brought to you live from n london, singapore, and around the world this is "worldwide exchange." welcome to the show. the headlines from around the globe -- greece's finance minister returns to athens empty-handed after they reject athens' latest budget proposals. china january trade data buckles from slow global growth and factory closures. signs beijing may be loosening its control on the property sector. barclays warns it could miss next year's profit target following its worst quarterly perfe

performance in three years. hello and welcome to the show. you're watching "worldwide exchange" with christine tan and i'm beccy meehan. let's talk about greece. the plans failed to impress eurozone finance ministers. the eu has rejected on economic reforms saying athens must do more to cut spending. speaking at the end of the meeting in brussels euro group president jean-claude juncker outlined the steps greece must take to secure a new bailout package. >> firstly, the greek parliament should improve on something, the policy package agreed between greece and the try at that. secondly, expenditure reductions of 325 million in 2012 should be identified in order to ensure that the deficit target is achieved. >> well, those comments come as

greece faces another wave of protests against austerity measures. up yons have called a 48-hour nationwide general strike that starts today. the greek finance minister venizelos says painful choices must be made now. >> translator: our choice is one of humiliation for a proud country, or even greater humiliation it will face if we act under the illusion of saving face with decisions that will have a much greater social cost. silvia wadhwa has more details. it looks like once again we're on the brink with greece. is this it this time? is this the last chance? >> reporter: i don't think it's fair to say they rejected it. it's not quite good enough. we want to make sure what you offer us is a letter of intent gets implemented and there are 300 odd million that have to be signed up. but that is just nit-picking. the bottom line that comes out

of brussels now and has been for a number of weeks is one of slight exasperation, skepticism, saying, okay, you promised a lot of things. if you deliver what you promise, you're going to get the money. the fact that we're going to meet again -- not we but the eurozone finance ministers will meet again next week -- shows you, i think quite clearly, that they want to sign up on this deal but they also want to, which is quite reasonable, have a parliamentary deal. just because there's been agreement between party leaders and the troika doesn't mean the deal is sign and dusted. they want really to be greece on track and then they say we sign up for the money. they will if we follow anything that's happened in the eurozone so far in the eu for the past six years they never do anything 11:5. they do it 30 seconds after 12:00. there are question marks.

venizelos couldn't have put it more dramatically. this is about greece. this is a historic moment. we can only draw the history into that greece -- a greek word that if you could imagine europe without grease, thece, that wou sorry word. >> let's bring in our guest host, john woods, chief investment officer at citi private bank. we thought we had an agreement yesterday. there's another stage to go. we have at least one more stage to go. how does this make you feel about the prospects for greece? >> there's another greek word we use as well and that's called chaos. sitting over here in asia it does seem to be an exasperating experience waiting for this deal to get signed off. i appreciate the need for some sort of populous approval through parliamentary sign off. i think that makes a lot of sense. in asia we're looking concerned about the risk of the uncertainty stemming from a

refusal or failure to sign and the potential impact that will have on our markets and on our underlying growth in terms of exports. >> reporter: well, i mate have some bad news for you, i think you'd better get used to that sense of uncertainty. that's going to be the theme song for the eurozone for the next few years or so. in terms of where greece is, do you plan in asia when you lack at scenarios, "a," if that's the right word for it, disorderly default for greece or an orderly default for greece and can you envision -- very often we talk about it if it defaults it has to go out of the eurozone. i don't buy that argument. i think we could have a blueprint inside the eurozone but what's your view out there? >> well, our sense is that when banks are being required voluntarily to take a 70% haircut there's a default anyway. so we're not entirely certain over here about whether a default within the eurozone will be much different than we've

already seen. a default outside the eurozone or one of a disorderly nature has extraordinary implications for our markets because the reality is our assets, particularly our risk assets here, tend to be driven by important inflows and if there's the sense that risk appetite is pushed dramatically to the back foot and we start getting a drying up of liquidity from developed markets, that will have a major and a material effect on markets. at the same time, of course, we are seeing this shift in consumption in developed markets particularly europe which, as i alluded to a little earlier, is impacting underlying growth, particularly exports. just before i came out here i noticed that the philippines had export growth contracted by 20%. this morning we had china trade numbers where we had a contraction in export growth. we've seen similar stories in korea and japan. so the model that once drove

this region forward, which is somewhat leveraged on consumption in developed markets, is being put under the microscope somewhat and a disorderly event or some financial global financial crisis will have is major impact. >> john, stick around. come back and discuss the other issues around this in a few moments' time. john woods, chief investment officer at citi private bank. let me update you on the breaking news we have here. we have some figures coming out from italy. italy's december output figures which are better than had had been expected. the bear in mind that further decline and month on month figure for italy's output was seen down. in fact, we have seen a decline of 1.7% on the year and better that expected the month on month figure up by 1.4% versus an expected decline of 0.5%. at 1.4% increase in december

industrial output in italy versus an expected decline. we have seen the spreads tightening, too, in italy which has suggested we could be getting a bit of an improvement in terms of the market sentiments around italy and their situation. industrial output numbers in december seem to be backing that up on the ground up by 1.4% but it's just one month's figures. let's not get too excited. christine? >> good point to note. china has released two sets of trade data today showing further signs of slowdown in the world's second largest economy. we've been talking about that with john woods as well, bits of it. tracey chang has all the at the tails for us. china's january trade data soared, the biggest in six months. a slightly more than $27 billion. it was roughly $10 billion higher than analysts expected. in january plummeted to the lowest in 29 months while ex orts dropped to the worse level since november 2009. the markets had already factored

in the impact of factory slowdowns over the lunar new year but the slowdown in global demand appeared to be far more worse than many had anticipated. the data highlighted worries about the pullback in china's domestic consumption but they are conscious about reading too much into january's figures because of the holiday factor. meantime, china's fourth quarter current account surplus, the broadest measure of the trade balance with the world, also slipped 41% from a year ago. back to you, christine. >> tracey, thank you very much for that. let's get to john for some reaction. no decoupling there but how worried do you think the pboc is when it comes to these figures? >> i mean, i certainly is think there's a reasonable case to discuss about a seasonal distortion is absolutely the case, the number of working days in the last month or so was substantially less and the numbers will look a bit odd. but, nevertheless, that import number was the standout one for me. that mid teen contraction in demand on a broad based demand

was quite scary, it kind of compliments the pmi trends we've been seeing. it actually compliments, also, the numbers we saw yesterday in terms of the slump in the producer price indegs. we are getting the sense that demand in china is decelerating perhaps a little bit faster that anticipated and that's going to impact our growth assumptions. >> when you say demand is decelerating, are people in china saving more because of all this uncertainty? >> well, i just think they -- people in china are always saving. there's a huge amount of saving activity going on particularly from a consumption -- as a proportion of gdp perspective. the real demand driver obviously comes from the fixed asset investment and where we're seeing that diminish is more of a function of available opportunity or the government or provincial governments to essentially pump in these prime

conditions. >> john, we want to you stay on with us as our guest host. let's take a look at the equity markets and see how they're stacking up at this point in time. a mixed picture across the board. we had markets mostly lower today after the eurozone ministers withheld a second bailout. china traded as we were talking about also weighed on sentiment across the region, fallen exports, the bigger picture, the fall in imports from china was a big concern. but take a look at china finishing to the upside. 0.1%. we had property counters leading the way higher cushioning the impact. they decided to provide subsidies of property markets so that's triggering a lot of speculation that other local governments might follow suit as well. the hang seng is off 1.1% but not because of what's happening in china but more on profit taking from banks and oil majors. the nikkei 225 off 0.6% as well. the greece concerns continue to weigh on the nikkei. the key 9,000 level, as you can see. the kospi is off 1.1%. almost 1.1%.

the taiwan weighted index is off 0.6. new zealand 50 finishing flat. 0.6% higher. resilient if you see the markets trading flat or to the upside and the sensex trading down 0.7%. so overall it's a mixed picture but trade is cautious. becky, what does your heat map say? >> the market is down. equity markets are moving lower today across the region. it's pretty objevious at a quic glance at this heat map we are lower and, in fact, the stoxx 600 is down nearly half of a percent so far today. let's break it down by the individual bourses and see how things look when we look at this from this angle. the ftse 100 losing 0.3%. we do see bigger declines, though. 0.l% lower there. the cac is down 0.6%. and in italy the ftse mib by just about 0.3%. as well as the macro factors which have been very well discussed so far today on cnbc we have some individual corporate news as well which is

also having an impact, too. start with the down side. alcatel stock, did report income up by 7%. alcatel is a real outperformer, the stock higher by 16.5% or so, nearly 17% to the good, in fact. this is a telecom gear maker and the company reported some figures that were mixed, to be honest. revenue down by 20% in the fourth quarter. their clients are really cutting back on spend iing and yet analysts are taking heart a couple of points including the fact they have a strong cash flow and also they have reported the first annual net profits since the merger of alcatel and lou sent a few years ago which held the start of the company we know as alcatel-lucent. it's worth noting, too, the last earnings report fell very sharply so the gains today don't even make up for the decliners in that period. if you look at a longer term

chart, which we shall later on, it doesn't look quite so optimistic. a good performance today. barclays is higher. this company's stock is up by 2.9%. the earnings today also boosting the stock of the company. they did tell us they may miss their profit target -- they have a profit target for 2013 of a return equity of 13%. that may not be achievable in that time period according to the business today. the last quarter was the worst in three years, suffering from their bonds business. also cutting their bonus pool as well and more on bonuses very shortly. let's look at what's going on with the euro rates that we have been watching the ecb yesterday, of course. they were talking about the prospects of the next ltro and the impact that's still unfolding from that ltro. no move on rates. the euro is 1.3272 against the are dollar. against the yen 103.05. steady on those fronts. against the sterling 0.8.

the euro/aussie 1.2413. into the bopped markets and a real tightening of spreads recently particularly with what's going on in spain and italy as well. a bit of optimism about those countries having seen yields very high on that debt. the bund is at just below 2%. just above 2% at the end of yesterday creeping back below that level now and only marginally, only over 5% for the spanish and the italian debt, too. 5.46 for the italian debt. and in the u.s. the ten-year treasury is just a fraction over 2%. christine? beccy, thank you very much for that. up next on "worldwide exchange," no more big spenders. barclays says it's slashing its bonus pool this year following in the footsteps of other big banks but where do you stand on the bonus debate? e-mail us worldwide@cnbc.com.

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seeing profits rise 13% in the fourth quarter, just above analyst estimates, said it was well positioned in 2012 and

beyond but has cautioned the near term outlook for trading currency. the results come a week after the eu antitrust commission forced the company to abandon its planned merger with deutsch bourses. ro a bullish outlook saying they plan to reach a positive cash position after posting strong cash flow in the fourth quarter of 2011. the company also aimed to grow its operating margin this year. shares are trading higher by just over 15%. the ceo had this to say about the outlook. >> after a pretty strong q-4 for us looking to 2012 we are guiding the market that we should have a better result on our operating profits and on our

net cash position and that is a reflection of what we think the market will be which is very different market to market. there is not one set of numbers that will guide the market in 2012. you will have very different dynamics in europe or in the u.s. or in china. but we think we're well positioned. >> well, barclays has this forecast for fourth quarter net profit which fell by 3% compared to 2010 figures. the firm suffered from losses at its investment banking arm as the eurozone crisis hit trading revenu revenues. ceo bob diamond declined to say whether or not he accepted a bonus for 20 11 the bank said it slashed its bonus pot by 25%. beccy? >> we know barclays has slashed its bonus pool by 25% and we have that information for some of the other global banks as well. a look at our giant check which

is often used for my paycheck but will be used to discuss the bonus pool. barclays cutting by 25%. credit suisse down by 41%. deutsche bank has cut by 17% and ubs by 40%. we've also seen the pay of senior bankers coming into the spotlight particularly here in the uk where there has been such intense pressure on some of the big ceos like steven hester most recently to forgo their bonuses. this is clouded by the fact that we have big government share holdings of some of these institutions like rbs. let's get into this in more detail now with our next guest. joining us is the greek head of business at the telegraph joins us now from their offices. there were so many issues to discuss around pay but let's start on this point. how can the media, the banks themselves, distinguish sensibly

between executive pay and institutions held entirely by private shareholders and those which are held in part by the government and have received bailouts? they seem to be two very different issues confused when we talk about the bonuses this time around. >> well, i'm not sure they are necessarily. i think ultimately it ought to come down to performance. and when you look at the performance of the banks and the executive teams, i think whether you are a government and a public shareholder or whether an institutional shareholder of a privately owned bank, the equation has to be the same. now the big difference is that the banks and the executives are not actually making the distinction themselves. they've lost control of that process and, of course, the people who have control of the debate or are winning the debate

are the politicians and they, of course, are in the royal bank of scotland and they are dictating the debate. but for the privately held banks, it's really down to their shareholders to stand up and say, well actually we're happy or we're not happy with the performance and we're going to vote one way or another on pay. >> which i guess is my point because for the way i've been reading the situation even when the politicians don't have a shareholder, they seem to have a bigger say almost than the shareholders themselves. >> that's very true. you are absolutely right, but that's because the institution haven't been talking, haven't been speaking up, haven't been expressing their views on why they think as the owners of banks that executives should get paid x, y or z and they've left a void which is where the media and the politicians have piled

in to dictate the argument. but as we know, there are always two sides to an argument. it's just that we're not hearing the other side. >> damion, this is christine. due think this is too much focus on bonuses because from what i'm hearing and from what people are telling me the bankers are still getting the options, very attractive options, and they still get paid indirectly very well. >> well, they do, but also what's been forgotten is over the past two or three years, remuneration of banks has changed profoundly and of course in short hand terms in the media and amongst politicianses there is talk of big bonuses and of course the headline numbers can be quite big but these bonuses are now paid largely in shares and we saw barclays capping the amount of cash anyone will get at 65,000 pounds so things are paid mainly in shares that deferred for several years and there is the prospect of callback so i think the debate is very simplistic and what we

are missing are the details that have actually been forgotten. >> damion, i know we have some graphics to play out which demonstrates the relationship for the big banks between the pay of bankers and shareholder returns. talk to us about the extent to which there's a correlation across the board between how much banks are getting paid and how much they are paying to the shareholders? >> well, i think actually the correlation is only now beginning to become what you might call rational as in the sense that share prices have started to fall to underperform and you can see that bankers pay has fallen quite substantially in a number of years recently but that coincides with all this that you mentioned politically and in the media. i think if you extend the analysis longer term over the past decade, for instance, the

correlation does break down and i would remind you of the words recently early wrer this week, the chairman of the royal bank of scotland who did say something sensible and reminded the world that the relationship between shelled returns which have been poor over the past decade or so and executive pay at banks which has been extremely high over the past ten years has obviously meant this connection has broken down and it needs repairing. so i think going forward you will probably see bankers pay and bonuses much more closely aligned to shareholder returns which is how it should be but, again, that's a good example of where shareholders over the past decade have completely failed to stop bank bardz and remuneration committees from paying their bankers too much. >> thanks for coming on to talk about these issues. i'm sure it's a topic that will divert us for some time to come.

christine? >> interesting discussion there. up next on "worldwide exchange," europe and india discuss iran in a possible free trade pac. how much progress have the two made? plus, linkedin revenue more than doubles. so uh this is my friend frank and his, uh, retirement plan. one golden crown. come on frank how long have we known each other? go to e-trade. they got killer tools man. they'll help you nail a retirement plan that's fierce. two golden crowns. you realize the odds of winning are the same as being mauled by a polar bear and a regular bear in the same day? frank! oh wow, you didn't win? i wanna show you something... it's my shocked face. [ gasps ] ♪ [ male announcer ] get a retirement plan that works at e-trade.

welcome to the show. the head lines today -- greece's finance minister returns to athens empty-handed after eurozone leaders say the latest budget proposals are not good enough. trade weakened due to slow global growth. stocks hold steady on signs beijing may be loosening its control on the property sector. >> barclays warns it could miss next year's targets following its worst performance in three years. just a week after its mega merger with deutsch borse, reporting higher fourth quarter results.

we have some breaking news. january ppi figures. now the output ppi came in at plus 0.5% on the month. that was -- the forecast was 0.1%. the output the lowest since november of 2010. the input ppi a low, lowest annual rate since is november of 2009. actually we've had lowest rates on both the output and the input ppi for january 2. let's get straight out to our next guest, charles, head of market strategy at lloyd's bank wholesale banking. your thoughts first on the ppi figure. lowest annual rate since 2010 for the output ppi. input since november of 2009. inflation coming back under control then. >> yeah, absolutely.

this is what we've been expect ing from the data for some time now and it's clearly part of the bank of england thinking that we have a pretty benign profile this year. partly due to the easing on the input side. the inflation picture well above target for a couple of years looks on course to be a much more benign over the next 12 to 18 months. >> more qe as well. they saw the inflation report. saw these figures so they had a better idea of what was going on. some said 25. do you think more to come? >> clearly a bit more of a debate given some of the upturn we've seen in the forward looking data such as the pmi recently.

if you look at the monetary creation story it's very weak. the support looks necessary. this will work its way through and i think that we could have another 53 on top of yesterday. >> charles stays with us because we have inflation data out of germany, too. let's get out to patricia svares. >> reporter: we had hicp in germany and there was one little digit that was revised to the upside and that is the cpi number for the year from initial estimates of about 2% which is the same amount to what happened in december on a month-to-month basis. january the fourth month in a

row we had lower inflation. everybody is scratching their head because of the disconnect between the german economy and the other eurozone countries which do not have this kind of inflationary development and especially not economic growth. now if you look at the argument the ecb must be looking at that as you have, for example, higher wage inflation now just coming along, as you have unemployment at its low since 1991. as you don't have any housing bubble. as you have more households with less -- with more savings and less debt. that means that people are actually quite willing to buy. and if you look at the ways we see the indicators for the sentiments here in germany, the consumer is willing to spend a propensity to buy is high. the expectations that the economy is going to continue well is high. so there's a lot of weighty negotiation also behind that picture. so inflation is being watched especially by the ecb,

especially after the interest rate decision and the ltro as well. >> pa trish wra, thanks for that update. we still have charles with us, he has stuck around, our guest host is here, too. charles, let's get your thoughts first on the situation in germany as patricia was just telling us and the inflation data there and had a the consumer is willing to spend. we've been worrying about europe. how does the call look to you? >> germany has been doing well. certainly last year's data was pretty strong. it's starting this year weaker so we won't maintain the same kind of pace we had previously but german consumption is exactly the kind of thing we need. one of the big concerns you have about the whole eurozone crisis going forward is how they're going to create growth and historically german consumption has been very stable and pretty soft, frankly. and the more pickup we see in german consumption and the more trickle down that has across the eurozone as a whole the better the prospects look and the prospects for the crisis look

that much better as well. >> john, what are your thoughts? do you think that the strength in germany can carry the rest of the eurozone or is the situation too bad? >> well, i must admit i'll take anything i can get sitting over here. my underlying sense, though, that it is probably a limited story. but, charles, i would like to ask you one question and there's a lot of people in asia that would be interested and fixated on your reply which is for how long do we think this liquidity will be made available? we were talking about the boe. obviously there's a lot of focus at the end of the month on the ltro. we've heard stories in asia from anything from $300 billion up to $1 trillion i've heard mentioned. obviously that has a direct impact in terms both of price appreciation and length of rally on our markets here. i would be very interested in

your view on what the ecb will do next. >> i mean, i think that's absolutely right. that's a key question going forward. the next ltro we expect to be pretty substantial. the banking sector probably needs from where we're at around another 500 billion to 600 billion funding the rest of the year to meet its requirements. so that's more or less where we're putting our target for this ltro this month and that should continue to 0 support asset prices and clearly has helped the banking sector to a large degree. but we're not sure that's going to be enough. so i think there is the possibility that we could see further three-year ltros from the ecb later in the year but they're going to wait and see what happens. the earliest you'll see that is middle to late q-2. >> charles, thanks so much for that. head of market strategy, lloyd's bank wholesale banking and markets. so let's move on, talk about the markets in general. declines for many of these stocks that make up the stoxx 600 at least. we have a few gainers, of

course. the majority are down. overall this regional index is shifting lower by just about a third of a percent. this is how the individual bourses are shaping up, though. depends on which market you look at. declines here in the uk of 0.2%. losses in germany 0.6%, down for the dax. in paris the cac is losing half a percent. the ftse mib is managing to hang on to very modest gains, hardly registering them on the percentage scale but just a fraction higher so that shows up as green on our wall there behind us. now let's look at the individual stocks on the move. barclays for a start, we've been talking in terms of the banker bonus issue. bob diamond declined to comment on his bonus. we do know the bonus pool overall has been cut by 25%. elsewhere in the earnings today they may miss profit targets but overall being take ebb positively because the stock is up just over 4%. outperforming the broader ftse

100. alcatel-lucent, a strong performance which may surprise when you hear revenue and adjusted profit both dropped. adjusted profit down by 20% in the fourth quarter of last year. many clients of this company which is a gear maker have been cutting back on spending but strong cash flow and the last time they reported results the shares fell very hard so pulling back from that particular move. total down by 0.8% but thet profit that moved higher on the back of oil prices. this is the picture on the currency markets and we are looking at 1.3278 for the euro against the dollar. euro/yen at 103.16. euro/sterling 0.8388. against the aussie dollar up by 0.7% or so against the australian dollar. now the bond markets. yesterday, of course, we heard

from the ecb and the bank of england, too. the ecb, mario draghi told us, the effects of the ltro still filtering through the markets, still more to come and saying that he expects the next three-year ltro will be substantial when it comes to the end of this month and we should be anticipating the impact on the bond market, too. in the meantime just 2% exactly right thousand for the bund. that's where the yield stands on the german market. real tightening for spain and italy which is seen as good news because we saw yields pushing up a great deal higher on the ten-year debt in the peripheral countries, concerns about the outlook for their economies. 5.21 is on the spanish debt and 5.44 roughly on the italian debt and the u.s. treasuries just to point out what's going on there, just over 2% yield. christine?

>> eu ministers delayed the second bailout or refrined from giving it to greece. fallen exports, or more importantly imports also weighed on sentiment across the region. the take a look at some of of these markets. kospi in south korea falling 1%. sensex off 0.2%. we have the nikkei falling on those greek concerns below the key 9,000 level, 0.6% lower. new zealand holding steady, 0.6% modest gains. australia market up and taiwan weighted index down. of course the big story was over in china. besides the trade data we also have one piece of news that was moving markets today and that's what the market is focused on in greater china. there was some talk or there was talk on the report that the local government relaxed home purchases and that upset data of weaker coming from china. this pushing higher slightly, 0.1%.

wuhu, its manufacturing hub, has given its residents a very big post lunar new year surprise. it has announced that people looking to buy homes can now enjoy subsidies and tax waivers. the incentives will reduce the cost of homes by roughly $27 per square meter which would translate into more than $3,000 for an average home in wuhu. they are expected to following in wuhu's steps. there is no indication they have given wuhu the stamp of approval and top leaders have repeatedly said in the past they will keep the tightening control in place but, of course, there are already signs these controls are slipping. last week the pboc told banks to guarantee loans for first home buyers. back to you, christine. >> interesting. a lot of people are wondering when the others might follow

local suit. we'll be focusing more on that. tracey, thank you very much. tracey chang. right. let's head over to what's happening in india. of course the big story there poe cussing on the eu-india summit. that's something we're watching very closely. top of the agenda free trade, economic cooperation between asia's third largest economy and, of course, the european union. all the highlights live from new delhi. what can you tell us? >> reporter: thanks very much. yes, the india-eu summit did kick off this morning. the prime minister met with the european council president and the commission president heading the delegation from the european side. they are going to be talking about that very crucial foreign trade agreement or the bilateral investment treaty agreement which has been urned negotiation since 2007. the sensitivities on both sides, the eu wants a reduction for

crucial sectors like auto, wines, et cetera. and the indian auto industry is not particularly keen with any sort of production. both sides trying to iron out sensitivities. what we were told this morning is that they are hopeful of negotiations concluding by autumn this year. so there could be positive forward movement on the free trade agreement. eu is one of the largest trading partners accounting for 14% of india's trade and of course a big source of direct investment into india as well. outside of what happened between the eu and india trade delegation talks, what we do under is that they did brief the prime minister on the situation in the eurozone. telling the prime minister that they were hopeful some sort of a bre breakthrough as far as greece is concerned could be arrived post that meeting which is currently under way in brussels and they're hopeful there could be some positive outcome as far as the eurozone is concerned, perhaps by early next week, so the prime minister in india has been given a sense of what's happening in europe and of course as far as that crucial foreign trade agreement or free trade agreement is concerned between eu and india, we

understand advanced negotiations currently on talks could perhaps c conclude by autumn. back to you, christine. >> shereen, thank you very much for that. we're watching the summit closely and considering what's happening in greece. let's talk about one european company. of course that knows about doing business very well with ind qua. of course we know it is the fastest growing subsidiary of germany's top business software solutions provider. let's get an insight now, of course, about the tech industry and general outlook of doing business over in india. the managing director s.a.p. india joins us live from mumbai. good to have you with us. we are focusing a lot on the eu/india summit. what are you hoping to see that could benefit you? >> well, we continue to work closely with our -- many of our cu customers in india to grow their business overseas. anything that facilitates that globalization of indian

corporations is very positive for us in india. >> as the european company doing business in india, what are you most frustrated about? what do you wish -- is there a wish list about the sort of changes you want to see? >> well, we're a european company but i would say in india we're very much an indian company and i think we're absolutely bullish on india. we just came off of the triple digit growth last year in india, so we're excited about the potential here and we really don't have a lot of frustrations. we just see lots of opportunity and we're really delighted to be in india supporting indian customers. >> we've seen how the indian government has been reluctant to open up the retail sector to

foreign investors. what about the tech sector? are you getting level playing field in terms of the business you are doing in india? >> abc hutly. india is our second largest subsidiary. we consider ourselves an indian company. and we have complete access to this market. we also have substantial leadership in india so absolutely a level playing field. we're delighted to compete here and we've been winning big. >> peter, i understand you see great opportunities so you want to see -- to be as complimentary as possible to the ipd yap market but it must be in your experience as a non-indian business person there must be a difference doing business in india to elsewhere around the world, those differences, i think, that make it difficult

for some people moving into a new market to understand how to do business there. what are those differences that maybe sometimes are misunderstood outside of india? >> well, personally i've been in india the last 12 years so i somehow maybe have lost the perspective on how business is elsewhere. but the great thing about india is that there's a strong push on basic business fundamentals in this market and i think that's really not any different from any other developed market in the world. there are more challenges and i think that develops even stronger business professionals here so maybe one of the things is the competition. the other thing is having a large pool of very intelligent

business professionals to work with. and this makes india a really exciting place to work and it also makes india a great place for companies to be to tap into that kind of potential. >> all right, peter. we'll leave it there. peter gartenberg, s.a.p. india. all right. some earnings to tell you about. of course dbs, the largest bank, assets reported at record net profit for 2011. cnbc spoke exclusively about the forward strategy especially as european banks trim their asian assets. >> both capital and liquidity constraints after npro and capital constraints. they're not as aggressive and many businesses.

for us give us an opportunity to build client relationships in a business we like and know and we can do that because the european banks are weaker at this time. >> reporter: the january trade numbers were out in china not long ago and the numbers were actually quite shocking. i wonder from your perspective what conclusions can you draw from the state of chinese economy based on some of these numbers. >> actually the real issue with china has been clear, frankly. you look at the trend lines. chinese exports have been coming off and they're coming off certainly because of demand and that's what shows up in the numbers. on the other hand what few people give enough weight to is the growth in chinese domestic consumption. it is 34% of the economy. it's a low number. it is going to get to 40%, 50%, 60% in time. but month on month, quarter on quarter, you can see this kicking in and sometimes the

movement happens quite slowly and so you have to work through the transition but i see this is what happens with the chinese economy. >> let's talk about banking regulations today, how onerous are the current and future proposed new regulations on the banking industry? will this stifle business? >> you go back to the fundamental rules around capital and liquidity. this would be on the banking industry worldwide and in asia. the observation in most countries or the next couple of years, but it's quite clear to me that you could wind up creating a constraint and the credit constraint in most markets around the world if you don't wind up through the liquidity. it's clear that when you start getting black and white in your definition, the unintended co consequences are significant. they can be quite impactful. there's no question that we're

getting to a stage where it will put the cost burden as well as a credit on the system and we just have a global body, we need to make sure that we're not throwing the baby out with the bath water as we try to address some of the egregious parts of the system. >> and that was cnbc speaking to piyush gupta. coming up on "worldwide exchange," we're talking tech with linkedin jumping, are we allowed to be optimistic about tech now? we'll see. there's nothing worse than going to the post office and waiting in line. i don't have to leave my desk and get up and go to the post office anymore. [ male announcer ] with stamps.com, you can print real u.s. postage for all your letters and packages. it gives you the exact amount of postage you need the instant you need it. can you print only stamps? no. first class. priority mail.

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welcome back. we are foe can cussing on banker bonuses as barclays is the latest to slash its renumeration but do bankers deserve the big payouts and has ceo pay gotten out of hand? had let me know what you think. e-mail us at worldwide@cnbc.com. plenty of people have been sending me their thoughts so we're having a look at what other people think, too, and let me know your thoughts later in the show. >> i've seen some of those e-mails, beccy, and they're pretty interesting.

a final thought from john woods from citi bank. lots of headwind facing investors these days. what's your advice to clients and investors? >> well, i think my main advice is enjoy it while it lasts. the there will be a wave of liquidity hitting our shores. it will be forcing risk assets in terms of currency and equities. i suspect our markets are going to test if not exceed some of the post-lehman highs we've seen the past two or three years but i suspect this rally is driven more by liquidity than fundamentals. we heard from an earlier speaker the ltro would be in the amount of 500 billion to 600 billion. this will be unambiguous for the near term. but i do caution and do express concern over perhaps the second half of the second quarter. my sense is as liquidity wanes, some of the underlying concerns

we have about the region, particularly export growth, particularly underlying demand, will start to diminish somewhat and at that point i think we need to be more cautious and focused. >> hate to cut you off, john, but great stuff. thank you very much for your time today. john woods, chief investment officer citi private bank. and a quick good-bye to our viewers in asia. this is the time to bring you in where you join us, jackie. welcome. that's exactly right. good morning, ladies. it's great to see you. we have a lot, of course, coming up on the show. we'll get an update from the latest in greece so stay with us for that.

good morning and welcome to the show. the headlines from around the globe this morning. in the united states just a week after its mega merger with deutsche boerse it's blocked by regulators, you're owenext moves forward on its own. greece's finance minister returns empty-handed after they say the latest budget proposals are not good enough. and china seeing trade weaken in january due to slow global growth and factory closures over the lunar new year. but stocks hold steady on signs beijing may be loosening its control on the property sector.

good morning. you're watching "worldwide exchange" with christine tan, beccy meehan, and i'm jackie deangelis. let's look at futures. it does look like it's going to be a down open, if the markets were to open now lower by 60 points. the s&p 500 lower by a little bit more than seven points and that's, of course, after the news out of europe yesterday that we had a deal in greece but still waiting for approval, beccy, so that short-term uncertainty rattling the markets here. >> greece's plans did fail to impress eurozone leaders. the eu has rejected the agreement saying athens has to do more to cut spending. speaking at the end of the meeting in brussels euro group president jean-claude juncker. >> firstly the greek parliament

should improve on something, the policy package agreed between greece and troika. secondly, additional stock expenditure reductions of 325 million in 2012 should be rapidly identified in order to ensure that the deficit target is achieved. >> those comments come as greece faces another wave of protests against austerity measures. the unions call the 48-hour general strike that starts today. speaking in brussels the greek finance minister venizelos warned that painful choices must be made now or greece faces leaving the eurozone. >> translator: our choice is one of humiliation for historic and proud kcountry or even greater humiliation it will face if we act under the illusion of saving face with decision that is will have a much greater social cost. >> so the comments come out of germany, silvia. i noticed that headlines are

crossing that merkel is telling german mps allowing greece to default would have uncontrollable consequences. i guess the rhetoric is all political gains, isn't it? >> reporter: yes, and this has been the line all along, will have uncontrollable consequences, one should then say define default because what we have now isn't anything but default. when you ask private sector haircuts of 17% and more, isn't that very close to default or if a country is insolvent, isn't it defaulting? so i think the bottom line is uncontrollable because the uncontrollable default is something they would have uncontrollable consequences and that's what everyone is trying to avoid. the order ly default, even thouh you don't call it that, is what we're heading for in greece anyway. and when we talk about what happened in brussels last night, not really a big surprise. a surprise for some but we've been talking about this. eurozone leaders said before

they went into the meeting very unlikely that they would wave through the next bailout at that stage because they needed approval from the greek parliament first which is quite a reasonable demand, i daresay. i can't say they rejected the package that came out of athens. they simply put it on hold and say, okay, we have to wait and see. if you pass it in parliament, if we can assume that this is legislation and it will be implemented, then we can talk about sending you the money and that will probably happen next week. >> silvia, stick around for a minute. i want to bring in our guest host who has just joined us for the next hour, fund manager. we seem to have been on the brink for ages and ages when it comes to greece. we've been talking to various guests this morning about whether they think this is really it. is there still some more flex? >> i think we're approaching the end game. i think part of the process of the ltro has given markets not to go into full-scale panic over

the greece situation. europe will have to decide how to defend. that's very important. does deserve more time but unless the greeks can enact this, i think patience is running out. you've seen about 63 billion, the draw from the greek banking system, the preparations for the defaults began months ago. >> in terms of where the ecb stands, what draghi was hedging his bet about whether the ecb will take haircuts, he couldn't make any commitment at that stage and the official line is, no, we're not. but it didn't sound to me so categorical what he said. do you expect the ecb to take the haircut as well? >> well, this is the difficult g. do we have a cds event and this is something i grappled with right from the beginning. does the ecb deserve its premium for being the lender of last resort. ultimately when you are talking

about a 70% haircut, the market was implying a 90% haircut, it is a default. at some point all lenders have to accept responsibility for the risk they took and unless we can enact the program, you are at some point whether it's now, today, six months, 12 months' time, you hit a default. and to date we haven't actually really seen any progress on that. we've seen significant progress in other parts of europe. >> george, the important thing -- this is christine, by the way. how to manage the default. are we heading towards an orderly or has the chances of a disorderly default now increased and what's the ramifications of the global economy? >> yeah, i think it's a very key question because actually the last thing anybody wants is a disorderly default and i think that the preparations and the breathing space of the l it tro

allowed and the work the troika is trying to put in place obvio obviously gave some form of stability but ultimately i think any form of default is going to be somewhere between the two where you end up with some restricted currency, some assets that are able to trade, some that aren't. so i think it's not as clear cut as disorderly but i think it's somewhere between the two it's going to be a fascinating to watch. now ultimately we don't have to get there if we can't enact the spending cuts. >> now i want to bring silvia back into the conversation. really quick, silvia, i haven't heard this in some time, greece leaving the eurozone in some while. we're going to manage the problem. we're going to create a situation where the eurozone can stay together. but recently in the past few days i have been hearing maybe again there is a chance that greece will leave the eurozone. given everything that's happened, the whole chain of events and the uncertainty still

pending now, is that back on the table? >> reporter: i don't think it's back on the table. on the other hand it was never quite off the table. it's always sort of some option to be played in the market as a contingency plan. i have mentioned all along and politicians you talk to mention all along it doesn't solve any of our problems. this romantic theory that if the greeks have their drachma back, wonderful, they could become competitive again and everything will be back in happy land and never bought that argument and most of the people i talk to don't buy it either. those who don't buy euro bonds now of greek denomination will pile into the drachma bonds when they come in, won't they? the greeks as a nation would have to face massive inflation from all the imports and the bottom line is it doesn't do anything for the eu at all because look at hungary. we still have to bail out hungary and they're not even in the eurozone so we still have that stone around 0 our legs, as it were trying to bail out a

country even outside the eurozone but inside the eu. not to mention the ramifications this would have for the european integration process, et cetera. i think if it's talked about, it's a completely hypothetical question still that let's say the romantic notion is a solution. i never saw it and the politicians i talked to don't see it as a solution. >> all right. thank you so much, silvia, for that. meantime, george is going to stay with us, the founding partner and fund manager at natterly. we will be talking about barclays, in fact, the bank is slashing its 2011 bonus pool by 25%. it seems that you have tons to say about it. in fact, if you are curious about bonuseses or have some comments feel free to e-mail us. let's get on to what's going on at barclays in terms of the earnings as well because they suffered losses in its investment banking arm. we saw impacts in the eurozone

crisis hitting revenues in addition to the banker bonus issue. it probably has confused matters just a little. let's go out now to sales trader at ig index who has been across this story for us. what do you make, will, of the earnings from barclays and the reaction that we've seen the share price today because the stock is trading a good bit higher even though they are pretty cautious on the profitability the next couple of years. >> reporter: yes, hi, beccy. it's been interesting this morning from the volatility point of view in the stock price. we've had a real fall in the volatility this week in the uk and for barclays to open down 3% and now trading up around 4% seems a bit unusual in the way that we've seen some of these stocks trade this week and the earnings, i think it's only a slight miss in terms of the overall headline figure but a lot of talk about having a bad quarter and that seems to be something we've seen from a lot of other banks the way the market is in london at the moment, struggling with some of

their trading divisions and certainly perhaps investors are looking at it this morning thinking the very bullish statement from bob diamond thinking they're not going to pull town their target for this return on equity from 13% seems to be this morning. >> george, you and barclays, what do you make of the reaction? >> i think it's been very rational. analyst comments focused on the earnings. as for me banks and why we've moved very little banks being quite a big bet. it's all about the balance sheet trend and what you've seen today is core information, tangible. balance sheet enormous discount and the market is reacting to that. these banks courtesy of the ltro, the regulator anytime in the last 3 1/2 years in my mind. >> will, how does barclays look now after this set of results versus with its peerses?

>> well, we always intend to see a little bit more traffic in barclay when is it does head down to that two-pound level and when it got below there. these levels we still seem to be seeing a lot of action. we've seen a bit more short money coming in, possibly the short-term reaction to the share price move today. it does look a bit more of a good bet. without the constraint of having the government intervention on their board and as we saw earlier the pressure from the banker bonuses. >> george, this is christine here. because you own barclays stock, i'm waiting to ask you on the topic of banker bonuses do you think bob diamond should take his bonus? >> yes, i do. on the steven hester issue, let's be quite frank, he has done an amazing job. i'm embarrassed as a british taxpayer that he was forced to

step down. he's far more important to this count country. steve hester has done an amazing job. as taxpayers we should be incredibly grateful and i think in the event that we don't start to recognize that, one of the big financial firms will turn up and steal him because he's done a truly incredible turnaround. what is it, $160 billion liquid assets today. this business can now absorb a bigger hit than it did at the time of the financial crisis. it is on the road to producing profits. i'm incredibly grateful for the hard work he's done. >> all right. great stuff, george. i'm sure a lot of our viewers will be wanting to write in on those comments. george, our guest host, thank you very much. and still to come on the

show, of course we have a lot more coming. we'll talk about barclays a little bit more. the bank slashing its 2011 bonus pool by 25% and it seems that you have tons to say about banker bonuses so keep sending us your e-mails. ♪ [ male announcer ] how could a luminous protein in jellyfish, impact life expectancy in the u.s., real estate in hong kong, and the optics industry in germany? at t. rowe price, we understand the connections of a complex, global economy. it's just one reason over 75% of our mutual funds beat their 10-year lipper average. t. rowe price. invest with confidence. request a prospectus or summary prospectus with investment information, risks, fees and expenses to read and consider carefully before investing. should we be letting him p-l-a-y with our t-a-b-l-e-t? [ mom ] i think it's fine. it's the new element from at&t so it's w-a-t-e-r proof. cool. what else does it d-o?

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welcome back. you're watching "worldwide exchange." it's time for your global markets report. let's start here in the united states. take a look at how the u.s. futures are doing now in terms of our trading session on wall street. looks like a lower open on wall street. the dow lower by 65 if the markets were to open now. the nasdaq by 11 ran the s&p 500. this was after a day yesterday, beccy, we saw all the indices higher. it was a third straight session. the upside, of course, is limited because of the uncertainty, of course, we're still seeing in greece. >> doesn't seem to have gone away. overall the equity markets across europe are down. we see 0.4%. the majority of hems of the stoxx 600 are trading lower. we're down overall on this index. the individual bourses are varied. clearly down is the name of the game but 0.3% lower for the ftse.

the dax 0.7%. the ftse mib did manage to trade higher very recently but has since turned negative by 0.2%. on an individual move basis, there are a few stocks i want to point out to you. the macro picture is a big part of what's going on in the markets today but corporate news on the likes of barclays. lots of focus on bonuses. we'll talk pour about that but overall the earnings were like this. may miss profit targets, so they told us return investment goal for 2013 looking a bit shaky. but there's plenty so we've heard from the stock price reaction 4.6% higher. alcatel-lou sent is gaining by nearly 15%. the company reported earnings today with adjusted operating profit down by 20%. revenue down. customers are cutting back on spending but many market watchers were impressed with the

strong cash flow and also bear in mind that last time the company reported its figures, the stock fell very hard. even with the declines that doesn't bring us back it to where we were before the last earnings report. we have to put this in longer term. total is moving lower down by just over 1%. the company came out with net profit up by 7% on higher oil prices, also confirming its previously dwided output as well. let's see what's going on in the currency market. this is how the euro rates are shaping up. euro dollar at 1.3247. down versus the yen at 102.98. lower against sterling, 0.8365. the euro up against the aussie dollar by 0.7%. in the bond market on the back of yesterday when we heard from the ecb about their rate decision expected on hold and the fact the l ittro still feed

through the system according to mario draghi, 1.98 on the german debt. tightening when we compare with the spanish and the italian debt in particular. spanish ten-year yield at 5.21 and italy 5.48. much more control than at the levels we were looking at around 7% above which was considered unsustainable for those k countries. christine? a lot of concerns about the eurozone. eu ministers held a second bailout for greece. trade data showing a fall in imports coming from china. that seems to be weighing on the markets as well. take a look at the shanghai market managing to close to the upside. there was a report that said the local government in wuhu apparently are relaxing home purchases and that seems to be lifting the property counters over it in shanghai offsetting

any negative impact from the trade data. shanghai composite up. hang seng down more on profit taking than mig else. we had profit taking in oil majors and some of the banks, the nikkei 225 is up losing the key level. kospi down 1%. elsewhere taiwan weighted index up. australia down 0.9. new zealand pretty much flat. the sensex trading to the upside we are awaiting news of the eu/india summit going on in this particular market. sending it back to you. barclays ceo bob diamond has declined to say whether or not he has accepted a bank bonus for 2011 but the bank says it slashed its overall pot. let's get back to the founding pa partner and fund manager at matterley asset management. you defended very eloquently

steven hester. he's doing a job, but he's doing a job for a bank which has uk government as a major shareholder so i guess you could say logically it's the government's business what his bonus is. i guess it's not the government's business necessarily what is bob diamond's bonus should be because they don't hold a stake. this is certainly one of the things coming through in the tweets we're getting on this issue. joey says banker bonuses in the business of shareholders. no one else's business. the shareholders stepping up and being vocal enough, do you think? >> absolutely. and make no mistake those conversations are happening. it's the way that the major institutions in this country work. that will not happen for 0 the rest of the public domain. does bob diamond deserve something? he runs a bank of nearly $6 billion. he didn't require a government handout. yes, he does. he should be receiving a bonus for are that.

are they cutting bonuses? yes. are there areas of excessive pay? absolu absolutely. it's coming down. >> george, obviously we're no strangers to this issue here in the united states and after our financial crisis, the bonuses here at the banks came under major, major scrutiny and we've seen the same way people have been tweeting in regarding the barclays issue that people have been expressing their opinions about u.s. bonuses as well. do you think as a matter of principle, whether the government has a stake or not, that shareholders -- that stakeholders in general should have a say on these issues? >> absolutely. i think it's really important. what's the role of government in a nongovernment backed bank is they have to push at all costs the banks are well capitalized, property capitalized and can cope with whatever the world economy will throw us. where do they stand on pay? i think quite rightly they must and the pay over longer duration has retooled so it's not

simply -- it's more linked with success. i think it is a matter for the owners of the business for shareholders not politicians trying to win votes. >> it is a matter for politicians if the manner in which bonuses are rewarded is a threat to the economy of that country which means the politicians ultimately have to get involved. it seems to be what happened the last time around that there was something in the culture of risk taking that the government had to intervene and that's the feeling that comes out. messages are being sent on twitter. follow me and get involved. kenny says it's not so much the bonus, it's the culture of risk which doesn't need to realize rewards 10 to 20 years away before paying out. how can that be fixed if we align the interests of the

economy and individual businesses? >> yeah, it's a very good point. let's look at the heart both here and the states, what hits the economy is lending to property. you saw especially in the uk the switch from paying people on the issue creating a loan and that being successfully repaid to origination of that debt and that's part of what created this. the tweeter is exactly right. it's about linking long-term business performance not necessarily the quick buck. i do have that but also in a people-based industry, unfortunately to retain talent it has to be paid. >> okay. thanks to everyone who has sent in thoughts as well and e-mail us. get involved on twitter. and george will be joining twitter soon so that's something else to look forward to. jackie?

still to come on the show china's trade data disappoints but how much can the lunar new year break the blame? and is there a wider problem of a slowdown in growth? we'll discuss more on that next. people really love snapshot from progressive, but don't just listen to me. listen to these happy progressive customers. i plugged in snapshot, and 30 days later, i was saving big on car insurance. i was worried it would be hard to install. but it's really easy. the better i drive, the more i save. i wish our company had something this cool. yeah. you're not... filming this, are you? aw! camera shy. snapshot from progressive. plug into the savings you deserve with snapshot from progressive. tspark card from capital one... spark cash gives me the most rewards of any small business credit card. it's hard for my crew to keep up with 2% cash back on every purchase, every day. 2% cash back. that's setting the bar pretty high.

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china's trade surplus rose sharply in january as imports plunged but economists say the data was likely skewed by the long lunar new year break. however, january's trade figures confounded market expectations revealing uncertainty once again about china's growth. meantime last year's fourth quarter current account surplus, the broad eest measure of trade balance with the world, dropped 41% from 2010 figures. let's get some reaction from george, our guest host. when you look at these trade figures and what they say about dhin, are you concerned that if china doesn't get its house or economy in order we could see a protracted downturn in the global economy? >> absolutely. we are all reliant on asian growth more now so than ever. i do, however, think the response to the chinese started to put in place at the back end of last year will come to fruition this year and i also believe that your comments about

the new year can't be overlooked but the world now rests heavily on two shoulders, the u.s. and china, and hence the scrutiny. >> a lot of conundrum. a slowing economy is one thing. they are also facing inflation which is about 4% and growing from the last figure that we saw this week. do policymakers know what they're doing and in terms of the conundrum they're facing can they get the policy tools right? >> a very interesting point. have the chinese managed their economy well through this downturn, absolutely, far better than most others around the world. one area that does concern me is the asset bubbles and, you know, the inability of the very savings focused chinese to deploy their own capital in 24. we've seen that very starkly created very aggressive property bubble in certain parts of the country which have been painful for the banks. and whether or not we'll see

some freeing up where there will be deregulation on investor shares. commodities other than gold and i think that's going to be interesting is how they are allowed to diversify their own wealth. >> interesting. george, thank you very much for your insights. good talking to you. you will continue to stay on with us, of course, george godber. on that note, jackie, beccy, that's it for me. i'm going to start my weekend now. i'll be back on monday. >> have a great weekend, christine. coming up on the show stocks continue their slow trudge higher. our next guest says the market is way overbought and may be due for a correction. wanna know the difference between a trader and an elite trader?

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welcome to it the show. the headlines from around the globe today, just a week after its mega merger with deutsche boerse is blocked by regulators, euronext moves forward on its own reporting higher fourth quarter results. barclays warns it could miss next year's price target following its worst performance in three years. and china sees trade weaken in january due to slow global growth over the lunar new year.

stocks hold steady on signs beijing may be loosening its control on the property sector. good morning. nice to have you here on "worldwide exchange" on this friday morning. let's take a look at u.s. futures as we get set for trade on wall street. it does look like it's going to be a lower open. the dow, if it were to open now, would be lower by 70 points. the nasdaq by 12 1/2. and the s&p 500 lower by 9. this was after three straight session gapes for all three indices over the last few days. of course the upside, though limited, we did get a deal on the table in terms of greece, beccy. still a lot of uncertainty ahead. that's what the futures are indicating. >> none of the deals seem to be done deals if you get my drift, and that's causing a concern for equity markets which are also down today across the board. we saw the ftse mib move higher earlier on but still down on that front as well. nearly 1% lower now for the dax.

the german market has been underperforming. 7% or lower for the cac and the ibex. 0.3 to 0.4 for the ftse mib and the ftse 100. plenty in the equity markets today, jackie. >> yeah, it's been a grand march higher for the u.s. markets not just recently but over the past few years since the s&p 500 hit its closing low, 402 companies or 80% of the intex is up about 50% or more and more than half are up more than 100%. so joining us now to talk more about that is tim mulholland from china/america company llc and still with us is george godber in london, our guest host, and we'll continue to discuss as well. at this point, i want to start with you and talk about the s&p. feels like the bulls are out but are we due for a correction? >> we're 20% off of our october lows. very impressive rally. the rally has been relentless. i don't think we've had close to

a pullback. the s&p technology composite index has only had three down days all year. while it's been a great rise, some studies i look at low to high indicate that next week -- between this week and next week you could see a crusting in the market, maybe a little overdue correction after such a gain. >> okay. and a lot of issues on the table in terms of what we're dealing with europe and domestically. let's start with the domestic picture, the fed coming out and saying we're going to leave interest rates low for an extended period of time. will that help us or hurt us in the long term? >> well, that's a big issue that i have. it's not widely talked about because i think that the effects of zero interest rates are doing more harm than good and when you look at that, a study that showed personal income and interest wages, salaries and interest, the interest component is down about $400 billion over the past three years alone. look at insurance companies, how

it's changed their investment strategy and the returns are getting and savers are getting killed. there's some collateral that contamination of balance sheets that's brewing now. look at the global situation, at what people do to get extra yie yield. so in this sense i would argue stability and zero interest rates is creating instability. >> don't you think we're due for a correction? >> it's an important point. we are positioned somewhat for a correction off a very strong level in the fund, our cash balance right to the top of what i would expect and, however, one thing i do worry about, i haven't been out marketing this week and seeing potential investors, everybody around the world has sat on the piles of cash and it worries me that we're all waiting for this pullback in the market. i am very much in agreement with your american guest but i am

worried that we all sat in the same boat. >> all right, tim, and just last but not least i want to get your take on the situation in europe. obviously a lot of short-term uncertainty in terms of what we're seeing with greece, but in terms of the whole eurozone, the ltro, this it boost in confidence for the short term certainly but also we get back to the same question in terms of the ltro and what the fed is doing as well, is this a short-term fix or are they doing something greater here? >> you know, i have to say it's a short-term fix, a very powerful short-term fix and not really unlike some of the short-term fixes, liquidity fixes that we saw during the '07 and '08 period there were a lot of acronyms for programs. we ran the new highs in the market at almost nine months after this credit crisis really start started brewing. so very powerful but, you know, this austerity and the other issues, lack of pro-growth issues, i should say, in europe

are going to weigh and will overcome liquidity because it's a solvency issue, if you will. >> okay. that is a great point. let's leave it there for now. thank you both for joining us. you will stay with us. we'll get more of your insight. still to come on the show a tale of two virtual cities as lippingedin and groupon disappoints with a strong loss. are these overvalued or can investors still get connected? we'll ask the top analysts next.

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good morning and welcome back. you're watching "worldwide exchange." thanks for joining us on this f friday morning as we get ready for trade. linkedin's profit and revenue doubled. it is above analyst expectations. the professional networking site added 14 million new profiles during the quarter bringing its total to 145 million. that was a different story for groupon earlier this week. the daily deal site hosted a surprise loss in its first report as a public company. joining us now to talk about linkedin, the director of equity research, ken, let's start with linkedin. obviously the numbers certainly speak for themselves and you can't really argue with that but

anecdotally a lot of young people who are out looking for work and certificate isching for jobs who don't necessarily use linkedin. it is the kind of thing i feel people join the site but they're not using it every day the same way they would use facebook. a lot of people are using facebook in their job searches. so how do we actually know it is aggressively attracting and holding on to users that are using it to find placement? >> i think people are using linkedin as a professional way. companies feel more comfortable used a linkedin to target loyees, whether they are looking to higher at the moment or passively look at people they're looking to hire. though it is a jobs site or a resume for many people, i think companies are still comfortable with going through the linkedin versus the facebook. >> and then that makes a lot of sense in terms of the company's

standpoint. so i know, for example, that i'm on linkedin but a company has never reached out to me for employment opportunities or to see if i'm engaged in employment right now or what my situation is. how do we know whether they're really gaining traction with that and turning that into actual jobs found? >> i think certainly if he look at the hiring numbers are growing and i think a lot that have is coming from gains and what companies are getting out of this, they're able to target users better than they can with just simply going on facebook where it's much easier to find people's professional interests, where they work, et cetera. i think a lot of that detail is on linkedin, just in a more available manner. >> let's were i in george. nobody has tried to hire me lou linkedin either but that's probably because they didn't want to hire me. any kind of interest? how do the valuations look? >> as a value, very, very

difficult for me to look at these multiple sales and earnings. no doubt someone will win in this space and will be got-to but plenty that will fall by the wayside as we saw the dot-coms at the point years ago. i would be fascinated on your views on valuations in the seco sector and really can we possibly 0 justify them. >> i agree with that and i think that's our big reservation on linkedin. the story itself is a great one and you continue to see share gains, margin expansion, guidance came in higher than we were expecting and long term we feel that our estimates reflect a lot of that opportunity, but i think the stock trading at six times its 2013 revenues and so even assuming that they stay on course, a lot of that upside is already in the is to go at this point. >> yeah, and that's a good point that a lot of people are bringing up that potentially these stocks can be overvalued and so maybe it's not

necessarily the time to get in but certainly going to be a gra group to monitor going into 2012. thank you for joining us, ken. the s.e.c. has reportedly reached a settlement with two former bear stearns hedge fund managers over claims they misled investors as the subprime mortgage market was collapsing. the deal could be announced on monday when a civil trial was set to start. they were accused of lying about the health of their hedge funds which blew up in 2007. they were report edly pay a fin but won't admit any wrongdoing. the justice department and the s.e.c. filed criminal and civil charges against the men in 2008. they were acquitted in the criminal case in 2009. other stories we're following, the chairman of the house financial services committee, spencer bachus is the subject of an insider trading probe. the investigation began late last year. the balabama republican was highlighted in a "60 minutes"

piece about lawmakers profiting from insider information. the house and senate passed measures tightening insider trading rules. in 2010 "the wall street journal" reported that he made several suspicious trades during the financial crisis in 2008. the fed and the u.s. treasury sought to stabilize the markets. beccy? >> wolf began schaeuble said greece's plans would not do enough to bring debts down. he's in frankfurt and has been keeping a track on what's going on in the twists and turns in the story, silvia. >> reporter: and he's also reportedly been talking to the portuguese finance minister on the sidelines of the last meeting and suggested to him if portugal needs to renegotiate its particular bailout deal, germany would stand ready to help. so curious things going on there. of course portugal not on the front burner of the crisis right now but whatever we have to sort is out with greece we know that

y eurozone finance ministers yesterday certainly said to athens, yes, what you've given us is nice but we want implementation, we want a proper parliamentary approval, just a letter of intent isn't good enough for us and we want another 300 million odd savings that we need in the current savings plan before we can sign off on the deal. that seems like nit-picking as we're talking about it, but it's more the tone that comes from brussels than the actual numbers. my guess is if we indeed get parliamentary approval and it looks like a rubber stamped deal from athens then mr. venizelos can go back to brussels next week to his colleagues in the euro group and they will sign off on the deal. that is, of course, still a big if even though venizelos said that he's confident it will get through parliament. >> silvia, thanks for that. so italian prime minister monte

has said to ease pressure on greece and what he called a big potential explosion. speak iing on the first day mon said if there is a minimum of compliance with the requirement set 0 out this is the moment to turn the page. maria bartiromo will be speaking to the italian prime minister. catch that on u.s. closing bell at 4:00 p.m. eastern.

good morning and welcome back. let's take a look at the u.s. futures as you get set for trade today on wall street. it does look like it's going to be a down open at this point. we are looking at the markets right now if they were to open the dow would be lower by 56 1/2. the nasdaq by 9.4 and the s&p 500 lower by 7 1/2 and that's, of course, after a greek deal

was put on the table but still a lot more uncertainty about whether or not that deal will be approved. and, of course, in terms of some of the data we're looking at december trade deficit figures, those are due out at 8:30 a.m. eastern time so we'll be watching intently for those. at 9:55 we're going to get the first report on february consumer sentiment. analysts are looking for a reading of 75, up a point from january, and then at 2:00 p.m. the treasury puts out the monthly federal budget as well so watch for that. ben bernanke is speaking at the national association of home builders conference in orlando at 12:30 p.m. about 20 minutes later cleveland fed president will be speaking about the housing market, so look for those comments as well. still with us tim mulholland managing partner and george, our guest host in london, is with us as well. we have some economic data coming out this morning. no major earnings. i'm still waiting on more details out of greece so what's

re really going to set the tone today on this friday as we head into the weekend is this. >> well, i think we talked about an overbought condition. new move highs, the market is under a little pressure. i would watch a retest of the weak lows perhaps near 1330 in the s&p futures contract, see how that holds. and then more importantly you mentioned the consumer confidence index that will be out early morning, and i think i'd watch the market if it is a higher than expected number, if the market really can't make much progress on the upside that would give you a hint of weakness in the marketplace and perhaps a correction. i don't see anything upsetting the bull market unless we get some sort of shocking news or some event which i'm not sure we're going to get that today so i would watch the range for the week, 1353 on the upside. >> george, let's put a similar question to you, what are the crucial indicators you are looking out for in the next few weeks? >> i agree with team when you have a momentum liquidity as we

did with the ltro, everything goes up. bonds go up, equity goes up. the next phase has to be led by the economy and do we see any real growth? now what we've actually seen is manufacturing pmi. important service sector has looked better in the u.s. and the uk. so, for me here, it's all about that. does the economy show any form of lead. stocks are cheap relative to bonds, relative to gilt, to long-term history, more so in the uk and europe than in the u.s. but from here it has to be driven by the economy and that's everything i'll be looking out for. >> yeah, and that's a really interesting point, george. tim, i want to bring you in on this because it is about the economy and it is about those fundamentals. and although we've seen what people are calling a bull market and seen some nice moves in our three major indices, one analyst said 19 of 2012's 26 trading days the s&p only moved half a

percent or less. we're seeing these small moves, tim. do you anticipate that's going to be the pace of the market moves as we go forward? >> well, that's what makes trading in this type of market tough because you get these drifts and grinds higher and very shallow pullbacks so it's a difficult market to trade in. but i think what george highlighted was exactly the point. do we have the underpinings of economic growth to sustain this and, you know, i think that asset inflation brought on by stimulative monetary policies and these sort of things tend to not last. it's not backed up by fundamentals. i think that is key to watch and how things correlate. >> okay. thank you so much, tim and george, for joining us on the program today. and that wraps it up for "worldwide exchange." i'm jackie deangelis in the united states. >> and i'm beccy meehan in europe. thank you for watching wo "worldwide exchange."

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