last week we saw a whopper week

for the stock 600. up by 6.5%. booer' currently off by 0.3%. we're focusing on many corp rates. the biggest sector movements. wpp basic resources down by half of 1%. that is curious given that australia many of the mining and commodity stocks didn't really benefit from that chinese rate cut. autos doing better. peugeot being spurred by the numbers. here are the european markets one by one. ftse 100 off and the cac 40 and no trade for the smi. curious to see what the german dax is doing.

earnings, phillips was out with numbers early this morning. the aex is down by .33%. phillips is doing this. down by 2.5%. this is after piilips had cost cutting. helping it beat expectations despite that, stock is down. the stock is improving but head winds will remain. >> it will take time before the emerging markets are back at historical growth rates. we see the current volatility and that is something that is difficult to deal with, nevertheless, i'm pleased with the 22% results improvement despite all that currency volatility. >> but the dutch company has said the $3.3 billion of its lumen leds has been thrown into

doubt. the rest is still on track to be sold in an ipo next year. karen? >> thank you. reaching the same conclusion this morning. the selling of the share prices down to execution hiccup rallying the share of that lighting business. this is a company that's been in transition. you've been looking at the ability of the company to spin out lighting business away from health care and consumer products. there's a real historical story about lighting. it started as a father and son business of light bulbs. suddenly u.s. regulators have come out and put a red flag on this. they've expressed certain unforeseen concerns about the deal and hasn't actually expressed what the concerns are. lots of concerns on the

conference call. phillips pretty adamant saying it's not going to delay the exit from lighting. this has been a 12 to 18 month strategy. will this be a much longer transition? pih philips says it's trying to stay on track. the numbers looked okay. third quarter income 324 million euros. keep in mind, the numbers last year which prompted this transition in the business was a loss of 103 million our rows same period last year. much, much better time coming to the actual figures being produced today. other missing items in the numbers closed. factory in cleveland higher. this caused a bit of red ink in the numbers. in terms of projections, got into the modest sales growth but so far it's been a wait and see

approach. the stock price down 1.6%. >> they always say about this, people are looking at the lum my nens sale given what you say. the ongoing business has shown a bit of reform. margins have improved. asking about the operating profits which have improved as well. i'm thinking the market is looking at a division which has $3.3 billion sales. it's not the ongoing business. i don't want to ring the bell for the bullishness of philips if we're looking at those two factors alone. it's relatively small amount of money compared to the broader size business. the other is the ongoing operations globally which have improved dramatically. >> what type of beast is it?

siemens, snyder, there's no like for like. to me it needs to be a compelling business. >> very, very difficult. i think that the problem, you have to understand what is the business that you're really buying. the second thing is what do multiples do particularly when you think of ipo in a dfivision. you don't have tangible evidence of what is exactly going to happen, therefore, you're prone to get very excited or very disappointed very, very quickly. it's a problem. >> let's bring richard kelly in here. head of global tri-cities securities. what kind of companies are you going to find. there is, again, something talking about the years. they're breaking them down again. i think frans van houton has stripped phillips of its

associations. lighting is going. how do you feel about companies at the moment when you're looking at them in terms of whether they are conglomerates or whether they are focused companies or is that not an issue? >> the biggest issue is you're going to massive shops when it comes to the impact of the dollar, the collapse of energy. you're trying to feed that through. so many companies more of the business was expanding out of the u.s., expanding out of developed markets. now you're seeing all of the structure come through. this is the time when you're trying to squeeze the profits and consolidate into the world you thought you were getting into one world, now we're going into a different direction. >> fair enough. let's move on. plenty more markets opening. karen? >> let's get back to the markets because we're off the two-month highs we saw on friday. on the back of the pboc and the dovish announcement by mario draghi.

the ftse 100 losing 0.4%. let's get back to earnings. wpp, the world's largest advertising firm reporting sales of 2.9 billion pounds for the third quarter. the business received a boost from strong trading in north america and reconfirmed its guidance for 2015. they're telling us they haven't changed their view on the chinese economy despite slowdown fears. take a look. >> china, it was tough in the third quarter. looking for an improved fourth quarter. my long-term faith, i remain an unabashed bull on china as i do for the other great markets. >> quick look at the share price of standard charter, too. there we go, wpp is back on. down by 1.5%. so i mentioned standard chartered. standard chartered plans to exit the convertible bonds business. the move comes a year after they

unveiled their international cash equities division. in an effort to use capital, quote, more efficiently. the strategy effects will be used in hong kong according to a statement released by standard charter. the stock is down 0.4%. want to see how credit suisse is doing. 24.02. off by 0.8%. the company has announced the purchase price for the private placement. they raise fresh capitol. they will issue 58 million shares at 22.75 swiss franks each. this means it will raise just over $1.3 billion. remember, that's really just one part of the capital raising exercise, the bigger chucnk, 4., that will come in the rates issue. deutsche bank has made the headlines over the week end. off by 1.6%. u.s. regulators raising their

investigation according to the "new york times." the initial money laundering probe will be widened out to look at possible international sanctions violations. they say that they're currently investigating the trades in question and has taken disciplinary measures with regards to certain individuals. more bad news coming out for dutch bank. and aberdeen asset management is now trading. up by 4.4%. the company has denied that it has put itself up for sale. according to "the financial times" the company is on the lookout for a potential buy jer. the firm's ceo martin gilbert has made several approaches to rival firms, however, aberdeen asset management has issued a statement to cnb saying, quote, in his 32 years running aberdeen, martin gilbert has never approached anyone formally or informally about big the business. but what the market is doing this morning, they're speculating on a buyout.

>> yeah. there's a lot of pressure in that sector. let's get back to rich kelly. rich, do you think the asset management industry is an interesting bet in terms of valuations at the moment or do you think it's living on borrowed time? >> that's certainly an area where you can talk about consolidation. you can see what used to be a great global macro environment. you have to look at ways to consolidate the returns and find where's the excess return in the world? >> there isn't any excess return, is there? >> there must be somewhere. it's always about innovating, always about finding it. whether it's finding the next crisis, whether it's getting the e.m. call right or wrong whether china will implode. that will get the turning point. >> now this has been quite a year of reckoning, i think, for a lot of people. especially for that shakeout which we saw which was, face it,

proving it seems to be quite seasonab seasonable. a lot of people didn't see it and were long and got very hurt. >> i think, you know, it used to be an environment where you could sit on carry trades. it used to be an environment if you got it wrong you were reflecting along on yield. that return is gone. you have to get the calls. that is over bearing. >> that is the thing, you cannot sit on the carry anymore. >> you know what happens, a lot of the things that we have been used to saying to justify trades have disappeared out of the rhetoric. for example, you know, just a correction. well, you wound for it completely. we're still printing money. those 60 billion a month are happening and your stocks are not moving. i think there are a lot of things that are changing because it's become part of the liquidity. becoming part of the liquidity. more importantly is the monetary laughing gas environment is not -- >> monetary laughing gas.

i haven't heard that one before. i don't hear much new except for hearing facebook is facebook. monetary laughing gas. europe, monetary laughing gas coming from draghi. i did see a piece from stewart richardson of rmd wealth over the weekend. it was asking the question, is qe working? >> at the end of the day i don't think it does as much as we would like to think. we try and get currency out of it. the biggest ability of qe is to help banks deleverage and get them lending into an environment. it doesn't create much of a demand. it's much more effective when you're in crisis periods than when you're not. it becomes less effective in the u.s. and the u.k. and less effective in japan. >> i think it loads more. robin, lowe's, 100 billion, 120 billion. >> i don't think it's a question of size. >> why are the markets very excited at the end of last week?

they said, yeah, we'll have a look, see what we can do. >> the markets have to respond because they're doing something. you're getting them acting. for the eurozone -- >> that's terrible. all of these geniuses, we pay far too much money. i think that was your words. and now they're getting excited because the policy they have questions about don't think is credible, going to be extended. >> isn't it dangerous that asset managers are betting that to get excited about the stock market when things get worse because then they'll have to do something on monetary policy knowing that monetary policy only works in the financial sector? that is a huge, huge, huge level of risk taking on both sides. on one area you're basically saying, oh, gosh, you know, unemployment is lower than we expected. the economy is growing a little bit better, that means that

monetary policy is known to be stepped down. then what happens is that what you want is for things to get worse so that monetary policy is accelerated. isn't that amazing? >> i don't think that's what you want. that is part of the game that we've gotten into. >> the market volatility. >> for the eurozone, you have markets deleveraging. if you do nothing and provide no support, you're not going to get the lending. if there is an area you can still get traction from qe, it is the eurozone. we can argue you are getting some of that. that will peter off. i think the eurozone finds at bcb, they're not at the lower bounds. it is an interest rate we know how it works. you have 20 to 50 basis points they could be using. the environment is even if we have questions over the tools, we know we're in a world where what we would like to see is easier policy in the eurozone, japan, china. getting us to the world where the fed can tighten. even if they're not great tools, if they do something to put the floor in.

even if they might not have great transmission. if they put a floor in confidence and get the fed back to tighten, then you get currency markets moving the way they would like to, you start to get this transmission. there's no question that the transmission mechanism is broken. we're getting less monetary easing. still not getting the political and structural changes that we should be getting. >> but the signaling effect has loss its effectiveness. that's what we saw over the weekend. the pboc cut, how long did that last in terms of the positive reaction in the markets? maybe one day or so. what about the ecb? we recently saw some verbal intervention. how long did that have an impact on the market? maybe half a day or so. it's not really working as it was last year or in january, is it? >> i think we say that. if you look at all the disappointment we've had in the world and everyone worrying about the slowdown in china and we know that that feeds to german manufacturing, questions over u.s. growth in a world

where we know the eurozone is the one continuing to struggle to grow, it's the one that's been the most resilient. continuing to have pretty stable growth. this is much more pro active than we're used to the ecb responding. we can debate whether the activities are there. i think that does help to get through a bit of confidence. on the day it was one of the largest moves on euro dollars that we had in the last decade. to say it didn't last all that long, at least it got in there. we have china coming in. now it's built expectations where those expectations were almost nil as of the start of next week. >> look at the banking sector, qe may be positive for the banks but there comes a point where you see margin difficulty on the positive side of the debating sector. banks so far had a pretty good run of it up until about august. fortunes for the sector like everyone else went south. we saw a dropoff in august and september and a bit of a recovery. it means the banking sector is positive today. this week's trade we want to know your thoughts after credit

suisse and deutsche bank revealed strategies. are you buying into a sector rebound? yes or no? maybe you're waiting for all the details first. and get in touch with the trader poll at cnbc.com. #traderpoll. do you want to buy or wholesale? >> i prefer late cyclicals. banks are due pro cyclical. next year is going to be very challenging in terms of earnings because lower interest rates, you know, margins are not there. you know, going to have the year-on-year effect after all the provisions and all the cleanup of the previous year. i prefer to look at the late cyclical. >> this is happening in spain, hasn't it? you have the recovery phase because they've got to get better from where they were. you have to look at it differently. where is the strategy for these companies? >> it was going to be latin america. then you had brazil. and it's going to be very, very

difficult to upset brazil stagnation, latin america issues at the same time, extremely low interest rates and very, very low yields. >> is there a bull case as well, rich? money -- >> the yield. >> the transmission mechanism is broken. they still control it. presumably you have low interest rates with relatively fat margins on their net interest. they've got a lot of regulator capital issues out of the way. >> the yield. the banks are becoming more utility type kind of businesses. therefore, if you strip out the multiple expansion and the growth, you have a very sort of evident yield that is not as at risk as it was in the past. >> i think you need some sort of domestic demand for return. everyone's gotten so bearish on the global environment.

if you look under the details in china, it looks like they've stabilized. things are still going up. there's still a debt overhang. if we get through this there is a bit of debt global return. you could have dramatic improvements in eurozone improvements. that's what gets people buying houses, buying autos and getting consumer credit going again. that's what the banks need. horrific news out of fr. 47-year-old chairman ceo pierre died. heart attack. they have said today that jean-francoise will be chairman and max roche will be temporary ceo. they'll try to find new permanent ceos and chairman.

>> sydney opera house, wow. >> horrific news. 47. let's switch gears. let's talk autos. revenues for car maker peugeot accelerated. european sales held on to slower emerging market demand. the french firm has assured investors it will not be dragged into the emissions scandal ripping the "w." off by 1.3% here. >> the bottom of the french market at one point reporters not doing very well from philips to wpp to pew gee, not doing very well. equal share. chinese government, same stake,

13.7%. further down the line vanguard, bernstein managed to get on the list on the share register. deep holding by a couple of core ownership parties there. in terms of the performance, it has been stunning. it has been an overperformer for those that held the stock getting into that 55% higher is how it's been trading. the interesting part is european car sales were so challenged for so long. it seemed to be china where the company was pivoting to. it should have been a stronger performer. it wasn't. if you look at the sales volume 4.3%, earnings starts look better. exclude china. china was meant to be the strong point for the company. in terms of the projections for the year as well, 8% growth expected in auto demand for europe versus 3% in china. well and truly outpacing the mainland. contraction to some of the other areas, 57% down for latin america and a whopping 35% down

for russia. the company even though it's regearing and trying to do the most with its joint venture out of china, the numbers not going to stack up short term for the mainland, yet it still looks like it's going to do okay. maybe this is by the competitive nature what it's doing in the industry. >> that share price rise was ruled out in china. you can see it. >> the numbers were atrocious last year. cash flow was a problem. >> the growth areas in the car market, if you have a good name in premium, if you've got a good name in suvs, if you've got a good name in budget or eb stroke hybrids. they are the four areas, small budget, eb, suv, premium. those are the four areas, you have to earn one of the areas or a couple of the areas. peugeot, and i've owned peugeots, nothing was greater than my 1980 peugeot 1.9 for all

of you 1.6 muppets out there, i should say, 1.9. should have never bought that car, it was too powerful. the problem is it doesn't have a niche. another technical term, peugeot is stuck in middle frididdle. it has okay prices but it doesn't own the growth area. >> i mentioned the banks. you have a question of growth strategy. isn't this the same for peugeot. the first positive income in four years. it wasn't the coverage rate. now the question is it's very, very interesting. >> the sector, i don't know. i'm wondering at 12 times it with the sector trading at nine times on average albeit very big problems in there, does it deserve the premium? >> it's on china. >> china. >> exactly. the risk is a bet on the recovery of the european market that is much stronger than where we are currently. i think that basically you have

to be a little bit cautious. i think that what peugeot has been able to do is to put at least a floor under expectations of margin compression and profitability improvement. it's been very evident. >> i ask the question does it really matter when you get your hands on the shares. >> it's not going to be taken out, is it? what do you think of valuations? any thought on this one? >> that would be outside of my area. >> there's a lot going on. i mean, i'm unbelievably skep c skeptical about this ferrari price. i could not be more skeptical about buying ferrari at 30 times earnings or whatever it is. >> reminds me of the facebook ipo. look what happened. >> ferrari is wonderful in terms of the brands, f1, sam vettel, i love ferrari but would i buy the shares at those prices at 55

bucks more? >> the car holder and shareholder, i want to come back to richard and ask you about the car market. much is made of the fact that what people are spending their money on, cars, homes. discretionary items, this is the first real signal that the consumer is alive and well in the states. would you describe it that way as well? >> one issue in the u.s. was people waited so long to replace cars going out of '07, '08 there was some natural overhang. and the other was the collapse in energy prices made it that much cheaper to go out and buy your expensive car. i think that's part of some of these issues that got people back out there. you still don't have the real wage growth and the personal disposable income strong enough in the u.s. to say this is a massive amount of consumer spending but we're seeing enough resiliency in the u.s. consumer. i wouldn't say it's a bad sign. >> enough about these finance companies. i mean, auto companies. sorry.

let's get back to karen. >> want to take a look at shares and talk talk. down 4.3%. talk talk and bae systems last week's big cyber attack which may have compromised the personal information around 4 million customers. they reported they have received a ransom demand from an unidentified party claiming responsibility for this. we saw a huge share decline on friday. we recovered a little bit. drug maker as stra seneca received some good news for the first time in 65 years. they asked the fda to ask the pharma giant for studies to gauge the long-term effectiveness and safety. last but not least, let's go back to earnings. tnt express back up by 13%. 2016 will be a, quote,

challenging year. the third quarter operating loss slowed from 27 million in our rows from 57 million our rows. >> rich, getting a rate hike this year in the states? >> no, absolutely not. >> 100% conviction. >> almost done. there's still too much pressure on the dollar. too much uncertainty on the world. >> rich kelly, head of global strategy at t.d. securities. coming up on the show we're going to speak to helge lund, the ceo of b.g. [female announcer] if the most challenging part of your day

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dovish talk coming from draghi. and the pboc rate cut coming on friday in the afternoon trading session. that's the picture we saw in asia. we saw a little bit of muted response even though the shanghai comp was up. other markets failed to get excited by the rate cut on behalf of the pboc. sector wise, most of them, all of them in the red actually. media down by 0.9%. wpp even though they did beat some metrics failed to impress investors basic resources. the dollar has been strong. we are down. steve. >> the international energy agency says crude suppliers could tighten by next year.

they have a mild winter as causes behind oversupply. helge lund who is the ceo of b.g. group who is joining us out of our singapore studio. helge, good to speak to you. everyone's prepared for the long haul on lower oil and gas prices. that still remains the case for you at b.g., doesn't it? >> yeah. i think the industry has to be prepared for it and i think that is really the best way that companies can prepare and that is certainly what my company, b.g., is doing now. >> yeah, but in terms of the future, you guys have got to invest massively, massively in cleaner oil and especially cleaner gas in order to get the environmentalists and the climate change lobby on side of

your initiative. is that money available for the huge investment in new technology this industry needs to find in order to not find themselves on the wrong end of a top cop deal? >> i think the oil and gas industry has positioned themselves to be part of providing more energy and at the same time we need to make sure that we can provide that energy with lower c o2 emissions. i think the governments, the people around the world expect the oil and gas industry to engage and that's what we are doing. we are clearly part of the dissolution. one of the areas that you're focusing on is of course energy efficiency. there's also a big space to use more gas in electricity production and that is the solution that is in hand and we can implement it very quickly. >> helge, one question about the

l&g market. there's been massive investment in the last ten years on new infrastructure to bring l&g to a growing asian market. l&g has come down to virtually no premium in some markets relative to u.s. so what do you think is the future of l&g? how do you see profitability in some of these places in europe and probably expecting high growth and high prices and how is the industry accommodating the situation? >> so i think if we look at the long term we are very positive about the long-term development. we estimate an annual growth of 4 and 6%. believe in gas, also in the context of climate change and

issues related to that. on the shorter term there is, of course, some noise and some issues that we need to understand that partner around economic growth in the next few years. it's also in some other growing market in asia around looking at the gas prices but certainly longer term we were in l&g. >> when you think about this current environment, one of the issues that has come up quite recently is how quickly the industry has been able to reduce costs and get service providers to reduce their costs to the industry. do you think that this has finished? do you think that there is an ongoing improvement in terms of efficiency and in terms of cost savings or is all that could be done has been done?

>> it's a really good question and in my opinion they're in the first phase of efficiency improvements. you know that is negotiating the contracts and dealing with the short-terms gains that we can see in the supply chain. i think the harder effort needs to take place now with the whole industry working together to improve productivity and make sure that we work more efficiently for the longer term and that means, i think, we need to introduce new technology, we need to introduce new ways of working. i think we need to standardize much more than we have done in our industry. we need to learn from what other industries have done over the last few decades to make the value chain and supply chain more efficient. i think that is an effort that has just started. >> helge, let's not use the word

collusion here because the regulator might have an issue. this is one of the concerns by the takeover of the australian commission that is concerned about competition shrinking in the marketplace. when we talk about how tough things are out there and that it's consolidation, it's survival die really for a lot of different industries, do you think the regulator is out of touch by running the ruler so finally over the merits of this deal? >> i cannot comment on the process in australia. it is share that is running that process. we can expect that the deal will be closed early 2016. and it's come to corporation in the market. i think that goes across all operators and all service companies and technology companies because we have to deal with the fact as an industry that we need to provide energy more efficiently than we do today in order to develop

good companies but also to provide the energy that they need decades into the future. >> helge, you have this regulator as a thorn in the side of the deal pushing it out suggesting that it has real issues. do you need to consider plan b going it alone as a b.g. owned entity? >> so the companies, we are making good progress on the regulatory approvals and we still expect the deal to close early 2016. >> helge, great speaking to you. thank you very much for the very laconic answer. very good to speak to you. ceo of b.g. group in singapore. i didn't expect anything else. m&a appetite is at the highest level since 2009. the report suggests that nearly 60% of global companies actively pursuing acquisitions in the next 12 months. speaking to us earlier on the

program the ceo of wpp said the corp rates are making deals because they're running out of other ways to cut costs. >> if anybody mentions that terrible phrase revenue synergies, they get laughed out of the studio. it's cost synergies that people focus on. >> pittman is with us of the global transaction studios ey. she's in the studio with us. give us a sense of what it looks like and how different it is in terms of appetite and what we can expect. >> well, this year has experienced an emergence in the markets. we've seen them come back with megadeals. we have the middle market really engaged. this is the highest appetite we have seen in six years' time with six out of ten companies saying we intend to do a deal in the next 12 months. what they're saying is we have spent six years really focused on the bottom line, which is a really good thing to do. lessons have been learned. we've also got to look to the longer term and to grow a growth

platform. so they're bringing in the top line parent as well as the bottom line. >> you've been saying the same thing. you must believe the message. i wonder how dangerous the message is. the commodity sector has a whole bunch of assets. they're being spun off. are they in a dangerous path where they have to embark on deals whether they're good or not because your own job is in question. do you think that's what we're seeing right now wonder both of you? >> well, i think what we've got is a low growth environment and organic growth by itself is not enough. that's coming through very, very, you know, clearly. that's a really good point you're making. there are three really big destructors out there that are very different from previous cycles and it's technology. you know, the digital consumer preferences are changing dramatically. and we're getting a sector blurring.

sector lines are blurring, boundaries are blurring. this is really driving m&a. the option in the past was to be conservative, stand still and layoff, not do a deal. you can get into trouble for not doing a deal. there can be issues if you do do a deal. let's be very clear, you know, not doing a deal when your core business is being impacted by technology, by changing consumer preference, that they want a lot of different things, you have really, really got to make some strategic decisions. >> are you going to jump off the cliff right now if you're a ceo and do a deal? >> i think when you find yourself in an environment in which growth prospects are very, very poor, it makes sense to do a deal if the valuation is right. now, the issue that investors have is that historically, you know, m&a doesn't tend to create value for shareholders, specifically for the company

that it's acquiring. and that happened in an environment in which the world was growing 4 or 5, 6% per annum. now that the world is not growing that way, how are you going to present deals so that your investors are comfortable with them. that is the point to me. i think that what needs to happen is that companies present those deals as an opportunity to become stronger in an environment in which they could become weaker instead of saying, oh, we were all fine and we just are changing the landscape. >> you've covered this for years. we didn't get the deal with monsantos. should he have done a deal? >> should he have done the deal to save his job? probably yes. should he have done the deal because the price was right for shareholders? probably, yes. i would argue probably yes. >> tell me, why didn't he do a deal then? >> you don't know when the emerging markets are going to come back then. you don't know when the soft commodities were going to come

back. >> say when. >> when if both. for shareholders maybe that was the best deal at that time. maybe he wouldn't have gotten a better deal for the next three to four years, but i think you point out a very good question. are managers, are they judicious right now when it comes to those deals? are they happy to walk away when the price is not right? this is specifically when we talk about the inquirer. the question to you is are these managers when they feel the price simply isn't right, specifically for the choir, are they happy to just say good-bye? that's it. >> i think that's a great point. this is something that's very interesting coming through the survey that we haven't seen before in buoyant m&a times. we have almost 3/4 of the executives saying we will walk away and we have walked away. they are looking to the synergies. if the price is too high, we will walk away. regulatory is too complex. we will walk away.

they are being much more di diligent and they will walk away. >> the money coming out of e and m. the markets drive m&a. you talk about gas and mining which are the big sectors, consumer products being the fourth. those three sectors are under an enormous pressure. utilities is a mess. metals and mining, you could make a good argument about that. do you think it's about defensive rather than some return? it's about the low growth, where do we get our growth? >> look, i think it's both. i think it's an opportunity also for growth. i think there are a lot of companies that have done six years got strong margins now and have opportunities to take market share. i think that they're looking at some really quite spectacular deals. we've got an awful lot. all the attention getting is around the megadeals.

the bulk of the deals are done in the lower to middle market. the difference that we're doing is with the innovation and technology. over 50% are going to do a deal outside of this sector. so they're going to different sectors. so some are doing it for consolidation, steve, some are doing it to continue the cost saving which you would expect. that will never go away now. some are definitely doing it to take opportunities that are out there. >> brilliant. let's end that segment. thank you very much. global vice chair for ey and a new zealander. >> very much a new zealander. >> i'm going to bring in my accent. i can really spot the difference between a kiwi and an aussie. do you want to do this now, girls, ladies? >> we knew it was going to come, didn't we? the boys wouldn't leave this one alone. >> you're laughing. >> what is it, sunday. >> look, i think what we've got here, it's been a fantastic

competition. we have a fantastic team but 4 million kiwis, including myself, are really hoping that richard mccall leads that team. >> is he being cited? >> we have this competitive rivalry between the two countries. we admire and like each other. >> we like each other hugely. i think really it's the english that pretend we don't but we do like it. we like each other a great deal. we've managed this very well, haven't we. >> what is amazing, i have to say, is that you are clearly a passionate rugby spoiler. my great friend and ally karen doesn't give a damn about rugby. did you see the action? she said, what? she's the only aussie i know that doesn't care. >> i would watch it. the cricket. >> it's close to worry, as modern day worry. if i can watch richie, mano. >> yeah. yeah. yeah. so exciting. >> i hope it's a really good

match. they're two phenomenal sides. i really hope we win. >> impartial. >> i know nothing about it. hey, i'll read the story. australia will play close rival new zealand in the final of the rugby world cup after holding off a spirited argentina. three first half tries including two from ashleigh cooper. a 13-point lead that argentina refused to yield. nicholas sanchez's flawless boost, he kicked five penalties. saw them trail by 7 points with 26 minutes to go. there was no dream comeback for argentina, though. actually cooper completed a hat trick of tries to secure victory for the team in green and gold. >> the local press today in australia. you'd think they would be more excited about the win. it's buried further down. they're nervous about the final and not wanting to celebrate. >> i have an opinion. i think south africans play better man for man than the new zealanders are capable of

playing on saturday. i think you can give pretty much 12 out of 10 to the south afrikaans who are unbelievably strong on defense. not anywhere near as could be. >> do you think the kiwis can pull it out on the day? >> no chance. >> a couple of times historically. not last time. >> i know. i have had nail biting assignments. >> very, very exciting. >> i hope it's a very good match. >> i hope the best team wins. we'll be back after a very short break.

tell us about the negative environment and what it is doing for you and your cohorts as investors. >> i think that what negative interest rates do to investors, first it puts a lot less emphasis on cyclical sectors. it puts a lot less emphasis on growth. it will not deliver. negative interest rates don't deliver growth and it makes it be a lot more cautious.

finally enough, it doesn't lead people to invest into more aggressively or to borrow more, it actually leads you to take more caution. >> that's a big statement. >> it is. >> what evidence have you got for it? i'm not saying i disagree with you but -- >> look at it in the in order dick countries. in the nordic countries real investment did not grow in terms of productive investment. when it has been implemented it's basically a measure of defense. if you look at it from that perspective what central banks are not achieving is that money velocity is investing. i think that that is not going to be improved. >> it's not a perfect measure on the opposite side of this tomorrow. one of the points is that it does get around a political system. you have fracturing of major parties and the ability to do

more by governments is going to become increasingly challenged as the far right and far left emerge as dominant forces. when you have very low interest rates isn't this a valid way to keep stimulating economies for central banks? they can get around the political process which may be grid locked. think about the u.s., we don't know what's going to happen next year. >> you get a much bigger incentive for government to spend and to -- and for deficit spending. deficit spending is predominantly done on current spending, on an investment. therefore, you generate bigger problems afterwards. so what ends up happening is that the crowding out effect is that governments continue to borrow more, hour, the real economy, governments and families get more of that pie. governments borrow for less, that's fine, but it's spent on

current spending, not an inve investme investment. >> in terms of what we have to do with that back drop and damning verdict on negative interest rates, what shall we be doing in these markets? >> i think you have a tremendous opportunity in noncyclical sectors, in the defenses, you mentioned before the utilities. the utilities have done phenomenally. i think they're going to continue to do so. i think you have to be a lot less -- you have to be very, very -- i think that if you take into account that every year we have to revise downwards between 15 to 17% earnings estimates and global growth, then you will be fine investing in those -- in the sectors that don't. >> the wonderfully pro vok kativelily named company. stay tuned for the edition of the show, yeah, we have ben bernanke on.

hello, everybody. good monday morning. welcome to "worldwide exchange." i'm susan li. >> i'm wilford cross. here are your headlines around the world. >> the china stimulus effect fades. european stocks open lower and u.s. futures are pointing down shrugging off asia's positive session.

lights out for the lumileds deal. they delay the sale of a $3.3 billion division. the ceo tells cnbc he's confident the transaction will still get done. >> still, we have to first close our lumileds deal. we see a little bit of a delay there in the regulatory approvals. >> apple starts taking online orders for the new tv. iphone sales could take the shine off of its earnings. >> ben carson overtakes donald trump for the first time in the republican presidential race while the democrats lose another candidate as lincoln chaffee drops out of the race. all right. we've got the german etho institute data coming out. october current conditis