good morning, everybody, it's monday. you're now watching "street signs." i'm louisa bojesen. >> and i'm caroline roth. saudi's energy minister says he's optimistic about an opec production deal by november. but crude prices remain under pressure as producers gather for the world energy congress in istanbul. we'll speak to bob dudley coming up in 30 minutes.

now william hill, all bets are off as the bookmaker confirms merger talks with their canadian rival. no handshake but plenty of acrimony as hillary clinton and donald trump trade ugly blows that focus more on insults than policy following the republican candidate's video scandal. >> this was locker room talk. i'm not proud of it. i apologized to my family. i apologized to the american people. certainly i'm not proud of it, but this is locker room talk. >> i think it's clear to anyone who heard it that it represents exactly who he is. because we have seen this throughout the campaign. good morning, everyone. let's kickoff the show with economic data out of italy. this will surprise many of you and probably you, too. before the show we thought, hey,

italy august production data doesn't rock anyone's boat. but here we go. jumping 1.7% in the month of august. the biggest increase in seven months. that's after all the manufacturing and consumer confidence numbers have been so poor for the last couple months in part because there was so much uncertainty ahead of the constitutional referendum happening on december 4th. but this is good news out of italy. industrial output unexpectedly jumping 1.7%. no major change in euro dollar, though. 1.1178. >> they are still looking to try to increase the lowest pensions and the investments on the 2017 budget plan. that's going to be presented later this week. it is quite important for italy, this latest data. you were just looking at the european markets, we are plenty flat.

it does seem like the talking point is about the u.s. and the debate. we'll get to that in a second. but just to show you the main european markets at the moment, the dax is flat, a couple points higher. the market is a couple points lower. when it comes to the sector position there is, to the up side, autos, media resources, banks and health care. speaking of the banks -- still no deal for deutsche. deutsche bank's ceo john crier says there's no deal. he hopes to lower the level proposed by the doj. >> deutsche bank's risk officer says they are taking a cautious stand to the riskier assets mr. lewis said, quote, the risks in

our derivatives book are massively overestimated added that the exposures are in line with peers. regardless, still no deal. >> reporter: well, regardless still no deal. and that is weighing on the shares. they are the biggest loser here among dax values down by 2.5%. of course, everybody was expecting that this deal is going to happen over the weekend. as there were so many reports that deutsche bank's ceo is meeting with the doj representative. there was also much talk last week when he was in new york. so i guess the demand of expectatio expectations which was cleared up toward the deal over that weekend was so high that we see now huge disappointment. of course, people are now saying if the deal is not reached over this weekend, the settlement

price may actually be higher than the reported hike for $4 billion u.s. analysts are saying that anything below 6 billion u.s. dollar is positive for the position. anything above it, they have to raise capital. because their capital buffer or the litigations reserve i should say for these kind of things is rough roughly 6 billion u.s. dollar and nothing more. >> annetta, on friday there was speculation in the market that led to volatility in the stock that they would come back to raise the 10% stake to 25% in stocks. that was later denied. do you think that's because they

have so much money in that investment? >> yeah, well, they are very loyal as a family investor. and looking at what price they have already invested in, they have had a huge loss already by now. but when we look at the oil price and other problems there in their country, not only are they not cash rich anymore, they will also look into the detail. but depending on where you are, if you are already invested, you might think, okay, what the heck, i'm going to buy into low levels now. because the shares obviously are creating close to record lows. but all that speculation from the qatari family was official with no comment. but there was speculation out surrounding the potential capital increase of deutsche bank, i guess probably if the bank is going to raise capital, they will wait until any

settlement with the doj. because a, they don't want to be seen as cash rich. and b, what to tell investors that they spend the money directly for a settlement with u.s. authorities. back to you. >> annetta, thank you for that. meantime, the italian finance minister said that european institutions should be aware of the systemic implications of their decisions. speaking to cnbc, he warned europe's banking system still remains fragile. >> i am not commenting on the specific decision, but certainly there is an issue there which has to do with the fact that on the one hand the europeans are struggling hard to compete in the euro market, not just the eurozone, but in the situation in which the banking sector is too fragile. still dealing with the legacy of the financial crisis. for reasons i can understand,

although i'm not fully familiar with a foreign entity, a foreign institution fully independent, introduced as an element of agility in the system. all institutions should be aware, especially their national institutions should be aware of the systemic implications of their decisions. >> cnbc also spoke to the chairman of ubs who said european banks have a problem balancing probability while dealing with settlements from the past. >> so first what i usually say when i'm asked about the european banks is we at ubs are not a european bank. we are a swiss bank. switzerland is not part of the eu. you don't see that switzerland is part of the union. we have a totally different relationship. here we have 20,000 out of our 60,000 workforce in the u.s. so we look at ourself as a swiss bank with a big home market, 20,000 people, but also as a u.s. bank. we have a large u.s. footprint.

we are in 300 cities across the u.s. for us the issue of home versus foreign and u.s. is never there. you need to focus your presence in the u.s. market as if you are a u.s. bank. you need to behave and have people run this that understand u.s. clients, that understand your legislation and you need to run thbank like that. we have not always been good and perfect on that in the past, but we are really focusing on doing things right here in the u.s. according to u.s. rules and basically playing by the rules. the past will be remediated through a number of settlements that happen. we're talking here about things that went wrong in the early 2000s. and i have no insight whatsoever into the exposures or risks of proportionality of any of our competitors. so it is very hard for me to judge. the one thing that we do trust is that the u.s. system, we are talking about private litigations, the u.s. system will ensure that when this is settled there will be

proportionality. you have heard demands out of the german government that ask for the proportionality. it is more about understanding the issue and seeing no differential treatment. i'm pretty sure this will be the focus of the u.s. as well. >> i understand your effort to not get too involve in this. but let me just tell you what i was told when i conducted an interview, he said it is frustrating when you try to rebuild capital levels in the banking system and then there's a fine that swipes away all the good work that's been done trying to rebuild those capital levels. as a former central banker who understands the need for banks to work and to deliver money into the real economy, you must look at this story, though a little aghast and think, every time a fine comes down, it means that's another small business in germany or somewhere else that's not going to get money. >> no, it's not quite like that.

what i think we needed to do, and now i'm in my fifth year at ubs, you need to have a balance and recognize if things went wrong in the past, you need to put them right. if i look at ubs, we have over the last four years raised $5 billion capital, we have basically paid out $7 billion of dividends to our shareholders and we paid $8 billion in terms of litigation costs. so the balance, and at's in everyone's institutional interest, is you need to have a balance between building capital and preparing the bank for the future and settling your legacy. it has to be done. and we did that because we moved early, we got out of businesses that were no longer profitable and we focused on the things that were profitable. that's why last year we had a $6.5 billion profit. if you have no profit, if you're running low profits, you cannot build capital and settle the past. so it's very much up to every clause of every bank to focus on the right balance between

settling the past, being profitable now and building the bank of the up too. and i think european banks have a problem in the sense that many of them are still in the transformational business model to reinvest and ensure shareholders that are at the core of the franchise that they have the capacity to earn. william hill and amaya confirmed they are in merger talks. the potential merger of equals would be a reverse takeover under listing rules. a tie-up would create a clear and national leader across online poker and sports betting and discussions were ongoing. hillary clinton and donald trump attacked one another's fitness for the presidency in the heated town hall debate that wrapped up just a couple hours ago. this after a 2005 video e merged on friday in which the republican candidate donald trump described globing women and used highly vulgar language.

steve handelsman has more from st. louis. >> reporter: tension from the start, no handshake. and soon came the question, didn't trump on the 2005 tape just released admit to a crime? >> you bragged that you have sexually assaulted women, do you understand that? >> yes, i am very embarrassed by it, i hate it, but it's locker room talk. and it's one of those things. i will knock the hell out of isis. >> have you ever done those things? >> no, i have not. >> hillary clinton said the tape revealed true trump. >> i think it is clear to anyone who heard it that it represents exactly who he is. the question our country must answer is that this is not who we are. >> and she talks about words that i said 11 years ago. i think it's disgraceful and i think she should be ashamed of herself. >> trump targeted her and bill clinton in the audience along with women who accused him of sexual misconduct.

>> but bill clinton was abusive to women. hillary clinton attacked those same women and attacked them viciously. >> reporter: trump switched to hillary's e-mails. >> again, you should be ashamed of yourself. >> okay, donald. i know you're into big diversion tonight, anything to avoid talking about your campaign and the way it's exploding and the way republicans are leaving you. >> reporter: republicans who did not bail out pleaded with trump to be low key and contrite tonight, which he was not. >> it seems like he was definitely a little more measured. on the other end, it seemed like this was the most aggressive, the most gloves off debate that we have ever seen. and we only have three to four weeks to go. can it get any worse than this in terms of the language? >> i thought it couldn't get any worse but it just did a couple days ago. i mean, it is really incredible that these are things that are being debated like you say three weeks ahead of the actual election. it is just phenomenal.

and at what point do you say, well, the signals that this says to society, not only women now, but you're talking muslims, mexicans, the list goes on in terms of the insubjects, right? >> it does. >> but it is interesting from just kind of a news perspective, how do you cover it? do you describe the words that he used? >> well, you have to in a way. >> well, yes, do you use the words that he used, you have to, but yet it is offensive. it's not offensive when he said it's locker room talk. somebody said to me a long time ago who runs a very big company, he said to me, i don't do business with people i don't like and with whom i don't trust. at what point do other global leaders or do other business leaders look at somebody who says all these things and says, i just stopped trusting. that goes for all candidates out there. >> we have seen the fallout. according to a public opinion poll by politico, 39% of voters

think he should no longer run for president. 45% say he should stay. and at least 160 of the united states 332 sitting republican governor senators, house of representative members have condemned his comments. many said we will not vote for him. so the fallout is very clear. people are taking actions. is this something he can shake off? that's the big question. and we should talk about what the market is making of the latest debate. we'll look at the mexican peso that made strong gains against the u.s. dollar reaching a one-month high signaling markets are lessening the odds of a donald trump victory. meantime, u.s. futures were pretty much unchanged. that doesn't tell you a lot because last time clinton was seen winning the first debate, the u.s. features or futures saw a big rally. didn't happen this time around. >> what do you guys think? we would love to hear from you. neutrally, i generally don't care who wins on either side. i think there's a case to be

said for, you shouldn't maybe be too far right or too far left. but if everybody can be in the middle and it works out for the greater good of everyone out there, maybe you disagree. e-mail the show, you can find us on twitter @streetsigns. >> keep the tweets coming. @carolineroth. >> or @louisabojesen. we're talking within a 1% difrence in reliability of each other. and, sprint saves you 50% on most current national carrier rates. save money on your phone bill, invest it in your small business. wouldn't you lov more customers? i wod definitely love some new customers. sprint will help you add customers and cut your costs. swit youbusiness to sprint and save 50% on most current verizon, at&t and t-mobile rates.

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we are 19 minutes after the top of the hour. let's check in with pauline out of singapore. hi, pauline. >> reporter: good morning to

you, louisa and caroline. the asian markets are mixed even though volume is light as several markets are closed for a holiday. japan and taiwan, that is. the kospi is up 1.1%. a supplier confirmed to cnbc that samsung halted production of the galaxy note 7 because some replacement devices continue to overheat. so we saw samsung under pressure today. now we'll talk about the asx 200 that ended up .10. doubts persist whether opec nations will come out with a production cut. and look at the bench production in thailand. at one point today it was down by 3.6%. right now it's down by more than 3% after the royal palace in thailand issued a statement on the health of the king. the royal palace said the

88-year-old monarch is, quote, in unstable condition. and financial markets in thailand react very quickly to news about the royal family and the monarch who is high he revered in thailand. louisa? >> thank you, pauline. now frankfurt is reportedly vying for british banking jobs in the wake of the brexit vote. germany is changing their labor laws to make frankfurt a more financial hub. the changes include imposing an upper salary limit on employee protections on 150,000 euros that could affect redundancy terms. they have responded to say there are no concrete plans to change the law and the finance ministry declined to talk about the plans. we'll talk about global bond funds that attracted 11.4 billion in inflows bythis

highlighted the surge in global bond yields. meantime, it does seem the investor appetite is falling for gilt. they surged last week briefly above 1%. the sterling tumbled to a 31-year low. and we are seeing the ten-year gilt yield at 0.99%. why are we seeing this, because of the depreciating sterling, or the current account deficit of 6%? what is it? >> i would say all of it. we have heard samsung call out volatility implication. if you remember the film "spinal tap" where they managed to turn it up to 11, it feels like that. when you get these kind of bad impacts on markets, liquidity can be poor. they are trying to take a lot of gilt out of the market anyway.

whether it was an algorithm gone wrong having an impact on the sterling market, we don't know. but the impacts are continuing this morning. of course, we have seen hard brexit concerns to worry investors. people being caught in the crossfire of this, perhaps long sterling or long gilt. basically they are continuing to see technical levels get bridged. you have to remember at 94, 88 to 94 was a key level in the ten-year, and that broke through. so we could be pushing to further resistance levels this week as we see more flow. >> is the sell-off a reflection of investors now doubting the boe, specifically after the comments from teresa may questioning the effectiveness and the side effects of quantitative deciding? >> probably. but if you go back to recent

history post qe, you tend to get sell-off in gilt market or in europe very much so. some of the qe you have seen sell off in the u.s., we saw treasury yields rise post that as people start to look at the impact of the weaker currency having a bigger impact on inflation. this move is quite significant. what worries me is that the inflation pressures could build quite quickly in the uk. the uk finds sticky inflation when it comes through. and we have seen gas prices up 6% post referendum. that is going to have an impact, too. it's a conflict of many events and finding itself propagating in the process. >> let me broaden it out a little bit and ask you where you are seeing the most activity at the moment. you said you are pretty busy and seeing quite a lot of flows as well. >> yes. people want anything on cash. in fact, a lot less on cash now with european investors getting negative return. we issued the corporate bond

yield that now yields 4%. so obviously if you have zero, you can take risk with investors that way. the other thing we have been doing in the strategic bond fund is looking at the way the kurds have pounded down flat. one of the places we have been buying is the yen. so we are looking at the short bond fund and the strategic bond fund. and we are looking for good managers to identify good opportunities in emerging markets. the reason the end looks quite attractive is because even if spreads widen in the end, say the spreads blew out to where they saw you in the lehman's level and stayed there, you would still outperform the treasury market. the reason being the spread as a percent annual of yield is so attractive, but you're getting paid to take risk in carry. >> let me also ask about portugal. because i noted last week, the yields in portugal have been up,

eight-month highs or so. and now we have portuguese rallies, this one rating agency out of the big four, changing away from the investment grade. so they are still eligible for the quantitative easing program. do you have any fears with regards to portugal and think they are safe? >> well, we don't trade portugal. so i tend not to get involved too much in the european market, basically because yields are a lot lower than i can achieve in the uk in terms of corporates and the gilt market. it has historically traded a high yield in portugal until more recently. in the whole european banking system, whether it be portuguese or italian, we have seen the risk associated with the department of justice in the u.s. on the german banks. i don't feel the german banking

system is fixed. so i feel they need the ecb to stand behind them. i don't think portugal is a safe investment in the ecb. what i liken the ecb to is stabili stabilizing a bike. i still need to stand beside my son even though i have taken the stabilizer off. i think we are going to see the stabilizer off and wait for the banks to run on themselves. the u.s. banks seem to be able to do that. some of the uk banks are close to doing that, but the european banks haven't done that. >> that's a scary thing, taking the stabilizers off the bike, huh? >> yeah. >> once they are off, if you put them back on again, do you trust them? >> well, anyone can crash at any time, i guess. >> bryn, thank you so much. after the break, we are at

the world energy congress in istanbul speaking to bp's ceo bob dudley. first, we need to check out the world markets live. find us on twitter and get involved in our discussions, @carolinecnbc or @louisabojesen. see you in a sec.

welcome. you're watching "street signs." i'm caroline roth. >> and i'm louisa bojesen. your headlines this morning. no deal for deutsche bank. shares extend losses as a settlement between the doj lender remains elusive. and the saudi prime minister says he's optimistic about the opec production deal by november. crude prices remain under pressure as producers gather for the world energy congress in istanbul. we'll be speaking to bp's ceo

bob dudley coming up in the next half hour. and william hill, all bets are off. they soar to the top of the stoxx 600 as talks continue about a merger with amaya. and donald trump and hillary clinton focus more on insults than policy following the latest scandal. >> this was locker room talk. i'm not proud of it. i apologized to my family, i apologized to the american people. certainly i'm not proud of it, but this is locker room talk. >> i think it is clear to anyone who heard it that it represents exactly who he is. because we have seen this throughout the campaign. good morning, everyone. i just realized we are both channeling hillary clinton pantsuits this morning. no intention. there is no agenda behind this.

>> maybe this is where, like we run off and change into like eight-footed frog outfits to be completely in the third party. >> let's not do that. >> i'll do that. >> but a big coincidence. but we'll show you what the u.s. futures look like. looking quite positive. the s&p 500 up by 5 1/2 points. this is after u.s. stocks fell slightly than expected. the dow jones was off by 0.2%. the s&p off by 0.7% snapping a three-week winning streak. but this week is the start of the u.s. earnings season. in terms of the european markets, we are down across the board. the xetra dax showing a loss of 0.11%. and no deal yet with the doj. the ftse 100 is flat to slightly

lower but well below the 7,000 level. that was the only inthe exthat gaped last week. and on friday on the back of the flash crash in the pound and the ftse, they are off by 0.7%. we did get strong data out of germany this morning. exports in the month of august rose dramatically by more than 3%. that was the biggest jump in six years. what it also shows you in the currency markets, we are still seeing some weakness in the pound versus the u.s. dollar. but back above the 124 level but still down by 0.2% on the day. and i want to show you the continued strength in the mexican peso against the u.s. dollar, which often is seen as a proxy for the u.s. presidential race. and that is still looking to the thinking of hillary clinton whipping it. winning it. he told delegates at the world energy conference in istanbul

that opec shouldn't curb supply too tightly. >> i think opec needs to make sure we don't kramp too tightly. we want to be very responsible. the prices have dropped too low to impact investment. many companies are hurting and many countries are hurting. that needs to be relieved, but at the same time we don't want to get or give the market the opposite signal and shock markets into prices that could be harmful. >> wti crude this morning is off by .50%, 49.56 after rallying strongly last week. it was up by 5.8%. brent crude up 51.76. close to four-month highs this morning. it's off by a third of 1% this morning. in just a few minutes' time, steve will be talking in istanbul to the ceo of bp, bob dudley. we'll bring you that as soon as we get it. speaking to cnbc, the bureau highlighted the impact in opec

production cuts on the oil market. take a listen. >> i see that this channel is a serious challenge. but for me, more importantly, if there's a deep cut in oil production from the producers side, it will first quicken the markets much earlier than we thought under normal meeting conditions. and the higher prices, they put upward pressure and could impact the trade coming from the united states. >> now the u.s. presidential candidates attacked one another's fitness for the presidency in the heated town hall debate that wrapped up just a couple hours ago. this after a 2005 video e merged on friday in which the republican candidate donald trump described groping women in highly vulgar language. there have also been further clips posted from the "howard

stern" show. take a listen to that if you desire, but the two candidates greeted each other without the traditional handshake and set the tone for a highly contentious evening arguing over trump's treatment of women. democratic nominee hillary clinton's private e-mail use and the respective foreign policy plans. now nbc's tracie potts is joining us from washington. tracie, a lot of people are amazed at what is being debated three weeks ahead of the election. >> reporter: yeah, not the money in your pocket, not your taxes, not your health care but whether or not donald trump admitted to groping women more than a decade ago. his campaign would say irrelevant and he apologized for it. but the point of the debate, the point of the moderators in the debate last night was not to revamp the apology, which he did, but to pin him down on whether or not he thought the description of what he did, kissing women, touching women in private areas without their consent, amounted to sexual

conduct. and they stuck to trying to make him answer that. and he said no, because it was just talk. he actually never did it. he was just talking about it. and to draw contrast, he invited four of the accusers of bill clinton to sit right in the front row, not in the family boxes they had wanted, but in the front row facing hillary clinton. she defended against her e-mails once again. >> tracie, i know a lot of people here, at least, why don't they just put another republican candidate in place instead of trump? if the republicans deem trump to be unfit, why not just put somebody else in the position at this stage in but it is not that easy. >> reporter: no so easy. not so easy at this point. we are now inside of 30 days from this election. ballots with his name on it have been printed. some have gone out overseas to americans living overseas that get to vote. early voting is already underway.

so is it really fair to put one set of people on the ballot for people who have already voted and switch it? and have others voting on someone else? not only is it not easy, it may be against the law on both sides, democrats and republicans have had attorneys trying to look into this. and the consensus seems to be unless he willingly drops out, which he says he absolutely will not do, or unless he dies, they may not have a choice to hold on to trump as their nominee. >> tracie, thank you very much. tracie potts joining us live from washington. people writing in on this topic this morning on e-mail and twitter as well. caroline, one of the e-mails coming through from viewers saying, the real question for me is would i let this man pick up my granddaughter and drive her home? the answer is, not over my dead body. that answers it up for us. we'll look at the oil markets where after a strong

valley last week, wti is u up .62%. let's go out to steve in istanbul with a special guest. >> reporter: good morning. i'm here with bp's president bob dudley. given what we have heard from the saudi minister post-algiers, what do you make of it? >> it's a lot of discipline it's giving us, but there's certainly breathing room with the oil price to fit the fundamentals. the world is in balance today. so the prices aren't a surprise, but we still have a lot of new industry to keep our costs down. >> reporter: that is interesting, you think we're in balance, because i was talking to others earlier on who think it may be a bit more time before we call balance. he's saying early 2017. >> if you look at the daily

balance, it is pretty much there within a half million barrels one way or the other. but the stocks are so high, so you won't be able to tell until they slowly drain and sentiment changes. >> reporter: you have been lowering your costs of production really aggressively in shell, but i seem to have this level in my head, 55 to 60 and then they feel a lot more comfortable. >> we are going to rebase our. we said 60 next year. we are under 55 now. we can see our way to around 53 next year. we've got to do that. and hopefully these costs will drive hard to make them sustainable. so we don't have to rely on big swings in price. actually, that is not healthy for the industry, it's not healthy for the countries or consumers either. >> reporter: we are talking volatility and the new normal, but looking at the chart, we just had three years from 11 of 2014, but volatility won't

continue, will it? >> analysts say it will stay up high forever and keep going up. and when it is really low, people say it is really low forever and will keep going down. commodities do cycle. and we've got to learn the lessons of the past. i think we have all been through about four of them since 1986. and this is a really rough one, there are less sons for all of us. >> reporter: in terms of what will get you investing more, to have more before this decade, is that the case? >> we have to be careful what we are investing in. it is scarce capital. we will continue to invest, certainly. the company bp sells just to stay flat has to bring on 400,000 barrels a day of new production because of the way oil and gas -- people think you're bringing on in the states there, it just declines. we'll be investing in capex as there are good projects. the gulf of mexico had $20

billion in 2009, now it is under $9 billion, there are good projects and we'll continue to invest. >> reporter: you have been looking backwards and had to do a lot of work satisfying the claims of litigation, the settlements and what have you, do you feel like a new man that can go forward and do what the rest of your peers are doing in the industry? >> well, i do think we can draw a line under it now. without the line being drawn, it was hard to plan the company for the next decade. we have drawn a line under it, we provisioned it and it cost $61.6 billion, not to put too fine a point on it. we have the provision and know what it is going to cost us. now we just got to be safe, operate reliably, and that will lead to cash flows and get back to the oil company. >> reporter: the small question about opec, you have more capital if you didn't defend the dividend so aggressively. in a world of low interest

rates, that is salivating. >> the shareholders really want a dividend. really, the feedback i get is that they want us to maintain the dividend. the share price has moved up. the dividend rate is near 6% now. we'll defend it with $17 billion in capital a year. we have probably gotten well over $25 billion in cash costs. we can certainly reduce those before we need to cut a dividend, which is in the 6 to 7 billion range a year. >> reporter: how is the environment, as far as you can see, in terms of what the saudi oil minister had to say this morning about not crimping oil growth and not shocking the market as well. do you see any hope of an opec deal? you have been around with opec deals and cheating on opec deals, how do you feel about algiers and what we nd to see next? >> i didn't know what to expect out of algiers. companies who traditionally

don't have good relations actually make some understandings and agreements there. i think what is less important, what are all the details of the agreement? just the fact that people are talking and there's cooperation is very significant. they will continue to talk. i think even here in istanbul and we'll see what happens in november. as an oil company, not part of opec, we're not going to rely on that, depend on that. we're still going to make our changes and adjust, but you do see changes in the market. the world recognizes $1 to $2 trillion in projects canceled or deferred. i think there's a nervousness that can catch up with the world down the road here. so there's a lot to talk about. >> reporter: you know russia perhaps better than anyone, uh you still have a significant presence there. do you see any scenario where the russians will join the output on cuts let alone forcing a freeze? >> i have listened to what president putin and the energy minister novak said about

supporting a freeze. i don't know that cuts, whether they are in the cards or not. the russian oil industry is running very fast now. it's production drifting upwards. so the fact that they are also involved in discussions is, i think, significant. >> reporter: and we talked previously about iraq as we. iraq and iran, perhaps the thorn in the side of saudi efforts to have some form of pan opec agreement as well. iraq wants to voraciously cut production. iran as well. you're in one, in the in others. how do you rate the situation across the two countries? >> iraq has an enormous amount of challenges. it's got the conflict, we operate a very build field there and provide a lot of money in treasury. we are all doing what we can. the way the contracts work, they reimburse companies with capex. and everybody's slightly going slower. i don't see iraqi production shooting up. iran, which is at 3.7 million barrels a day is up to, very

close to their pre-sanctioned level around 4. so i think that's what has taken time for the discussions to get to where they are. you'll have to talk to the opec people about it. >> they say they want to get to 4 and then we're happy -- talking about 5, 6, 7, so you do wonder if it is feasible without companies like bp being more aggressive. >> i do know iran was talking about 5 or 6. that was pretty open news thune enthusiastic. >> reporter: the agreement didn't go forward with the price which you and patrick really wanted to see as others. are you going to say, which is what we do next in terms of the ioc and in terms of carbon? >> we have a group called the oil and gas climate niche tich. stay tuned to november 4th in

london. we'll come out with announcem t announcements on that. we have ten big companies working around the world including national oil companies on things of carbon capture use and storage. we're going to really work hard on the gas market and maintaining our -- reducing and eliminating flaring and reducing emissions. i mean, coal emissions are much higher than gas. the world has to comeo grips as does it want coal or natural gas, clean burning fuel. we'll talk about that. all the companies realize and accept the agreement in cop 21 as a good thing for the world. we are all working internally to head to the lower carbon transition. our portfolio is now 50% gas and that will continue to go up. these are the kinds of things we want to play out going forward. >> reporter: it's been a pleasure. thank you so much for your time, bob. we'll see you soon. happy november in london. bob dudley there of bp. >> thank you very much, steve. good stuff.

thank you for your e-mails. michael is saying, i'm rightly offended by donald trump's locker room language, but i also express outrage at hillary clinton's lies. he goes on to list a thing of all the issues with hillary clinton. i'm happy to talk about all of it. i just find it really interesting to see how politics have changed so much. what the debate topics actually are now. and what you should accept if you are an american and what to accept in terms of who you want your leader to be and why. but michael, i hear you. by all means, keep your e-mails coming through. you can find us on streetsignseurope@cnbc.com. still coming up on "street signs," with the government looking to cut the hard brexit rhetoric, there are fears that this could signal more volatility. we'll be back in two.

hi, everyone. fed vice chair fischer said forecasts are solid. he said the united states is close to full employment, an indication that the december rate hike is likely to be in play. now the u.s. added 156,000 non-foreign jobs back in september falling short of expectations. the unemployment rate rose by 0.1% pointing to a small increase in slack in the economy. cnbc spoke exclusively to the cleveland fed president who said that the miss is nothing to worry about. >> you are seeing solid numbers consistently this year. i would say, we're 192, i think

you said, is the three-month average, which is a solid number. the unemployment rate is about at what my estimate of full employment is, the natural rate of unemployment. that's a good number. the incomes are going up. you have solid hours work. so i think this is very consistent with what we expected to see. certainly with my forecast. >> meantime, uk businesses have urged the government to be consulted more as preparations for britain's brexit negotiations get underway. in an open letter sent by the cbi, the business lobby group emphasized the importance of maintaining access to the market warning there could be negative consequences if adequate trade deals were not in place. the letter comes amid a government u-turn on a widely panned proposal by amber rudd to force companies to list how many foreign workers they were employing. meanwhile, a survey of 7,000 businesses by the british

chamber of commerce looked at four-year lows in the third quarter. the significant slowdown in key services was a significant point of concern. >> speaking to cnbc, the italian -- i guess we're not going to do that story. >> we jump sometimes, don't we. >> it just brings up all kinds of surprises. let's talk about the head of the european g-10 bank merrill lynch. have you recovered from the crash? >> it was quite the day. these things are not supposed to happen very often but they keep happening in the market. i think all the investors are scratching their heads. they don't know what to make of this. we still don't know what is causing this behavior. i think at this point it can be choppy. at what point, either the market will stop focusing on the debt in the uk but we don't know what is going to happen at this

point. >> you have been writing about phantom liquidity before this crash actually happened. you said phantom liquidity in the essex market fueled complacency. does that tell us that the flash crash could happen again to another currency in low liquidity trading overnight? >> it is definite ly low flak. we are seeing the same volume of effects. you get 60% sharper market moves. i think this could happen to any currency, most likely this was triggered by a hard brexit headline that we have seen the last couple of weeks. but we have seen this happen before in the dollar, that is an indication of the problems in the market. >> you get 60% sharper moves -- >> for the same volume of effects. and this is the most liquid market globally. if there is a liquidity problem

in this market, emerging in other markets. >> how much lower could the pound possibly go? what is the elasticity? >> when you compare standing with the data, they should be closer to 155 rather than 125. positioning at this point i will argue is neutral, especially after what happened on friday. we can see some further downside, perhaps even below 120. in the headlines about a hard brexit persist. however, i will argue that as long as the data remains strong, this is most likely buying opportunity eventually. >> no one has been doing that or buying sterling on the better-than-expected data points when it comes to the pmis and industrial numbers. but the pick up hasn't been there. there's no marginal buyer as long as we still have the hard brexit comments. >> that is absolutely true. three weeks ago when we were getting the strong data, in the

last couple of weeks the market has completely known the data and accomplished it on the brexit headlines. >> how am i supposed to think about sterling sidelined with the u.s. election? like, what do you think the big play is going to be in three weeks or up to three weeks? >> definitely the u.s. elections is a risk. and one can argue that these are still on the rise from the markets. i'm not sure this is the best way to trade it. dollar/yen or aussie/dollar could be a better way. >> if you're positioning long dollar, short dollar, what is the impact going to be for steriling? >> i will argue it could still be negative. >> finally, when we talk about elections, you can't ignore the mexican peso? your view on that, it is more bearish, it seems.

>> nothing is fresh on the american elections except for the peso. it is of the value depending on your estimate 15% to 20%, but it is definitely the o that will respond the most given positioning. >> thamos, thank you so much. the head of the european strategy at bank of america merrill lynch. yes. >> implied open on the right-hand side of your screen. i'm louisa bojesen. >> i'm caroline roth. u.s. markets are closed today. "worldwide exchange" is up next. in reliability of each other. and, sprint saves you 50% on most current national carrier rates. save money on your phone bill, invest it in your small business. wouldn't you love more customers? i would definitely love some new customers.

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good morning. your money, your vote. donald trump and hillary clinton square off in a second presidential debate. we'll bring you the highlights straight ahead. no deal for deutsche bank as shares are under pressure as investors want word of a doj settlement. and samsung us is spends production of the note 7 as they deal with factory problems. it is monday, october 10, 2016. and "worldwide exchange" begins right now. good morning. welcome to