you're watching "worldwide exchange". the headlines from around the globe, tapering talk comes do a head. policymakers will likely use today's meet to ing to keep the options open. stocks lower ahead of that. lucent shares rallied. the new ceo has unveiled a fresh cost cutting plan. and cnbc learning the vodaphone has upped its offer to around 85 euros a share. that's pit them squarely against liberty global. plus president obama arrives in berlin for talks with angela

merkel ahead of a highly anticipated speech at the brandenburg gate. welcome to today's program. plenty to get through as we camp down to what the fed may or may not say. we'll hear how the margin has reached its widest point in more than five years. we'll bring you a view on what stocks might rebound the fastest. global wealth has hit a record high with u.s. millionaires in particular. we'll break down the details of where else the world's money is flowing. and what are the risks to a u.s. recovery? we'll cross to washington to

hear what might derail the optimism in america's manufacturing base. and can barack obama come up with a quote to match his predecessors at the brandenburg gate in we'll get a preview from nbc's chuck todd. first, though, the fed wraps up -- i hope you like that. very jolly. the fed wraps up its two day meeting with a decision expected at 2:00 p.m. along with updated economic forecasts. that's followed by ben bernanke's news conference at 2:30 p.m.. fed watchers expect the central bank to announce they will still keep buying bonds at the pace of 85 billion a month, but likely keep their options open to scaling back or tapering the program this year if u.s. job market keeps improving. rates are expected to stay on hold until 2015. strategist at monument

securities joins us. mark, good to see you. we've had our nickers in a right twist, haven't we, around what the fed may or may not do. is bernanke going to be in reassuring mode do you think? >> i think he'll try and emphasize a couple of things. one, he'll emphasize that the outlook for the u.s. economy is still quite unclear and that would dovetail nicely with what are likely to be downward revisions to the fed's forecast for the economy. if you look at the march forecasts, they were still forecasting 2013 gdp at 2.5%. and while i don't think they will go down to the sort of level that the imf was forecasting at 1.9 last friday, down grading that forecast of gdp, downgrading their inflation forecasts to levels which they previously described as sub optimal should offer markets some reassurance that as much as bernanke will stress tapering probably is going to happen, it's a matter of when. and he won't pre-judge his

options. it's not something which means immediately that interest rates are going to rise. one of the things that markets seem to have to gotten, that when the fed outlined its qe exit plan in 2011, it did actually say the first thing it would do was not raise interest rates but stop rolling off or reinvesting maturing debt. >> the other thing of course is they won't be buying any fresh stuff even when they stop. and tapering doesn't mean they stop buying, just stop buying 85 billion a month. if they went from 85 to 75, who would notice, right? >> hardly anybody. >> exactly. but even if they do stop buying, they will still be sitting on a lot of stock. >> a huge amount of stock. >> so that's more important than -- i'm saying why is there such market nervousness about even beginning this process. >> i think one has to go back to may the 16th when both the bank

for international settlements, central bank of central banks and the imf, warned that an exit from qe was going to be extremely difficult. and that it could cause a lot of ruptures in financial markets. it will be messy, yes. that perhaps we're at the stage where you you look at the amount of qe that's being done and you you look at the return on that qe in terms of economic growth, above all in the u.s., in the uk, the jury is still out on japan. the return hasn't been fantastic and the argument that it would have been worse without it starts to fail when people wonder, well, if they do stop, and if they to actually start to exit qe, what sort of damage will it do to the financial markets. >> and what normalization might it do.

all right, mark, you're sticking around. a lot more with you. we'll go all the way through to the bank of england minutes, as well, due out in half an hour -- 25 minutes, i should say. and also full coverage of the fed's decision and bernanke's briefing from 20:00 cet or 2:00 p.m. eastern. we'll also bring you you analysis from adam posen, he'll join us in just over an hour's time. if you have any questions for adam or mark, e-mail us worldwide@cnbc.com. worldwi worldwide@cnbc.c worldwide@cnbc.com. meanwhile the south african counter deficit is out. it has narrowed to 5.8% of gdp. the rand has seen an awful lot of weakness fairly recently.

u.s. president barack obama is due to speak from the brandenburg gate later today following in the foot steps of several famous predecessor including john f. kennedy who was at the same spot nearly 50 years ago, and it's five years after president obama's pre-election address which was credited with giving him international star power. the president is now expected to receive a cooler reception in the german capital where he's meeting with the german chancellor angela merkel of the bank of the g-8 summit. joining us from berlin is senior transatlantic fellow at the german marshall fund. doctor, thanks very much indeed for joining us. how is the president now viewed in germany? >> good morning from berlin where it's already very hot at 10:00 a.m.. the president is viewed indeed somewhat more coolly than he was five years ago when he attracted

a crowd of 200,000 people here. but that was because he was still a candidate and germans thought he was going to be the world's president. thousand we've realized he's human, he's fallible, he's made mistakes. still a pretty good president particularly when he compare him with his immediate predecessor in german minds. >> so a cooler reception. what do you want to hear in this speech today, what should our expectations be about this address? >> well, a lot of that has already been leaked to the press so we've heard some of the points. but the overarching issue is that it's difficult these days to make dramatic glamorous speeches in front of public monuments in berlin because the wall's been gone for 20 years now. there is no longer is warsaw pact invasion threatening us at the borders. and we have problems to solve, but they're more complicated. they don't lend themselves to speeches. that said, i think he'll be

expected to address the issue of the nsa spying on german and other european citizen, he'll be expected to address arms control, the problem of syria and of course the free trade agreement on which many europeans are pinning their hopes of reyou newed growth and cooperation with the united states. >> how significant do you think that is going to be? how big a deal is it do you think? >> how big is the what? >> if we can get an eu/u.s. trade agreement. >> yes, i think that that is -- the outlook for that is quite good for the simple reason that this is something that's been tried for decades and has failed in the past. because decades ago the obstacles were larger than the interests pushing towards a resolution. now there is a sense both in europe and in america of diminished power vis-a-vis rising more authoritarian powers. and there is a sense that cooperation and trade will help

revive our economies and revive politics and legitimacy of our politics, in other words, give us more influence abroad together again, influence that we need to be able to solve global problems together. >> and what do you think the u.s. has to say about the european financial crisis and the german roles and responsibilities within that? clearly the u.s. would like greater reflationary on policies for you're preurope. >> it's not quite that simple. there is i think an american impatience with better man insistence on structural reforms and the sky rocketing youth unemployment rates are a great worry to all of us. they have already increased migration flows within europe and particularly into germany of young spaniards, irish and others who come here seeking work and even willing to learn

the language which is a lot to ask. but i think that at this point the americans realize that germany is trying very hard to resolve the issue, has in fact made considerable concessions on growth such as giving three of the main debtor countries with state debt in the eu more time to resolve their government debt issues. so there has been movement torts each other on both sides. >> okay. doctor, thanks very much indeed for joining us. a beautiful day in berlin outside the very significant brandenburg gate. thank you very much indeed for joining us. now, one of the best performers in japan today was softbank up more than 4%. inching ever closer to clinching its u.s. prize after dish network said it's a back donning the bid for sprint nextel. analyst wills expect softbank to continue growing from its m&a strategy. shares gained nearly 74% so far

this year. and you lucent shares have rallied this morning. they announced a new cost cutting plan and strategy shift. stefane has been looking at this. they have the new ceo. what has he been saying? >> yes, this morning magic possession to reach into profits since the company was created in 2006, it has been profitable only for one year. therefore, there was some urgency to change the company. the plan is called shift plan and it will reposition alcatel-lucent to ip networking and very high speed broadband including the cloud technologies which the new ceo says are the main priority of the telecom customers. 58% 85% of research will be focused on this and the company is

planning to sell at least 1 billion euros in assets over the next two years. and the new ceo also is planning to reduce the cost base of alcatel-lucent which is it too high compared with the other giants of the sector like erickson and nokia. $1 billion in additional cost savings, but for the time being, no indication on whether or not the company is planning some job cuts. in terms of guidance, planning a 15% increase of its revenue from the cornet work beingnetwork ac and 2.4 last year to 12.5% in 2015. market reaction is very good this morning.2.4 last year to 1. market reaction is very good this morning. >> all right, stefane, thanks for that. on "squawk box" tomorrow, we'll have an exclusive interview with

their ceo. so watch that tomorrow morning. other telecom stocks also in focus here, vodaphone raising it bid for the biggest cable operator. it's rallied a lot in the last previous sessions. this after liberty global swooped in with a counteroffer yesterday. vodaphone's offer has now been raised 85 euros a share. initially we were thinking of 80 to 82. both companies declining to comment on exactly where they were at. now, european markets meanwhile just an hour and 15 minutes in to the trading day, a little bit weaker on the ftse 100. down 0.4%. we were up 43 points yesterday. xetra dax down about a third. ibex off two thirds. dow jones industrial average has another triple digit gain yesterday. as far as bond markets are

concerned and ahead of the fed, keep your eyes on treasuries of course. ten year treasury yield 2.18%. gilt yields 2.1. we'll look at bank of england mind minutes. did he vote again for qe, was he outvoted again. was that the case. spanish yields just below 4.6% at the moment. on the currency markets, dollar-yen yesterday trading around the 95 level. still on it, so not much movement. aussie dollar has recovered a little bit, but still far away from the lows. euro-dollar just below 1.34 mark. so on a 24 hour basis, we haven't moved an awful lot. really been in wait and see mode ahead of the fed statement later today. so is that also the case in

asia? let's get the details out of singapore. >> in fact another mixed session as investors a wait the fed outcome. japan managed to outshine while the company's exports saw its biggest jump in three years. the nikkei gained 1.8%. the runner up was the aussie market gaining about 1% with australia miners lending support. but the china market under a bit of pressure today. multiple factors weighed on sentiment ahead of the pmi data. worries overly liquidity and concerns that the possible ipo assumes may lead to a blunt of share supply in the already sluggish market. and take a look at some of the individual movers in the region. japanese automakers and camera makers 2% today. softbank also hogging the spotlight. shares gained 4.2% after dish

network dropped the bid for sprint nextel. and we've been watching hsbc hong kong because hong kong extended the rate of manipulation probe to this bank. shares ended down by 0.4%. and the big m&a story out of china is the country's biggest dairy producer signed another takeover deal after acquires kkr to modern dairy last month. and offered $1.6 billion to buy vashill. lots of consolidation in the tainted dairy sector. shares jumped almost 7% to a five year high. and actually gained 3% today. elsewhere south korean technology shares pulled back after yesterday's strong rally. samsung electronics and some lg units they lost more than 1%. back to you. >> all right. thanks for that. catch you a little bit later.

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cyprus wants to renegotiate its bailout. reports suggest it may not be able to meet terms of the package and that may cause more damage than expected to its two biggest banks. as far as peripheral bond yields are concerned, spanish yields just under 4.6%. we did see rising t-bill costs of course from in may and april, as well. mark, i'm not surprised cyprus wants to renegotiate. they are facing a ten year depression. >> facing a ten year depression. i saw an interview with the foreign minister a number of weeks ago at one of the european

channels achd he was suting that as much as they have to adhere to the terms, what they felt very strongly about is that the time line for the targets they need to meet is too tight and exceptionally that's what the president would like to try to negotiate. and he's absolutely correct having effectively bankrupted -- having bankrupted like a bank, they dough need to keep bank of cyprus afloat. of course, six of one, half a dozen of the other. because given the life lines, liquidity life lines the bank of cyprus might actually see they take the foot off the pedal. so you're in a very -- >> we've been here so many times before. >> in prib, the problematic is the assumption that the economy

will only contract by 9% this year. >> and we all know something more likely to be 15% in which case they would miss their targets. >> i'm trying to think of any other, whether pore you chew gallon, greece, even the targets for spain. i can't think of any other country that has actually got anywhere near what their tar get should have been for growth or anything else. >> indeed. ireland probably has the closest. but there's been misses along the way. i think in the case of cyprus unfortunately you go back to the original problem, basically cover cyprus ireland and obviously iceland, that having a banking sector of that size basically is quite preposterous relative to its natural underlying trade position. it's not going to be easy.

we will worry about this a lot more because in essence a lot of the eurozone worries haven't gone away. it's just that markets are fatigued and currently are distracted by other things. >> we have seen yields rise a bit as spanish yields hit 4.46% last week. yields are higher now. have we seen the lows for peripheral yields? do you think? that's a bit of a call to make. >> i'm not saying we couldn't trade back down towards the lows, but the persuasiveness for the reach for yield is not quite as large. if you were looking -- you have a couple of choices.

even with the rallies this year, they're still massively under because they're basically good companies. or do you want to reach for spanish and italian yields above all. and take a gamble with greek yields. and the answer is you're probably better off doing your home work and looking at the equity market if you're looking to generate better returns than offered in a lot of other markets. >> meanwhile samoa airlines is expected to introduce extra large seating. some of the changes include rows that are 30 centimeters or nearly a foot wider. ceo says passengers will be able to travel comfortably without squeezing in. earlier this year, they introduced a pay as you weigh ticket policy. so is paying for your weigh fair? get in touch with us.

e-mail or tweet us. i think on that case they have 130 -- did we say 130 kilogram is where you start paying extra. that is we think nearly 20 stone if our math is correct. so that is two people. still to come on the show, uk banking standards has some harsh words for the industry, you including a recommendation to jail reckless bankers. plus the minutes of mervyn king's last monetary policy committee meeting at the bank of england when there was no change in qe, but how did the vote break down. we'll find out. i want to make things more secure.

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pitti . we're just about to get minutes out from the last meeting with mervyn king. they vote in order change and to keep rates at a record low. those minutes are now out. 6.3. king, fisher and miles voted to increase the asset purchases once again by 25 billion to 400 billion. risks remain substantial especially to uk banks. so normal monetary policy, but

most mpc members boosting outfit. they see in-make peaking around 3% in june. mark, marvin oig sticking to his guns. >> and i don't see why there was any particular reason why he should have changed his mind. >> the data got better. >> let's take everything into account. what king said everyone got excited because he sounded more slightly upbeat. here is one of thoefs situations where you have to be careful --

>> he was more upbeat. >> he was less pessimistic. more upbeat almost sounds like we're getting the liftoff out of this recession, which is what mr. carney has been talking about, getting the necessary you power in the economy to get something which has traction as opposed to mr. king saying it doesn't look so bleak. but he's still not talking about growth being particularly good. so he would stick to his guns on that front. i think what people underestimate at the moment is actually the fact that the fls scheme is seen by the majority as being a rather better way of conducting injections into the economy in principal because it works very similarly to the ecb's long term refinancing operations. this is within the qe debate

versus the ecb -- >> last report we had was that net borrowing was still down. >> yes, but he expected to contract a lot more quickly if they hadn't done it. >> so mr. carney comes in, he's only one vote out of eight. so unlikely to get anymore qe because i presume the rest of -- he's been replacing mervyn king on that vote. so in change in q eflt. so if i market expectations on that will be false. so they have already said they will expand the fls. so what will change for monetary policy? >> i think there will be a lot more transparency. probably the first thing he'll introduce is issue a statement after every meeting. at the moment we have a rather archaic system.

he could make a policy statement. i think a lot of people will be surprised he may well delegate. he has such a huge macro credential job, he may well delegate a lot of the policy forecasting to the chief economist. >>. u.s. president obama is currently being well cod comed german president. he's expected to sign the golden book and a military ceremony will follow. he's expected to meet with angela merkel. these are live pictures outside where that meeting is taking place. back to britain and the government's banking standard reported onned in the wake of the libor scandal.

apparently calling for jailing reckless bankers as well as claw back powers for bonuses and pensions. let's jail reckless bankers. who is defining what reckless is? >> it is a bit pie in the sky thinking on some of these suggestions. some people i spoke to said it's a load of political grand standing and a lot of it is total nonsense. but essentially what they're trying to do is say, look, following libor, following misselling, following money launder, we have to have a system in place where banks and bank executives are held to account for what they do. you do the crime, you do the time. and this is what they're looking at. so, yes -- >> if you've done a crime, if something is against the law, then prosecute, jail. if those laws are in place --

no? am i missing something here? >> they want to change the framework because in the uk, we haven't actually held up any of our bankers in the rbs or -- no one has seen any kind of jail time for this. and i think what they're trying to do is create a harsher regime where -- and the key phrase is personal accountability. possibly things like voiding contracts might seem somewhat sensible. this would help when fred goodwin didn't want to give back his pension. it would allow them to say if we have to step it in for a bailout, forget about your pensions and deferred bonuses. that's all over. and it makes people feel like those bankers will be more accountable. will it happen and is it operationally viable? i don't know.

because the risks of these like all regulation is that you try to protect the taxpayer to such a degree that you put in rules that essentially make banks unvile. because if people thought they were going to have their pensions and pay cut, they might just walk out of a bank the first sign of trouble. >> on the one hand -- i think grand standing might make accountability better. but here is a plan for home building which everyone says is reckless itself. >> yes, in the sense that it is trying to basically target the bottom of the market in a market where what -- >> if a banker comes out today and says i'm going to target subprime and get as many subprime loans as going as possible to artificially boost the market, those same politicians who have written this report would say that looks reckless. >> yes, they definitely should do. i think the penalties should be

there should be no reward for failure and penalties for failure should be set high. jailing people for recklessness is a completely different issue. but the penalties in permanents of not rewarding failure are essentially what needs to be put in place. >> and they want people like the chairman to be specifically responsible for the whistle blowing program. that's a dig at lloyd stevenson. it peoples specific people have particul particular -- the report gives a scathing report of the government's handling of rbs and says what it has done is not sufficient and the government should produce this feasibility report on good bank, bad bank. we'll hear from the chancellor tonight. >> you're going. >> i am indeeindeed. i'll be tweeting.

>> and i just thought it's got a whole lot harder to find a replacement for steven hester with this report coming out. n anybody reading that will think i don't want that job. we'll talk more about that. thank you very much. are you donning a black tie? >> not a black tie, but a formal outfit. >> good. all right. mark, than you very mu thank yo well. streets of sao paulo were once again filled with protesters. initially spurred by rising travel costs, the protests widened against what many considered ineptitude and corruption by the government. and market fueleded by fears over the removal of qe stimulus.

our next guest says the gap is stretched to the widest point in more than five years. senior portfolio manager at alliance bernstein joins us now. the question is which way do you you close the gap. is it by emerging equities going up or developed equities coming down? >> the lag is 20 percentage point which is is the widest gap since 1998. if you think back to what was happening in '98, you were in the middle of a slow train wreck between the asian financial crisis and russian. so i think this gap is excessive. >> so back to my first point, which way does it close? does that mean western equities are overvalued? >> western equities look fairly valued, but emerging equities look excessively discounted and therefore there is a lot more up side to emerging equities. >> but if we continue to see a strengthening of the dollar, if

there is a perception that actually it's about where we're proceed correcting relative growth and the dollar keeps rising in value, as well, isn't that going to put more investors off emerginging markets or will the hot miners come out already? >> if investors are following relative growth, clearly emerging markets trump growth. >> but it's what we thought, what we priced in. >> and there in lies the gap for this year. the united states and the japan, relative trend has been more favorable versus expectations. and in emerging market it is needs to be recognized that there has been some disappoint relative to expectations.s it i needs to be recognized that there has been some disappoint relative to expectations.is needs to be recognized that there has been some disappoint relative to expectations.s needs to be recognized that there has been some disappoint relative to expectations. needs to be recognized that there has been some disappoint relative to expectations. growth in excess of 10 percentage points is a solid

foundation for strong stock returns if you can look out over one or two years. >> if the dollar keeps strengthening, i had a guest yesterday said that would impact emerging market bonds more than it would stocks. i presume you're going to share that view, are you? >> if the dollar strengthens, that creates all the more demand from countries like the united states for exports from emerging markets which should all else equal be supportive for emerging markets. >> so which country where, which market specifically? >> the most beaten down markets are china and brazil. i'm not a country picker, but these are deep and broad markets that are rich for stock selection having underperformed as much as they have recently. >> what is going to be -- how is the taper discussion of the fed going to play into it? how will today's -- when we hear from the fed today, how is this going to play? >> emerging market equities and

bonds took another leg down starting in early may with the talk of tapering. and some of the excess liquidity that had made its way into emerging markets bonds reversing. and that fed through to an up winding some of the emerging market stock positions. so they will be watching the if he would clofed closely today. you've seen a gradual un winding of qe. but if there is some abrupt surprise, that would be negative. >> some of the stocks you have holdings on. explain what they mean for you. >> gazprom trades at a discount rarely seen at 2.5 times earnings despite the fact thats's one of the most profitable in the world. i'm not here to say it is a paragon of management excellence or corporate governance. however, that discount is excessive particularly given

european gas markets are confirming the end market and tremendous optionality to selling gas to china. and bank companbank, growth pot solid deposit ways. >> thanks very much for coming in, morgan. for more, be sure to logon to cnbc.com, check out our in-depth look at dwindling asset allocations. northern india, the death toll from early monsoon flooding has risen to 120 according to officials. disaster relief officials suggest 110 people killed from landslides, building collapseses and flash flooding. another ten or more dead in a neighboring area. they are trying to arrange food to get to villages cut off by

mudslides. in asia tomorrow, a board meeting for sony with three new directors set to be elected. growth fears will be in focus with the flash pmi for june. and we'll also get gdp figures out of new zealand. still to come, personal wealth has risen to record breaking levels according to a new report, but where are the mega rich investing their money? we'll find out when we come back. [ kitt ] you know what's impressive?

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vodaphone has upped its offer for around 85 euros a share. which would apparently match the other offer. thanks for joining us. kind of interesting this bid battle we've got now particularly after vodaphone early in the year reached agreement with deutsche telecom to get on its plan. and yet they still proceeded with this bid for kabel. why is it such an important asset for both?

>> for vodaphone, it's a way to break out of relying on deutsche telecom's network to offer broadband to itd customers and it's also a way to expand its tv consumer base. >> liberty global, what would they get? >> they would get control of the entire cable market in germany. >> so makes sense for them. a lot of people thought they were using the threat of purchasing as a way to get better terms. clearly that's not the case. >> as i say, it is a way for them to expand their tv offering beyond the few 100,000 that it currently has to basically 8.5 million households. >> for whom out of these two companies then, who do you think will go the extra mile, for whom is this the more important deal

or liberty coming in and spoiling? >> i think that liberty is more spoiling. i think that the most likely winner would be vodaphone just based on cartel office concerns and antitrust. >> what's the likely price this might go to or are we at the a fair value now? >> i think we're probably at a fair value, but i wouldn't be surprised if it ends up -- if vodaphone ends up paying perhaps even 90 per share. >> vodaphone clearly taken a dividend from verizon and reinvesting it in europe. they used to want to be as global player, now seem to be pulling their horns into become sort of a major european player. is that the right strategy for them? >> i would dispute that. they are still focusing very strongly on asia and africa. i think it's a particularity of the american market perhaps that's causing them to sell that

stake. >> do you think they will eventually sell the stake or keep it? >> i think it would definitely help with their expansion plans elsewhere in europe. >> okay. thanks very much indeed for joining us. now back in japan, export in may the fastest annual rate for more than two years. so what effect did the weakening yen have in more from tokyo. >> exports surged 10% on the year. first double digit rise in 12 months. sma usually a slow month for trade due to the golden week hole darks but the weekend helped push up the value of goods. the yen fell against the u.s. dollar by 23% from a year earlier in may. the exports was surprisingly strong led by electronic parts and raw materials for plastics. now for the bad news. the big jump in exports failed to outweigh the robust flow of imports from asia keeping japan's overall trade balance in

the red. in fact the nation's trade ballast month showed the third largest deficit ever for any month. streak extended to the 11th month while making exported goods competitive, the depreciation of the yen also pushed up import prices. this cost import bills to become the largest on record. with the suspension of nuclear power plants here, imports of crude oil and lng have also risen substantially. analysts say the key for the trade can deficit recovering from the second half of the fiscal year is the growth of the u.s. economy of course. back to you, ross. >> okay. thanks for that. the wealth of the world's richest individuals topped pre-crisis levels rising 10% to hit a record breaking $46.2 trillion. annual report shows u.s. millionaires leading global rankings as they capitalize on rising equities.

but asia pacific is hot on america's heels. joining us for more is george king at rbc. north america reclaiming, but high net worths, what does it mean for the asset management industry, how are you taking these numbers and deciding what you're going to do? >> a couple of key responses to it. the first is growing wealth is certainly good for the business. means there is more that needs to be done. if you look at the competeositi of the wealth, that's quite telling. almost a third of assets still in cash. so still clearly a lot of work to do. >> so more of the focus still on return of capital rather than return on capital? sg i think there is still a big wealth preservation versus growth bias. some areas they're much more growth oriented. for example, in the u.s. north america, you have a much higher weight into equities.

so it varies by region. >> and where we have capital preservation, is that more in asia? >> it skews. because if you look at asia overall, it seems to be the case. but that's dominated by japan. global wealth is concentrated in the u.s., japan and germany. japan eat big gorilla. so it skews because of the japanese positioning. i think all of us in capital markets are getting excited about the policy issues coming

out of japan and what it might mean for spurring the economy for hopefully equity growth, as well. >> this is an interesting point. because if investors there actually still want just capital preservation and they still want predominantly income over anything else, doesn't really matter what the government does because they're not -- they will -- if the demand is for income it won't go into -- >> they're clearly i trying to dissuade folks from looking at government bonds and trying to put them into total return assets than just income. >> what does it tell us about faith? >> we've been doing this for 17

years and this was a new thing we added is a survey of high net worth people and their attitudes. this was a bit of a surprise that some of the higher kefd levels were for things like wealth managers. on the low he said of the scale was managing markets. 30% in europe. a lot of damage still. >> and how much is trust dictated by performance -- does the trust go up just because i make more money? >> probably has more to do if you find someone or firm that you're confident with, that drive it is. >> good to see you. george king from rbc. samoa airlines is set to introduce extra large seating to indicator to overweight passengers who weigh over 130 kilos. earlier this year, they introduced a pay as you weigh ticket policy.

it's become the first airline to charge peoples based on their weight. so is paying for your weight fair? does it depend on where you sit that weight limit? get in touch with us, e-mail or tweet. @rosswestgate. we look forward to your answers on that. meanwhile, when we come back, we'll have analysis from adam posen. we've seen mervyn king still voting for more qe. and of course we'll look ahead to the fed. plus we'll continue to bring you coverage of president obama due to meet angela merkel. we went out and asked people a simple question: how old is the oldest person you've known? we gave people a sticker and had them show us. we learned a lot of us have known someone who's lived well into their 90s. and that's a great thing. but even though we're living longer, one thing that hasn't changed: the official retirement age.

♪ the question is how do you make sure you have the money you need to enjoy all of these years. ♪ [ whirring ] [ dog barks ] i want to treat more dogs. ♪ our business needs more cases. [ male announcer ] where do you want to take your business? i need help selling art. [ male announcer ] from broadband to web hosting to mobile apps, small business solutions from at&t have the security you need to get you there. call us. we can show you how at&t solutions can help you do what you do... even better. ♪

this is "worldwide exchange". here are the headlines from around the globe. fed watchers say policymakers will likely use today's meet to go keep their options open. stocks in europe have been trading lower ahead of that, but alcatel-lucent shares rally after a fresh 1 billion cost cutting plan unveiled. and vodaphone has upped its offer for kabel to around 85 euros a share. it is now in a bidding war. plus the u.s. president arrives in berlin for talks with angela merkel ahead of a highly

anticipated speech at the bra brandenburg gate. if you've just joined us in the united states, welcome to the start of your global trading day here. we had another triple digit move for the dow of course last night. this time another upward move, 138 points higher. right now we're forecast to open higher once again nasdaq is nearly 9 1/2 points above fair value and the s&p 500 at the moment is around 2 1/3 points above fair value. ftse 100, cnbc 300, first of all, it's flat. ftse 100 had a 43 point gain yesterday. down a little bit this morning if you take a look at where we

currently stand. and minutes out from the uk, 6-3 once again. three members including the outgoing governor mervyn king still voting once again to expand qe, as well. at the same time of course you can see here going to go to angela merkel before he takes hi brandenburg gate for his speech. a number of stocks to look at today in europe all centered around the big battle brewing for the german cable operator. vodaphone reportedly raising its bid after u.s. will i liberty g

swooped in. they are initially at a range of 80 to 82. neither company is confirming or commenting when contacted. >> still in wait and see moment for the fed, of course. ahead of that, treasury yields fairly contained right now. 2.18%. ten year gilt yields, 2.11. have come down a little bit post the mpc meeting. as far as concern city markets, dollar-yen trading over 95. right on that mark at the moment. aussie dollar down slightly from selling yesterday. so 24 hour basis, pretty much unchanged. reflects the caution ahead of the fed. what about the asian trading today? we have an update from singapore. another mixed kday for asia bourses.

the nikkei 225 up 1.8% while the country's exports saw its biggest jump in three years thanks to a weak yen. but china markets under a bit of pressure today for multiple reasons. liquidity concerns and also fears that the possible ipo resurm shon starting late july may lead to a blunt of share supply in the already sluggish market. and plenty of m&a news driving stocks today. dairy jumped to its five year high gaining almost 7% to buy yashili. and over in japan, softbank climbed more than 4% today. the japanese mobile carrier looked set to clinch its u.s. price after dish network said it's abandoning its bid for

sprint nextel. and softbank shares have gained 74% year to date. and down under coal miner white haven shares jumped after the tycoon off loaded his stake in the company to repay his debt. and meanwhile echo entertainment also ended higher by about 2% following news that malaysia gaming giant has raised stake in the company. and that's all from me. back to you. >> thank you. yep, the fed is wrapping up its two day meeting today. the decision expected at 2:00 p.m. eastern. along with updated economic forecasts. that will be followed by ben bernanke's news conference at 2:30. fed watchers expect the central bank to announce they will keep buying at the same pace but keep their options open to tapering the program back if the u.s. job market keeps improving.

rates are expected to stay on hold until 2015. joining us for more is adam posen. good too s see you. welcome to london in june. >> they have themselves in a twist because they haven't figured out how to put their pants on properly. >> and yet i doubt there is anybody -- we don't know what the bank will say. >> i think there is very little worry that he'll say anything other than i'm not tapering yet, we are leaning towards tapering because the news is good, but it's data dependent. so in other words we're back to the way it used to be with central bank policy. not pre-committing. the committee will look at the data and make up its mind.

>> which then means the market will digest that and get in a twist again. >> like you, whether it was the reaction to the japanese results a couple weeks ago, the ongoing agonizing over what the fed will do, this is what happens when you start having a normalization. there is two way risk in what the central bank will do because there is genuine two way risk in the economy because it's not clear everything is bad or everything is good. things are okay. so we're just getting back to normal life here. and the idea that the markets are going so crazy when faced with normal life is disturbing, but not something the fed should react to. >> on the other hand you see we've got i suppose also predicated on the point that as far as equities are concerned, we're up 15% for the year, up off the fresh record highs we hit at the end of may. how much concern is there in

bond yields? >> the big concern is that the asset classes won't move as one the way they had been the last few years. so i could really see a move in equity -- emerging market bond yields and it will vary. without a huge move up in bond yields. and then you have to distinguish between emerging markets. >> what global liquidity has do done, is what we're seeing is the beginning of an unwind of a global hump for yield, is that -- >> you yeah, i think it's less

about the hunt than the global. you'll have to make more calls about this region versus that region, this company versus that country. >> you mentioned political risk, as well, as we look at pictures of the president meeting angela merkel for talks today. where do you you perceive the biggest political risk? >> i think even without events of the last week, i think i was already saying a couple months ago that brazil, turkey, russia, were the places. in other words, basically tbric minus china. fundamentals certainly not as good relative to the u.s. as they once were. >> and i suppose expectations of the fundamentals, relative expectations that have driven

assets. let's get back to what our expectations now should be for the u.s. economy. >> i and dave stockton are on the optimistic side of consensus. we think that u.s. real growth will be 2.53%, maybe even a little more in 2013. and more than that, close to 3.5 in 2014. again, not hugely different from consensus. i personally worry a bit less than the sequester's direct impact. it's not a great idea, but close enough for government work and the numbers are not that big. the private sector tail winds from housing are very big and should be. between the healing of the balance sheets and what the fed has done with agencies. so i'm pretty bullish on the u.s. economy. you'll see also the rise in dollar probably over the coming months. because of the unwinding of the trades we were talking about, that's already under way. no reason for that to stop.

does that paekt faffect fed pol. does it affect equities, possibly. i think a bigger reaction will be in equities to the dollar than a fixed income. >> all right. don't forget of course as we count down to the news conference of ben bernanke, talk also turning his secretasuccess. yesterday the president praised him although he kept mum when name the successor. >> i think janet yellen is the most likely and i think that reflects two things in particular. one, she has extraordinary credentials. she was a governor on the board. she was chairman of the council of economic advisers. president of the san francisco

fed. >> janet yellen as larry just said is enormously qualified. people tend to sometimes think she's more dovish than she is. she was very tough on the federal reserve board in the 90s. she's been very strong as a leader at the fmoc. i'm not just trying to be nice. i can rattle off six to eight names of people who are good. larry summer, charlie evans and don cone okohn, ferguson, peopl shouldn't under estimate his chances. we shouldn't obsess so much in the greenspan way about there is only one person that can do the

job. there may not be more than a dozen, but we luckily have that dozen. and ben bernanke himself said i don't personally have to be here for the exit. so i think it would be great if it was janet yellen, but if there were any of those six names, i think we'd be fine. >> there would be something wrong if we can't find more than one person. >> exactly. >> and that was larry meyer we were listening to. okay. adam, stick around. plenty more to come from you. and stay tuned, as well, cnbc has full coverage of the fed's decision and bernanke's briefing from 20:00 cet, 2:00 p.m. eastern. when we come back, we'll recap today's headlines. we went out and asked people a simple question: how old is the oldest person you've known? we gave people a sticker and had them show us. we learned a lot of us have known someone who's lived well into their 90s. and that's a great thing.

but even though we're living longer, one thing that hasn't changed: the official retirement age. ♪ the question is how do you make sure you have the money you need to enjoy all of these years. ♪

recap of the headlines, the fed tipped to keep its options open. and alcatel-lucent unveils a cost cutting plan sending stocks higher. and vodaphone has raised its bid to around 85 euros a share. one other story we're following, samoa airlines set to

introduce extra large seating to indicator to overweight passengers. those who weigh over 286 pounds, which is a lot of pounds. some of the changes in samoa's xl class include extended rows by 30 centimeters or nearly a foot wider. ceo says passengers will be able to travel comfort bring without being squeezed or squeezing in. earlier this year, samoa introduced a pay as you weigh ticket policy becoming the first airline to charge passengers based on their weight. so we've asked is paying for your weight fair depending on where that weight is set? mike tweeted airlines are dealing with a reality. keep your responses coming in. weight of course is a safer i issue on planes, as well. still to come, the bank of england split once again in terms of voting for more qe at

mervyn king's final mpc meeting. adam posem echlposen is here t his views of what happens next. as we do that we'll also leave you with a look at where equities are weighted. u.s. futures are pointing to an uptick it at the start. [ male announcer ] we've been conditioned to accept less and less in the name of style and sophistication. but to us, less isn't more.

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this was governor king's final rate meeting and he called for another 25 billion pounds of qe. he prepares to deliver his last speech beforehandi handing over reins. mark posen is still with us. we talked about mr. osbourne earlier. what do you think mr. king might say? >> the dividing of rbs into a good bank and a bad bank. so i think as parting shots go, that would be a pretty hefty one already. >> and he's continued to be outvoted. he's stuck to his guns.

are those still members right for more qe? >> the data has picked up a bit. the danger is a trap of low expectations. basically growth will be mildly positive, something like 0.9 for the year. and the majority on the committee will say we don't really have to do anything. can't grow that much. inflation is a risk. and you end up doing nothing. >> funding for lending is a better way to go? >> poichts of funding for lend to go make sense was about addressing credit supply. the problem is it always goes through the same messed up

banking spm system. that was the debate we had six months a year ago within the committee was do do you it through the current banks or around the system. and the majority went through the current banks. you got mediocre results. >> what is your assessment of his governor ship? >> i think he's been right about qe. we were very much on the same side most of my time on the committee. i think his vision in creating inflation targeting regime and shepherding it through has proven right. on the financial regulatory side, he has a series of misjudgments. i don't think they were -- they were not criminal by any means, but they were -- the decision to kick supervision out of the

bank, it's not a great record. consistent with that of greenspan and the other leaders of that period. they were all convinced and reinforced each other's beliefs the financial system was largely sf regul self regulated and you could play tough hardball with it without really intervening, which were false assumptions. >> so in terms of monetary policy, he got gets a tick, but terms of regulation, you think he failed? >> failed is a little strong. he certainly didn't do great. but again, i want to emphasize he gets credit for the monetary policy side, but he was part of a broader movement it that he led but it wasn't just him that pushled t pushed the agenda. >> central bankers were economists first. >> i think there was something of a bias that the nitty-gritty

of financial stability were things that were secondary to monetary policy. >> the job is now vastly different because we've now got the macro credential wing that's been set up. >> carney is good on a number of levels, but the strongest argument you have is experience managing a central bank that has more responsibilities, his experience in general as a manager trying to make this thing work. there's still a huge intellectual gap for all of us to figure out what would be a good macro dren shal pocredenti. we're watching trying to get lessons because we don't know yet what works. >> outside of the prudential regulation, what does carney have to come? is he going to get lucky, is he just going to inherit a recovery in the uk? >> no, i think he'll inherit a

weak recovery. better than stagnation, but not much. >> and what are his tools? >> the tools on the monetary side, you're right, that's the big question. do you do more qe, credit easing, forward guidance. i think coming up for the august inflation report, there will be some sort of foreign divide answer. i don't think it will make that much difference. >> any sense that carney would be in favor of what you're talking about, circumventing the banking system to get credit? >> i think it will be on the table, but i don't think in this quarter. i think it's something that you need to get more members of the committee on board will and i think that will take some time. >> all right. thank you. you'll be tweeting tonight where the chancellor and mervyn king will be speaking.

so follow her. please that had you managed to get your name. doesn't always happen. still to come on the show, what are the risks to a u.s. recovery? after the break, we'll be in washington to hear what might derail optimism in america's manufacturing base. and a reminder of where the futures are trading. we are called higher at the moment by 2 1/2 points in the s&p and dow 26 points.

tapering talk comes to a head. fed watchers say policymakers will likely use today's meeting to keep their options open. stocks in europe have been trading lower ahead of that, but alcatel-lucent shares are rallying after the new ceo unveil as fresh 1 billion euro cost cutting plan. and vodaphone has upped its offer to around 85 euro as share pitting it jersquare jerry agaiy global. and president obama is meeting with angela merkel ahead of a highly anticipated speech at the brandenburg gate.

dow yesterday up 138 points. today also at the moment above fair value on the futures. the s&p is up around three points above fair value, 12 points yesterday. the nasdaq currently up about 11 points above fair value and the dow at the moment some 30 points above fair value. those future just moving a little bit higher. european markets on the other hand have been softer, but we are at the best levels of the day. ftse fairly flat. xetra dax up two thirds. cac 40 up two tenth. so turning around a little bit. yep, the fed wraps up its two day meeting today with a decision due at 2:00 p.m. eastern. along with updated economic

forecasts. the central bank is expected to hold rates and keep buying bonds at the pace of $85 billion a month, but likely to keep their options open to scale back the program this year. if u.s. job market keeps improving. central bank watchers have been weighing in on an expected time line for a qe exit. speaking on cn last night, robert heller former federal reserve governor gave his take. >> i think the survey probably has it right. december or a bit earlier the economy is doing reasonably well. not swimmingly. but muddling through at 2% growth. so the fed really has leeway to start tapering off. >> adam posen is still with us. is it f. it if it is that time line, how will it trade? >> we were discussing about the markets as you said having their

nickers in a twist or as i said unable to having to deal with assess credit to weigh risks. the fed will have to not get rushed into this just out of fear hat markets will be volatile. and i think no earlier than september i'm very confident, i think december is possible. but this is going to be more data dependent than people are thinking. and there is also the possibility they could decide to taper not on the treasury side because they will say we're worried about housing overheating versus the whole economy. and people should be cognizant of that risk. >> and then what that would mean. reduce by 10 billion -- >> i think it actually means a lot. on the one hand, it says to all those people who says you're worried about the bubbles, the fed is trying to do some form of policy so that's good.

the impact on real economy is much bigger than an equal amount of reduced treasury purchases. that will show up in home builders, durable goods, housing prices. so i actually think if they go that route from a press department point of view, it's a good idea before from a policy point of view, not a great idea. >> adam, thanks very much indeed. enjoy the rest of your stay here in the uk. as a reminder, cnbc has coverage of the fed decision at 2:00 p.m. eastern. no one is really involved in global markets going to miss that. imf meanwhile has been releasing a statement following its mission in spain. they say there is a strong progress helping stabilize the spanish economy. but of course we've heard lots of predictions before about things stabilizing in spain which haven't quite worked out. elsewhere the u.s. industrial sector is running like a well

oiled machine, claiming 85% of the sector is pretty optimistic about growth in 2013, but there is still concern about traditional worries like material pricing, the federal deficit and government regulation. they still drop up as the biggest threats to recovery. joining from us washington, leader of industrial products practice. karen, thanks very much for joining us. >> good more than. >> we just had a discussion about fed policy will be data dependent. what is your base case right now for u.s. manufacturing over the course of the year? >> well, we just recently released our survey. we interviewed and did a survey on 1,000 manufacturing companies in the united states. middle market manufacturing companies. and in general, about 85% of them are optimistic about their businesses. however, when they look at federal policy, government policy, they're very concerned.

so in a sense, they're optimistic about things they can control, their own business, but things that are out of their control like the u.s. government, the world economy, they're much more concerned. most are looking at a growth rate in the middle single digits. so about a 6% to 7% growth rate. they're also looking to hire employees. over 60% of them are looking to expand their workforce. but the thing that is very concerning to them and that's on their mind is things related to government regulation, the affordable health care act, there is a lot of uncertainty on how that will impact their business. also we just have some new taxes that got implemented this year. medicare taxes, there has been an increase in the personal income tax. and also the federal deficit is very much weighing on their minds. so while they're optimistic about what's happening in their

business, they're very concerned about these things they cannot control. >> those concern which is they say you can't control impacting their willingness to invest, impacting having a material impact and what they do? >> yes, definitely so. we've been doing the survey for several years and we know some of the best practices of thriving businesses. and thriving businesses reinvest back into their companies. and they invest in technology, they invest in their people, they invest in training. they invest in continue it us improvement. and so for example this year there was a personal income tax increase. and of middle market manufacturer, probably about 75% of them are organized as a pass through entity. what that means in the states is that they get taxed at the individual level. so they had about a 5% bump in their income tax rate and so because of that, they have 5% less of cash flow to reinvest in

their businesses. and they're paying taxes instead of investing in technology, investing in people. and i think that is really what's concerning to them in terms of how they see the way forward. >> and this survey, i don't know how many of the firms you listed as opposed to private companies. the reason i ask that is because public companies seem to have a lot of pressure from investors to return cash to shareholders as opposed to in-stres. i'm interested in what your split is. >> what's it actually unique about this data is about 80% of the respondents are privately held companies. so one of the things we've been asking for several years is what's the current state of your business. holding its own, thriving and growing or in decline.

and last year about 39% of the respondents said their businesses were thriving and growing. that went down to 32% this year. so there is some caution out there. and what's interesting is we're actually here in washington, d.c. today to share the results with various people on the hill. people are always interested in this because this really is the pulse of the middle market. it's the pulse of middle market companies privately head companies in the u.s.. and it's a big part of our economy. it's about a third of our gross domestic product. >> it's important. i hope those discussions go well. karen, have a good day there in washington, d.c.. thanks very much for joining us. still to come, the battle lines are drawn. the latest shot trying to toll dell's plans to at that time pc maker private. details of the proposal and dell's response next.

plus a preview of president obama's highly anticipated speech in berlin. these are the latest pictures of where he and angela merkel will give a press conference in less than an hour.

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today. following in the foot steps of presidents including john f. kennedy. the speech also comes five years after obama's pre-election address at the nearby victory column credited with giving him international star power. chuck todd is reporting from berlin. and joins us for more. >> reporter: the president has a busy 24 hours here in berlin. it begins with some working meetings with the german chancellor, there will be a joint press conference, first time actually that u.s. reporters have had a chance to question the president on this trip. obviously a lot of things have happened in the last 48 hours, whether it was the showdown with russia on what to do about syria, the news about negotiating with the taliban in afghanistan, so perhaps some things that we'll hear from the president that we haven't heard before. but the symbolic event and highlight of the trip will be the speech the president gives it at the brandenburg gate. a lot of historical significance

there, cold war reminders. you'll hear the president talk about previous famous presidential speeches that have taken place in berlin. this is marking the 50th anniversary of jfk's ich bin ein berliner speech, but also 26 years ago that ronald reagan gave his tear down the wall speech here. but the president won't just be talking symbolically, he'll be making a proposal to reducing nuclear stockpiles both in the united states and russia. the president will announce that he wants to start new negotiations with russia to try to reduce arms even further. of course there already was a new s.t.a.r.t. treaty signed between the united states and russia approximately two years ago. so those talks haven't begun, but the president will pledge to do that. after that speech, he will have a late dinner here and then back on the plane and back at the

white house thursday morning. traveling with the president, chuck todd, nbc news, berlin. and a recap of the headlines. fed keeping its options open on the case of the bond buying program at its meeting later today. alcatel-lucent reveal as cost cutting plan that sent stocks higher. and sources have told cnbc that vodaphone has raised its bid for cable deutsche land to around 85 euro as share matching liberty global. other stories we're for thing, sec chairas share matching libe global. other stories we're for thing, sec chairs share matching liber global. other stories we're for thing, sec chair share matching libert global. other stories we're for thing, sec chaira share matching liber global. other stories we're for thing, sec chair says they plan to require companies and individuals to admit wrongdoings as part of settlements. a major shift. critics including some judges have complained that practice doesn't deter repeat violations. as we've said, cnbc has learned

vodaphone has upped its offer. the new offer is for around 85 euros per share. and according to the ft, also instructing a rifle bid based on assets instead of cash at about that level. alcatel-lucent shares have rallied this morning. they announceded a new cost cutting strategy. the ceo aiming to cut 1 billion euros more by 2015. and the m&a wheel keeps spinning like a top as dish network stopped chasing sprint. kayla tausche has more details. what's the latest stage of this story? >> well, ross, it seems to change every single day. and as of this morning, the dell board special committee says it will review carl icahn's latest proposal to counter the company's $24 billion buyout

effort by michael dell and silver lake partners. icahn reached his stake by nearly $1 billion in stock from dissident shareholder southeastern as is the management or about half the company's holdings. that gives him an 8% stake making him dell's second largest shareholder. icahn is propping they would buy back up to $16 billion in stock if they join his campaign to stop the buyout. this is at least the third proposal icahn has floated as and the alternative to that deal. dell's special committee says the latest offer is a, quote, further deviation from icahn's original bid to bite a majority stake. the panel says he needs to flush out more details. icahn says he continues to talk to lenders for up to $5.2 billion in financing. the fight is far from over. shareholders who want to back the effort would first have to vote against the buy outoffer

and then hope the slate of directors will pursue that proposal. dell shares in germany this morning have been a little volatile. they're thousanow down 1%. and we'll be watching them. dish network is dropping its pursuit of sprint. clearing the way for softbank to buy the virless provider. dish says it will focus its efforts on its offer for clearwire. it's currently locked in a battle with sprint which is trying to buy the rest of the company it doesn't already own. that's clearwire. dish says it wasn't practical to submit a revised offer for sprint by tuesday's deadline even though it still sees the strategic value of a merger. additi dish, sprint, softbank are up. clearwire down just slightly. ross, back to you. >> good stuff. great to see you. coming up, fedex set to report fiscal fourth quarter

results in around 90 minutes. how has the package delivery giant adjusted to the slump in its express service as customers switch to cheaper shipping options? i want to make things more secure. [ whirring ] [ dog barks ] i want to treat more dogs. ♪ our business needs more cases. [ male announcer ] where do you want to take your business? i need help selling art. [ male announcer ] from broadband to web hosting

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spend less time on the ground and more time in the air. suddenly, faraway places don't seem so...far away. ♪ fedex forecast to earn $1.96 a share. revenue of $11.5 billion. joining us from stafford, connecticut is senior analyst at oppenheimer. scott, good to see you. what is the key for you today in these numbers? >> good morning. yeah, we're keying on the fiscal

14 outlook. we anticipate $7.22. there is a chance it could be a little lower, a little higher. expectations have come down recently. so it will be interesting to see how the stock reacts this morning to the guidance that they provide. but that's really where the investors will be focused this morning. >> what do you think they will say about global growth? >> that's one of the drivers that's brought down the street consensus for fiscal '14. just a little bit of uncertainty in the global market. a big driver obviously for fedex. so the tentativeness around there is what's brought the numbers down and what will make the guidance number the big driver. >> as we get into the growth patterns, how much is that -- i suppose what i want to ask is what is the stock priced for in terms of that outlook? how much of a swing factor will

it be? >> i think the stock again with fiscal '14 being the key, the guidance there, i think if you see a guidance of $7 at the low he said and high end of the range 40, 50 cents higher, i think that would do good things for the stock. you could see the low end having the six handle in front of it. and then it makes it a little more uncertain that would be below the consensus estimate which is close to ours at 7.22. so that would be interesting. but i think people are expecting the worst because of global trends as you mentioned. and so i think it will be a relief almost once the number's out if it's not too bad. >> and meanwhile what do you expect to hear on both capacity and sort of proficiency improvements? >> sure. so one of the big initiatives at the company has been in its express unit to improve

profitability by $1.65 billion by fiscal '16. and one of the initial initiatives that they're pursuing there is a voluntary buyout. and we expect to get an update today. it they have been offering that over the past few months and we'll probably get a feel today for what -- how many accepted and perhaps what this could mean toward their profitability goal. and then the other major issue that really came to a head last quarter is their transpacific international routes u.s. to asia particularly. those are major keys that investors will be looking at following up on the guidance. >> all right. scott, thanks for that. have a goody in stamford.

how should investors be positioned amid the taper talk? here is a reminder of some of the thoughts we've had already today on cnbc. >> try to calm markets a little bit and try to disconnect the question about the tapering and when the first rate hike might come. that might take away some of the uncertainty. i also think that he would try to repeat tapering and the speed of it it will be data dependent. >> fmoc won't give us the degree of clarity the market is looking for. i think what we may get is some adjustment for the fed's own forecast for gdp this year and next year both of which we think are too high and a fresh look at their unemployment forecast. and that we think should provide

some uplift. >> their inflation forecasts for levels which they have previously described as sub optimal should offer markets some reassurance that as much as bernanke will stress tapering probably is going to happen, it's a matter of when and he won't pre-judge his options. it's not something which means immediately the interest rates will rise. >> that's the thoughts on the fed. ahead of that, futures right now suggesting u.s. markets will open a little bit higher. a long way to go of course. right now the dow around about 25 points above fair value. the s&p at the moment about 3 1/2 points above fair value. earlier we asked you is paying for your weight fair. if airlines charged the heavy weight, does that mean i should get a discount for being lighter. a fair point. that's it for "worldwide

exchange". "squawk box" coming up next. whatever happens, we hope you have a profitable day.

good morning. it's decision day at the fed and the financial markets are on edge as we wait to hear from chairman bernanke. it's wednesday, june 19th, 2013. is it really? "squawk box" begins right now. good morning. happy wednesday. and welcome to "squawk box". i'm becky quick along with joe kernen and andrew ross sorkin. the central bank that is the big story today, the fed widely expected to keep its key interest rate unchanged today. but the real question will be about that bond buying program

which we affectionately know and love as qe infinity. economists expect the fed to keep buying bonds at $85 billion a month. but pay attention to signs that policymakers may scale back the program later this year. that's the big question in the marketplace at this point. will the taper begin. the fmoc will announce its decision at 2:00 p.m. eastern time. with y ben bernanke will hold a news conference at 2:30 p.m.. we'll talk expectations with two economists in just a few minutes. but a lot of questions swirling, including ben bernanke's term which president obama brought into a huge focus yesterday with his interview with charlie rose. also later on we have marty feldstein and randy kroszner. and we will get the scoop from them, as well. the markets ahead of the fed decision, futures this morning, on