i. the company's plan for challenger bank williams. >> we always wanted to create a geed effective bank. i think what we've seen in the last few weeks post the referendum is a very different interest rate environment. i think when you model that out what you see with williams and glen is a much less effective stand alone challenger bank so we've come to i think a difficult decision, but the right decision for williams and glen, the right decision for us which is it's not going to be possible on a stand alone basis. that would be ineffective in the market. so we are going to look at alternatives, including a potential trade sell of the

business. >> what about santander. the reports earlier this week that santander was interested. are they wrong. >> we are talking to a number of parties. we're not going to talk about specific names and as we sit today, we are several months away from being in a position to update the market. >> you said there were technology costs associated with trying to separate out this business and that was always going to potentially delay the timetable. is that too difficult a job to separate out this business or is it as you alluded to there the brexit vote that scotch third-degree for you. >> the technology project has been going well in the recent months. we had about 640 systems to stand up. we were well over standing up 90 pktd of those systems. it's really been the fundamental shift in the macro environment over the last few months. post the referendum that's

caused the decision today. >> are you saying that any challenger bank then in this environment now is going to struggle. >> i think for the sector generally it's going to be tougher and for the challenger banks there will be more challenge. >> so tie this altogether for me. what does this mean about your dividend? can we write this off until 2018 or beyond. >> when you look at today's results, i think oola lot of wh we talked about there's some positive easing and another billion pounds of operating profit the six quarter divisions are going very well. much better performance out of the investment bank, return on equity 11%. we've had six quarters in a row now of producing plus or minus billion pounds of operating profits. i think what we need to do is continue to work through legacy issues. if we can continue to work through those, we'll be a good strong healthy bank.

>> you were there this morning. you were speaking to the cfo. i'm just looking a the a note from neil wilson the market analyst. he said they move from one disaster to the next. this time it's legacy issues. after eight and a half years of being bailed out, it's time to move on. >> i think they wish they could. if you look down what's contributed to this 2 billion pound loss that we saw in the first half of the year, they have 450 million ppi. what we wanted to get clarity on if we could was something to do with the u.s. mortgage litigation they're facing. nothing there. they didn't give us any clarity there. >> obviously with the challenger bank there was hope santander was going to come in and take this. looks like that is not going to happen. ase quite said brexit impacting the underlying rate r

>> they're still 73% owned by taxpayers as neil reminds us as well. >> and will continue to be. >> we're not going to see any changes near term. >> who knows after the brexit vote. that's the challenge. who knows on the dividend now. i said to him can we assume this is pushed back to 2018, 2019. he kind of looked like you're asking a question we seriously can't answer. let me give you the silver lining though. there is a silver lining here. they generated profits of 1 billion pounds in their core business. return on equity of just 11%. we're gaining market share. they're seeing more than 15% loan growth. they are benefitting in a sense from the provisions they're getting. they're trying to push loans out there, but oh, boy, one word,

litigation. >> we'll still continue to watch the banking sector. other big stuff coming up today as well t. latest u.s. payroll releases later with the dow jones group forecasting 179,000 jobs were added in july. 180,000 the depending who you talked to. this compares to goldman sachs. that follows a poor number, remember, 38,000 for the month of may. a blowout 287,000 for june. now the unemployment rate is expected to come in at 4.8%. uk government bond yields continue to fall after hitting record low after the bank of england pulled the trigger on fresh monetary easing. the first rate cut in seven years was combined with restarting guilt purchases worth 60 billion pounds and buying of 10 billion pounds worth of corporate debt. governor mark carney said the new qe program was aimed at

stimulating lending. >> the governor also addressed how low rates could go and whether or not the n pc would consider heading into negative territory. >> no on the negative situation. i've been clear on that. if anyone write in whatever you want to take that off the table for me. okay. there's -- i'm not trying to be clever in the way i'm answering that question. >> yes, he was. peter rose is right head of market strategy. >> what do you make of carney's actions. >> i think he did a really good job. there's a real realization that central bank policy is not really going to solve the issues that brexit has sort of uncovered. businesses are concerned about investment. they're concerned about trade. they're concerned about financial services passport. that's not going to be fixed by liquidity injection and loan which demand has hardly been

reaching out to. i think carney did a good job of explaining this is sort of a stopg stopgap. move to a fiscal type of solution. he was on the local media giving more sort of a folk mom and pop type interview. just explaining what he was doing and why. really try to address the issues of the every day british public and reassuring that things were being done and perhaps some of the prevote or hype was overdone. reassuring them. i thought it was a positive thing. that's where the solution is going to lie. >> you he had to do that because he was the one suggesting it was going to be a disaster if they voted out. just a point. >> but exactly on the mom and pops interview i noted that as well on the radio in early haur they were discussing it already and talking about the

unemployment rate and what we can expect there. one of the standouts was the post-brexit uk economy where he's looking at so negative unemployment going from 4.9 to 5.5 over the next new years sdmiet t despite the new stimulus. >> he was very clear things could get worse. the downgrade in growth is there. again, getting out there and reassuring people. making clear his comments about not going to negative rates and it wouldn't affect savers was a really important thing. that's what the people on the street are significantly concerned about. if he can sure up confidence on the every day british citizen it will go much further than 25 basis point cuts. that's not going to solve the situation right now. >> this is symbolic basically. >> absolutely. that's what the brexit is more than anything else. these are rules made by man and it needs man or female to fix the solution so they need the confidence of the people on the

street that they can conduct business. >> there's a parallel here between what carney said yesterday and the comments we got from phillip hammond with what's going on in japan. >> very much so. >> and the backup in yields that we've seen, this kind of tradeoff between the government saying there's fiscal policy and the bank of japan disappointing on the monetary side. >> you bring up a great point. central banks are coming into a reflection point. the policy mixes are not working and the leader o this sort of inability for central banks to really drive growth is the bank of japan. they've been doing it for over 20 years now. they're heading into helicopter money and it's not providing the stimulus the economy needs and i think markets are realizing that's not going to work. >> i tweeted a picture of the uk economic data before the brexit vote and the uk economic data after the brexit vote. people are angry on both sides.

>> they're concerned. >> deal with it or people who voted to remain and the people who voted to leave, but i'm curious as to why we saw this -- it was a big move yesterday by the bank of england. why do it yesterday in why do it now as opposed to waiting a bit for the actual affect to take hold? >> i think again we sort of seeing a lot is psychological. it's really your outlook and how you're sort of moving your assets and investing and how you're forward looking. if you're positive about the situation then the brexit situation should not be an enormous hurdle. you keep investment on the sideline. you should be going forward. the pullback in economic data could well be a view of that. >> survey data too. so the bottom line is if you try to stop the data, the real data may not be that bad. >> that's a good point. >> we've got to go, peter.

head of market strategy at swiss bank. almost 16% rise in first half rev nuf sales. 1897 million euros in line with expectations while topped forecast. revenue guidance with growth seen in the high teens. fed rico is a ceo. thank you so much r hanging on sir to talk to us. we were talking about the brexit effect and i do note via the ft that they said the exact of brexit on the fashion industry is, quote, unquote, daunting, brain scrambling, and multilevel. you being where you are in the higher luxury end of retail, what do you anticipate. >> well, brexit for us in terms of revenues, we have a negative

impact because uk represents 16%, but overall in terms of the margin it's a positive impact because we have more cost than revenue. we expect a slightly positive impact. >> sure, talk to me a little bit about your numbers as well because they look pretty strong. they look pretty strong. are you anticipating you're going to be able to keep on with these types of growth levels or do you feel the likes of amazon, for example, they'll move into the high end luxury market and mess up some of the things you have going at the moment. >> they will continue to be strong. the point on brexit that in july after the shock of the first few days, you play demand and consumer appetite back to normal. so we're very happy about that. so like in month of july, it's going to be back to normal. and, again, going back to

brexit, i think it's unique position because we're strong in the uk and strong in the continental europe especially. having said that it's going to be more difficult for european taylors to get into the uk which is the biggest market of europe as well as for british to get into continental europe. it's a good market. we are basically the only player in the online retailing that can concentrate in both markets. in terms of amazon, i don't think they're going to go into it. >> got a quick question, i can see you're getting more users and more orders as well, but then i look at the amount that each order is generating and actually people are spending less. i just wondered whether that's a concern to you particularly given you're operating profit

margins here are pretty thin like 2.5%. no, they're not spending lsz. they're spending the same. slight decrease in the value because of the currency. the price business has grown a little bit more, but overall, if you look at the effect and the value less than 2%. >> so you clearly have a 16 year head start on other online retailers, but i look at some of the department stores trying to get in on the action and luxury names like lvmh hiring the kind of people they need in order to do this. how do you stay ahead? how do you differentiate yourself? >> caller: we are the market

leader with over $2 billion in revenue compared to all the other players, european players. we are p investing a lot in technology and operation in order to have a fantastic state of the art machine, but also on the we are investing and leading through our buyers. we're going to be more buyer revenue. almost 60% of our revenue. >> okay. >> we have will continue. >> thank you very much for being with us. the ceo. with ibm and make sure getting those products is easier is very important for these guys. >> massively important. e-mail the show. let us know what you think.

streetsignseurope@cnbc.com. >> we're on twitter, you can tweet us directly. >> we're going to take a quick break. coming up on the show, know voe narrows guidance. we'll have a breakdown right after the break. stay with us, we're back in two. okay, so what's our latest data say? our customer is a 21-year-old female. heavily into basketball. wait. data just changed... now she's into disc sports. ah, no she's not. since when? since now. she's into tai chi. she found disc sports too stressful. hold on. let me ask you this... what's she gonna like six months from now? who do we have on aerial karate? steve. steve. steve. and alexis. uh, no. just steve. just steve. just steve. live business, powered by sap. when you run live, you run simple. it's my decision to make beauty last. fix. roc retinol started visibly reducing my fine lines and wrinkles in one week.

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mpx hi everybody. welcome back. you're still watching "street signs" going to european markets. you've got read and green up by the region of half percent to over 1%. when it comes to commodities,

oil has been a big mover this past week. coming off a little bit this morning, but still hanging on above that $40 level we had some -- a small drop in the crude inventory data in the session. >> let's get back to some earnings today. italian bank lifted its dividend after posting a rise in full year profits and revenues hitting an all-time high. the boss says the preunderwriting contract on monte dei paschi issue does not amount to a binding commitment. he added he hoped unicredit would remain a long-term investment under the new ceo. boosted a rise. scope prizes in the second half of the year. this event producer is considering divesting assets in asia and elsewhere, but remains committed to the uk market for now despite evidence of some slowdown in investments since

the brexit vote. arising damage claims linked to natural disasters hit all yanz. the german company said it has seen a loss due to floods in europe while turbulent markets cut returns in markets. outflows pimco has slowed and told cnbc it was on track to achieve the second half results. >> the pimco team has done a lot to stabilize customer relationship and performance of funds should also help that we can achieve our second half year results. >> now novo has narrowed the guidance. the danish drug maker expects operating profits of 5.8% this year. this as they posted a 19% rise in the second quarter boosted by

strong sales of diabetes and obesity treatments. daniel is here to talk with us. good morning. good to have you with us. so novo anymore disk coming through with these numbers. who cis their biggest competito at the moment. >> santa fe. new competitors coming into the market including eli lilly. we have america and mmerck and coming in with generic insulin which is important with people with diabetes. >> it's a very complicated disease too. are they heading in the right direction in terms of their cooperation with technology companies because a lot of it seems to come from being able to monitor yourself and being able to give yourself the best treatment along the way too.

>> we think there's a couple of things going on here. price pressure from insurance company which what we're seeing in the diabetes market is similar to glax co-a couple of years ago. there's a broader thing going on here. digital health is using technology to help patients manage their disease better and getting someone to have a better diet and exercise in some cases may have a more gant impact on their disease their some of the new drugs that are coming out. i think this is a big change that's happening in the drug world, but also across health care. >> it's not just about the insurer so it's about the pharmacy too. i look at what's going on in the u.s. and dumps a drug for eli lilly in the space. i guess they got a better discount. novo playing off that as well. you have to race to the bottom here in terms of pricing and who can offer the best discount. >> yes.

>> what about quality control or these all. >> well, there's debate. obviously every company will tell you their drug is the best. to some degree, these drugs are similar. when you talk about the pharmacist, the part benefit manager which actually works for insurance companies to negotiate with the drug companies. so both cvs and express groups this week have restricted their form which means which drugs are available or preferred so it's cheaper for you as a patient to get a particular drug and that's changing behavior. >> why? why are we shocked about this if we know this is going on and we've seen it before. how do they combat this. >> i think what surprising the market is actually how much power the insurers have got. >> right. >> i think some of it has come from the consolidation we've seen in the u.s. over the last 3 or 4 years. the other is they're able to change consumer/patient behavior and that's partly because of the

economic situation. health care is getting more expensive. >> not specific to diabetes. this could happen in everything. >> it can. what's in their pipeline at the moment. diabetes is their big thing. >> got a few things in their pipeline. got some more advanced insulins, receiver is one of those which is bulls pinned the hopes on that actually that will take over. they also announced today we'll get more data on oral insulin. it's probably three to five years away from market. has more clinical testing. i think the diabetes market is going to be challenging. >> daniel, thank you very much. daniel ma hoeny fund manager at polar capital. we've got to take a quick break. check out our blog. we'll be right back with more here on "street signs."

hi everybody and welcome back. you're still watching "street signs." your headlines. sharing in rbs slipping after the british bank racks up 2 billion pounds in losses. look beyond the substantial charges for litigation and conduct. >> what we need to do is continue to work through legacy issues. as soon as we can work through those, we'll be a good, strong healthy bank. >> not insured for losses. all yans shares also lower after the german group sees net profits falling. outflows from the bank's asset management business have slowed. >> the pimco team has done a lot to stabilize customer relationship and performance of the pimco funds should also help

that we can achieve our second half year results. >> no voe nordisk is europe's biggest loser. narrows guidance due to increased competition in the u.s. and european markets edging a little bit higher after the bank of england cuts rates to a historic low and launches the biggest stimulus program since the financial crisis. >> by acting early in comprehensively, the npc can reduce uncertainty, bolster confidence and support the adjustments in the uk economy. >> hi, everybody. welcome back. it's friday. we are some five hours away from it will implied open is a little bit higher as seen on the right hand of the screen for all of the u.s. markets.

we're still waiting for the payroll figure. is it going to be strong enough for a september hike. that's what a lot of you are going to be looking towards. anticipating a figure around the region. when it comes to european markets this morning, pretty much all green across most screens. the main markets trading higher by almost half a percent to over 1% when it comes to the ftse mib. now a big story is that of the bank, as you saw yesterday. uk government bond yields continuing to fall after hitting record lows as the bank of england pulled the trigger on fresh monetary easing. first rate cut in seven years combined with the starting of guilt purchases and the buying of 10 billion pounds of corporate debt as well. now governor mark carney said the easing program was aimed at stimulating lending. >> the purchase of up to 10 billion of uk corporate bonds

will support the real economy by directly affecting the financing conditioning for companies that make material contributions to uk economic activity. by supporting investment, this action should improve the monetary policy tradeoff with inflation. by acting in capital markets it will be complimentary to the enforce the bank lending channel. by lower credit premium bonds are a prosht mean of providing stimulus. >> governor also addressed how low rates would two and whether they would consider heading into negative rate territory. >> no on the negative rate scenario. if anyone just write in whatever you want to take that off the table for me. okay. there's -- i'm not trying to be clever in the way i'm answering that question. >> now rbs last week warned its business customers about potentially passing on negative

rates. earlier today asked the bank cfo to the reaction to the bank of england move. >> we're obviously pleased at any measures that are going to help the banking sector generally in the uk. for us, we are a very liquid bank. our loan to deposit ratio is 92%. we have are the fastest going of the large banks in the uk. we've put on more loan volume growth than any other uk bank over the last six months by some margin so i think that passage of measures is good for the sector. probably for us provides less benefit. >> when he said that he's announced or he's announced those measures he said there's no excuse for the banks not to pass them on. will you pass them on? >> we're obviously going to look at the total passage of measures. there's obviously a fairness agenda between borrowers and depositors. it's a very difficult

environment for depositors, but we'll certainly look across all of our rates and take the appropriate measures. >> he also suggested he wasn't so keen on negative rates. you as a banker perhaps suggested that at some point business depositors might have to have negative deposit rates. will you only do that if mark carney takes it into negative territory or do you reserve the right to charge before them. >> we're always going to resume the right to charge. all we did recently was update the terms and conditions. we will take any decision like that very cautiously. it is, i think, you have to think about it as a passage between borrowers and your depositors. none of us want to see rates go negative, but all we did a few weeks ago was give ourselves the flexibility if we needed to take that step. >> now, meanwhile low interest

rates are also squeezing insurers. >> sit a very difficult environment. i would not call it yet toxic. our life profits in the second quarter 16 are higher than previous year was a billion operating profit in the life segment stand alone. i think we are doing very fine. we have adjusted our new business makes to the more difficult environment. we have changed products and adjusted it to the low yield environment and we are on a good track. >> head of columbia thread needle investments. with us this morning. >> good morning. >> simple yquestion, do you thik the bank of england did the right thing. >> they did the right thing in offsetting the lack of confidence with brexit. rate cut, yes, the lending scheme that makes it possible

for banks to pass on some of those lending schemes, yes, that all looks very good. although there aren't many signs there are credit market difficulties. on the quantitative easing side, i have some concerns that won't be as stimlative as they compressed confidence, but overall was it right for the bank of england to try to support the economy, yes it was. >> even at at this time. even at this early hour, brexit hasn't happened yet as people were pointing out to me as i tweeted the data. before the data and people are saying brexit hasn't happened. it should be post referendum if anything. >> we haven't left the union. we don't know the terms in which we'll leave the union and yet when you look at the forward looking indicators of activity so consumer confidence, house price indications, lloyds business parameters, c bi

indicators. looking to cut down investment, you saw the purchasing and services and managing and construction going into recessionary type behavior. there's no reason why people should stop activity and yet there is a confidence shock, which does seem to be delaying irreversible long-term investment decisions on the part of households and businesses so yes it's appropriate that there is a policy response to that negative impact. >> as i was saying earlier here on the show, i mean carney's assessment of a post-brexit uk kmich was phenomenally negative when looking at the numbers he gave us. unemployment he thinks will go to 5.5% over the course of the next two years despite all the adtional measures they're putting in place at the moment. do you think this means we're bound to anticipate more cuts, more stimulus or is it enough for now. >> i sensed a handover looking towards the treasury to provide

some stimulation. you've got to remember back in 2008, 2009, there was a 6.4% contraction gdp. we're not looking for anything like that right now, but that came with huge rate cut, big fiscal expansion. there's only a certain amount the policy can offset. we're not looking for that kind of economic fallout before brexit has even happened, before we know the terms of an exit of a european union, but what we do see is a falloff in confidence so policy try to setoff some of that impact. and as you said job increase has been forecast by the bank and it will be nice to see that and say you know what, we're going to wait and see. >> how much of an impact would you anticipate from yesterday's move. >> it's really interesting because the bank of england in advance said they're going to be thinking about banks, insurance companies, you've seen two great

interviews in your show with leaders in the area of that. on the pension side they said they were going to try to be cognisant of that. forbes playing particular note to that. it was a little bit disappointing in the report and the comments they basically said, you know what, pensions are going to be okay. they said there's been stable levels of pension contributions. that doesn't match with the data i've seen. maybe i've been looking in the wrong place. there was nothing presented in the quarterly report that suggests i have been looking in the wrong place. >> the business confidence index, before the vote minus five. after the vote minus 47. that's a pretty big difference in terms of business confidence. when looking at the moves from yesterday from the bank of england, is this going to encourage companies to investment or are companies still going to be thinking brexit hasn't happened. we need to wait until brexit haens to see what article 50

entails afterwards and how can we possibly invest before that. >> taking a step back, yesterday was a huge deal for the markets. what does a quarter rate -- quarter rate cut mean for the economy, doesn't mean much. the measures that were put in place to facilitate bank lending was to stop a counter action by banks stopping that quarter point being passed through. it's not a big exact in the economy. if you look through it will uk equity market, there was a big rise overall. in sterling terms, uk equities were probably the worgs perfo performe performers. >> so gerald writes in and says the more complex it gets on twitter, article 50 gets further away. do you think if five years time people will wonder whether we've left or not? is it going to happen within two

years. >> i don't think i've got a better call than anyone else on the timing of the article 50. i've within guibeen guided by t minster. >> this goes back to the point i'm making and you want to look around and find an adult and you realize you are an adult and you can't find anything. anyway, guidance, very important. toby, thank you very much. head of multi-asset at columbia thread needle investments. u.s. president barack obama has strongly rejected comments that the u.s. paid a ransom for release of american prisoners. confirmed the payment was made, but said this was quote not some of the deal. last january iran freed five pridser ins as the u.s. granted clem si. the payment was made the next day as part of the nuclear deal with iran.

donald trump's allies. they've urged him to get back on the track and refocus his company on key issues after a week of falling poll numbers and bitters exchanges with members. trump has lost ground against rival democratic hillary clinton who attacked him saying he was temperamentally unfit for presidency. tracie potts is in washington. good to see you. wrap up the week for us. what are we looking at heading into the weekend. >> reporter: it really wraps up the numbers. you mentioned the nbc poll. another national poll that puts donald trump 15 points behind. that's double digits in a national poll. something we haven't seen since the early part of the primaries. then we have the battleground states, states like pennsylvania where donald trump is down by double digits. florida down, new hampshire down

by 15. all of the polls in the last 24 hours are not looking very good for donald trump. in addition to that we talked about a republican party and its worries about trying to correct or get him to self correct the direction of his campaign. we are seeing more republican elected leaders say publicly that they will not vote for donald trump. none of this seems to be slowing him down, at least anything he's acknowledged pri ed publicly. he's still having large rallies. wisconsin will be interesting because it's the hub of house speaker paul ryan who he failed to endorse, but interestingly his running mate, mike pence is endorsing ryan. donald trump talked about that last night saying paul ryan is someone he can't endorse yet, but when mike pence asked him if it was okay for him to go ahead and do so, he said, yeah, sure. you like the guy. go ahead.

>> so you mentioned his running mate, you mention mike pence. i saw also that at this recent rally that an 11-year-old boy got up and asked mike pence whether his role just would be soften up what donald trump said. >> yes >> yes, whether he was be an apoll gist for trump. he said one day you may be the governor of north carolina you'll find that everything is not so black and white, but what you are finding on the campaign trail is mike pence taking positions that donald trump is not and that's unusual. not that it won't necessarily work, but it's unusual. something we don't typically see in presidential politics. >> good to see you. look forward to seeing you next week joining us live out of washington. coming up on the show, as the

olympics kick off tonight in rio de janeiro, we'll be taking a look at the economy.

hi, everybody. welcome back. you're still watching "street signs" on this friday. i'm louisa bojesen. nissan in the auto sector is reportedly looking to exit the car battery business. the japanese car maker negotiating the sale of the unit with pan sonic and other suitors. that's according to nikkei. hackers are gathering in las vegas to share secrets of the trade at the black hat conference with even the fbi in attendance. meanwhile apple is jumping aboard. offering money to hackers to find vulnerables in its system.

craft hiens is going to review in a bid to improve quality. reporting quarterly earnings above expectations the food maker said it would continue to address the shift in demand towards healthier food. cost cutting measures. i always hear people talking about how much sugar they put in kech up. >> the strong sales they were boosted by the popularity of the newly launched game overwatch and the acquisition of andy crush maker digital. shares were up in after hours trade by some 12%. linked in beat the street posting a rise in revenue in what could be the last earnings report before joining microsoft. josh lipton has more details. >> reporter: beating and investors focused on the $26

billion microsoft merger. company reporting e pst of a 1.13 of revenue. that was growth of about 31% on the top line. street had been looking for e pst of .78. company also gave us new numbers on the talent solutions division referring to what recruiters use when they're hunting for job candidates on the site. revenue there 570 medicillion. revenue from premium sub skrixs, 155 million. there was no conference call because of that pending merger with microsoft, a deal that financial analysts applauded. thinks that acquisition makes sense because he says it helps round out microsoft's business applications portfolio.

he sees obvious potential synergies between officer 365, bing, and copy with linked in. i'm josh lipton in san francisco. getting in the mood now. olympic fever hitting rio with the city putting the finishing touches ahead of the opening ceremony that takes place tonight. the opening of the world games comes as they voted to clear the way to suspend for president to be removed from officer. the 21 committee voted 14-5 to try for doctors government accounts. jamie anderson is managing principle at funds. welcome to "street signs." good to have yo with us. aren't we already kind or weren't we already factoring in

there was a big chance of her leaving. >> yes, good morning. it's great to be here. thanks for having me on. you're absolutely right. this has been priced in. what we're seeing investors now pricing in is to be a rate cut in the fall. just this week, we saw the headline inflation figure for south pal low trend down. that's what we're seeing across the board. it's boating well for yield assets. it's important for investors to realize that real yields in brazil are 300 basis points. if you factor in the potential for a 3 hurkts basis point cut, that's a tailwind of return. we think investors like it. >> in terribms of the actual imt from the olympics, is there going to be a difference in measured impact especially given something like 30% of tickets

are unsold. is it going to be less of an event this year somehow. >> that's a great question. you might see lower attendance than they originally projected. however we feel like the games themselves are going to feel more or less like past games. is there a long-term economic impact on fewer ticket sales. my guess is no. that's a good question though. >> the sports minister also saying he's confidence there will be no zika cases or will be close to zero. some of the err issues that are taking place that the brazilians are looking ats right now, the zika and more than a scare, the zika issue. you've got a brazilian economy which is unsure on its feet right now. you've got the political wrangli wranglings. >> so great points. i would point out first of all that six months ago, the

expectation for zika becoming a larger concern were very different than the reality is today. so szika is probably pretty wel under control at this point. i wouldn't say it's a nonissue, but it's to the the issue we thought it was going to be six months ago. what has happened is brazil assets have continued to rally through the olympics leading up to the olympics and we think the olympics being concluded over the next few weeks, rolling into the final impeachment chapter is going to be the rally. the brazil benchmark is up 55% year to date in dollars. about 30, 40% of that appreciation is driven by currency, but you're seeing fundamental appreciation. i'd also point out mostf the money going into brazil's equities and fixed income over the last six months has been global. so local investors have recently started to participate in the

rally. for example, we focus on real estate and real estate equities are up 80 to 110, 120% in dollar terms year to date. >> does that mean that we could be looking at the brazilian central bank cutting rates at any point in the near future. >> so yes, i think that's where investors are focused. the reality is we need to see inflation probably trend down more. i would say in the seven maybe six and a half year on year range. we can be there by this fall. the central bank has been very transparent about their desire to get inflation down. we're at 8% year on year at this point. if we see that trend strengthen a little bit more of the frab by september october, we'll be willing to telegraph a rate cut by the end of the year. >> jamie, thank you very much for being with us. managing principle at terra

funds. >> now head to cnbc.com because we'll be following every minute of the game. you can read why some experts think what should be a pride for brazil has been less so. and some economists are questioning the wisdom of hosting the games. just glancing at your comments coming in. keep your bank of england comments coming through as well. you can look back at the previous discussions on my twitter feed. we do see them, but way too many to respond to them. the latest payroll release is due later today. dow jones forecasting 179,000 jobs added in july. that compares to golachsdman s looking at a figure t 190,000 positions. we had a huge number for june. we'll be back monday. same time, same place. have a fantastic weekend. take care of yourself and your surroundings.

good morning. working for a living. the july job's reports likely to set the tone for today's trading, but could it be a game changer for the fed. and earning central from tech names too fast food chains we're going to bring you a round up of the big movers. you're money, your vote. hillary clinton with a nine point lead over donald trump. it's friday august 5, 2016 and "world wide exchange" begins right now. ♪ ♪. >> good morning and welcome to "world wide exchange." happy friday, i'm sara eisen