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tv   Street Signs  CNBC  August 24, 2020 4:00am-5:00am EDT

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ese machines to do the heavy lifting for our nation. well, folks, there you have it. an army of one beat the might of the united states military. and that's what this episode was all about. >> get him! get him! get him! get him! [overlapping shouts] [upbeat music] >> the fda has issued an emergency use authorization and that's such a powerful term, for
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a treatment. >> bt just topped the stock 600 on the report with the biggest group preparing to fend off a $15 billion take over bid. >> getting back, bytedance plans to sue the u.s. government as they look to fight the executive order banning american companies from working with it and oil stocks jump as the u.s. prepares for a twin storm scenario the gulf coast braces impact for two tropical storms set to hit at almost the same time this week >> a vaccine developed in the u.k. ahead of november's presidential election. according to the financial
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times, the u.k. food and drug administration is awarding emergency use authorization in october for the vaccine that was developed by astrazeneca here's how it's trading near the session. 2.4 plus% on the boards and also across to the european markets this morning optimism around vaccines and treatments right on the outset and some of the gains continue 1.4% not much as you can tell not even one along the boards here let's take a look at the markets in europe. 1.6 and 6,100 annual and
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including for the dax. the german market has been a little stand out and it also reversed over 1% last week so this morning trying to claw back the territory as you can see despite showing leadership this morning, still well and truly under where we have seen it in recent months. 1.4% on italian stocks so some of the sectors early leadership by technology names and there's leadership from the technology and underperforming has been emergency, autos and retail stocks. but this morning we're seeing oil and gas now race toward the top of the boards on concerns about a twin storm approaching the gulf of mexico and the
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united states shoreline but the markets of course have clearly seen this tug of war between the demand and supply side demand has been a concern for a lot of people now with supply at this point pushing up the oil majors. technology was out in front. but railroad strong trade. basic resources 1.8 plus percent. in terms of u.s. future, we have been approached nicely but the other big ticket item that's been around whether there will be any news in jackson hole this week. the market is hoping for clues after disappointment around clarity for fed policy in coming months so that is one to watch and of course u.s. stimulus as
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we countdown to the u.s. election but currently it's is the vaccine and treatment use that is nudging the market into the green. that's right the fda has proven emergency authorization for the use of plaza to treat coronavirus patients but doctors cautioned that more research is needed but president trump hailed the move one day after he accused the fda of deliberately delaying coronavaccine trials. >> the fda issued an emergency use authorization and that's such a powerful term this is a powerful therapy that
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transfuses very strong antibodies from the blood it's had an incredible rate of success. today's action will dramatically expand access to this treatment. >> meanwhile, u.s. house speaker nancy pelosi slammed president trump for attacking the fda calling it, quote, dangerous >> the food and drug administration, the fda has a responsibility to approve drugs budging on their safety and efficacy not by a declaration from the white house about speed and politicizing the fda this was a very dangerous statement on the part of the president. it went beyond the pale in terms of how he would jeopardize the health and wellbeing of the american people. and accuse the fda of politics
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when he is the one that has tried to inject himself in the scientific decisions of the food and drug administration. >> i want to ask you about the market that we have seen suggesting that there's a number of sectors and stocks doing particularly well. amazon carrying the technology basket high and getting to 70 odd percent and offset by other names still lagging behind do you think we start to close the gap between the two different angles that we see on the cape it boi
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boils down to the difference between value stocks and growth stocks it's the worst great depression in the u.s. and lagging growth stocks because those tech names in the u.s. in particular have driven markets forward we have seen this widen as we have seen societal trends. there's calls for it to be the best on record while they said on q-3 it's too soon to say and it's likely that we'll continue their winning streak. >> and you get this response,
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what's the potential for that with some flow anticipated around u.s. stimulus from congress or on the other hand from changes through fed policy. this has been much faster. if we think about potential down sides there is the deflations of local and causes inflation when thinking about what you import because stuff is much more expensive to trade so imports are much more expensive and that causes extreme inflation.
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i don't know if you remember back in 2013, we had the then fed chair announcing that he was going to have qe and we saw those five economies, turkey, south afterkarks brazil go into free fall because they had been so propped up by qe. and this time around it's not just the emerging markets. it's all of us getting propped up by stimulus there's significant implications of it. >> one of the other potential reprecautions of all of the stimulus is what kind of time frame do you think investors should be bearing in mind when it comes to inflation. is that something they should be
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considering putting on now >> that's very difficult to tell because it does depend on a number of factors, not least that question that we're all waiting for, the vaccine because of course this is an economic crisis that is caused by a binary issue whether or not we can return to normal life. whether or not we feel confident to start spending and traveling in the same way that we were before now if the vaccine comes, a lot of concern may well be mitigated although there's a lot of conversation about the fact that we have a quite significant rally for a decade from now and markets do go in cycles. it will eventually cause ib inflation. at the moment we're tracking
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well below and we should expect that to come up as indeed we have done in recent history where we have seen markets be flooded with cash. there are assets that do well in a loan environment or interest rate environment and assets that do well in a higher inflation environment. they push to raise interest rates which ultimately will be good for buyers or new bonds being issued at this high rate that seems to be the answer to everything but diversify your assets we have also seen europe continue to underperform the u.s. and it felt like there was a time at the start of the summer where europe might be
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able to actually jump ahead of the u.s., the virus was more under control relatively speaking it's been unprecedented in terms of the collaboration between leaders but now the data suggests the economic recovery is weakening in terms of momentum what do you think from an investment perspective is europe a place that investors should be looking relative to the united states and perhaps other parts of the world >> it's important to note that the u.s. although it lead the recovery, it has been lead by that very small number of sectors. if we unpick the u.s. and look at the russell, the much larger group of the s&p 500 there's a huge number of companies that just aren't profitable if you're not in the small sectors of tech and growth then u.s. stocks have not been doing so well either
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the european market is made up of those sectors not doing well. plus we did see hotspots and have to go for food purchases so there's an impact on the economy in terms of opportunities, it's all about sorting it the more working from home digitalization it's about working out how much has been undersold and people being too pessimistic. they have gone too far and what is going to be left behind
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because it's predicting how we're going to do that in the future the ftse 100 company very large employer in the u.s. and europe announcing that they will continue their working from home measures even after coronavirus is concluded and there's a number of other employers following suit working out what is along-term trend and working out what is just coronavirus specific is going to be key to working out what is a real investment opportunity and truly disrupted and not to be recovered sector. >> i want to ask you short-term about the market that we have at this stage because has that fundamentally changed this type of market? we might have more volatility
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ahead. because it's been such a loss making trade. >> we have been lulled into a false sense of security when we had such record low volatility we had products launched below volatility and they didn't get much because we were living in a low world and that's changed now. so it's not unlike a lot of investors professional and personal alike that only invested in years. you have seen trends in the market going up particularly in bond markets where we haven't had a bear market for bonds. you could spend a whole career investing in a rising market and then you get a period like this that really shakes things up and rewrites the whole book. >> thank you very much for joining us today.
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it suspects unsanctioned changes were made to its engines manufactured between 2008 and 2013 that would effect exhaust systems. global dividends saw the sharpest fall since 2009 as companies cut their pay outs amid the pandemic. forecast dividends will fall between 17 and 23% this year the u.k. and europe are the worst effected regions with oil majors and slashing pay outs but they have so far proved
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resilient. they have seen them slide the first time since 30 years. it's a major shareholder which will be in the process, it's such a large player in the industry they recently inked a major deal in the united states giving them a huge seat at the table with the consolidation of t-mobile and sprint perhaps they don't want to necessarily consult today the u.k. market as well. but that said, you can see there is merit given we have 5-g roll
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out taking place across the u.k. there's a lot of energy behind the scenes to try goat the share price higher given that did dividend has taken a huge it if they were to get caught up in a potential deal it's hard to imagine a situation where it doesn't become very political. but also committed to a 12 billion pound investment program at 20 million. locations around the united kingdom so a lot at stake for the government
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coming up on the show, we'll talk about the u.s. and the eu they signed a deal to repair relations. more on that story coming up next
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more than 800,000 people died from coronavirus worldwide. 23 million have now been infected italy recorded a spike for the first time since may with 1,000 new daily infections the united states nudged past 5.7 million cases despite reporting less than 50,000 infections for a 7th day but still a staggering number. >> eu trade commissioner phil hogan will not step down from his position after attending a dinner last week that potentially broke the irish
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governments virus restrictions he issued an apology for his actions after the prime minister said the commissioner should consider his position. ireland's agricultural commissioner has already stepped down they reached a deal for $200 million worth of product the chief negotiator of both parties said it was part of improving eu-u.s. relations. >> how did this deal come together and how significant is this agreement >> so this marks the first time in more than 20 years that the u.s. and eu agreed to cut tariffs so it marks a deescalation in tensions between
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both sides of the atlantic we reported on u.s. still with tariffs on a dispute over digital taxation it's also been an issue between both sides of the atlantic but now we're watching both sides saying that they actually want to have further trade agreements essentially the european commission said it will end tariffs for five years with a view to make that permanent. it's a critical development in the lobster industry in the u.s. which has struggled with trade war with china and with fewer sells as well and is also an important bioground area for republicans and democrats ahead of the presidential election and in return the united states said
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it will cut tariffs on eu goods by 50% and these products include for instance, crystal glassware and prepared meals in terms of the size though, the deal is quite small when you look at the overall trade between the eu and the u.s. but we heard from both chief negotiators saying that this is just the beginning. >> i want to share with you, commitment to find a solution for the long standing dispute and so essentially, this comment tells us that the deal we saw on friday could pave the way for a broader deal on aircraft subsidies. something they have been arguing over for the last decade
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and essentially ruled that the size of this deal is small and could be a shift in the trade tensions that we have seen between both sides of the atlantic thank you for the report president trump refused to rule out the possibility of decoupling with china. he said the u.s. did not have to do business with china and would cut ties if they don't treat us right.
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tensions between the two superpowers remain elevated and phase 2 negotiations of a trade deal stalled amid white house criticism of how beijing is handling the pandemic. it could have a significant impact on the entire industry. the company behind tiktok says it will file a lawsuit against the trump administration later today. >> it said in a statement it was suing the u.s. government to ensure that the company and it's users are treated fairly coming up on the show, russia opposition leader remains hospitalized after a suspected
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poisoning. and we'll leave you with live shots from kiev as ukraine celebrates it's independence day. at cdw we get you're always looking to modernize. yeah. i'm just not sure office drones were the way to do it. [ laughing ] drone voice: l-o-l. our market share looks good, but... drone voice: where are the bagels? well, cdw can help you modernize your company the right way, with a scalable infrastructure from hpe, making you more efficient and secure. great. oh. [ drones buzz angrily ] let's find a different room. for transformation that works, you need hewlett packard enterprise and it orchestration by cdw. people who get it.
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health care stocks trade higher z apresident trump looks to bypass safety standards in a bid to fast track the vaccine and the fda gives emergency approval for a new therapy. >> the fda has issued an emergency use authorization and that's such a powerful term. emergency use authorization for a treatment.
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china backs them after the company says it plans to sue the u.s. government. this as the tick to be owner looks to fight an executive order banning american companies from working with it oil stocks jump as the u.s. prepares for a historic twin storm scenario the gulf coast braces for impact from two tropical storms set to hit at almost the same time this week let's get a check on european markets and how we're trading. they had a lackluster performance. we saw concerns as economic data showed signs of the recovery losing momentum.
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today a very different story a strong bounce back across european markets the main benchmark up about 1.5% reflecting gains across every region and every sector and a lot of that optimism no doubt coming on the back of a positive development on treatment approval and we're waiting for that but we're seeing a boost of sentiment for european markets let's take a look at treasuries and how u.s. bonds are trading this morning we have the jackson hole economic symposium to look forward to so putting it into risk assets this morning >> u.s. equities rose for a fourth straight week last week
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on the back of improving economic data. a number of coronavirus cases. this week we're looking forward to the republican national convention a strong start to trade for wall street as well following the gains in asia and the gains early in europe. >> protestors once again took to the streets of the capital over the weekend demanding the resignation as the country's main opposition leader says she sees herself as a symbol of change richard engle has more >> there's a battle underway for control of this country. they say that they're in the majority and they want to show it they believe that elections held here were stolen the government stolen by alexander and they have come out to say they won't accept it any longer and they want him to step down there are risks to this. demonstrators have been arrested they have been beaten. they have been disappeared and
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people here tell me they have frightened but they have no other choice the government says this is all a foreign plot this is all a foreign conspiracy driven by the united states. he has gone so far as to say nato deployed troops to the border he is clearly trying to whip up an heir of hysteria and nationalism. there's a tug of war going and where this goes it's hard to say. the protestors say they'll keep it going it's hard to know how long they can and whether they have the stamina to with stand what they expect will be a strong government crack down. richard engle, nbc news. he was transferred on saturday after becoming ill during a flight on thursday
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doctors did not find any poison in his body while initial tests argued that today. joining us now is mark who is the director for europe important developments taking place andmoscow sees it as a frontier against the eu and nato what do you expect moscow wants to happen in belarus. >> it's quite different from what it actually wants to happen necessarily. so those things are quite separate in short, they want to ensure that they stay within the historical orbit politically, economically, culturally, militarily and there's no signs of possible defection to the west. the point being here that that could occur in a situation where he is in power or where he is
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not in power so moscow is surely prepared for both scenarios and other scenarios as well to develop overtime what we're monitoring here is more of a how this transition really plays out in what ways and over what period of time as well and it's relatively unlikely to be resolved soon to be perfectly fair >> russia's foreign minister weighed in saying it was possible to prove that he did not win the august 9th election talking about the absence of international observers but also made comments against the opposition >> potentially what i'd say more definitively
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is i believe this is the end of lukashenko it will take time to play out. he lost all legitimacy with the eu as well as with russia who is not sad and will see him go. what they are a little bit more concerned about this is transition of what it looks like he mentioned about a potential for referendum he also rejected stepping down in power and this will be a long drawn out fight but ultimately i believe we will be dealing with them at some point in time you have him still staying within russia's historical orbit and elections most likely down the line however free and fair those are is another question of course to be added at that time.
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>> just lastly, demonstrators have been so focused on domestic issues and didn't want outside involvement from russia or the u.s. but you described where it remained in the orbit of rush yab innuance a russian influence and control. can they go down a solely independent route at this time >> that remains to be seen ukraine obviously did not stay down independent route but veered toward the west which become quite dangerous of course we have seen the outcome of that other commentators have likened the situation to what is in armenia. that's a different situation belarus is far more important than armenia is which did meet a slowly more independent route
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and promises to stay within the orbit. the risk here going forward and what is concerning about comments is the potential for this situation. because they're being impacted with meddling from the west. that's it. this will take a considerable amount of diplomatic tax and skills to ensure that it doesn't escalate to another level. miscommunication, overreaction for that matter. >> i want to get into the geo politics here.
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sources say to talk about belarus, he will travel to lith way -- russia and ukraine over the next couple of days. what do you think the u.s. wants to achieve here? >> stability they probably likely want to give the kremlin assurances that the u.s. does not intend to be meddling or trying to destabilize the situation. trump has been disinterested in domestic political situations and russia doesn't want to know that and not to mention citizens so likely trying to provide any
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sort of stabilizing comments to help ensure a more secure future for the region but aside from that, far from the democracy portion of previous us. administrations. >> mark, i just want to ask you how the developments around him tie into all of this the anti-corruption advocate that's taken ill over the last week clearly the belarus situation puts some stability in question in the region especially for russia and now this thrusting russia back into the pot ligspo over it's role and handling of the illness. what might this mean for stability in the region? >> right the situation popping up this time is quite interesting and also don't forget there's major protests going on out in russia's far east near china it's their second month and have proven to be quite resilient so that's going on in the far east and to be fair, from the
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kremlin's point of view it's far more concerning. the major risk here is yes, it's possible this could have been an order from putin directly and that's of course how commentators in the west generally interpret it but i would say it's probably more likely and also more worrying is the fact that this very likely could have been security agents or protectors of the regime acting with sort of assumed apru approval by putin as opposed to being directed by putin directly to conduct such an attack. it doesn't work to the kremlin's purposes i believe sort of reading between the lines here that it sends a nice signal to the opposition within russia, particularly we elections coming up in september it sends a
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signal with the tools that the russian state has at its disposal at the lengths that the kremlin is willing to go or security agents believing that they are acting in line with the kremlin's wishes how far they're willing to go. it's a pretty poignant political time in russia and tools they can use and reminders of oppression to keep stability within the company particularly amid the potential instability on the western border with belarus. >> it's always great to get your analysis thank you for joining us this morning. >> coming up on the show, the republican national convention kicks off tonight. find out who is speaking at the convention after the break
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the u.s. energy companies have shutdown almost 60% of crude oil production in the gulf of mexico. as threat of back to back storms looms. overnight, downgraded from hurricane status while tropical storm laura is getting longer. both are expected to make landfall on the southern coast of the united states this week a historical nightmare unfolding in the gulf tonight. right now dishing out deadly damage across the caribbean claiming three lives in the do minute juan minu -- dominican republic hurricane marco is up first. slated for monday landfall bringing up to 6 feet of storm surge to southeastern louisiana. in new orleans, shovels fill sandbags and grocery lines grew. >> it's better to be prepared
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than not >> marking the 15th anniversary of hurricane katrina just ten years old when they escaped the deadly flood waters. >> do you trust the walls are going to hold? >> no. >> why not >> because it floods when it floods, it just get bad. >> the governor of louisiana declaring a state of emergency while dealing with the covid crisis >> it will be a last resort. >> and caution against relying on first responders already stretched thin >> maybe longer than it ordinarily is. >> the u.s. house of representatives passed a bill providing the postal service with $25 million
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the bill would reverse recent cost cutting measures and would require the postal service to prioritize the delivery of all election related mail. mitch mcconnell said the bill would not pass the senate. u.s. postal service released a statement saying that the bill would constrain it's ability to make improvements. the republican national convention kicks off today in charlotte, north carolina. president trump says he will speak every day at the convention and also hear from u.s. secretary of state mike pompeo and senate majority leader mitch mcconnell let's get to richard johnson in u.s. politics and international operations at lancaster university let me ask you first up what we can expect from this republican convention, richard. >> i think that the republicans are going to try to tell a story of past, present and future. i think the past they wantto d
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that as a way of the president positioning himself as an outcider i think that's part of it. i think it's going to be about not just this particular mode to the pandemic when the president has made missteps but looking at the president's term of 3.5 years and pointing to various policy achievements from the republican's perspectives over the 3.5 years for particular constituentcies and particularly the president's base and evangelical voters there's a lot on foreign policy we might be hearing about as well and looking to the future trump is going to make it a choice between biden as a trojan
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horse and trump someone that built the economy once and he'll be able to do it again and i think that's effectively what they're going to try to do so quite a lot to achieve in a week but i think it's central that they pull this off because they are behind in the polls and they do need to nudge their podium figures up soon. >> richard, from the outset, president trump was criticized for his inability to draw a bridge between the divide in the united states if anything creating even more divisive politics and we have seen that with protests around covid-19. if you hook at the list of speakers at the republican convention it feels that he may double down on that type of politics and that type of strategy on the ticket a couple pointed guns at peaceful protestors and you have a teenager involved with confrontation with a native american protestor last year and also to rebuild the wall so a lot of themes where trump
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plays to the base seem to be very much in the cards this week. >> yeah. i mean, you know, look, american politics is now, it's just a highly polarized environment which means that, it's very unlikely to see really any candidate at the national level, either a democrat or republican dipping below kind of 40% of the vote you know, so what that means then is trump has a small number of voters that he needs to reach in order to kind of start flipping it and the key i think really for him is white suburban voters and particularly white suburban women voters who turned against him in 2018. he needs to bring them back. so i wasn't surprised so much to hear that you are getting these kind of almost identifiably
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suburbans speaking like this it speaks to i think one of the appeals that president trump is making to electorate which is if you vote for me i'll keep you safe from these leftest forces to an outside it does look very divisive but there is a particular focus there is a targeting that's going on in the message that he is trying to send out. >> i want to bring up coronavirus and the president's ability to tackle the crisis clearly krit soized for not taking more serious measures and approach around mask wearing as well but over the weekend trying to fast track a vaccine developed here in the u.k. how significant would that be for voters that might be on both sides of the fence happy because there's a vaccine and not happy because there's elements of safety skirted around to get a vaccine in the
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mix. >> up until this point, president trump has mishandled the politics of this moment which is quite unusual for the president. whatever you might think about president trump he is quite politcally savvy he has not been able to do that with coronavirus, if he were able to declare that he was fast tracking a vaccine it could put the democrats in a difficult position in the sense that the democrats might argue look, we need to go through the proper procedures and make sure that the vaccine is safe before we roll this out and so on. president trump could accuse them. >> we have to leave it there thank you for joining us today much appreciated that wraps up the show today thank you for joining us on street signs
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it's 5:00 a.m. at cnbc global headquaters and here's your top five at 5:00. call this a tale of two markets. big tech keeps going up and both stocks are going down. which one ultimately wins out. a scary scene in the gulf of mexico two storms converging on texas and louisiana. thousands forced to evacuate potential cost and impact to america's critical infrastructure next. >> on the fast track, the fda giving a green light to a well-known covid treme

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