welcome to "street signs." i'm joumanna bercetche >> i'm willem marx these are your headlines this morning from london. hurricane florence is just moments away from making landfall on the u.s. east coast pounding north carolina with a life threatening storm surge and heavy winds. european stocks gain on hopes of renewed trade talks between china and the u.s., but david tepper warns it could lead to a market selloff amid the late stages of the bull run. >> if you ask me, i think it's

late-inning game i'll say it a different way than the sixth, seventh inning. i don't play the way those other guys play. i could say it's the eighth inning, but sometimes baseball goes extra innings. mark carney reportedly says a no-deal brexit could lead to economic chaos and a property crash. but jd whether spospoon's chiefs he is exaggerating >> poor old mark has not had much to do, he had to put interest rates up once and down twice in the last few years. he got everything wrong. and the boss of the world economic forum says we have not moved on from the global financial crisis ten years after the down fall of lehman he says problems have only been postponed. >> we have found a way where we give, let's say, a whole mess,

which we have created to the next generation to sort. hurricane florence weakened to a category 1 storm as it closes in on the carolinas, but strong win winds and heavy raina lashing the coast. there could be catastrophic flash flooding even as the storm weakens. jay gray filed this report from carolina beach, north carolina where the hurricane is expected to make landfall >> reporter: the early calling card from florence, driving rain, wind and waves >> this is a powerful storm that can kill today the threat becomes a reality. >> reporter: and this is just the beginning. roads have already been washed

over communities from virginia through the carolinas are filling up water pushing into places it's not supposed to be, and more is on the way >> the first bands of the storm are upon us. we have days more to go. >> reporter: the massive storm is expected to linger. >> this is enormously dangerous. >> reporter: meandering along the coast for 36 to 48 hours battering communities across the strike zone. jay gray, nbc news, carolina beach, north carolina. energy infrastructure in the hurricane's predicted path include nuclear plants, lng facilities and two key pipelines. one is called the colonial and it carries gasoline and diesel from texas to new york, while the plantation pipeline moves crude oil. our next guest says potential disruptions in refining and

transport could cause the gains in crude prices to fall away you can see brent is close to that $80 figure. 78.50. almost got to 80 just a couple of days ago. again trading stronger as we head into the day of the storm that's hurricane florence, of course we'll be monitoring developments >> any time hundreds of thousands of people are evacuated from their homes, you can't help in a storm like in, but think about the human impact what do you see as the second order effects this hurricane >> you're right, the human impact is real people are having to evacuate homes. they'll be without power it will be hurtful in terms of the impacts on commodity markets t may shg it e transitory when people evacuate homes and

power consumption is lower, that means things like natural gas, oil could be lower >> homes are essentially empty so people are not using cookers, fridges, air conditioners. >> that's right. so business activity falls off people are not in the homes consuming the energy that they would have been consuming. >> there will be an increase in demand for gasoline. gasoline prices are likely to increase but that should have a depressing impact on oil prices. if there are disruptions to those pipelines that joumanna described earlier on, that would mean the oil produced in the shell-producing regions of the u.s. are unlikely to get to their destination sources quickly enough that would mean that there's a glut of oil being produced and

the refiners are not consuming that oil so gasoline prices could go higher but oil prices could go longer >> how long do you expect these impacts to last for? the hurricane hits this evacuation effort in terms of the damage and in terms of the impact on oil and gas, are you expecting lasting effects or just a transitory thing? >> it should be quite transitory looking back at historic hurricanes, yes, power outages have existed for more than a week ten days on average. there is a lack of consumption there, that should depress prices we should overcome that as the rebuild effort takes place as the storm has been downgraded in terms of its -- in terms of its strengths, that should reduce some of the knock-on impacts. >> what about the impact on

agriculture, soybeans in that part of the world. do you expect an impact there outside of the energy complex? >> yes it's very likely there will be damage to soybean crops in the carolinas. in terms of the actual aggregate output of the carolinas versus production nationally, it's a small fraction so there will be an impact it will be negative in terms of production, therefore should have a marginal positive price impact but it won't be large in scale indeed what will overshadow that is someof the trade restrictions around exporting soybeans to china. that's somewhat overshadowing this impact. >> in terms of the markets, going back to energy, you have got shale product coming out of basins, places like texas, getting to the coast through these pipelines, colonial one of them at what point where is a lot of that going now

>> so that product -- the pipelines are open right now there is not any measurable impact >> which geographical markets as buyers of that product would see an impact if this is infrastructure is damaged? >> it's mainly the u.s. product. the product is coming out of texas, the permian region, goes through the pipelines into the east fining activity there and then goes north to new jersey most of that product is being -- the primary consumption is domestic u.s. is a large exporter of finer product, but for right now that's almost a secondary impact we will not see a huge impact on global markets as a result therefore brent and wti could

decouple you could see the spread widen more over due course because of the downward impact on wti versus the continuous strength in brent >> i'm sure as a commodity investor you will be watching closely. that was the director of research at wisdom tree. just to bring you quick numbers out of italy, we got the revised cpi numbers. the final numbers for august have been marked down. joumanna bercetche >> brilliant so let's check in on how markets are trading. we're trading off the positive tone from wall street. had a good day for the three makers yesterday a bounce back in tech again. apple was one of the names leading the charge up 2.5% after its launch day again, asian equities trading in the green. again, here on the back of the potential discussions going on between the u.s. and china terms

of finding detant vis-a-vis the trade, fixed asset growth coming in on the low side versus expectations slightly lower than expected pointing to a somewhat of a slowdown in chinese activity generally speaking markets are starting off the last day of the trading week up 0.2% for the broader composite index. let's dig deeper ftse 100 trading positive today, up 13 points, 0.2%, after what i would deem as an uneventful bank of england event yesterday all of the comments there driven by the political back drop carney made some comments with respect to the likely impact a no-deal brexit would have on the economy and the housing sector house builders are coming under pressure this morning on the back of those comments

we also had xetra dax and cac 40 trading in the green the message from the ecb yesterday is that they are sticking with the plan and continuing with the asset purchase plan until december keeping optionality in case conditions change. ultimately the outlook seems positive draghi seemed upbeat but not really a market moving event ftse mib, the italian index up a half percentage point. >> china's industrial output topped forecasts in august while investment growth dropped to a record low industrial output rose 6.1%, slightly above expectations, but fixed asset investment growth slowed to 5.3% between january and august china says global trade needs to be fairer and more effective beijing has also called for reforms to the wto and said the organization has to pay more

attention to the needs of developing nations the impact from trade frictions will have some effect on the global economy, but they will not be too significant david tepper has trimmed some exposure to equities because of the trade war with china he told cnbc he's uncertain about the equity market and warned stocks could drop as much as 20% if trade tensions worsen. he said it is hard to be precise about markets but decisions on tariffs will be significant. >> china is stimulating, they're stimulating because the tariffs are coming so that might push us into higher interest rates. so a little tricky at this point in time. it's the sixth, seventh inning, i don't play the way other guys play it could be eighth inning, but you know what happens in

baseball extra innings. that happens if you ask where is this market now? to me the market is fair valued if you don't have tariffs on china, okay? but if you do have tariffs on china, the question is how high does the dollar go, and where will earnings be in that case. then the market will be rich at this level. coming up, mark carney's comments chill some members of the uk cabinet during discussions of the impact of a no-deal brexit find out what may happen to the uk housing market in the months ahead. man: are unpredictable crohn's symptoms following you everywhere? it's time to take back control with stelara®.

for adults with moderately to severely active crohn's disease, stelara® works differently. studies showed relief and remission with dosing every 8 weeks. woman: stelara® may lower the ability of your immune system to fight infections and may increase your risk of infections and cancer. some serious infections require hospitalization. before treatment, get tested for tuberculosis. before or during treatment, always tell your doctor if you think you have an infection or have flu-like symptoms or sores, have had cancer, or develop any new skin growths, or if anyone in your house needs or recently had a vaccine. alert your doctor of new or worsening problems, including headaches, seizures, confusion and vision problems. these may be signs of a rare, potentially fatal brain condition. some serious allergic reactions can occur. do not take stelara® if you are allergic to any of its ingredients. man: are you fed up with crohn's symptoms following you? talk to your doctor today, and learn how janssen can help you explore cost support options. remission can start with stelara®. everything was so fresh in the beginning. but that plug...quickly faded. luckily, there's new febreze plug.

it cleans away odors and freshens for 1200 hours. [sniffs] ahhhh! breathe happy with new febreze plug. thanks, janet. it's welcomemy happy place. store. you can learn how to switch to xfinity mobile, a new wireless network that saves you cash. and you can get 5 lines of talk and text included with your internet. and over here i'm having my birthday party. dj fluffernutter, hit it! ♪ dj fluffernutter simple. easy. awesome. ask how to get $300 back when you sign up for xfinity mobile,

and purchase a new samsung phone. visit your local xfinity store today. stor whether weatherspoo welcome back italy's deputy prime minister has urged mario draghi to look after italy's interest rather than just criticize the country. salvini said he was responding to comments made in a press conference yesterday after draghi was asked about the role budget discussions have had on haven't market volatility. >> words in the last few months

have changed many times. what we are now waiting for is facts. the main fact is the draft budget law and not only that the subsequent parliamentary discussion we have to see how that is then investors will formulate their view >> let's look at how italian bond yelled yields are behaving we have the ten-year rallying a good 30, 40 basis points the last week or so. two-year is trading up 87 basis points slightly weaker on the day

concerns about italy's budget and the potential conflict between rome and brussels is reaching far beyond italy's borders. mandy drury and nancy hungerford now join us. take it away >> hi, joumanna. great to hear from you we are very far from beautiful italian shores, but we're joined here by an italian who is from a large growth equity fund that invests primarily in mid size italian companies. thank you very much for joining us today, marizio. since we just finished on the bond market, how would you say the bond market jitters and the new attempts to calm down those jitters, how has that affected your investment climate? >> has not affected my investment climate as we invest

mainly in equities which are longer term, liquid investments, in companies that we look at for months before investment clearly there is always a benefit of having all the cylinders of the engine including the bond part, the good environment, also for an equity investor as we are. i'm quite hopeful through the months some actions of the government will come through, this blip in the spread that we have seen in the last three to four months will come back into a more normal level that will reflect the fundamentals of the country. >> what do the jitters do in public markets we have seen a discount at times, what do those jirts mean for private markets? is there a discount on assets in

italy due to a story of ongoing political disruption >> if you ever have a situation clearly such as this one, if you feel you have to take a company to public market with ipo, you could experience some discount, but generally speaking the italian equity is experiencing quite a bit of positive news flow deriving from the fundamentals the fundamentals are the following. first and foremost, a lot of companies are not public if they want to buy italy they can only buy little of that because most are still with the founding families that are still carrying 100% of those >> talking about investing in

italy inc, you have locally grown companies, and then tapped foreign investors, have you been able to meet your targets? >> there's been strong demand. we have a fun d of 1.3 billion and co-investments that could take the fund to double of that. for instance some of the middle eastern wealth funds have been coming in with enthusiasm into our fund to capture some of those companies that are jewels that are not easy to capture if you're not a locally rooted fund based in italy

>> i want to hear about your role on the supervisory board of st and micro electronics this is a company that could be vulnerable to trade flows. how concerned are you about that >> clearly it will be specific from company to company, with regard to the smublemiconductor industry, i see strong trends which are linked to some of the new electric vehicles, some of the automated products at the center of what sd and other semiconductor producers do, and therefore independently from some of the constraints that are related to trade difficulties i

generally speaking am quite positive around those companies. >> wonderful thank you very much for joining us today >> thank you very much >> enjoy your time here. back to you in the london office >> thank you very much >> mark carney reportedly karened of a looming financial crisis in the event of a no-deal brexit he said a disorderly divorce could lead to a crash in the uk housing market with prices falling by more than 35% that's when he briefed theresa may's cabinet yesterday. the bank of england chief also has reportedly warned that the central bank could not stem a crisis by slashing interest rates and that unemployment and inflation would rise the bank of england refused to comment on carney's reported discussions with that cabinet yesterday. we are gored by george barkley

thanks for being with us we spotted mr. carney sneaking into the back of downing street yesterday. the bank of england would not confirm or deny if he was there, 10 downing street eventually did. it's not clear that those warnings that he gave whether they are misconstrued or misunderstood by members of the cabinet. in your view how worried should the british cabinet be about the possibility of a no deal >> i suspect he was talking about just not a no dell thal t wasn't planned, i imagine he was talking about a no deal planned and not planned so if you have something that's a surprise, you come to the 29th of march, all of a sudden we're out, we were not intending to be out and we have no deal that's a much bigger problem than going into this saying we want no deal you can transition for that. if you have no deal, no transition, you could be in a

serious mess that's what i think he was talking about. that housing prices could fall sharply, recession, unemployment rise significantly i imagine all of that is certainly a possibility if we get into a no-deal situation without planning for it. >> the bank of england will always publish the scenario analyses it is not just one analysis. we were talking about the banking stress test, they will assume various inputs, one is house prices, gdp, credit spreads, all of those will lead to a certain outputs they are among a different array of potential scenario. so we don't know the crux of this story and what scenario he was referring to how significant are house prices for the bank of england when they're thinking about the overall assessment of the economy? >> they're very important they tend to move along with other things like household consumption, things like that.

housing prices, consumer spending are influenced by wages, employment, interest rates. on top of that brexit will be a big issue. if you think about regional housing markets, i think they'll do reasonably well all of the fundamental drivers are positive the london market is a different matter a bad brexit could see an exodus of city workers that could lead to a decline in the upper end of the housing market >> can i caveat something, we're not picking up on, london house prices have been extremely expensive for a long time. irrespective of brexit, even before the referendum was held if you look at it from price to income perspective, london and the east part of the uk are trading at extreme premium relative to the rest of the country. perhaps this is part of normalization. yes, house prices do need to go down at some point because they were artificially inflated at some point

>> when you look at where house prices are now, we're looking at an average house price in london north of 600,000 for an average. reuters had a poll where on a scale of 1 to 10 where did they give the valuation of london, they gave it a nine. the rest of the country got a seven. so london is overvalued. it's more prone to issues on brexit >> all right we'll leave it there we're all involved that was the chief uk economist from nomura. elsewhere, the latest from europe and also from company news regulatory oversight post-brexit

is a concern for the roche ceo in an interview the boss of the swiss firm expressed worries over how the uk will regulate new medicines after march 2019 warning that the uk drug sector could become less competitive, he said the drugmaker's priority is to develop products in regions where pains can get access quickly. we've been speaking to a number of ceos about the impact of a no-deal brexit, they said it was important to have c contingency plans, but that tha would not be catastrophic. >> if the rules are not clear, we are making contingency plans and increasing in the uk to make sure there is good access to patients who depend on our products >> it's important for businesses to put their points across there's a lot of smoke screens, a lot of people who don't know what they're talking about we believe the country would be better off with no deal because

it's a protectionist system. why not say it i don't think many people mind debate to be fair to the media they've been good at creating debate coming up, the turkish central bank marks its independence with a hike but will president erdogan stop calling for lower rates? more on that after this break.

welcome back to "street signs. i'm willem marx. >> i'm joumanna bercetche. these are your headlines hurricane florence is just moments away from making landfall on the u.s. east coast pounding north carolina with a life threatening storm surge and heavy winds. european stocks gain on hopes of renewed trade talks between china and the u.s., but billionaire hedge fund manager david tepper warns it could lead to a market selloff amid the late stages of the bull run. >> if you ask me, i think it's late-inning game i'll say it a different way than the sixth, seventh inning.

i don't play the way those other guys play. i could say it's the eighth inning, but sometimes baseball goes extra innings. mark carney reportedly says a no-deal brexit could lead to economic chaos and a property crash. but jd whetherspoon's chief says the bank of england governor is exaggerating the effects >> i'm someone who thinks, and a lot of people do, thinks we're better off with no deal. poor old mark has not had much to do, he had to put interest rates up once and down twice in the last few years he got everything wrong. and the boss of the world economic forum says we have not moved on from the global financial crisis ten years after the downfall of lehman he says problems have only been postponed. >> we have found a way where we give, let's say, a whole mess, which we have created to the next generation to sort.

>> it's the day after the central bank extravaganza yesterday in europe. markets are trading on a more positive footing ftse 100 up a bit. the german and french indices also up. ftse mib up 0.2% this after two pretty uneventful ecb and bank of england meetings both sticking to the core ruhor the time being the ecb has said they will be looking to end the asset purchase program by the end of this year. keeping a little bit of optionality. they slightly modified some growth forecasts, but generally speaking sounded pretty sanguine about the economic outlook let's talk about fx and some of the price action we've seen in currencies yesterday we did have that weak u.s. cpi number coming out of

the u.s. that had dollar trade on the back foot versus other currencies midway through the ecb conference we actually saw euro spike, but it wasn't because of what mr. draghi was saying but because of some weakness transpiring in the u.s. dollar you can see euro is charging ahead. not really charging ahead, but trading stronger again today up 1.5%. cable is also an interesting currency pair. trading through 131 now, up at 131.30 there is more optimism priced in on the potential of reaching a deal over the next couple of months between the uk and eu on the withdrawal bill. all eyes on that dollar/renminbi, today a bit of weakness on the chinese currency side of things there you can see that renminbi is about 0.15% weaker. it had strengthened as of late ahead of those potential talks between the two sides. u.s. markets, dow seen opening

up about 40 points higher. nasdaq about tf poi26 points hir the best day for the month of september so far in emerging markets, turkey's central bank hiked interest rates 625 basis points to 24%. in a show of defiance to president erdogan. the turkish president called for rates to be lowered. speaking to the turkish media, the finance minister said discussions about the independence of the turkish central bank are now over. the rate hike saw the lira firm against the dollar and european banks with expo sure sure to tuy also gained as well. let's look at some key turkish metrics. we have the turkish index leading the charge up about 5% or so after the turkish central bank delivered that hike

expectations were between 0 and 700 basis points so markets are reacting well to that news. the banking sector was up 5% already. this is the relative sector performance. all having a good day today. turkish lira, a lot of volatility throughout the day. about 8% intraday changes in the lira, but generally ending on a firmer footing, about 3% stronger than where we went in despite emerging market shocks on multiple fronts, our next guest is doubling down on a career spent in the asset class. mark looking to raise 100 million pounds in a concentrated portfolio of 20 to 30 stocks with an average market cap of $2 billion

wonderful to have you with us on the show again talk to me about the listing before we talk about the general macro environment. why did you go down this route rather than a more traditional financing route? >> we're doing two things. we're doing the trust in the uk. there's an audience for a trust in the uk, that special closed-end vehicle in emerging markets a closed-end vehicle is great because you can go into small cap companies with very little liquidity. on the other side in europe, we're doing an open-end vehicle, so that investors from all over the world can go into that vehicle, that would be different from the trust in the uk >> last time we spoke you talked me through the strategy of the firm we were reading about it now you will be investing in about 20 to 30 stocks, each with an average market cap of $2 billion, specifically focused on emerging markets

you have ever screened for those stocks has the macro environment since we last spoke caused you to reassess some opportunities that you were looking at? >> definitely. we had a big reassessment. it's a great opportunity to be investing. not a good time to be raising money. a lot of people are hesitant to put money into emerging markets. but it's a great time to find bargains if you look at our model portfolio, you see stocks in turkey, argentina, places where a lot of people would fear to tread. our experience over the many years since we've been in emerging markets, you go in if things look bad if companies in which you're investing are solid, have good balance sheets and earning good profits >> talking about things looking bad, i have to pick up on some comments from president erdogan saying we will see the result of central bank independence after

this rate hike he says in 50 years inflation was never in line with central bank targets he says the sudden rise in the lira was an economic assassination attempt. and he says he has faced heinous economic attack against our country after a series of statements quite strong words out of the president there. he doesn't seem to think the devaluation in the lira is domestically driven by rather international hands at play here always the case with emerging markets. turkey is an interesting one talking about this specifically, the central bank hiking yesterday 625 basis points, does that bring stability back to that market? >> not really. i agree with erdogan in some ways the central bank raising rates is not solution. the solution is confidence, gaining confidence of investors, not only foreign but domestic.

and that means you have to have policies of balancing budgets, doing things that give confidence to investors. raising interest rates alone will not do the trick. we've seen that around the world. argentina is a good example. you can raise rates, but if people are not confident in the government -- >> but surely the confidence is a reflection of what the government is implementing in the first place. one reason investors did not have confidence is because they saw the way the president was reacting to this crisis, and he didn't react in a way they would like him to react. when you think about your portfolio, are you also thinking about working with countries and with governments who can be relied on to do the right thing in times of economic stress? >> our experience is they will not make changes until their backs are against the wall at that time they'll call on the

imf, the imf will come in and say you have to balance your budget you have to stop spending. you have to raise rates on subsidizing electric power change that. then you can get change. that's where -- that's the best time to be coming into these markets. reforms are now kicking in you have to wait until that happens. >> when you started talking about launching this enterprise early this year, one thing mentioned in the press release was the environmental and social aspects to your investment decisions. when you look at turkey or myanmar, is there ever a moment where you will say we're not investing in this because they're jailing journalists. will that ever factor into the decision >> absolutely. if you look at venezuela when chavez came in, we were out. he clearly stated we will take over companies >> there are countries you would

consider not investing in because of leadership? >> exactly it's an unusual case where you have that situation where you don't want to be in the country at all usually it's more nuanced. the government may be a little unfriendly but then the companies can survive in thatuse prices are very, very low. >> will you not invest in turkey now? >> we will invest in turkey. we can find bargains in turkey but it has to be in a company that will survive the current situation. what we found is often these companies that are in an environment that are in trouble can often have outside returns and boost the returns of the total portfolio. >> all right we'll continue this conversation shortly. that's mark mobius from mobius capital portfolios. metro says it has been

contacted by those interested in its real hypermarket business. the ceo said they hoped to sell the entire unit. the group also confirmed guidance for the year. investec announced it will demerge and list its asset managing business. they say that will simplify operations and allow separate units to focus on domestic growth paths the south african firm plans to list in london we'll have more on the global financial crisis ten years on from the collapse of lehman coming up we'll hear from klaus schwab stay with us

tomorrow marks the tenth anniversary of the largest bankruptcy in u.s. history the collapse of lehman brothers stunned markets and set in motion the great financial crisis our colleague andrew ross sorkin sat down with tim geithner who

said the fed's responsibility at the time was limited >> there were powers we didn't have most central banks have vastly more power than the fed has. most governments are parliamentary systems where the head of state can legislate powers he or she doesn't have at the moment so people around the world looked at us and said of course you had the authority to do it of course you had those tools. that led to part of the trauma there were two pieces of uncertainty, one was how big were the losses who was exposed to the losses, who would not survive the losses, and also they couldn't figure out what could we do to protect them from that it was hard to figure out what was the extent and limits of the fed's authority. >> also spoke to the deputy ceo

of socgen who was in the eye of the storm ten years ago. he said the banking sector is now healthier than it's ever been >> the banking industry in europe is in a completely different situation today. for me the biggest part is the liquidity rates within the balance sheet of the banking industry are much better today new capitalization and requirement of the banks has been more than doubled, and the liquidity has been better. today the banking industry is much safer than ever >> the executive chairman of the world economic forum, klaus schaub has a much more critical assessment of the situation. he said the policymakers just kicked the can down the road >> unfortunately i have to say that we have learned too much. we have learned how we avoid the

major global breakdown and i think all credit goes to the corporation, global corporation of central banks but we have postponed to a certain extent the problem or we have found a way where we give let's say the whole mess, which we have created, to the next generation to solve. because we should not forget that the global debt load today is substantially higher than it has been at the beginning of the financial crisis >> mark mobius is still with us. talking about kicking the can down the road. i want to ask you about china. yesterday we had some -- or overnight we had more data points out of china pointing to further slowdown in activity there. looks like growth is tracking

6.5% things are beginning to slow down do you think that this could present somewhat of a headwind to the world economy in the next couple of years? two, do you think the source of the next crisis could emanate from china >> right if you look at the chinese economy, let's remember in 2010 they grew at 10% now let's say they grow at 5%. but that 5% will be bigger than that 10% in 2010 because the base is much larger. so, yes, a slowdown in china beyond what we're seeing now will definitely have an impact particularly on the other asian countries. china is a big trading partner but on the other side, if you look at the trade war, the good news is there's winners and losers, not just losers. so a lot of these countries that can produce what china is now producing will be coming up.

they'll acquire a lot of that production capacity to ship to the u.s. so what we're doing is looking at chinese companies that are benefit from the trade war situation where they have production facilities outside of china some direction the other thing you have to consider is that we're in a situation where the chinese are not reducing their imports of raw materials. if you look at the dollar value, it looks like it's going down, but the quality is going up in oil, iron ore. and that's an indication that this economy is still very big and very strong. >> just to pick up on what you said in the first comment, that's interesting in that you think the trade war itself will present some opportunities, investment opportunities reading between the lines, you don't think this is going away, tariffs are with us to stay, aren't they? >> yeah. at the end of the day trump said he wants no tariffs.

he wants free trade. but in order to get there he has to stop this so-called war you can see it, they already made an agreement with mexico, probably canada will come along as well. but the big, big picture is china. 3$300 billion trade deficit is huge compared to mexico, canada, maybe 60 billion or in that range. so i think he has to continue th this on the chinese side they'll have to test the waters to see how far they can go to resist and counter act what trump is doing. you must remember, they have a lot of tools in their armory the currency, they can allow the renminbi to go to 8, 20% or 30% devaluation of the renminbi will help them continue their exporting. 20%, or 25% tariff that the u.s.

imposes. >> is that something you see happening? >> it's quite possible i'm not predicting it but it's quite possible >> you have made a name as someone willing to get on the ground, to visit factories, talk to small business owners and try to understand what the opportunities were you mentioned the idea that chinese firms are able to offshore production and they will be the ones benefitting from these trade conflicts where are those productions being offshored to where are the opportunities from the second order impact of the china growth story >> good example is vietnam samsung is a good example. i believe now 20% of vietnam's exports are samsung products you can imagine what's happened. chinese firms are doing the same thing. for low-cost garments,

bangladesh, shoes, vietnam you will see diversification of their production but the other interesting thing about the chinese situation is that the chinese government is now becoming more aware of governance sosuade companies to improve corporate governance. the interesting thing is the chinese government has been emphasizing that for a state-owned enterprise which is a positive development >> mark, we have to leave it there. thank you very much for joining us today mark mobius of mobius capital partners before we head out, some more comments that we had from president erdogan and turkey the central bank did hike 625 basis points yesterday, but erdogan is now saying that he must -- well, this must give a

lesson to those who exploit with price hikes. and he says on interest rates my patience has its limits. we've seen the turkish lira come off now a bit of weakness after trading 2%, 3% stronger yesterday in trading but these comments from the president don't seem to be helping. he's saying that the private sector must not give up on private investment and calls on turks to convert their savings back to lira that's the picture for turkey today. that's it for today's show >> "worldwide exchange" is coming up next - i love my grandma. - anncr: as you grow older, your brain naturally begins to change which may cause trouble with recall. - learning from him is great... when i can keep up! - anncr: thankfully, prevagen helps your brain and improves memory. - dad's got all the answers.

- anncr: prevagen is now the number-one-selling brain health supplement in drug stores nationwide. - she outsmarts me every single time. - checkmate! you wanna play again? - anncr: prevagen. healthier brain. better life. man: are unpredictable crohn's symptoms following you everywhere? it's time to take back control with stelara®. for adults with moderately to severely active crohn's disease, stelara® works differently. studies showed relief and remission with dosing every 8 weeks. woman: stelara® may lower the ability of your immune system to fight infections and may increase your risk of infections and cancer. some serious infections require hospitalization. before treatment, get tested for tuberculosis. before or during treatment, always tell your doctor if you think you have an infection or have flu-like symptoms or sores, have had cancer, or develop any new skin growths, or if anyone in your house needs or recently had a vaccine. alert your doctor of new or worsening problems, including headaches, seizures, confusion and vision problems. these may be signs of a rare,

potentially fatal brain condition. some serious allergic reactions can occur. do not take stelara® if you are allergic to any of its ingredients. man: are you fed up with crohn's symptoms following you? talk to your doctor today, and learn how janssen can help you explore cost support options. remission can start with stelara®. cost support options. i love you, basement guest bathroom. your privacy makes you my number 1 place to go number 2. i love you, but sometimes you stink. febreze air effects doesn't just mask, it cleans away odors. because the things you love the most can stink. and try febreze small spaces to clean away odors for up to 30 days. breathe happy with febreze.

thanks, janet. it's welcomemy happy place. store. you can learn how to switch to xfinity mobile, a new wireless network that saves you cash. and you can get 5 lines of talk and text included with your internet. and over here i'm having my birthday party. dj fluffernutter, hit it! ♪ dj fluffernutter simple. easy. awesome. ask how to get $300 back when you sign up for xfinity mobile, and purchase a new samsung phone. visit your local xfinity store today.

breaking news, hurricane florence about to make landfall on the north carolina coast. we have full team coverage of the storm as "worldwide exchange" begins right now ♪ good morning welcome from wherever in the world that you may be watching i'm brian sullivan, you're looking live over our shoulder here at wilmington, north carolina where hurricane-force winds are picking up winds reportedly as much as 100 miles per hour and over a foot