welcome to today's "worldwide exchange." radical let sa right a party holds on to its vote. >> and shares in bankia are suspended among reports the troubled lender will ask the spanish government for more than 15 billion euros. >> and ali baba shareholders approve the plans as reports suggest the sovereign wealth fund may be taking a stake.

>> and wil se'll see if stocks buck the trend. they typically close lower ahead of the memorial day weekend. >> this is my hat. it's the monaco grand prix kicks off this weekend. >> an event that you've been to, i haven't. >> and we are sponsors, so we whether be getting the latest from the pit side

mar yoe mondio monti says gl probably keep the euro, but warned the economic reforms required may take decades to complete. >> a number of european governments, banks and other corporates are prettying greek exits. companies such as bmw and ia sgchlt also say they're planning for the possibility of a eurozone break up. >> and joining us for now is julia chatterley. so --

>> 70% of people voting anti-bailout plan in these elections, yet 81%, 80%, want to remain in the euro. that can't go ahead. something has to give, whether on the side of the greeks or the side of the europeans. obvious obviously the possibility of a greek exit is put at 50% to 75%. listen in to what people have been telling me. >> we would like to stay in the euro. but things have become so difficult in this country. taxes are getting higher. and the pressure is dreadful.

>> i know they're painful, but less painful than possible exit of greece from the european union. >> i don't think that they try to force us out of that. we were the withones who tried join the euro even if we weren't ready. so it's our fault mostly. >> so it is looking increasingly like a referendum on euro elections, but that isn't what we're seeing in the polls. and as you suggested, it does seem that syriza is in the lead. but another smaller poll suggested they were neck and k neck. we just have who tone people go less with their anger with politicians and more their desire to stay in the eurozone. >> european central bank says

talks that it's preparing for greece to exit the eurozone are up founded. executive board member said the bank was working hard to reserve the integrity of the bloc. >> it's our strong preference that greece stays inle eurozone. we expect they keep their commitments. we're working on plan a that means greece stays in the eurozone. if public speculate about plan b, c or d, than plan a will not work immediately. so i'm not speculating. i'm working on make plan a successful. >> let's bring in patrick armstrong. what are investors to do at the moment as we wait for june 17th and try and anticipate what policy responses we may get? >> nothing's going to happen june 17th anyway. it won't be a big bang whaefrt outcom whatever the outcome. people when they're campaigning

they're all extreme in their views. once elected, there's a moderation on both sides. our view is greece will stay in the eurozone the next few years. and then more ways you can deal with the contagion. >> and headed parity to the dollar? >> we think it's moving towards parity. that's actually part of the solution to become more competitive, a weaker euro facilitates that. and the euro has held up incredibly well. >> teflon europe as it's called. >> a hope and belief that it's a weaker of euro countries, but with the exit, i think people are realizing that will come with a lot of contagion. >> say eventually eurozone will move toward decisive actions but only when there's near panic.

>> i think you'll see the ecb step in first. i think you'll see a resumption of the smp, spanish yields move past 7%. italy is in much better shape than spain. you'll see a resumption of bond purchases. and that will give germany a bit of clout to negotiate the fiscal and economic integration that is needed to facilitate euro bonds and euro bonds is a big part of the solution. once you have fiscal integration and a euro bond, the euro becomes viable all of a sudden and those are the two mixing ingredients. and you need panic to force the hand of politicians and central bank. >> so at the moment, though, what do you do. >> we're short euro. europe will remain in recession. you want companies that aren't

getting revenues primarily from europe. you want stable cash flows. something we've got wrong is we're short bunds and i still think that has to unwind. >> let's check what bond markets are doing. the ten year at 1.41%, off record lows, but still incredibly low. france ten year going for 2.46%. you just heard patrick saying he's short german bunds. what about you guys? >> bupds are strongly here and it's true that 1.4%, you have to believe that something disastrous is going to happen for you to be long did your rag

here. so we're inclined to be the same way. but when you have panic and flight to quality, you won't have a big unwind of that in the near term. so we prefer france or more tactical trades rather than big picture trades. >> and you also did a big client survey and you found that a lot of people are expecting the european central bank to restart asset purchases. perhaps this time just for buying government debt in italy and spain. >> yes, that's correct. we surveyed about 80 of our clients and the vast majority clearly expect that the ecb will do something. they're split on what the ecb should be doing, cutting rates, restarting the smp, ltros or all

three. i think the fast majority would say it's more about the cutting rates to help the euro continue to weaken and then the smp to provide some back stop to the spanish and italian bonds in particular. but the way the ecb was enter viewing is not expect difference and needs to change. >> how high is the threshold for a full qe program? >> it's interesting because most of our responders basically said that they wouldn't see the ecb doing fully fledged qe in the second half of the year or in

2013. 50% said it's beyond 2013 or never. i think the threshold for the ecb to really engage into that is quite high. i think the ecb is probably more minded to do ltros and cutting rate rather than restarting the smp or doing qe. >> what are your thoughts of the three negatives you mentioned, they've all been done before, i think you're getting diminishing returns from them with interest rates where they are. banks are just buying their own sovereign nation's debtses and getting increasing intertwines. >> correct. if you really need to have something, i think the ecb is there to provide it even with diminishing returns. it is the only institution that

really can act very quickly on a market panic. on the other hand, the market know that is it has diminishing returns and the ecb, 00, knows there's limited flexibility. they can cut rate maybe by 50 basis points, but then that's it. the smp know in a they are seeing all the other bond holders, impact likely it to be diminished, as well. so they know that the options are a little bit more limited. which means that the thresholds for them to use this, to use these a tools, is also a little higher in my view because these are the last bulletses before they have to engage into full qe. >> i see lloyds this morning saying german bund yields on the ten-year could hit 1 about.25%.

>> other maturities are already negative. i think to get to really negative, what you see is that people are a little reluctant to go there. and what you see is that when you're faced with less than ten basis points and ten year bund at 1.4%, people say why don't i by france at 130 basis points higher than that. and what you're saying is there's more risk appetite to go for the stuff that is yields a little bit more, but that is not completely risky. >> all right, thanks for joining us this morning. >> now just remind you what's coming up. a 12 carat pink diamond? one of the key items on sale at christy's in hong kong.

we'll speak to the chairman about appetite for art and collectibles in the chinese market in it ten minutes. it's also the most glamorous event in the formula one calendar. we'll hear from the chief of cnbc's f-1 partner. >> and coming up, is their resilience in beauty. we'll speak to the ceo and find out why makeup sales continue to rise. plus we'll get out to the chicago mercantile exchange for a preview of the food price outlook. we'll break down what's in in your breakfast. you can see certainly weighted to the up side. this following the gains yesterday.

we saw a short while ago what's going on with bond yields. stain has been below. record low 1.36, but as i say, lloyds talking about yields getting down to 1.25. >> we saw sterling much weaker against the dollar. today we can't break through 80.32. dollar-yen 79.61. what about asia today? joining us is tracey chang with the update. >> tgi friday. asian markets are showing yet

another mixed exhibit. hong kong shares reversed earlier losses. hang seng closed up about a quarter of a percent. but index still retraced more than 50% of its rise from october lows to february highs. and a range nikkei finished about 0.2%. index posted its worst losing streak in 20 years. south korea kospi rebounded about half a percent on bargain hunting. elsewhere, australian shares buckled down to a six month low. led by mining stocks. india sensex also showing weakness. so a lot of lingering pessimism. >> this morning we're asking viewers to send through their

ideas for the facebook sequel to the social network. accepted through your ideas on twitter @cnbcwex or @kelly_evans and @rosswestgate. you saw a mockup of what that see cell could lack like. >> and will the film talk about whether there was a prenuptial or not. i've got an idea for the film title. we want to hear yours. also what chinese economic slowdown, paintings up for auction, we'll take a look at china's appetite for art. ♪ how are things on the west coast? ♪

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amid the talk of a slowing economy, you'd think it might be bad timing for a luxury goods auction, but christy's expects to sell off more than $250 million worth of art and antiquities this weekend. jonathan stone joining us. thanks very much. what is your assessment of chinese demand for these articles right now?

>> i think we're pretty confidence about chinese demand. the chinese have been considerable players in the art market for recent years. i came back from some sales we had in london and there was no layoff or slow down from chinese buying. so i think we're going into the sales quietly confident. >> at what point do you think it becomes your single biggest locati locati location. >> currently it's our third biggest location and sales have grown from single digits well into double digits. and it's now the number three location. so sitting in asia, i fondly hope that within a decade it

could be well up there with new york and london. >> we got reports from tiffany who cited some weakness. is the luxury market really recession proof or is there evidence that slowing chinese demand will potentially show up this weekend? >> i think what we've seen is the really great object, and this is the great hinge about the art market, whether a great diamond or painting or vase, because these are really unique objects, the demand really doesn't slow down. because it's a once in a lifetime opportunity to buy this simply wonderful object. and there is always hunger to do that. even in the darkest days of 2008, 2009, you're still seeing record prices. so the unique thing about all these objects is that it really is a once in a lifetime chance to acquire something which is unique, wonderful and great. and that is what is driving the

demand. >> i want to check in on the finer rare wines. you have a patrice collection, the wine market took a bit of a knock last year. what's happening now with that? >> i think we did see? correction in the wine market last year, but what our specialists are good at doing is getting the prices right so that the estimates and the prices we put on things before the sale take in to account the situation of the market. and they adjust it accordingly. and they work with our vendors to do that. so in that sense, i think that we can achieve great results. because we really do take into account and are very sensitive to where the correct pricing is at any given time.

>> out of the series of spring auctions here, what's the real star as far as you're concerned? what's going to attract the most interest? >> there are two great things. one is the martian pink about diamond which is an amazing pink diamond which is xwlamrous. and in the field of fine art, we have a pinting by one of the great 20th century chinese artists called separation and it is a really beautiful painting of his wife. painted at a time of separation. and it's a kind of homage to their love and his yearning for her and we're anticipating something in the region of $5 million to $6 million for that. those are two of the highlights. we also have a great collection of enamel from a private american collection which is a kind of new market for us, but we've had some successes in the

past and i think that is something which is really exciting and is also the top lots in that will do extremely well. and will appeal to all the chinese collectors. >> all right, jonathan stone, chairman and international head of asian art. thanks for that this morning. we'll keep an eye on that pink diamond. >> the estimates here $8 million to $12 million. not small change. >> and you have to wonder who will be able to put that up. although real assets, maybe it's not the worst thing in the world to own a pink diamond and try to sell that in 20 years. >> quick check of the headlines out of asia. japan's core cpi climbed for the third month in a row. but still a long way from the central bank inflation arrest get of 1%. analysts say the bank of japan will need more easing measures to fend off deflation has it has been trying to do for so many

years. >> and japan's finance minister says concerns about greece are helping to drive the yen higher and that is hurting japanese stocks. >> and minority shareholders of ali baba.com have given their approval to be taken private. they will fork out about 1350 hong kong dollars for each share that it doesn't already own. the company now has the green light from 84% of its shareholders for the privatization plan. that will pave the way for the delisting of the stock which sources say will happen at about the end of june. and coming up next, south korea's president talks exclusively to cnbc about the country's prospects following a credit rating upgrade.

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syriza party holds on to its lead with 30% of the vote. putting it anti-bailout agenda firmly on the table. >> shares oig in bank yoig are suspended after reports that they'll ask the government for

more than 15 billion euros in aid. ? alibaba.com approves privatization as reports suggest the sovereign wealth fund may take a stake. >> european stocks are up. toward session highs at the moment. >> and a look at what's happening in bonds.

euro-dollar has moved further away from the september 2010 level we hit yesterday. sterling still around the 8 on mark and aussie dollar has just 3wu6r78ed off its six month lows. >> want to bring you headlines this morning just crossesing out of china, which says it is filing a wto complaint against the u.s. on counter veiling duties against chinese subsidies. this would affect chinese exports to the u.s. worth more than $7 billion collectively, 22 products in particular. this was an e-mailed statement from china to the wto, also picked up by chinese news media and we're getting more details on that. >> and maybe the u.s. didn't think china would use it against them. >> it's usually the other way around. chloe cho spoke exclusively

asking about how korea is going about achieving this. >> translator: korea's fundamentals are very strong. when you look at figures for public debt, their average is about 100%, whereas korea's level stands at around 33% on par with china, so fiscally, we're very sound. if you look at the banking sector, the bis ratio for many financial institutions is much higher than the international average. in terms of the north/south tensions, regardless of what situation authority korea is experiencing, i think the risk is, less than what it had been on the korean peninsula over the last six decades. >> you recently met with your japanese and chinese counterparts and agreed to take this idea of seeking a free

trade agreement. how much of a realistic time payroll can we expect? >> translator: right how south korea and china have agreed to engage in negotiations. once we have sorted out an fta framework japan can join in. if the three countries were to negotiate from scratch, then this will take quite a bit of time due to their different economic sizes as well as priorities and necessities. as to whether it will take as long as the korea/u.s. fta, i don't think so, as there was a lot of political opposition to that deal, while will isn't as much towards a korean/china fta. >> you can catch the full

conversation at the times you see on your screen. aviation minister is talking tough describing back against charge airlines for carbon emissions. reema, what's he saying? i don't think reema can hear me. >> now i can. thanks so much. i couldn't hear for you a brief while. but india has said if sanctions are imposed for two of it airlines, with respect to the carbon tax dispute, india has fought back and said they, too, will ban the european airline. and the aviation minister said

traveling is a two way traffic. but also saying india is will being to find a solution to the problem, but it should be on a multilateral platform and the decision should not be rushed. important tanks on both ways is hurting both the countries and is not in then's interests because it will be counterproductive to eu and india at the same time the european debt crisis is there. there's slowing consumer demand which is hurting the economic growth. the and i have yan minister is saying that it will fight back and impose sanctions on the european airlines on its own air base if they decide to impose sanctions on two of the indian airlines, but they're willing to talk. so let's see how that story goes. but quite a flat performance for the any sensex, but there has b quite a bit of release on the occurrencurrency front.

on that node, it's back to you. >> thanks very much for that. and it's not just independent criticizing. many airlines have denounced the decision. and the move risks a trade war. and the eu being arrow sgant in its approach. european closing bell will have more later today. >> that's a long flight, london to vancouver. over in china, the government has been critical of the eu carbon scheme and is putting up cash nevertheless behind a push to go green. tracey chang has more details. >> ministry of finance said it will roll out a $27 billion package to support the green

technology sector this year and that will push it around $53 billion since 2007. and if you add local governments total would exceed $157 billion. and analysts say this latest increase is part of beijing's initiative to stimulate economy through fiscal policy and policymakers have been stepping up efforts to help shore up consumption driven growth. market watchers say as encouraging as this may be, stronger policies must be in place for these to have a real effect. back to you. >> let's get a quick check on asian. monday the bank of japan releases minutes from its april 27th meeting. that's when surprised markets by boosting its bond buying scheme by $124 billion.

also, india's prime minister will be in myanmar for a historic visit and australian central bank governor will speak at 2:00. you can bet they're listening to clues on further rate cuts. >> spanish government reportedly set to revise figures to the country's public deficit. the shortfall could be higher than originally estimated. the government's already revised deficit figure from last month. >> bankia shares have been suspended from trading as it tr prepares to present a restructuring plan. it was part nationalized earlier this month following mounting losses.

>> i much prefer italy to spain. spain has its banks that will need a lot more capital infusions. only thing is its aggregate amount of debt at the sovereign level is smaller than at the economy. >> would you buy government debt at these levels? >> not quite, but if you saw italy spike up from here another percent or so, we'll probably be buyers at that point assuming we have encouraging words from the ecb. i think we'll end up like a scenario we had in november again. >> apparently they've been urged

not to win the song contest. because if you win, you then have to host the contest next year and they're suggesting the costs could be too high. >> i don't understand the euro vision. if you win, you automatically host -- is it just like a giant europe wide talent contest? >> it also includes the middle east, israel, turkey. >> has it happened that anyone who has won hasn't gone on to host it? >> englebert humperdink is the representative. so keep your fingers crossed. >> the austrians and germans -- you have a list of points.

they all give each other top points. it's like -- and the uk has for no friends, so we never get anything. >> well, maybe you'll get a winner. >> we'll see what happens. our next guest keeps a close eye on chinese consumer trends. sean ryan is managing director of china market research. thanks for joining us. we speptd a lot of time saying the chinese authorities need to at that time economy away from investment and industrial production. is that in a pause or is that fundamental shift still going on? >> thanks for having me. it's clear that there's still the shift going on. you saw last year the chinese government increased the minimum wages on average by 22% in 21 of the 31 provinces. and salaries are still continuing to go up in the last month or two.

we've been talking with hr departments of fortune 500 firms and they're still telling us that salaries are still going up. china is weak right now economically so you'll see the government is putting in more infrastructure spending. but long term net-net, the great growth story for the world is still the chinese consumer. >> that said, you have noted that there are heavy discounts, foot traffic to department stores is down. so clearly not all is well. >> they need to be cautious of brands in the mid range, i think they'll have atrocious quarters coming out in the next couple quarters in numbers p.

but people are still spending money on the high end. the truly wealthy are still spending. so you talk the porsches have a nine month wait and they're not discounting much. the real discount is at the margins of luxury like the jaguars. so if you're interested in buying a car, now might be a good time. >> but the fundamental basis for getting excited is the emergence of a strong middle class. what you're saying people need to walk back expectations there and perhaps look at china more as super luxury play. >> not every single brand in the world will win and that's always been the case. a lot of people see strong middle class and say sell to the chinese and make huge profits. but there haven't been as many brands as people think making money. if you take a look at a pepsi,

their profits might not be as large will as people think, in large part because their cost structure is too high. logistics are high. it's expensive to ship something like a pepsi bottle from one part of the bottle to the other. it's much more than in the united states. i wrote a brooke called the end of cheap china and it tracks female consumers. they're still spending a lot of money. >> we're hearing from companies their biggest issue is retaining staff, hiring new staff, but the money they're paying for the general population, savings rates are so high in china, i'm wondering if you're seeing them consume rather than save. >> take a look at people that say the overall savings rate is

about 40%. that's kind of a high schoolish way of analyzing the market. when you look at older generations, they're saving about 50%, 60% because they're very concerned about being able to pay for medical car costs. the government is implementing better social security benefits that the older generation will never spend. they lost out on the great economic boom of the last 30 years. but this is why roubini and others need to go deeper into savings rates. consumers under the age of 28, effective savings rate of zero. younger consumers are spending. i interviewed a girl who is 26, she makes $250 a month selling shirts and she had $1,000 ipad and i asked her how on earth did you afford this. and she told me that she saved up money for six months by skipping lunch so that she could

buy that ipad. so younger consumers go out and spend and they're not putting money in a bank account. >> at least she saved it rather than slapped it on the credit card which is what we would have done over here. i want to go back to the autos. it prays into the german numbers. how much stockpiling is there of cars in china, how much inventory build up is there? i'm trying to work out whether some of the export numbers is something that will come back. >> investors should be cautious of the midling brand autos. honda might be facing glut

problems because consumers are taking a wait and see attitude. people say we've heard there's discounting, maybe if we we wait another week or two, prices will drop even more. so unless it's a brand that people get very excited about, you are going to see more inventory problems. but like i said, if you take a look at the suvs for bmw, range rover, porsche, you still have several month waiting lines on the suv side. so investors should be tilted more and going long on companies that sell a lot on suvs. for more sedan type companies, inventory is a problem. everybody is worried about a disoperatidi disnationary discounting cycle. >> all right, sean, thank you for your thoughts this morning. a discounting deflation cycle. that will be important to watch. >> really good stuff there with sean. we'll take a short break. still to come, it's time to

start your engines and step on the gas. f-1 is hitting the shores of monaco. we'll be there on the phone to look at the business behind the grand grand prix. in here, great food demands a great presentation. so at&t showed corporate caterers how to better collaborate by using a mobile solution, in a whole new way. using real-time photo sharing abilities, they can create and maintain high standards, from kitchen to table. this technology allows us to collaborate with our drivers to make a better experience for our customers. [ male announcer ] it's a network of possibilities -- helping you do what you do... even better. ♪

four main market makers could post up to $1 million in losses from the botched facebook ipo as they deal with thousands of problems with customer orders. sit take dell reportedly lost some $30 million.citadel report0 million. morgan stanley will adjust basic trades from last friday so no one will pay more than $43 a share on limit orders. facebook closed at just over $33 a share. so this morning we're asking viewers to accepted through their ideas for facebook the sequel. here are some of the responses we've gotten. the social net worth. and the social network 2 hyper extended. if you think you can to better, send lieu your ideas on twitter @cnbcwex or @kelly_evans and @rosswestgate. >> i'm thinking just call it

wall street 3. anyway, i'll chuck that one in. the monaco grand prix kicks off this weekend. ken joining us on the phone from track side down in pit lane, cnbc a partner, as well. graham, thanks for joining us. >> a pleasure. >> what a season we've had. five races, five different winners from five different teams. i can't remember the last time that's happened. why is will this season sort of so much more exciting in that sense? >> i think there's a lot of variables come into play this season. changes in the technical regulations and also the influence of the tires. but i think the one thing it has shown is diversity is really, really good for the sport. and we're entering another grand prix, sixth of the season. nobody knows who will win and perhaps a sixth winner already.

so from the perspective of the fans, it's really turning in to be a great season. >> how hornt is monaday importa the business side? is this the one where you get the major sponsors? is this one of the races of the year that you do the prime entertaining with all your bankers? >> yes. obviously formula one is an incredibly sophisticated sport. gone are the days that somebody would be swayed simply on a visit to a grand prix, but what you see here in monaco this weekend is a melting pot of global commerce really. all the movers and shakers are here. so it's a great opportunity for the teams to network and really showcase the sport. and of course it's a fabulous setting and fabulous event. >> graham, we know this week we

had reports that some new investors have bought into formula one including black rock and norwegian sovereign wealth fund, all ahead of a plan tned o in june. how are the teaming feels about that bearing in mind they're not really actually part of that deal and yet it's your circle. it's your entertainment. >> i think it's fair to say there's a mixed feeling in the pad dock. some feel engaged in the process, but i think by no means all the teams. and i think you outlined an interesting point at the opening there, which is we've had five race winners from five different teams and that's what the fans want. the fans want diversity, they want a mixture, they want teams of different flavors up and down the lane. so there is a real peeling that amongst some of the teams that there hasn't been engagement

with the full spectrum which is unfortunate considering the growth potential of the sport is huge. >> and you're off to the states and then two grand prixs next year. going to new jersey. so how important is that for commercial rights holders? >> north america is such an important market. you could argue that two grand prixs is minimum for a market of such importance. and formula one has had attempts in the past to establish himself in north america. we as teams are focused on shows in austin and an additional race in new jersey. it's such an important market and the teams are really, really

key. >> we wish you the best this weekend. thanks of that for joining us. >> thanks. the debate on euro bonds quote irritates him a bit because it requires structural reform and greek aid should stop if athens does not respect commitments and it's possible for german wages to rise faster. patrick armstrong with us. you are short german bunds. you like gold? >> we sold it automatic in march, but yesterday we started buying platinum. we think it's a much better risk return right now. platinum supply demand pretty

much in balance, but south africa is such a basket case in terms of infrastructure. 70% of the production coming from south africa. you could see supply disruptions there. >> if you're cautious on global growth, you you wouldn't want exposure. >> it's also a precious metal. we've talked about cars in china. we immediate it for catalytic converters. jewelry demand isn't slowing down. so platinum looks much better than government. >> i love it. patrick armstrong, joining us for the whole hour. thank you so much. >> we'll take a short break. still to"worldwide exchange." ♪ ♪ i can do anything ♪ i can do anything today ♪ i can go anywhere ♪ i can go anywhere today

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welcome to "worldwide exchange." your headlines from around the world. >> syriza holds on to its lead in the latest poll out of greece with 30% of its vote. >> share mis-bankia are suspended amid reports the troubled lender will ask the spanish government for more than 15 billion euros. >> china lodges a complaint at the wto against u.s. anti-subsidy duties that could affect $7 billion worth of exports. >> plus we'll see if the u.s. stocks can buck the holiday trend. they traditionally close lower

ahead of memorial day. >> it looks like green across the board here, but you have to take fair value into account. the dow jones would open up roughly flat. nasdaq same thing. s&p looks like it would open again roughly nat. take a look at what's happening the rest of the world. stocks are searching for a direction. u.s. stocks typically don't do that great on the friday before memorial day because it is believe it or not about to be a holiday weekend in the u.s. >> it is. i'm sorry about that. >> i know, not quite the same. >> you'll be finding we don't work u.s. holidays -- i mean we

work u.s. holidays is what i mean. >> i miss it. >> the hand that we're giving the u.s. today, slightly firmer tone. remember we were up yesterday. we're right now the a third higher for the ftse. ibex as well up around just over half of 1%. the core market is just always higher. ten year gilt edging up. spanish yields are down lower. and ten year spanish yields can briefly go below 6%. lloyds have come out and talked about the possibility of ten year fund yields going down. as far as the currency markets are concerned, euro-dollar nudging up slightly. just bouncing off that 2010 low.

dollar-yen steady. aussie dollar bouncing off six month lows. sterling has been weaker against the dollar. >> and in the united states, charles plosser is speaking at a conference about monetary policy and we'll get his remarks. a little before 10:00, we'll get the final report on may consumer sentiment and the bond market does close an hour early today ahead as we were just talking about of the memorial day weekend. >> what do they do with that extra hour, is this the first weekend of the hamptons? >> it is a big hamptons weekend, yes. doesn't quite measure up to monaco. but it's still a lovely place. >> so you goat from memorial day to labor day. >> and when you can wear white. >> you can't wear white before

memorial day. >> >> no, this is very, you know, key part of traditional etiquette that i have routinely throughouted, but, yes, apparently only supposed to wear white in the summer. >> you in a white suit for monday. >> mario monti tried to temper speculation of a greek exit from the eurozone last night. speaking on italian tv, he said greece will probably keep the euro but warned it may take decades to complete. >> a number of banks and other corporateses are preparing contingency plans for a creek exit. companies such as bmw say they're planning for the potential of a eurozone break up. >> meanwhile latest opinion polls suggest ser syriza has

taken the lead. julia chatterley joins us for more on this. we're only getting opinion polls for the next couple of weeks, so they decrease increasingly important. >> you're right. i think the opinion polls will be watched very, very closely over the next fewparadox, 70% v for anti-bailout parties and yet ultimately the polls also say 80% of the population want to remain within the euro. and it's just how you make those two things work. listen to what the population have been saying. >> we would like to stay in the euro, but things have become so difficult in this country. taxes are getting higher and

higher and the pressure is dreadful. >> will i know measures are painful, but less painful than the possible exit of greece from the european union. >> i don't think that they try to force us out of that. we were the ones who tried to join the euro even if we weren't ready for that yet. so at least it's our fault mostly that we joined the euro group. >> the political uncertainty here certainly heightens the perceived risk. and nothing that i'm hearing here on the ground suggests that we'll get anything different in the next election. and as you mentioned, the latest poll suggests that anti-bailout party taking 30% of the vote.

i spoke to the ceo of ef consulting earlier today and she had some very strong views about just what an exits and return to the drachma will mean for this country. >> i think if greece goes back to the drachma, there will be economic kay so is and uncontrollable social explosion. people will lose their savings. it will be worthless and they would have to balance the budget and the current account deficit instantly. which means that they will be unable to support necessities like petrol, medicine and food staff. >> ultimately the question going forward is whether the greek pop lake decides to acknowledge the risks. so we keep watching the polls and wait a few more weeks. >> okay, thanks very much for that. joining us is chairman of the

2012 b-20 summit. i assume any global business at the moment is planning for the possibility of a greek exit. how do you go about that? >> it's true that in today's globalized economy what happens in greece affects everyone else on the planet. we've seen that with the uncertainty of the past few days. even latin american currencies have depreciated. so i think we're all looking very closely at what the greek population decides and we truly hope that they decide to stay within the eurozone. i think that would be the best decision for the greek population instead because of the fact that they will keep their life time savings and they will stay within the european union. and also for the world at large,

it will prevent any possible contagion effects to countries with sovereign debt problems. >> you're also on the board of hsbc mexico. correct me if i'm wrong. but to what extent are banks in particular struggling in light of what's happened across the eurozone to match correctly as was reported in the financial times this morning theirs assets and leichts? are we already seeing a move toward treating them separately? >> i think banks are continuing to see this as a global problem and i think in the case of mexico and latin america, more broadly, we have sound macroeconomic fundamentals, but

because of the fact that the eurozone crisis has trigger effects all around the world and it slows down global economic growth we have to watch closely and take measures at what could happen at the banking system as large because as you know, many european banks are very present in latin america and about 60% of the assets of european banks are in emerging economies. >> has there been a noticeable impact in terms of funding that have been withdrawn? have they repatriated capital back to the eurozone, is that leaving funding for growth in other parts of it like latin america very short? >> it has. and in fact one of the recommendations for the upcoming

summit in mexico is precisely that. they should recognize the relatively low risk of trade finance. and they should think that the liquidity and capital requirements for trade finance maybe should be given a different treatment because one of the engines for recovery and growth is international trade and we immediate for trade finance to continue to flow to emerging economies. so that's why we're asking for g-20 leaders to revise some of the requirements in base he will three specifically in terms of trade finance. >> all right, stlik. we'll come back to you fairly shortly. >> this morning we're asking you what facebook the sequel mitt look like. viewers are sending through some of their ideas. keep your tweets coming. at cnbc wex.

>> the world's best and bright are descending on mexico for the b-20 summit. we'll examine the priorities leaders will try and address. respect

these are your headlines. greece's radical left holds on to its lead as governments and businesses start preparing for a greek exit. >> bankia preparing to ask the government for 15 billion euros in aid. >> and china lodges a complaint against the u.s. that could affect exports. >> the bi business summit leaders gather from around the world. 20 largest economies. and among their top priorities this year are trade and investment. you mentioned how you were asking for trade measures. what else is on the agenda? >> we have our recommendations around seven issues. security, green growth,

employment, trade and investment, transparency and and itity corruption. and we're asking the g-20 leaders to push for more rapid progress in specific wto agenda items like trade facilitation, 10 to 15% of the cost of global trade is red tape. with a multilateral facilitation, we could reduce that cost and it's like low hanging fruit that we could take out. also we're asking g-20 leaders lead by example. that's always the temptation to resort to protectionist measures. so we're asking help to continue to promote the free trade agenda as one of the engines for renewed growth. and finally, we're also asking

them to recognize open cross border investment is important to renew development and job creation. >> you can briefly address if the world trade organization which you just mentioned were to take action against argentina as is being discussed, the you were implications that that would have across the region and whether argentina is being viewed by other latin american countries as increasingly isolated. >> definitely. we feel that it's taking steps in the opposite direction as most of the other latin american countries have been moving to a more open borders and to regulate and to actually privatize national companies that are state owned. argentina has nationalized assets in argentina and also has taken a lot of measures to tax exporters and honor a lot of

international commitments. so in latin america, we're concerned that argentina is growing more and more isolated and it's one of the g-20 countries that probably does not share a lot of the philosophy that most other countries share in terms of what are the right fundamentals for economic growth. >> all right. we'll get more of your thoughts in just a bit. we want to bring you this news. again, more commentses from the bundesbank chairman now saying that the ltro operations by the ecb would give us time, but not resolve the crisis. and importantly he says that it would be an illusion to think euro bonds could resolve europe's crisis. >> mutualization of debt doesn't help growth and the ecb has reached the limits of its mandate. >> not the most surprising thing coming from him, but a reiteration of -- >> mandate a long time ago and then they found other ways to to

extend the mandate. so no surprise. >> still pushing back against the french. so watch the politics. >> also still to come on the show, good there doesn't seem ta shortage of people waiting at the makeup counter. the latest perfume. how does the industry manage to remain resist tapts.

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siemens. answers. take a look at the futures. we've come back slightly from earlier highs. and the global perfume industry is what we'll talk about how. generating more than $27 billion in revenue per year. in the u.s., number of brands carried nearly doubled over the past decade. number of designer fragrances

also rising. so why is the industry holding up? has the overall market gotten bigger? i know we have more brands, but has the market itself grown or have we just divided it up more? >> no, it's growing every year. the growth is different according to each country, but in general america and asia growing the last two years. >> your asian figures in the first quarter were quite strong, but what caught my eye is that your middle east business is up 35%. is that region becoming one of the stronger ones for you? >> yes, not in terms of growth.

definitely the market apart from europe, the rest of the world is doing really okay. and doing plus 25 on the first quarter this year. >> i can't understand who is paying $75, whether a consumer in the u.s. or around the world, for perfume. we know how high unemployment is. why are people still willing and able to shell out this much? >> if you look at the price of the fragrance, it doesn't change much over the last ten years. so i would not say it's cheaper, but the first access to luxury and you can have an item of the

brand. >> you make proper gukts for other brands. you make fragrances for a clothes group. how important is that when you have your -- they have their own labeled products, how does that chip in? >> you need to have the brand, the consumer to be securitized and the brand is history of the fragrance are going to develop. so the brands and you need to have a good mix in terms of fragrance product. but brand is 50% of the success. >> if you were part of the b 20

going to global leaders right now with top priorities for business, for growth, what would they be? >> i don't know. i have no idea. the situation is so difficult. europe is so difficult that i don't see what they can do really. it's a nightmare, but it's a neat mayor the consumer develop, the business develop. europe is still okay. when you look at the figure in germany in france or in uk, the which is is quite fine. not fantastic, but no reason to complain. the government hch- >> would you like to respond quickly shall. >> yes, definitely the european union is affecting the regions of the world so we hope to establish through bodies like

the g-20, we can restore international growth in a sustainable manner. and we hope that the recommendation for the big 20 will be issues will help for the private sector and the governmental sector to work together to establish new fundamentals for renewed growth. all right, thank you for being with us. still to come, we have the latest on the currency move. the euro just off two year lows against the dollar. we'll look ahead to the trading day on wall street. >> and take a quick look at how futures are trading ahead of the morning open.

welcome to worldwide exchange. i'm kelly evans. >> and i'm ross westgate. headlines from around the globe. >> radical left ser resa pa syry holding on toits lead. >> shares in bankia are suspended amid reports the lender will ask the spanish government for more than 15 billion euros. >> china launches a complaint at the wto against u.s. anti-subsidy duties that could

affect over $7 billion worth of exports. >> and we'll see if the u.s. can buck the trend of closing lower ahead of memorial day. >> we're looking at the dow opening up 3 to 4 points once you take fair value if to account. nasdaq about 2. s&p 500 again slightly flat or potentially to the up side. and the ftse global 300 gives you a sense of how global markets are handing off this morning. up just a little bit. we've been recovering between gains and losses.

cac 40 up half a percent and ibex even in the green this morning. plenty of ideas already on where invest is tore investors should consider putting their money. >> not so much in the way of fundamental news to justify it and it's a trade that's worked well so far. >> we're short euro obviously. europe will remain in rescission. >> they're much more aspirational play, soin investors need to look at brands like apple or thighky that are still aspirational for chinese.

>> he said watch ut for the mid market concern. euro-dollar off the lows that we hit. 1.2557 is where we stand at the moment. the dollar has done well across the board this week. is that a trend that gets maintained into june? >> and maybe through the whole of the summer because at the end of the day, the dollar is the safe haven. but it isn't really the preferred safe haven. you'd rather buy a currency with

a current account surplus. i think this is the big question. will investor tos carry on once the crisis is stabilized. and i think it could begin to stall the movement lower in euro dollar over the next spring our summer and may again disappoint the euro because over the last two years, euro-dollar has been more restill yant than expected. >> what's your view and why is the euro still at these levels? >> there's a huge down side risk related to greece. so the euro clearly has this weight of down side pressure. but there is also the potential

that we will see stabilization and politicians will be able to offset some of the worst case scenarios. assuming that can happen, i think there's still a lot of focus on the u.s. dollar. when we talk about euro-dollar for the last two years we've been talking almost exclusively about the euro, but the dollar is not a strong currency. it is a weakened currency. and there is still qe-3 on the table in the u.s., a lack of carry with the u.s. treasury bonds. and we see the dollar longs reverse quite quickly and that i think is something which a lot of the euro bears have not considered. >> that implies some of the currencies that take a beating start to maybe look at some gains. do you expect and maybe it has to do with measures out of the europe central bank or the u.s.,

do you expect the currencies to perform better over the next several weeks? >> i think that's a really interesting thing. if you look at the performance, they're beginning to outperform the euro. will this is interesting because all of these currencies historically have been risk off. so when there's a growth and fear and these currencies get sold off, but the fact is these currencies have not been sold off as aggressively how as they have been in the past. and that means potentially when investors are getting tired of the dollar because the fed could ease again. tired of the yen because the bank of japan could come in, tired of the swiss franc because they're trying to weaken p their currency, too. so what do yyou buy. so maybe there will be interest in the next couple of months. but we have to get the next reserve bank meeting out of the

way first. >> and it's the norwegian and swedish crown. the swiss have been pretty successful holding the floor on the swiss franc. will that continue and you have the threat of intervention from japan, as well. so if people wanted other safe haven trades, where do you go outside of the dollar? >> that's the problem, where do you go. and i think that's why the nokia and stokia will be the -- but i think it is the dollar over the spring and summer. but if we get stabilization, i think they'll move out of those pretty quickly and move into high yielding currencies. but the swiss, there's been more talk that the market will take on the swiss central bank and could break that, but i'm so reluctant to believe that.

yesterday we saw a spike higher in euro swiss and that suggests to me that that's the up side, not the down side. >> swiss against the euro is just a flat line. we have to go. thank you very much for that, jane. still to come, find out why making the right food choices could make your breakfast cheaper. we look ahead to the usda food price outlook out later this morning in the u.s. 

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four main market makers can post up to $100 million in losses from the botched ipo. citadel has reportedly lost some $30 million. that's something to what was purportedly lost at knight capital. morgan stanley told brokers it will adjust facebook trades so no worn wione will pay more than

limit orders. we're asking viewers to accepted through hair ideas for what a movie sequel will be called. one viewer suggested my big fat geek ipo. another says married zuckerberg, the sold short network. still trying to work through that one. send in your ideas. >> my favorite was dude where is my order. >> i did like that one. >> let's check in where we stand with oil prices. brent ticking higher. besides the weak economic data, we've lost about 15 bucks deconstruction in price on brent since the beginning of may. and we're down for the fourth straight week here. the longest losing streak since 2010 for oil prices.

but it is worth pointing out that discussions with iran have ended in stalemate. western countries insisting tehran must seek before sanctions can be eased. so stalemate before those talks resume again. there's a view developing with the $15 price reduction, we have priced in already. as far as gold concerned, slightly higher at 1559. platinum also slightly higher. patrick armstrong earlier talking about how he thought platinum could be the new gold. >> and these are your headlines this morning. greece's radical left holds on to its lead as governments and businesses begin preparing for a greek exit. reports circle that bankia is

preparing to ask the government for 15 million euros in aid. and china lodges a wto complaint against the u.s. that could affect over $7 billion worth of exports. there will be a round table discussion on the coal ver rule, focusing on which types of hedging and market making operations should be exempted. it would limit proprietary trading by government insured banks and of course it's received more attention since jpmorgan revealed what is at least a $2 billion trading loss earlier this month. >> and chesapeake energy is getting a big boost from investors.

they say chesapeake has problems and he didn't know if he would invest more. black rock has increased its stake several times recently raising its holdings by at least 4 million share. chesapeake closed up 3.2% thursday. >> lehman brothers may soon be your landlord. they've struck a deal to bite rest of the apartment giant archstone that it doesn't already own. they own 70,000 apartments in the u.s. 2007 was a different world. >> and so bizarre to see lehman's name back in the headlines. makes you needily think back to 2008. all right.

today's other top stories. the nikkei has closed out its longest weekly losing run for 20 years. it closed the week lower today for an eighth straight week and when you consider what that country has been through, that's pretty amazing. >> and they were the best performing indices for the year. minority shareholders of ali baba have given their approval to go public. >> comes on the heels about the death of the future of the public company. and here we have another major one. >> china mahas filed a complain against the u.s. saying tariffs imposed are currently considered to be unfairly subsidized. >> i can't wait for the reaction among certain members of congress for this. >> the tables have turned. a fascinating one to watch. >> and the head of german

central bank says the debate on euro bonds irritates him a bit. >> investors have put a certain degree of faith in the fact that euro bonds or some sort of measures would help the market. so so if he's out saying not so much, that might scare people a bit. >> and we'll see if the u.s. stocks can buck the trend of closing lower ahead of memorial day. ♪ i can do anything ♪ i can do anything today ♪ i can go anywhere ♪ i can go anywhere today ♪ la la la la la la la [ male announcer ] dow solutions help millions of people by helping to make gluten free bread that doesn't taste gluten free. together, the elements of science and the human element can solve anything.

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a crippling drought. and we knnoknow wheat prices ha been blamed from everything from social unrest to the arab spring. in the last six months, many soft commodities dropped significantly. the price of orange juice down, todd horowitz joining us from chicago. do you expect that wheat will continue to be the only commodity here where we see price hikes? >> wheat has been under tremendous pressure, so the big rally we just had was pretty much expected. we've been under duress for so long, eventually you get a dead cat bounce. so really what's happening is

wheat is going back to its normal plateau which wleet is normal wheat is normally higher priced. so i think we're back into that level and we had a big bounce. will it continue higher, no, we've probably reached the upper end of our new level. >> let's and you can about the trading day ahead. we have a shorter day in bond markets. we have the consumer confidence data out at 10:00. is that what you're going to focus on? >> i'm going to focus on that we're at the level, we're at the top end of our range again. we're at that 1320 to 1330 s&p. we're around 12,500 dow. i think we'll have a softer period. i think we're working our way lower in the overall markets and i think that history will

continue that we'll be a little softer here. >> we're always told about the sell in may. and that appears to have been a reasonably good strategy again this this year. how might heading into the he said of the month affect trading in the next couple of weeks? >> i think that we're working our way lower. you have to remember a couple things. first of all, we're up 100% from the bottom. we're still up 27% from the october for a low. we really haven't had a true natural correction in the market. so having a little bit of selloff here, we need to have a little bit of selling pressure to bring in some new money and to bring in buyers. we've got the big bond bubble going on here which i think is a problem. interest rates are way too low in this country because you're not allowing small business to get money to borrow because banks aren't loaning. they're just taking what they get and putting it into treasury notes. so we have issues that need to be solved here and i think that we'll have a little bit lower here until we can find a spot to

bring in new money to push the markets back up again. >> the demand story is not as if higher interest rates themselves would solve any problems when you have an economy that while it may look okay relative to the rest of the world, how cautious are you about the future of the u.s.? >> i think that we're in the best shape of anybody. i'm not a big fan of all the intervention and all the new regulation they're trying to bring in. and i'm certainly not a fachb qe. i want to bring back free market trading without total control by the fed. so take it out for a test drive. we're doing well. the stock market is doing well. i'd like to see interest rates higher. i think it's better for the overall economy if we can get enter rates a touch higher.

down here, i think we're in tremendous bubble territory and i think part of this recent move is part of the jpmorgan debacle which i don't think was a very big deal to begin with. >> is it getting a bigger deal? i don't think so. the jpmorgan trade was just a bad trade. bruno had made jpmorgan over $5 million. he lost $2 million. in the big scheme of trading, he made a bad trade. i don't see how it's a problem. >> an interesting point. and we talked about orange juice down and coffee up. what is your outlook for the softs from here? >> i think that the softs, as long as the dollar continues to be strong, the softs will continue to be on the weaker side of the market. i mean, they're all dollar

denominated so they'll be weak. we had our huge rush up in soybe soybeans, for example, after a 12 week rally. i think we'll get back into a natural order and this risk on run to the commodity market,s run to gold, run to oil, will be off and i think we'll start to get selling and we'll kind of hold these levels for quite a while now. >> alreadtodd, thanks. >> every time i talk about orange juice, i'm immediately back in trading places. >> exactly. >> great film. german my nanministry says it'st bad if it's delayed to the end of june. a lot of people saying if they just ran out of money that would be it. >> wishful thinking perhaps

delaying the next tranche to greece. >> we'll see what the greeks think about that. just ahead of the u.s. open, stocks just turned mix in the last half hour after solid gains yesterday. >> we're still in the green i believe this morning. take a look with the dow, s&p and nasdaq all poised to open just slightly higher there. this morning we're asking viewers to send through their ideas to the facebook movie sequel. one call it is my big fat geek ipo. another marred zuckerberg the sold short network. >> and the social net worth. and made thannial suggested the social network 2 hyperextended. >> keep them coming. we'll keep looking. >> and that's just about it for today edition. plenty more on european programming. >> richard branson always a news maker. he'll be talking about la would

he louisa bojesen. >> but up next, it's "squawk box."

a bit of good news for the bulls. dow closing higher yesterday. but here's a catch. it was only the fourth day of gains the entire month. and stocks are rising in europe. analysts are crediting bargain hunters. and we're approaching 6:00 eastern. u.s. equity futures are pointing to a higher opening on wall street. apparently -- i don't know. we're off monday. so today is friday. this a much better start to the day than i had earlier. it's the 25th. we're ready for the unofficial start to summer. "squawk box" begins right now.