies actually november. so we're still lapping some tough numbers from last year. >> let's take a check into the other stocks moving in the markets today, particularly a couple of stocks that are moving higher. kazakhmy's came out with its numbers this morning, beating expectations for the first half. this is a mining company which is listed here in the uk. they beat expectations. earnings fell by 0.8%. that is a smaller decline than expected. amec is coming out with figures this morning. they said that they saw profit before tax down by 4% in the first half, so that has a negative impact on the share price of that company. out to silvia wadhwa now in frankfurt for more on the german strait trade. >> the market is similar. we're sandwiched between this year's highs and on the down

side, give or take 50 points or so, but maybe the 4,450 or 4,400 or thereabouts. that's what the charts are saying. the market hasn't got any real dynamics, any real push, but we haven't got any real pressure to take us down, either. in the meantime, we're in stock picker's club. if you look at the gainers and losers, it tells you the whole story. you see deutsche post, rwe, volkswagen. you can broadly argue thooes they're the most defensive marks. on the downside, again, a relatively mixed bag. we don't see much of the financials on earth side of the fence. k & s, bayer, man se, so a mixed club. i think we are still in a macro story aside from the technical part of things. we've seen -- yesterday we saw

ifo. today we saw climate, not better than expected, but just right in line. all the components, the german consumer wants to spend more money, the german consumer expects its income to pick up. that all sounds like good news. i can't say we have good news from gm. it rambles on from both sides of the fence. it seems that the german government has woke up and smelg smelled the coffee. they might be in a more kons latory note, but only if something happens before the elections. after the elections, it might be a different game. stephane, positive reaction in france today? >> the largest retake bank in france, credit agricole, 200 million gain in the second quarter, way above expectations.

and the ceo also announced that it will have lower impact from toxic assets in future earnings. this morning, citigroup raised the stock from buy to sell after the main shareholder game formal guarantee for the toxic assets of natixis. the stock is up 11%. we have news from acole. most importantly, it's confirmed the plan to politic the company two two divisions with hotels on one side and services on the ear side. that's still a project. but it explains the speculation we have in the stock today. we are up 8% on accor. last but not least, we have the numbers on the second largest energy group in france.

it posted a net profit of 3.3 billion euro for the first half of the year. that was in line with expect ages, but better than the company's guidance. the ceo believes that the trading conditions will improve. the stock is up more than 3%. let's have a look now at the asian markets with adam in singapore. >> thank you very much, steph e stephane. what proved to be a tough day for the asian markets, particularly up in north asia, yesterday the nikkei the 225 touching the ten-month highs, down by about 1.6%, weighing on the sentiment there, of course. we have nervousness here because we have the lower half selections coming on sunday. we could see a shift. investors wanting to stay on the sidelines there. the yen had some pressure on the market. it was stronger versus the u.s. dollar. as you can expect, the consumer electronic stocks and the autos, they've traded particularly lower there. that was down by about 0.9%. but the action continues to be in the greater china region.

take a look at the interday chart for the shanghai composite. a lot of concerns about more scrips coming to the market, saying they're going to issue $1 billion more in shares. we're digesting a lot of earnings up. from the oil sector, we have cnooc out yesterday. today we're getting the big, big number out from petrochina, which is the biggest oil and gas producer in asia coming out after the bell and following up. but these stocks are closing lower because nymex light sweet crude did drop below that $71 a barrel. there were expectations in china to increase prices. coming out with first half earnings, they are excited about their mobile division.

subscribers rose to $39 billion. with that note, back to mike in the u.s. good morning. >> and thanks, adam. and a pair of key economic reports are out before the opening bell here in the states this morning. the first revision to second quarter gross domestic product will be released at 8:30 new york time. forecast called for a contraction of 1.5% versus the initial estimate of down 1%. still, a vast improvement over the 6.5% decline in the first quarter. the price index is forecast to rise by 0.2%. also at 8:30, weekly jobless claims are out, forecast to fall by 11,000 to a total of 565,000. richmond fed president jeffrey lacker travels to danville, virginia, to talk about the economy at 8:15 new york time. at 5:00 in the evening, st. louis fed president james bullard will be at the university of arkansas in little rock to speak about the economy, monetary policy, a lacquers of

voters on the fomc this year while bullard is an alternative. finally, we will get earnings from american eagle, j. crew, toronto dominion, toll brothers, computermaker dell and that is your global stock watch. coming up on "worldwide exchange," a gold rush. we'll talk about the prospects of further deals in the gold space after el dora do makes a bid for cino gold. businesses more efficiently, so we've brought in a team of experts to help. one suggestion is to make your shipping more efficient with priority mail flat rate boxes from the postal service. call or go online for a free supply and up to $160 in offers from authorized postage vendors. shipping's a hassle! weighing every box...

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i'm christine tan. chinese sovereign wealth fund ci kri is looking to overseas investment ten fold on signs the global economy is in demand. >> and i'm ross westgate. is the summer rally stalling? >> and i'm mike huckman in the u.s. investors get a revised read today and the fdic updates its list of troubled banks. >> right. global equities, a mixed session today. most of the asian markets have been down, christine will fill us in on that. but european stock markets an hour and a half into the trade,

we've had positive territory. ftse 100 up 0.12%. dax and cac is firely flat. travel, health care and media are all slightly firmer at the moment. on the downside, food and beverage, retailers, a fairly mixed bag. currencies have a bit more direction on them. yen has been up across the board. dollar/yen, 93.72. euro/dollar, 1.4246. sterling has been weaker, but it's, again, come off its lows. 1.6219 at the moment. euro/sterling, just below that 0.88 point. christine. >> hey, ross, lots of question marks about the state of the economy. equity markets taking a beatinger after coming up in recent weeks. the nikkei 25 down as a result. the kospi down 0.9%. the shanghai market, concerns about oversupply hammering this

market. and the hang seng getting dragged down as a result of weak earnings and poor earnings there, 1%. not a lot of direction, given what's happening in the market today. mike. >> we've still got five hours to go here, christine, until the opening bell in the united states. but the futures, that said, are seeing a slight improvement in the last half hour. so i think the most important thing to watch is what the dow is going to do because this could be its eighth straight up day. and that would be its longest winning streak of this year. as you can see, all of the three major indices are pointing to a flat to maybe slightly higher open to this point. we see the government come in with yet another auction today to fill up that $109 billion worth of debt that it's putting out there this week alone. and at the moment, we're seeing the yield on the ten-year t-note

creep up a little bit at 3.44% after ffr r finishing at 3.43% yesterday. so the first revection to second quarter growth product will be released this morning. forecasts call for a contraction of 1.5%, versus the initial estimate of down 1%, but it's still a vast improvement over the 6.5% decline until the first quarter of the year. for more on what to expect, we're joined by peter dixon. he's the senior economist at commerzbank securities. and mr. dixon, thanks for being here. do you expect any surprises, upside or down side in the gdp number? and for that matter, the weekly jobless claims number that we're going to get this morning? if so, how do you think the market is going to react after yesterday when we had good economic data and the market did basically nothing? >> you have to decipher between what's happening in the economy

and what's happening in the data. it's a backward-looking indicator and getting more backward by the day, if you like. so i guess the markets have factored in the notion that this number is going to be revised down from, as you said, is % to 1.5% negative. on a day when markets are looking to sell, that would be a good excuse for markets to dip. in terms of the initial claims numbers, we're not looking for an awful big move. i guess they're going to hover around the same levels we're seen over the past week or two. at least it's not getting any worse. >> so there is this ongoing debate, of course, over whether we're going to see a v-shaped recovery, a w-shaped recovery or some other letter of recovery. do you think that ben bernanke is the guy to try to ensure to his best ability that it's v-shaped and not w-shaped given that he's so learned about the

double dip that we saw, if you will, during the great depression? >> yeah, i think he is the guy. he may well know more about the great depression than anyone still alive, but the fact of the matter is, he's a guys that's done an extraordinary good job over the course of the past two months to 12 years in terms of steering the economy through the rough waters. it's right that he will be the guy who will be the fed head for the next four years. of course, the challenges facing mr. bernanke and the u.s. economy generally will be even greater in the next four years than you have been, certainly be very different. we will have a fed which has rather different powers at its disposal in terms of financial supervision and it will be interesting to see how mr. bernanke uses those if indeed he has to do so in the year ahead. >> meanwhile, it's ross here, we have a 1.9% increase in home sales out of the united states

yesterday and overnight, in the uk, they've suggested prices have risen in the fifth straight month. can we now say with certainty we've turned the corner? >> i suspect in the u.s., we may have hit the bottom and we're bouncing off slowly. i have a suspicion that in the uk that bottom may be a false bottom and we may well find the prices dip further in the course of the next few months. what cause he me a bit of concern here in the uk is the fact that there does appear to be a lack of supply in the market and, well, that's primarily because sellers don't think they're going to get the absolute value for their home and have just kept the house off the market. if that is the case, that could be putting upward pressure on prices in the immediate and present term. >> we've got cpi distributive draet trade data coming out, as well. what is that going to tell us? >> probably nothing that we don't already know.

retail activity is not under such a squeeze as it once was. as i said, i think, on this program a week ago, uk retail activity has held up remarkably well during this recession and i think it will continue to hold up reasonably well over the course of the next few months. don't look for anything startling. relatively month to month gains in the next few months. >> peter, this is christine. we have the japanese riding on risk aversion, heading over to the 90 letter on. >> obviously, the domestic side of the economy is looking pretty weak, as it has been for a while now. the japanese are desperate to get ex ports moving again.

obviously, the competitiveness aspect will hamper the recovery going forward, and it's not something that the boj will be terribly happy to see. >> all right, peter, thank you very much for that. it's always good talking to you. thank you very much for that. peter dixon, senior economist at commerzbank securities. moving on, we're watching shares of cnooc launching after an all-share takeover for the miner. it was focused at 1$1.8 billion u.s. martin, good to have you with us. what does this mega deal say about the prospects of the gold sector? >> well, there's a lot of interest in china now because china is now the number one gold producer in the world. they have overtaken south africa in the last year. that is very interesting to

watch with global production numbers globally. global production fell by about 9% whereas the gold price during this time has about tripled and that tells you that it's very hard to find gold near the surface where it's easily monitored at a low cost. it's extremely important for gold companies to replenish their reserves. and it indicates that the price pressure will be up in gold. so we still like gold very much. >> spot gold trading at $944.45. how much higher do you see gold prices rising from here? >> well, one of the reasons why we like gold very much is because i would very much disagree with your previous guest on the show as far as the u.s. economy is concerned. in our view, it's getting from worse and worse. i don't see any recovery at all there. in fact, the debt numbers that happen that were just announced earlier this week, $9 trillion

to $10 trillion, that's completely unsustained. so yes, a major reserve currency potentially facing hyper inflation as well as for the rest of europe, as well, and that could drive up gold prices substantially. if those investors twitch from the paper one to the real one, we could see gold prices move up again substantially because of this. >> martin, this is mike huckman in the states. i'd like to talk more about the amount of debt that you just referred to. this week, as i mentioned at the bottom of the hour, the u.s. government sputh another $109 billion out there. we've got another seven years worth of bonds to go out this afternoon. but you think that the u.s. government is setting itself up

for another financial crisis. could you walk me through that, please. >> definitely. we just had a congressional watchdog report saying there could be a substantial crisis. it's not over. you had just talked about the fdic. basically, they have run out of money, as you know. so they might need a bailout from the federal government or increase the fees that they get from the banks. but the banks are increasing the number of collapses this year, 81. so there is no improvement there at all. revenue res falling sharply on this year's expected 18% over a drop in tax revenue for the u.s. government. that's the wofrs since 1932 at the height of the great depression. it's a 22% tax drop in income

and 52% tax drop in corporate. and this picture of strong buyer of the treasuries, that could reverse any time. so it's very, very dangerous to be a long-term servant. we think a lot of money will flow from those bonds into pressure metals. >> okay, martin, we hear you. thank you very much for your views today. good talking to you, martin hennecke, associate director at teich. we've been talking about gold. ayesha foo reedy joins us live from mumbai with the india business report. >> hi. thanks for that. afternoon a lackluster start wibt crossed 4,700 for the nifty, which is categorically marked. most men have been watching out for that number.

but the big news is the is the foreign trade policy announcement. while it is a continuation on expected lines, there haven't been any massive reforms. but a couple comments coming in from the finance minister aim toes double the floebl share for india by 2020 and the policy targets $200 ml billion of ex ports since march 2007. and gems and jewelry in particular because it's interest subvention which has been continued in the policy. and i.t. continues to be the darling in trade. we saw an upgrade for fortis yesterday. there's been a big deep in the i.t. space. bp has awarded several millions of dollars in contracts. with that, it's back to you. >> ayesha, thank you very much

for that. woolworth rang in strong results for the fiscal year, but warned earnings mraint look as rosy as shoppers tighten their purse strings. woolworth said net profit rose 12. % toed 12.5 billion. elsewhere, we're watching nissan, of course, the end of the road for chrysler and nissan, apparently. the two carmakers have decided to put an end to their vehicle development partnership, citing significant changes in business conditions. chrysler had planned to sell a nissan made small car in north america and europe by next year. nissan would have had a chrysler truck model in its lineup. >> plenty of auto news in europe here, as well, christine. car demand will fall better than expected in the second half of the year.

the comments coming after data shows renault and pageo citron increased protection, but it's said 2010 won't be a year of growth. the gfk consumer septemberment survey was up to a three-month high. consumer prices fell in july for the first tooichs time since german ee unification in 1990. >> and massachusetts top securities regulator wants more information from goldman sachs about the company's weekly trader tips meetings.

secretary of state william gal vin says he's concerned the firm may be given preferential treatment. in 2003, gal vin helped negotiate a settlement with ten wall street banks. they were concerned at the time for winning investment banking business. in frankfurt, goldman shares right now are down 0.735%. and general elect has put its security business up for sale. jpmorgan has been hired to run this auction. the unit makes security cameras and alarm systems. it could reportedly be sold in piece necessary a buyer for the entire business does not emerge. in april, ge sold a majority stake in its homeland security unit which makes technology for airports to france. in frankfurt, ge, the company that owns cnbc, by the way, is up marginally at 0.3%.

christine. >> gukette more news, videos or blogs at cnbc.com. credit agricole beat expectations. we'll look at that and dip into what's going on with currency markets.

okay. on the currency markets today, the yen earlier on hit a five-week high against the dollar up across the board right now, currently trading at 93.66. euro shshl dollar is pretty flat. we're back up to 1.4250. european stocks, not the sell-off resaw in asia. and dollar/swiss franc, 1.0688. paul, thanks for joining us. it's interesting, in the last sort of 24 hours, the dollar yesterday rose on better u.s. data, which we haven't seen for a while. was it reacting to the data or was it reacting to the fact that stocks were weaker? >> i think the stocks paid a

little bit of attention. also, we've got to remember that we're in the summer doldrums. i don't know that anybody is on the beach still hoping their blackberry doesn't ring. and i think the market was caught a little longer. that move up, saw through from 1 much 48 to 1.43 on euro/dollar. we are trying to look for this current split from euro/dollar going up when equities go up and vice versa. >> the reality is, the yen is stronger and the reality is we're just in pretty clear, defined ranges, aren't we? so what is it going to take for us to shift out of them? >> i think i need to see on the euro/dollar break at 1.40, 1.445 which is the wide range.

that -- do we see the green shoots put roots down or do we get run over again? i think the equity markets are pretty much the key. the housing market seems to be picking up. i think that's all pointing fairly dollar positive. there are some pretty bond assets there. there will be a lot of money changing. >> paul, this is mike huckman in the states. and ross touched on this, that the dollar went up yet on good economic data here in the states. and i know you said, hey, volume was low, but there are some who are quoted as saying this is emblem attic or a change in correlation in the trading, when you see this type of thing going on. what's your opinion on that? >> what we were saying is for a few weeks now, after the last barrel release, there were signs that we were seeing a bit of a break-up in the correlation of

euro/dollar in ek markets. still city think that's the way it's going to be. and we think as the markets start, more and more dollars will change. i think that could well bring euro/dollar back down certainly below 1.40 again. >> paul, this is christine. only a matter of time before dollar/yen hits 90? >> i'm not sure. i think there's a bit of optimism going on in the election. it looks like it's going to end some 50 years of ldp rule. i think that will give the yen a short boost. the big story today, the nikkei news has floated again this story of a japanese homeland repatriation act where japanese companies can bring profits home with a lot less tax to pay. though people tend to ignore the fact that an awful lot of this is hedged. so our overall view is that the yen should be weakening.

and we don't really see japan as a really good place for its money. >> dollar/yen at 93 right now, how comfortable do you think the boj is at dollar/yen? at what point would they start to see something? >> i think we have to wait until after the electric. and there may be a big shake-up of personnel around there next week. the dpj view seems to be less interventionist, but i can they'll get a lot of pressure if dollar/yen does slide below 90. so i think maybe next week if it's heading towards that way, we might get a few subtle hints or maybe not as subtle. >> we had the data out overnight. house prices up for the fight month in a row. but sterling has just begun to grind lower, both against the dollar and against the euro, as well. where is it going? >> well, we think sterling is a bit overdone.

if we look at euro/sterling, almost close to currency, almost over 75. but in the moment, the market looks down on the pound. >> was this a reaction to the extension. but now people are pointing the figure towards the uk saying, you are lagging behind here. i think 88 has to be a decent level. >> all right. paul benarchick, thanks again for joining us this morning on "worldwide exchange." let's get you a reminder of what we're looking for in the u.s. trading day ahead today. there will be a pair of xhng reports out before the opening bell this morning. the first revision to second quarter growth profit will be released at 8 of 4 initial time.

the price index is forecast to rise by 0.2%. at 8:30, weekly jobless claims are out forecast to fall to a total of 565,000. jeffrey lacker travels to virginia to talk about the economy at 8:15 in the morning. at 5:00 in the evening, the st. louis fed president, james bullard will be at the university of arkansas in little rock to speak about the economy, financial markets and monetary policy. lackaard is a -- finally, on the earnings front we'll get numberes from toronto doe minute mon bank and computermaker dell. that's all coming up here in the states today. so a big day for economic data and earnings, as well,

christine. >> coming up in the next hour of "worldwide exchange," we will bring you up to speed with all the top headlines making stories around the world. (announcer) we understand. you need to save money.

i'm christine tan. cic is looking to up overseas investment ten fold on signs the global economy is on the mend. >> and i'm ross westgate. here in europe, the head of the financial services authorities floats the idea for tax on financial transactions. >> and i'm mike huckman. in the united states, investors will get a revised read today on the second quarter growth domestic production and the fdic updates its list of troubled banks. >> if you're just joining us in the united states, welcome to the start of your global day with "worldwide exchange." broadcast live from the u.s., asia and europe and in the united states right now, the futures are point to go a flat to maybe slightly higher open. in particular for the dow because it is shooting for straight eight. it had seven consecutive up days, tying its longest win

streak of the year. obviously, if it can pull off an eighth today, that would be the longest up strooem streak for 2009. gooding interestingly, the market couldn't figure out which direction it wanted to go. the dow crossed zero 65 times yesterday. moving on to the treasury markets, we did see the price go up just a little bit yesterday and the reeled retract because they move in the opposite direction. the government is going to have its last leg of a three-pronged debt auction today. this time it's going to be $28 billion worth of seven-year notes that go out at 1:00 new york time and at the moment, the yield is up just a little bit, 3.44% from the finish yesterday at 3.43%. ross. >> mike, i love that statistic on crossing zero, 65 times? >> 65 times according to our

stat gurus here. >> that kind of tells b with youin', we don't know what we want to do at the moment. that might be a good indicator, might mightent it? european stock markets are up an hour into trade. the ftse cnbc global 300 is absolutely flat. the ftse 00 snapped a winning streak yesterday. at the moment, we're all hovering around the zero mark. so we'll be in and out of zero territory as we head to the u.s. open. travel and leisure, health care, basic resources. on the currency markets, we can say the yen is pretty much up across the board up and near a five-week high against the dollar pb 6/the pound against the dollar just hedged up from below 1.62. but it has been very slowly, but steadily grinding lower against both the dollar and the euro, as well.

we'll talk about that still to come, christine. >> ross, here in asia, risk aversion is sending the japanese yen, the currency stronger and that's how the exporters. the kospi getting dragged down 0.9%. the shanghai market has concerns about oversupply in this particular market. and now the new share off of $1. billion, that is putting pressure on the shanghai market. so up 0.1% for the sensex. lots of concern about crude stocks, nike mechanics light sweet crude, $71.13 a barrel. and brent is pulling back, as well, down 29 cents, $7 .36 a barrel. ross, back to you. >> thanks, christine. joining us for the next part of the rest of the hour, phillip

manduch. phillip, good to see you. mike made a point earlier, you've never seen such a big die vergence between bulls and bears. who is not right? >> probably neither, and i'm not someone who sits on a fence, as you know well. you've got zero interest rates just about everywhere. fiscal pump priming and lots more needing to come. what's the problem? show me the problem and i'll understand it. but at the moment, the economies seem to be recovering. deleveraging is ongoing. yes, it might take some time, but this is a trend that's going higher and higher. against that, you've got the bears that says, look, you've got negative growth going on. it might get better but there's enormous deleveraging going on. the consumer has disappeared off planet earth. it's not coming back. so you get this complete die vergence. i've never seen it so wide between extreme bears and extreme bulls.

and my baseline case is we're pretty much right in the middle of nowhere right now. i do think that the public sector is going to have to stay in play for longer than it's going to like to do and the private sector is not going to come back in sufficient quantity in 2010 to replace that public sector input. as a consequence, you're not going to get huge earnings streams and you're not going to get collapses, either. equities are not an interesting place to be. >> phillup, good morning. this is mike huckman in the states. do you think yesterday's market activity is indicative of that? we had such bullish reports out regarding new home sales and, of course, factory orders, as well. and the market, as i mentioned, couldn't figure out which direction it wanted to go. in the end, it finished up, what, four points on the dow? is this a sign that either we've got fatigue after this huge

summer rally or is it just a function of the fact that no one is around trading? >> it's a fact that no one is around and people are pointing to the baltic rate thing, there's going to be less demand, so on and so forth. it also points very much to enormous fear in september. all the astros, celestal technical elliott wave, anyone you like from the technical planet is talking about a very bad september ahead of us and risk reversals in the options markets put call ratios in the options markets and short positioning amongst a number of the hedge funds who have licensed up their positions all brought protection. a number of them are fearful to a bad september and that is adding caution to the equation right now when, in fact, you're seeing interest rates continuing to come down at all ends of the yield curve, not just in the uk, but in every yield curve.

and that should be bullish. it's not at the moment because of that fear factor. i'll tell you what, if september doesn't come up with the bad news that the bears are forecasting, there's going to be another rally before the end of that month. >> yeah. phill phillip, obviously, september is historically a weak month for the stock markets. on the bull side, we've had several people come on and say, look, when everybody returns from holiday and the vacation and the professionals, they've got way too much money sitting on the sidelines, and it's time for them to put it to work because they're fearful that they've missed this ride. >> it was my thesis going into the summer that the pain trade would rally with an enormous conundrum as to what to do with we blew towards 1050 by the end of the summer. i don't think the high net worth

private wealth market. the technicians are saying this isn't going any higher than 1050 on the s&p 500. i do believe that we're reasonably fully invested institutional level. i believe that the sentiment levels suggest we can get a correction and i have no doubt we will get a degree of protection in the first part of september. the question will be to what degree? we'll be getting up for another rally in the second half of the month and into october. that will force more people into play, which is, again, going to be the you a item pain trade. >> phillip, hi. this is christine here. where do you sovereign funds like the china, the cics fall into? first of all, they said they're going to increase overseas investment by the end of this year by ten fold. surely, i guess that means they're looking for tundz to buy some good stocks at some very good buys. do you recommend investors do the same thing? wait for the markets to fall and

pick up more into low prices? >> you're leading into a macro discussion here. if you want to follow the chinese, and i think you should, their play is we're not going to divest ourselves out of dollars. what they are doing is shifting from paper dollars into hard asset dollars and that's what they're looking to buy across the board, wherever they can, dollars are nominated resource companies to secure their supply of resources in the future. now, what this really, of course, means is down the road, does this put upward pressure on commodity prices? and if the oil price, which could be used as a property for the dollar, if the oil price does start pushing through 75 and 80 and maybe even through 90 over the course of this fourth quarter, does that put pressure on the inflation targeting central banks to respond? not the federal reserve, which is a growth and inflation targeting bank, but the ecb and the bank of england. i'll tell you what, at the moment, currency markets are all about interest rate levels. they're not about risk correlations and the interest

rate levels are coming down. commodities could reverse that in the fourth quarter if china continues to pull and there's a lack of contracting supply as a function of the financing problem commodities over the course of the last year. there hasn't been much increased production, but there is increasing demand from china diversifying out of portfolios into hard assets. >> phillip man duke ka, you're with us for the better part of this hour. we look forward to more of your outspokenness and candor. coming up, is this a sign that the equities are ready to fizzle out? plus, another 11,000 americans are expected to have lost their jobs within the past week. is there any end in sight to the employment downturn? cccccccccccc

welcome back to "worldwide exchange." u.s. treasury yields have fallen this week as demand for government debt solidified. investors are now awaiting the results of today's $28 billion auction of seven-year notes after two successful treasury auctions so far this week. joining us now is david cole.

it's the deputy chief economist at julius bear and still with us around the desk is phyllis man duca. thank you for joining us. a lot of people are saying with these relatively successful auctions of the 2 and the 5 and the 7 is presumed to go that way, as well, this afternoon, that this is a really good sign. what's your take? >> well, of course, it's a good sign. however, you have to keep in mind, it's one of the most liquid markets in the world. so probably a little surprised. on the other hand, when you look for risk in duration plays, you look gore treasuries and longer duration and you buy this risking when you get attractive yields for that. >> but david, we've had two guests on "worldwide exchange"

so far, one who said that bond yields remain very low and that's something to keep an eye on. and another one said that it's dangerous, that's his word, dangerous, to be in long-term bonds right now. what do you think? >> well, it depends on the economic outlook. when you expect economic recovery will be risky, that we return to economic growth already to potential economic growth already in the next year, then definitely yields at these levels are too low. however, when you expect in recovery will be rather bumpy and we will fall back from the current growth or from the expected growth rates for the coming quarter, then probably yields are on right levels and it will be attractive and particularly going into 2010. >> david, what sort of appetite do you see, especially coming from the chinese? >> the chinese have little

choice, basically, as long as they want to keep their currency stable against the u.s. dollar, they have to buy in some form u.s. assets. they try to diversify into commodities, into other assets, but at the end, they have to be a big participator in these auctions to keep things stable. and a word on libor spread. we've seen those heading towards those of the yen. does this show that, you know, we're getting some key healing in credit markets or is that going to cause a problem perhaps longer term for the dollar? >> well, definitely. i think the yen and the dollar, they're both now attractive currencies when it goes to the carriage rate. of course, it will be a burden for the u.s. dollar. the longer the fed remains of this record low interest rate. the question is, is it really such a bad thing to see a weaker dollar for the u.s.?

>> david cole, thanks for being here. the deputy chief economist at julius baer. thanks again for joining us. fdic chairman sheila bair will give an update for the number of troubled banks. that number shot up to 305 in the first quarter, the highest since 1994. bair will disclose how much is left in the fdic's deposit insurance funds. the fdic board voted wednesday to ease restrictions on private equity investments in failed banks. regulators lowered capital requirements forcing investors to kick in more capital after their initial investment. only two banks have been bought by private equity firms. christine. >> here in asia, china telecom dials in with slightly stronger than forecast. the second quarter results, china's largest fixed line carriers, quarterly profits down

on a year earlier. from its new mobile business. china telecom did not pay an interim dif tend, but says it will revisit the issue at the end of the year. meanwhile, china telecom is in trade today up to 3.87. >> controversy from the chairman of the fsa says he would back bank taxes. in an interview, he says cappal requirements against the trading activities would be the most powerful tool to eliminate excessive taxes, but says he would consider taxes on financial transactions. he says the fsa should be worried about the competitiveness of london as a major aim. phillip, from those in the city, this is presumably quite incendiary stuff, isn't it? >> you would expect me to disagree with what he's saying, but what he's talking about

sounds like clownish talk you would expect at this time in a cycle. the fact is, if you start taxing transactions, you'll see money moving offshore, people will try to find efficient ways to invest and what he's trying to get to is companies shouldn't be paying employees enormous amounts of money for taking no risk. now you're getting employees sitting there and if they lose money that year, they'll move to the next stop and if they make money, they'll get a huge bonus. but it's for the shareholders of that top to deal with it and what he should be doing is making sure that shareholder activism -- that's the way to deal with it, not to put a flat tax against entrepreneurship and remuneration for performance. >> and just picking up one more

thing, i mentioned it to david, the idea that libor rates and the dollar, everybody is going to sort of where the yen is at the moment. what are the implications of that? >> you're s.e.a.l. seeing yield curves flatten. it's about interest rates at the moment. my own view is that you're going to continue to see the need for more public issuance and, of course, as you've seen from the uk, where with charlie bean said earlier this week that if it wasn't for qu, ratsdz would be higher than they are at this point in time, i expect that suppression of rates to continue not just in the uk, but in the united states going into 2010 and even in europe and japan, there's going to be a lot more qe going on. central banks have to mop up the public issuance that's going out as the public sector continues

to sa plant the private sector as the driver of economics. and that means more public deficits, more public issuance, more pressure on yields. >> phillip, you're sticking around. >> still to come, we have did i aggio on its feet with potential results. and we would love to hear from you with earnings season mostly however. what do you think of the results you've seen so far?

it's been a fairly mixed session today. >> we're near that unchanged level, having gone lower, gone higher, moved around a bit. we're right back on it at this stage. let's look at some of the movers behind that fairly flat centers. kazakhmy's is higher this morning, higher by 4.6%. first half earnings beat expectations. but that was a smaller decline than had been expected.

diaggio, though, a different pictures from their earnings report. shares are down by over 3% in this morning's trade. the full year earnings were in line with expectation webs but they cut their outlook and that had a negative impact on the shares. sylvia, how is it looking in germany? >> similar story as far as tin decks is concerned. the lid seems to be in the 6572. and on the dounl side, 5450. if you look at the gainers and losers, it shows you exactly, there is no sector theme in there. there is no real sort of better policy. jfk consumer climate in line with expectations this morning.

it shows you there is some resilience in the german economy. how is it looking in singapore, a.m. adam? >> the japanese equity markets are pretty weak. the yen strekts versus the u.s. dollar, it all looks fairly positive at this point in time. there's a lot of caution in the markets ahead of this lower house election. investors are not willing to take many positions. the shanghai composite, once again, extremely volatile, dropped as much as 1.7% today. concerns about more liquidity on this market. and earnings, of course, out from several companies, in fact, blue championship, waiting for petrochina today, so it's an overall weaker picture. >> thanks, adam. and a pair of key economic reports are out before the opening bell.

second quarter gdp will be released at 8:30 a.m. new york time. still a vast improvement over the 6.5% decline in the first quarter. the price index is expected to rise. richmond fed president jeffrey lacker travels to richmond to talk about the economy. at 5:00 p.m., st. louis front door president james bullard will be at the university of arkansas to talk about the economic outlook. finally on the earnings front, we'll get numbers from american eagle outfitters, j. crew, computermaker dell. that is your global stock watch. >> coming up, good news and bad news for the new ceo of aig who

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it is 30 minutes past the hour right now. in the united states, investors get a revised read today on second quarter gross domestic product and the fdic updates its list of troubled banks. >> and in europe, the fsa floats the idea of a tax on financial transactions. >> and i'm christine tan. in asia, sino looks for overseas investments. >> and the dow is shooting for eight straight. it's tied its longest up streak of the year. at this point, vekd have a slightly higher open four hours

from now. although it looks like it's going to be flat essentially on the nasdaq, all three which essentially barely eked out a win after a choppy trading day yesterday when investors had a hard time figuring out which direction they wanted to take things. moving on to the treasury markets, the government is going to finish up the last of $109 billion worth of debt being auctioned off today. we did did see the price go up and the yield go down just a little bit yesterday. right now, it's up at 3.44% on the benchmark ten-year t-note which is just up from 3.43% where it finished yesterday. ross. >> meanwhile, mike, here in europe, we're trading around the flat line, a bit like the dow was yesterday, really. the ftse 100 is -- there we go. the smi has the biggest movement, down 0.2%. on the currency markets, the yen has been the main beneficiary, up against most of the major crosses. dollar/yen, 93.64.

euro/dollar, pretty steady at 1.4250. it was lower than that an hour or so ago. sterling against greenback, 1.62. and thor row is nudging up against the pound. still trying to eye the0.88 mark. christine. >> asian markets are falling today. lots of questions about the state of the global recovery. that has hurt the exporters in japan. the nikkei 225 down 1.6%, as a result. the kospi getting dragged down 0.9%. the shanghai market, lots of concerns about oversupply there. the hang seng down %. and the bombay sensex now turning negative, down 0.3%. in terms of oil, the rise in crude stocks hurting oil just a little bit. $71.20 a barrel. that's for nymex. brent is trading up a little bit, as well, right now. trading along the ranges of $71.42 a barrel, down 23 cents,

mike. >> thanks, christine. joining us now for more market strategy is greg curtis. he's the managing director of greg court and company. still with us is our guest host around the desk, phillip manducha. greg, you know, do you think that the revised gdp numbers, the weekly jobless claims will be anything to move the needle after yesterday when we had robust economic data and the markets didn't do a darn thing? is this an indication that our investors are kind of over it? >> yes, i think so. i don't think we're going to see anything today that's going to move the needle. i'd be very surprised. >> and why is that? because everybody is expecting the revision down unless there's a huge down or upside surprise?

and jobless claims, everybody knows what the picture is in the employment situation right now? >> yeah, i think that's right. i think everybody has discounted what is likely to happen. it's only if something unusual happens. we've had such a strong run up from the lows back in march. i think we're pretty well out of steam at the moment. >> he's making the point at this stage you should neither a major bull or a major bear be. do you go along with that? >> absolutely, yes. i heard that and i agree with that completely. i think investors need to protect themselves on both sides of that issue. i do think that the danger is on the downside. >> do you buy gold as a safe haven? what do you get into? >> i don't really like the gold market. it's too unpredictable.

i do think you can protect yourself using inflation protection assets, you can protect yourself by holding more cash than usual. you can protect yourself by being slow equity markets. i would do it across the board rather than trying to particularly target gold or some other defensive strategy. >> phillip, you on the other hand have been quite a fan of gold in the past. do you still hold the story or do you go with what greg said? >> why wouldn't i hold the story? for two big reasons, one of which is you have continued softening of rates going on. the u.s. yields are moving down and will continue, in my opinion, to move down. yes, i understand the counter argument. but it does do well in the bust and one of the short-term consequences happening right now

and i expect continue to happen, indeed, and expand its happening is currency debasement. you're going to see continued central bank quantitative easing mopping up the public sector issuance that's necessary to sustain any kind of hope for growth. and that means that debasement story is soft assets down, hard assets up. >> following your argument, it was never more pessimistic than we were in march, the beginning of march this year. gold still couldn't get through at that point. >> well, it's gone very well. we've had enormous deflationary stories going around. >> you can argue any way you like. >> particularly in fx. gold is a currency to me. if i wanted to have a safe haven, why would i want to hold soft dollar, paper, cash at zero

percent with the central bank issuing it every day more and more and more rather than gold which has finite supply, indeed the production of which may be contracting because of financing issues. and i do know that the newest game in town, the newest player in town, china, is one generation away from holing it as a primary currency. >> greg, this is mike again. why do you think the danger is to the down side in equities? is it because we're approaching september which is historically a weak month for stocks or something else? >> no, i don't think so. i just think thaekt ves gotten well ahead of themselves. you know, relative to the economy, relative to any kind of reasonable outlook and relative

in the u.s., anyway, to what is likely to happen to the dollar. >> you're obviously an experienced chap. you understand somewhere in the back of your mind lurks that saying, the market is climbing your wall of worry. and you know my thesis, that we are probably in an 850 to 1200 range in this s&p and probably lickly to be for some time to come. but nevertheless, we seem to be climbing that wall of worry and there is always the risk that this monetary and fiscal pump priming leads to some velocity of money if the bank sector can get back into play the second half of 2010. and the central banks, which i think will be voluntarily, will stay behind the inflation curve and allow some reflation to happen. that would be very good for equities, wouldn't it? yes, it would. but my confidence level in that outcome is not very high. >> all right. greg, thank you very much

forever your views. we want you to continue staying with us. greg curtis, managing director and greg holt and company and phillip manduca, you will continue to stay with us. let's cross live to tokyo right now and check in on the trading day there with asuka kondo from the nikkei. kondo-san. >> thank you, christine. we saw concerns over a stronger yen and weaker chinese stocks. nissan motors shares fell back mostly on a stronger yen, but it as no unsed that it has decided to end its partnership with chrysler group. they scrapped the plan to supply the u.s. automaker with a car in north america and europe and now it needs to revise its declining sales on its own. bucking the downward trend, isetan mitsuko rallied.

they will likely cut its full time payroll by 1,000 or roughly 20% at its department stores. nippon shade glass shares started ask only and closed over 7% lower. the maker of flat glass announced the previous day that the chief exact will leave the company at the end of 2009. in contrast, shares of pasan group went up. that was the nikkei business report. back to you, christine.

>> condo-san, thank you very much for that. mike. still to come on "worldwide exchange," trading huddles in the spotlight. massachusetts's chief financial regulator has subpoenaed goldman sachs. before that, here is a look at how the u.s. futures are shaping up.

and welcome back to cnbc's "worldwide exchange." here are some of the top stories we are watching from around the world. president obama's pay czar, dan feinberg is expected to formally approve the pay package for aig's new ceo next week. robert ben mosh is slated to receive $10.5 million. feinberg is likely to approve that ruling before other payments about aig are made. greenberg tells reuters he believes ben mosh has the best chance to succeed as rebuilding his aig. aig shares rose 4% in after hours trading yesterday. massachusetts top securities regulator wants more information from goldman sachs about the company's weekly trader tips

meetings. reports say goldman analysts were passing on short-term trading ideas to their top clients. secretary of state william gal vin says he's concerned the firm may be giving preferential treatment. back in 2003, gal vin helped negotiate a deal between regulators and banks. in frankfurt, goldman sachs shares are trading down 0.75%. and microsoft is cutting the price of its high-end xbox 360 model by $100 just days after sony slashed prices for the ps. the xbox 360 elite will now set for $299. the entry level arcade model will stay at $199. microsoft is phasing out the mid level xbox and will sell that for $249.

sales have jumped 17% this year. microsoft says the move has been in the works for some time and in frankfurt right now, microsoft shares are down 0.6%. >> mike, china sovereign wealth fund cic may be going on a global shopping spree. cic is looking to expand its overseas investment this year by ten times the previous year on signs the global economy has bottomed out. cic is reportedly eyeing companies and property in japan. ross. >> christine, in an interview with prospect magazine, lord turner says higher capital requirements against trading activity would be the most powerful tool to eliminate excessive activity and profits. and he added if the measures were insufficient, he would consider strangzs.

he also says the fsa should be worried about comparing the competitors of london with a major aim. time for another final thought here. what is the outlook? you know, the ecu is a major currency investor and trader. >> it's obviously a difficult moment because of this september expected volatility. but i'm looking very hard at playing sterling and playing sterling against europe. two currencies that i think have merits. sterling because i think it's getting oversold. i think the bad news is out. i think the interest rate curves are converging on others. we may need to have another 20 basis points of convergence in the two-year swap rates for the uk, but it's very close now. there could be one last flush in sterling over the course of the next few days. but somewhere in that 88, 89 level against the euro, you have to be short of euro/sterling, i think. we may get that flush in dollar/yen that takes us closer

to the 90/92 level. i think that's a very interesting play. and why aren't o both? because i think risk appetite will go up in the fourth quarter and i do think the world isn't coming on to an end and i think equities will try to have a rally in the fourth quarter. >> phillip, thanks for that. time to find out what's coming up on "squawk box" in the next few minutes. carl is with us. hey, carl! >> hey, ross. we're going to talk about markets this morning. two wall street names spending the day with us. we have jim paulson there morning. plus, what a new fdic ruling might mean for private equity firms looking to snap up failed banks. john cannis knows the stakes pretty well and he will join us live. and children across the country are on their way back to school until the coming weeks. we'll talk retail with the ceo

of toys are us. and highly regarded retail analyst dana tellsy. it's hard to believe it's that time again, ross. also, jobless claims, as you know, and this revision, second quarter gdp, but we'll take whatever information we can get. we'll start it off in about 11 minutes' time. >> carl, thank you very much. >> all right. >> coming up next on "worldwide exchange," we look ahead to the trading day here. are we expecting in the or will jobless numbers that we just talked about kick start some market movement? aaaaaaaaaaaaaaaa

welcome back to "worldwide exchange." let's get a look ahead at the trading day here in the united states with greg curtis, managing director and chairman of greg court and company.

and earlier, greg, you said the danger was to the downside in equities. one, the bulls say all the pros are going to come back from holiday 0.vacation. and secondly, there was an interesting note out from lazlo berenni yesterday who is a maven of market history. and he said after the past two recessions and in the rallies that there has never been a correction. so what do you make of those two full points? >> well, i don't know that history really is going to dictate what happens here. i truly think the market has gotten ahead of itself. my clients tend to be capital preservation oriented. if the market continues to rally, we'll be very happy. but if he's wrong, we want to be protected on the downside and i do think he's wrong.

>> we're not looking at it so much as a sector play. we're looking at it as a quality play. we're looking at it as u.s. equities, knot non-u.s. equities, even on the bond side. that's how we're playing this, quality versus nonquality, not sector versus sector. >> greg, this is christine here. any overseas markets you're looking at at the moment that could provide a good buying opportunity? >> yes. we like the overseas markets generally because of our broadly negative view on the dollar. we're tending to be overweight primarily in the east economy.

we are not concerned about the possibility that an asset bubble could be building up in the emerging economy, so we're staying a little bit away from that right now. >> and greg, is there any scenario where you see the revised gdp number today or the weekly jobless claims number moving the market? >> well, of course, there are possible scenarios, but i don't really think so. i don't see any really big surprises coming out in any of those numbers. >> all right. greg curtis, we'll leave it there. thanks again for being with us this morning. let's take one more look at the futures here in the u.s. now. 3 1/2 hours before the opening bell. we do see the dow. well, now it's weakened a bit in terms of the futures and it looks like a flat open, perhaps, for all three, although the dow could be on track to have eight straight winning days. that is our show for today.

i'm mike huckman in the united states. >> i'm ross westgate here in europe. >> and here in asia, i'm christine tan. thanks for your company here on "worldwide exchange."