craig melvin: that's all for this edition of "dateline." i'm craig melvin. thanks for watching. [music playing] good morning welcome to "street signs." i'm julianna tatelbaum these are your headlines deutsche bank ceo says the economy will not return to prepand levels this year or next, saying a large levels of zombie firms will have a huge affect >> translator: our economy will only work with the 70 or 80% capacity and this will have

severe consequences. switch company roche will role out rapid test that will provide results in 15 minutes. we speak to the ceo of diagnostics in the next few moments. the swiss market watch dog offers a fresh case over the top scandal. japan's chief cabinet secretary is expected to announce he'll join the race to replace prime minister shinzo abe. warm welcome to "street signs," we have just finished watching the deutsche bank chief who warned that it is not likely we'll see the economy return to

precry si levels this year or next he noted how germany has done a decent job managing the economy through the coronavirus pandemic he did warn the large number of zombie firms to come out and have significant affect on germany. we'll bring you all things german banking on that later in the show annette will bring us and plenty more on that topic to discuss. i want to push on what one health care story in focus has come on roche. rolling out new rapid coronavirus tests by the end of the month. can produce results in 15 minutes with 96% accuracy. thomas schinecker is the ceo of roche.

thank you for joining us this new rapid covid test you are set to launch in europe can be used to diagnose symptomatic and asymptomatic what is your test capable of doing. how do you go by addressing those asymptomatic ones? >> caller: we are very proud to be able to launch another weapon against this pandemic. it is the 10th diagnostic solution we'll be launching. this is an antigen test that we'll be able to test the protein of the virus we include patients that are asymptomatic and not only

symptomatic. those that have a higher load than those with the lower load the actual amount we have tested we have testified four times more than you have heard about one of our tests and you heard about the studies. >> can you tell us what you will do about price abbott says their test will be about $5, how about you? >> caller: we have never made a statement about pricing. we have said it would be a fair and ethical pricing. we always said we only make one global price we want to make sure there is no competition between countries. those that would be normal or prepandemic time

we found it well with other tools we have launched in very good and fair pricing. >> in terms of geographic roll out, you are due to launch in europe you will be getting u.s. approval can you give us information about that u.s. timing and when you could launch in the states >> caller: we will launch soon and we believe this tool is helpful in all countries that do not have a test at all we want to help those and we want to support the u.s. as soon as we can, we will apply to the emergency use and it will be up to the fda how long it takes to get this authorization. >> public health experts have

been waiting for a solution like this that could reveal results within 15 minutes. how do we see these tests being used you have 49 million initially and i know you have plans to ramp that up how will they be used to aid in the process? >> if you compare the anti-again testing to the ptr testing here you detect the protein. you will never get to the same accuracy as you get with a ptr however, you can scale faster and reach areas that don't have testing infrastructure this will be used to find those patients with higher viral loads and the ones more infectious,

the super spreaders. that will contain the amount of spread in society because you specifically target those groups >> i know this test doesn't require any special instrument they are meant to be used by health care workers. are these kits going to be available for us at home or to be used for more wide-spread use? >> at this point, you don't need instruments. we recommend it is being done by health care professionals because to get a sample, you have to get to where the virus is located how you get the sample is very critical to the accuracy for us and for any other company.

it is very important the role health care row fe health care professionals play >> you noted this is the 10th diagnostic that roche has developed. you've also developed monthly he can molecular and neurologic tests and it has been said antibody tests would be a game changer. so far, it hasn't been a game changer. we are a few months in and have had these antibody tests available. what is your feeling about how useful they are? >> caller: i don't feel they are

disappointed it is extremely important to have and understand these. if you don't have these antibody tests, you will have a harder time to develop vaccines, et cetera you will need that to increase the scientific understanding and progress the potential medicines and disease that come to the market specifically, once these are coming, these tests will be crucial and say did the person actually develop antibodies and what is the level. so first of all, now to understand and to bring the medicine to market is important and in the future to understand how this vaccine actually works. >> before i let you go looking ahead, what is going to be the next focus for you at roche diagnostics. we have this rapid antigen test.

what is next >> caller: we'll launch three more diagnostic solutions this month, globally and some of them are the solutions being able to differentiate and specifically going into the northern season, it will be important to be able to differentiate but we'll also launch another antibody tests and work with vaccines >> thank you for joining us this morning, ceo of roche diagnostics. i want to take you to japan. we have some developments there in the leadership race japan's chief cabinet secretary suga saying he'll run in the race to succeed the p.m.

i have decided to run after deep thought after what i can do as a politician we cannot allow a political vacuum there is no time to waste. must recover as early as possible when everyone can live without fear he says there are many things in the world that cannot be taken for granted. i want to promote more competition in japan cell phone industry as fees are too high. so talking a little about the platform he'll run he has mentioned his simple beginnings as the son of a farmer and put himself through university i have consistent belief i want to revitalize regional economies. so some insight of how he would propose to run the country the key message here echoing

what prime minister abe said last friday, must avoid a political vacuum in the face of a national crisis. you will remember, when he announced that, a huge part of the resignation came to the timing given that we are looking at a bit of a lull, he doesn't want there to be a political vacuum if the virus surges again. he wants to avoid that now we are seeing that repeated by suga. more comments coming out about him. we'll take a quick break when we come back, opening the banking submit in frankfurt. we'll bring highlights of his speech next. gan stanley, a globl collective of thought leaders offers investors a broader view. ♪ we see companies protecting the bottom line

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welcome back let's get a check on european markets. we are just over an hour and it is a strong start. up about 1.5%. europe hasn't participated in the rally we saw state side.

hitting fresh record highs the s&p and the nasdaq hitting all-time highs the stoxx 600 dropped .4%. a little bit of trade and pushing stocks higher. the only sek tr trading in the red is banks we'll get a look at banking in a moment outside of that, every sector is participating in the rally let's look at the markets. we have green across the board strong gains for the dax the cac 40 also bouncing nicely. ftse mib lagging a little but still decent and ftse 100 jumping. yesterday dropping 1.7%. a bit of that was a catch up trade as uk markets were closed on monday. let's look at the european banks in more detail the only sector trading in the

red, moves are contained certainly interesting to see that investors are differentiating. the positive sentiment will lift other stocks including some of these reopening stocks in the travel sector. not enough to lift the banking sector down and especially developments in spain as coronavirus numbers weigh on sentiment in that country. the swiss watch dog has opened the case to credit suisse. the regulator said, quote, it would assume violations to the regulation law and the former wealth managd they will partici

with the investigation kicking off the banking summit in frankfurt warning it could take years before a return to the pre covid levels >> translator: a return to our strength will take longer today. a lot of companies have to manage to live with reduced sales for quite a long time because we have to deal with an eek n economic situation where we'll have a recovery, yes and not step by step and not in all industries >> how the financial sector will lift economies out of the covid slump. >> translator: we have to ask ourself what the in you normal

is it is different from the crisis 12 years ago because banks were the first in this pandemic to be part of the solution we have to see what will happen in the future, will we continue to be part of the lugsolution >> our guest will join us now. great to have you on the show. with he were discussing that european banks are not participating in this rally we are seeing what do you pin that to? >> i don't think i would attach too much to the performance of one simple movement of one day banks have declined a bit over the past couple of months over covid-19 and under the policies of the fed and european central bank perhaps a sense of that will continue we've seen the deflation hit the

eurozone it seems the ecb will become more aggressive. that might be some concern there that the monetary policy will not be favorable in terms of the policies for banks i wouldn't read too much into it the past has been far more severe to that this is tame in comparison >> i understand your point we do look more broadly. the inflation data you alluded to sinking to 0.4%. the lowest level since tracking in 2001. analysts calling this a shocker. what does this mean for ecb policy moving forward? what are we to hear out of the central bank >> they have to be scratching their head all of the models are being falsified in the process

lowering the interest rates right up to the 20-year mark we've thrown the kitchen sink at this and it is not working we are asking what is wrong with our economic levels and why isn't it working the way it should the explanation is simple. the european businesses are reluctant about spending and so they are holding down cash that will carry on as long as people feel uncertain. there is little the ecb can do about that they can go out and buy more as ets and create headline inflation. it is hard to see how they are beneficial overall we have different concerns about the inflation and they seem to feel more the better what they do will expand the easing and become more aggressive and it has a negative

impact in terms of the bank's interest margins than before they'll see more of that and pump more money in because of the markets where that money will flow in the stock prices and the stock market >> i want to take your attention to the currency markets. one of the big topics has been the appreciation of the euro versus the dollar. typically, we've seen the push back from the euro strength. is this time going to be any different? >> they are concerned about it the german economy is dependent on the euro. the issue there comes down to monetary policy more than anything else. the fed has been far more aggressive to covid-19 than the european central bank. the central bank was out of gun

powder when this started they had already gone into negative territory something the fed hadn't done. the dollar took a hit. what can the ecb do about that in turn, they can flood the market with euros. they might be thinking about doing that looking at inflation, all of those things are pointing to the ecb coming out with new tools to come into the currency of the new market to increase liquidity out there. >> you look at the recent past before things hit, one of the big appeals was their dividends. now we have seen them put their dividends on hold. when is it likely to see those return and see the price again >> the dividend has been put on hold at the behest of the

central bank they have to wait to see if they are stable and if they are in good shape financially i think they have held up pretty well the rates are very encouraging they are strong and have strong balance sheets i would expect the ecb to lift that quickly and lift those requirements it wasn't a requirement. it was a request given the strong position of the european banks in q1 and q2. the results were better than the ecb thought they were be they said we have to shore up the balance sheets and not let any money out. that has not come to be in this crisis a very strong balance sheet they had going into the crisis and do

not seem to be eroded at all they were lifted and would seem not to be lifted soon. >> looking at banks. one of the big questions is how much we'd see loan losses rise the job retention schemes help to support the economy and mitigated the number of bankruptcies and job losses, et cetera do you think the banks have put aside the appropriate levels or is that a risk you are thinking about becoming more prominent going forward? >> that has become a bit more of an art than a science. these credit and loss models have been based on the historical data and the model is not something we've seen before. this is not tested in the outbreak of economies that have been shut down because of

regulations and requirements it's uncertain how large those will be. u.s. banks have set aside huge amount of capital. it is really hard to say how well that will work out. way might see those come back into the profits or extend to the losses what happens in europe is hard 20 say that could be the further case those might well have been in the estimates and might well be

quite good we have to watch and see what happens over the am coulding -- coming months. >> lastly, we know european chiefs have long been calling for more banking union before we see consolidation. do you see covid-19 accelerating this push or do you think it sets us back >> i'm not sure it has much of an impact. last year, there was talk about deutsche bank it doesn't seem to be that much of an appetite. saying this is an uncertain environment on the side to get all the work together in this

risk regulators don't seem to be in the mood we have a lot of large banks in europe the too big to fail where there is reluctance on both sides. there is a strong argument to be made in terms of pan european and the banking sector i don't think there is much appetite for it. saying is this something weighed into looking at deutsche bank and saying this is a real risk to me that's probably something we'll see in the more seeable future then >> thank you for joining us. sfl i want to take you back to japan. we have more comments coming in from suga.

more comments. more specific and more important to markets he says he won't stop abe reforms. he comments that abenomics has created more jobs even when the economy is in a severe state he says i want to push it further. as the relationship with the bank of japan, i want to retain the way abe dealt with the bank of japan a return on northern territories. a real continuation of the policy that shinzo abe implemented during his tenure. a suggestion should he win the race, it will be a continuation, an evolution rather than a revolution of the japanese economy and the relationship between his leadership and the bank of japan.

coming up on the show, we'll be talking spain as a second wave hit the country, we'll talk about what it can do to help its tins whocizeitut putting its country on life support.

welcome back to "street signs. i'm julianna tatelbaum these are your headlines deutsche bank ceo says the economy will not return to prepandemic levels this year or next >> translator: our economy in some areas will only with 70 or 80 or 90% and this will have severe consequences. roche plans to launch a rapid covid-19 test at the end of the month telling this show, the pricing will be equitable. >> caller: we always said we will do fair and equitable so it will be in the same ballpark

we will make one global price to make sure there is no competition between countries. japan secretary joins the race to replace prime minister abe and pledges to continue abenomics. president trump visits kenosha, wisconsin condemning the protests and >> i think the plolice do a i really great job and they do have some bad apples let's get a check on european markets about an hour and a half into the session. the dax up and cac 40 leading the way. ftse mib gaining momentum and.

european markets are trading very well this morning that comes on the back of record highs yesterday of the s&p 500 and nasdaq which both saw fresh highs at the close of the session. one stock in focus in europe and the travel sector, ryanair has reported a 53% drop. with passengers falling to 7 million in the month operating at 60% the normal for the month. trading 1.2% underperforming the global market >> let's get a check of travel and leisure stocks we have a mixed picture here we have tui, carnival and others trading higher on the down side, the airlines are taking a bit of a hit. down 1.2 easy jet trading lower interesting divergence airlines are taking a hit and

other travel holding up and rebounding from the hard hit we saw on the sector yesterday. spain continues to be a focal point. the country must avoid a lockdown by up to 15% according to the ceoe. joining us to talk about the spanish economy. vice president of the ceoe also with us. some pretty dire numbers there when we look at the forecast of the spanish economy contracting 15% in a down side scenario. how much is this to do with the structural of the economy and because it is exposed so heavily to the tourism industry and how much is down to the government's handling of the pandemic >> good morning. yes, as you mentioned spain is probably going to be one of the

countries that are going to be hardest touched by this. our forecast in worst case is minus 15%. best case is other minus12%. if there is a prolonged lockdown in the latest part of the year there are three main reasons why we are hardest impact by the covid. first of all, we have one of the longest lockdown in the world. we were almost four months lockdown in spain. a very tough lockdown for the public secondly, our economic structure is composed of various smes touched hardest by the covid we are highly dependent on the

tourism. that has been the sector that has been the worst impact by the covid. these are most of the reasons that explain why we are behaving worst than other economies these are discouraging the investments. the main reasons they are impacting and the three i mention before >> spain is set to receive about 140 billion euros from the eu recovery fund. a little more than half will be grants and others will be funds. where will they put this money >> i think on public works like we did 10 years ago will be a mistake. we he have to try to use this

money to increase the benefits, promoting public and private sector partnership this is where we are trying to promote the development to do. there are three main areas this money should be used first of all, digitalization to increase our competitiveness and energy and energy transition this is another key area finally to try to repair and minimize the impact on the crisis most affected trying to minimize the impact of this crisis. >> like many other european countries, spain had put in place a furlough and partial

unemployment scheme. those things are about to end. do you see it necessary to extend it beyond for particular sectors like tourism >> yes, we believe it is important first of all to extend this period so that uncertainty is reduced this year, that is completely lost we have two kinds of tourism, which is mainly in the med ra mediterranean area we need not only for tourism for a long time frame and in this sector to prepare. the impact of covid and the

lockdown for the sanitarium is not exclusively concentrated on tourism and hotels and in the industry travel agencies and many other sectors that are a very low level of operation due to the covid. if we want to avoid a large part of the sector to be completely damaged in the few months, we need to do so so that once the situation is overcome, they can operate. >> let me ask you about the political landscape at the moment and we heard perfect the prime minister speaking to the whole whose who in this business, so spain can calling about a political unity

in this moment he was referring to some of the tensions where they had been spent with the 2018 budget passed by the predecessor. there is new intentions whether they can be renewed with the budget is there enough political stability and to handle the current crisis >> we believe that approval is extremely important as you mention before, there is 140 million euros coming from europe we need a new budget to spend on an efficient manner. we need a prudent budget on one hand is pragmatic from the point of view, there is no way but to run a large deficit. on the other hand we need to

prepare the strategy because we have already a huge amount of debt these should be based on two pillars. they should be to increase growth there could be margin for tax reduction in the specific sector severely hit by the crisis there could be some margin to reduce the temporary and to be prudent on the expenditures. trying to say, i mean as much, when it is possible. we believe we have to preserve our work but we have to be efficient. at this stage to avoid any tax

increase >> you mentioned the importance of shal and medium sized businesses in the spanish economy. it is dominated and has the highest portion of jobs that requires physical content or close proximity to others that creates a difficult back drop. how many of these small and medium size businesses will actually survive >> it is difficult to perceive there is a large sector which comprise these our economic in spain is not only based on tourism we have

many industries a this are efficient and competitive. the 13% gdp in spain it has a lot of traction capacity as well as long as travels don't recover. a very large part of our industry and the sector in spain will be important and severely damaged. >> we leave it there the vice president of ceoe state side, talks in washington, d.c. over fresh coronavirus aid measures continue to stall. house speaker says serious differences remain following a

call with secretary mnuchin. negotiations taking place since august have so far failed to gap between testing and schools. >> secretary mnuchin says he's ready to negotiate >> we'll continue to work with the senate and house for a bipartisan basis for a phase four relief package. i believe a bipartisan agreement still should be reached and would provide funds for school, testing, vaccines, ppp for small businesses president trump visited kenosha, wisconsin and blamed democratic leaders for what he called, quote, anti-police and anti-american riots. that was from president trump comments from wisconsin. let's look at u.s. futures and where we stand for the open. a lot of green on the board and the dow jones looking to open

200 points higher. the nasdaq looking to climb 147 points the march higher looks like it will continue on wall street coming up, the u.s. extends tariff exclusions on chinese goods until the end of the year. more after the break at cdw we get you're always looking to modernize.

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welcome back the sale of tiktok's u.s. subsidiary has reportedly stalled with a question whether the algorithm will be a part of the sale president trump said the tiktok deal still has time to close ahead of the deadline but that the u.s. treasury had to be compensated. >> i told them they had until september 15 to make a deal. after that, we close it up

the united states needs to be welcome sated. we are making this possible. we should be welcol compensated. it has been a busy day we heard from the deutsche bank ceo weighing in on his outlook and saying zombie firms will have a serious affect on the economy. let's go to annette with a special guest. >> reporter: yes, i'm joined by the chief economist from kfw we were just saying, there is a pessimistic look what is your take? >> i think the drop of economic activity in the second quarter truly was historic in germany. it is true we'll have a deep

drop throughout the year of around 6%. yet, with the second quarter, the trough of the crisis is behind us. for the third quarter, we are in a strong rebound growth. starting in q4, the speed of growth will slow down. the pandemic is still ravaging worldwide. global uncertainty is at unprecedented levels that weighs heavily on the german economy that weighs on the exports in terms of those export goods i think also next year, we'll see a rebound it will be a slower recovery. the recovery, the return to precrisis activity will belong

and is full of risks >> let's talk about the unprecedental limit here do you think it is enough to counter the crisis or do you think we need more from the fiscal side? first of all, i would like to say what we've seen is decisive and comprehensive in the fiscal package. the fiscal whatever it takes in light of the breath and depth of the shock is appropriate the measures, the subsidies and loan guarantees around one-third of gdp that's big in principal looking at our base scenario i would imagine that is sufficient

depending on the development of the pandemic >> in the midst of getting the money to the real economy by guaranteeing a lot of loans. how is demand going? is it still strong >> i am pleased to see the kfw loans as part of the fiscal government and reaching bredth of the economy has received 53 billion euro in loans. i'm particularly pleased to see the largest part of these loans goes to the backbone of german economy around 89 -- 98% of the

loans go to the country. with largest part of the loans with ticket under 3 million >> you have have not so much the very short term. >> in my view, that's a good sign for the stabilization for the economy because companies together with the banks are able to ensure the long term. however, it's pretty likely that investments only account for a small porgtion of that >> thank you so much we have a limited amount of time left i'm sending it back to you tomorrow will be another day here at the banking conference which we bring you live from frankfurt. back to you. annette, great to see you back out and about for sure.

before i hand you over to the u u.s. colleagues, the dow looking to open more than 200 points higher the gain set to continue the nasdaq with a 150-point jump this follows a record high close for the s&p as well as the tech heavy nasdaq that momentum is no doubt providing confidence for investors as well as european investors are bouncing back after four straight days of losses that's it for the show "worldwide exchange" is coming up next. another day, another chance to bounce forward.

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it is 5:00 at cnbc global headquarters here is your "top five@5." a strong start to september. the treasury secretary and house speaker reopening dialogue over a potential tim lus package. talks over tiktok reportedly hitting a snag because of the app's al