"live your days inspired anew." ♪ good morning and welcome to "street signs. i'm silvia amaro and these are your headlines market space and global bond selloff and in the uk, gilt prices and sterling struggle. brush off the worst of the bond market rout, but uk retailers plunge to the bottom of the stoxx 600 as marks &

spencers warn consumers are more value focused. consumer prices flat line from 2024 and factory prices remain in recession territory for the 27th straight month. and deadly los angeles wildfires spread into hollywood hills with president biden declaring a major disaster and cancelling a trip to europe. very good morning. we start today's show looking at the action across the european equity space starting with the stoxx 600. we are just marginally above the flat line for the moment we were lower earlier in the session and what we are witnessing at the moment is a cautious approach within the investment community as they are

digesting a very important market narrative over the last 24 hours or the whole week really, we see concerns with inflation whether the fed will be able to cut twice this year and let's see how this story will develop over the next couple hours. at the moment, if i take you to the european bourses and got a look across the european bourses, we have a mixed picture. look at the ftse 100 we are actually up .70%. it seems at the moment investors are brushing off a little bit those concerns that we have seen regarding inflation, but nonetheless, this is one, if not the market narrative to watch today. i want to talk you to the european bond market because of that we have seen higher yields across the board that started in the u.s. market. indeed, when you think about the european bond yields, let me take you to the benchmark.

the european 10-year bond at 2.53%. we have seen the benchmark actually trading around a five-month high. if i take to you the uk, when you think about the performance in the bond space, look at the numbers. i want to take you to the ten-year yield it is important and we are at 4.86%. all in all, i want to put it into context for you we are looking at levels that basically we haven't seen since 2008 that's huge, huge change we are seeing growing pressure coming from the bond market. let's see where that will trigger any sort of policy change from the government i also want to take you to the treasury markets because there again with higher treasury yields across the board. thinking about the benchmark we saw the ten-year yield hitting the high of 4.73%

yesterday. that was the highest level since april. if you look at the longer yield on the 30-year, we ares hitting a high there, level, we have not seen since november of 2023. ofs the story across the board with the higher outlook for inflation and what that's going to mean going forward. thinking about how this story has played in the fx space, let me show you how we are moving across the currency space. the euro/dollar. we are marginally lower sense the u.s. dollar. sterling, we are down .60% again, the greenback at 1.22 let's see how this will develop and nonetheless, i want to discuss this in more detail with our next guest james carter, portfolio manager at investment management james, great to have you on the show at a moment when fixed

income is dominating the headlines, really. i would like first and foremost what is looking at in the uk we are looking at levels for the ten-year gilt we have not seen since 2008 explain to us what is happening here. >> in the context, it is not just the ten-year. it is the 30-year. back in 1998, you could not google how high the yield was because google did not exist the differential is 4% you compare it to s, you have to go back to the fall of the berlin wall to see a larger yield differential on the uk it is an incredible move it's a move driven by not only a change since september and expectations for inflation particularly in the u.s. post trump and in the uk post budget and potential for upside days

appointment for inflation. probably more so reaction to the budget and the fiscal headroom that has eroded the last couple weeks and buyers revolt in the bond market. we are no longer in the position where the bond vigilantes are. they are on the street i bumped into them to the studio when we look at real yields, we see that long term inflation expectations we think the bank of england is spaced it with the activists with the ecb rather than what the fed are doing. there's no need for them to look at what jay powell and had fed are doing. the economics are so stark christine lagarde has been focused on growth. whereas andrew bailey has been focused on the outlook

he needs to shift now and look at the bond market and fiscal headroom and the pickle the government have found themselves in and respond if he doesn't do it sooner or later, he will find the uk in had a more challenging outlook for growth. >> from what you are telling me, the biggest pressure, you said there is actually coming on the fiscal side, is because of the budget we will be on obtain in w government is number 11 and 10 listening to us in the bond market at the moment >> yup in the u.s., donald trump doesn't listen to many people, but the bond arket is one thin he should be listening to. i'm not sure of andrew bailey is listening to he should be i would be telling him to ramp up the rhetoric about the interest rate cuts over the next 12 months. the government will not change their decision making now.

they've got another budget in march. if the outlook doesn't change, of course, fiscal headroom eroded by the cost of interests going up with the bond yields rising the growth outlook deteriorating. the bond market is telling them you cannot change your fiscal rules any further. you cannot increase the amount of debt ance beyond what you already have the only thing they can do , if they are listening to bond market which they should be, is to rein in fiscal spending through tax hikes or spending cuts it doesn't matter. that's the choice they have based on the signs the bond market is telling them i. . >> i guess we are not far from there. i want to share the chart on the ten-year treasury. it is very interesting there is nothing better than context really we have the yield trading at

4.675% we have seen the highest level actually hitting 5.02% in the month of october of 2023 i'm showing this, james, because i want to understand we are not that far from the highest level ever what is going to take? are we going to test that 5% threshold in the near future >> the drawdown in u.s. treasuries is still at the worst level since the u.s. war of independence in the 1780s. that reset in yields does, in theory, make bonds more attractive and less risky. the issue we've had in september with the trough of that curve a few months ago was at a time where there was certainly risks from the employment space with the labor market looking like it was potentially weakening in that space and responding to that with the potential of cuts over the 12-month period

looking back at september, the interest rate priced in for june this year was for rates to come down to 3% in the u.s. if we look today, markets are now pricing interest rates to go down to 4% by june so that's quite a material shift. that's really come down to not only potential upside surprises to inflation, because frankly, anyone's forecast over 2025 has been thrown out the window with what trump may or may not done with the perspective with tariffs. just like the uk and post-october budget, the concerns are mounting with what is going on with the fiscal front. there are unfunded tax cuts that are familiar to uk listeners with what happens under liz truss and how that all ended and how it will be funded and the bond market is telling us at the long end of the curve it will be a lot more issuance for headwind for treasuries. >> i want to talk issuance and

before we get there, i want a call from you. will we test that 5% level >> is there there is a risk in market that we could test that level. we would prefer to be exposed to tips and inflation linked treasuries in the u.s. because of the concerns, the potential for upside surprise to inflation in the u.s in the uk, we think the outlook is much better not only because the outlook is different, but inflation which has been sticky in the u.s. and uk, we think there is room for inflation to surprise to the downside in the uk because it has been are driven by services that services inflation has been driven by wages. when you look at the jobs market which ultimately is going to dictate where wages are, it does show signs of material calling in the uk. anecdotally, we have seen the ceo from reed saying post-october budget, the number

of job openings fell 13% in the month of november. we aw indeed.com which said year over year, the fall has been 15% sorry, 25% if you compare pre-covid levels, it is down 30% that hasn't yet translated into lower wages. wages still are rising 5% to 6% in the uk. much faster than anywhere else we should expect that to start coming off the as the labor market and employees have less bargaining power to demand higher wages there is less upside risk to yields in the uk, we see yields coming back down and seeing what is happening to europe. >> briefly, i would like to look at the issuance level in the united states. we know the pressures in the treasury space is coming from the fact that the biden administration has focused their

debt-to-issuance on short-term debt is that likely to change what would that mean under a trump administration >> bessent preferred to issue a more balanced treasuries with more issuance at long end which yell yellen has not done. that is another risk for bond markets. there hasn't been much issuance at the long end. we should expect a lot of issuance for the outlook if you look at the policy ies we hear from the incoming administration, they are fiscally expansionary. that would be more of a problem for the u.s. it is certainly a headwind i would like to draw a parallel to the uk. in the u.s., we are going to have a congress controlled by the upper chamber by the republicans. trump, that doesn't seem concerned about bond markets at this moment in time.

i expect that to change and a lot of talk about extra fiscal spending and that being unfunded in the uk, we have seen, of course, a fiscal expansion post-october budget. if you look at the dmo forecast over the next five years, it does look elevated over the next year or two. it does look after that period it is coming down. we don't have much headroom over that fiscal budget with three or four billion under the current fiscal rules in march, they can change the spending plans and issuance doesn't concern me as much as it does in the u.s. which is another reason why perhaps international investors should be looking further toward the guilt gilt market and away from treasuries with the upside risk to ance and uncertainty from the perspective and inflation. >> very clear. james, pleasure to speak with you. hope to see you soon

james carter, portfolio manager. especially where, the pboc will sell 60 million yuan next week the biggest issuance of bonds. this is in the bid to fight pressures on the yuan amid the stronger dollar and falling chinese ields and rising trade tensions the yuan is on a six-month low against the u.s. dollar. meanwhile, producer prices dropped 2.3% year on year last month. the 27th consecutive month of declines coming up on the show, we will hear from president trump as he announces the data centers

as he was prompted by trump's victory. let's say you're deep in a show or a game or the game. on a train, at home, at work.

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welcome back to the show the u.s. president-elect trump announced a $20 billion investment from damac properties whose founder, hussain sajwani, will build data centers in the u.s. sajwani subjected the move had been prompted by the election. dan has been speaking with sajwani about the deal he joins us more about the deal. dan. >> silvia, this was an insight the conversation with the emirate billionaire.

these two have an been friends d business partners for e than a year now standing next to the president-elect making the investment in the united states. he says the sky is the limit when it comes to the future collaboration and investment from the uae into the usa moving forward. here is part of our conversation >> first confidence of the president and i take small part in that was very interesting and media coverage was very good we are very excited about this opportunity to invest that amount of money and get the data center business in the u.s as you appreciate the data center business is growing in a big, big way and growing in a double digit and more. making major changes in the global economy and i think in future we will see a major evolution in the world with a.i.

and data centers play a major role in the infrastructure >> what type of mark do you expect to make in the u.s. data center market with the initial $20 billion investment >> as you appreciate, u.s. is a huge market. so, our $20 billion is a sizeable money from our point of view to my knowledge, there are large amount of money getting invested in data center some numbers are talking $5 billion or more. microsoft will spend $80 billion this year. so, the landscape is big the opportunities are sizeable >> you said there could also be scope to increase that investment if market conditions allow? how much would you eventually like to invest in the u.s. if the opportunity comes up >> well, i mean, the sky's the limit. we can risk more as much as the market takes the limitation is endless. we can use the financial

resources. second phase, we can take third-party money and the platform can grow to the next level. >> you have a more than decade long friendship and business partnership with the president-elect. it is something you and i have spoken about several times in the past, but take me inside the room at mar-a-lago when you first told the president-elect that you would like to make this investment into the united states and, of course, at a time when he is resuming the presidency how did he react >> as you appreciate, he is very pro-business he liked to encourage businessmen to come to the u.s he likes his country to be open for business and investment. he was very positive he said, you know, i have a press conference next week and come join me and we'll announce that together. >> sajwani has the business relationship that goes back to 2013 that's when the trump organization and sajwani's

properties teamed up to open up the first trump branded golf course in dubai. the second is under construction he attended the first inauguration and now plans to attend trump's inauguration in the coming weeks as well clearly underscoring the relationship trump has with this individual and other key business leaders in the united states what this also really reflects is the unique ability that the president-elect has to leverage some of the foreign relationships, particularly in the business arena, to drive foreign investment into the united states. of course, what that looks like moving forward, of course, remains to be seen exactly where sajwani will get the money to do this is also a key question mark at this point. i did ask him directly where's the money going to come from he says as it stands, the business is capable of financing theinvestment, but he is opening up the idea or attracting third-parties to get

the $20 billion plus plus over the line what this looks like is still really remains to be seen. particular where those data centers are going to be opening or the timeline. a major announcement from the uae or here on the cusp of the president returning to the white house. >> that's right. thank you for bringing us that conversation, dan. our next guest says a.i. is the dominant theme of the future and picks and shovels away from players. we have the analyst joining us today. jimmy, first and foremost, before we discuss anything regarding equities, i want your thoughts on the moves in the bond space and the ramifications it could have for equities >> i think in the short-term, yes, the movements in the bond

market result in the volatility. that is the small cap space. i think that will continue as long as the bond yields keep picking up that is really a function of the yields we are seeing if inflation worries continue to rise especially with the incoming donald trump administration that could mean more volatility coming >> which sectors from the equity perspective are the biggest risk here from seeing higher treasury yields which ones are actually a moment to sell? >> maybe not a moment to sell, but the ones at risk the most would be bio-tech stocks as well as the unprofitable tech stocks as well. these two sectors are really at the sharp end of the interest rate sensitivity i would be worried about participating in this kind of climate. >> speaking about tech, we have seen tech rallying so much over the last two years around the

a.i. story you still think a.i. issing going to be the dominant narrative this year. that boom or hype expected to finish and come to an end with the pressures coming >> i think it is a multi-decade thing and what we get going forward is the development of the theme. what we have seen so far is the picks and shovels companies getting the majority of the investment and narrative and hype, but that's now going to move to the utility of a.i that comes in various different forms. one of which is general p erati. some will have digital work force and we have started to see that the other is the embodied a.i. jensen huang was talking about physical a.i that is another manifestation.

we feel the narrative will move and evolve to the utility of a.i. >> the reason i was asking you that is because when you think about, excuse me, how much these companies are spending on a.i., and we actually saw a little bit of pressure for stocks at the back end of last year given how much they were spending on a.i., we are looking at higher borrowing costs. surely at one point this is actually going to melt and explode to some extent, no >> yeah, 100%. i think what we're seeing is two dynamics happening one is the hyper scalers deep pocketed, google, microsoft can invest microsoft with the $80 billion investment those companies will continue to invest and continue to build moats around the business and continue o benefit on the other end of the scale is the companies able to raise

finance. we saw anthropic raising a $60 billion valuation the other day. if those kind of companies can continue, openai can continue to raise required financing, yes, they will continue to be in the game those will be left behind. >> i'm not sure if you have any thoughts, but i would like to ask you about this nonetheless looking at quantum computing stocks with a lot of pressure after the comments from the nvidia ceo what are your thoughts on this part of the market do you think they could benefit from the a.i. spending >> we think quantum computing is an interesting technology, but it is still decades away >> he said 20 years. >> 20 years. yeah i think the thing about technology, we all agree on is it surprises everyone, right we can be surprised. it could be much sooner than 20 years. certainly not pre-2030 type technology so, the hype that was built

around quantum computing plus google's as announcement was overdone and a bit too early in outer years, it is interesting technology. >> let's see we appreciate your thoughts. jimmy, senior analyst at investec. coming up on the show, uk retailers under perform despite up beat figures from tesco and m & s. we'll dive into the figures after this break

welcome to "street signs." i'm silvia amaro and here are your headlines market space selloff with the ten-year treasury yield hitting the highest level since april.

while in the uk, gilt tumbles. equities brush off the worst the bond market, but uk retailers plunge to the bottom of the stoxx 600 as m&a and tesco warn consumers will be more value focused. china flirts with deflation as consumer prices flat line in 2024 and factory remains in inflation territory for the 27th month. the deadly los angeles wildfires head to the hollywood hills with president biden declaring a major disaster and cancelling a trip to europe. time now to get a new check on how wearing moving across the

equity space on the european continent. we have the benchmark stoxx 600 below the flat line. looking at the what we witnessed earlier in the seeing, but overall, we are witnessing investors trying to understand something that is confusing, really, about how to position portfolios amid the pressures coming from the bond market. let me show you how the different european bourses are moving so we get a better indication of what's happening on the european continent. we have the ftse 100 up .40% the other bourses, however, are actually trading in the red. the xtra dax is the biggest loser at the moment down almost .0% i told you and it is the biggest market story today in the bond market let me show you how european bonds are faring at president the moment the yield on the ten-year german

bund at 2.536% at the moment all in all, we are looking at levels hovering at five-month high i want to bring you back to the uk there, the numbers are more staggering we have, at the moment, the yield on the ten-year gilt trading higher at 4.845% the longer end of the spectrum, the yield on the 30-year gilt also tracking higher at above 5% i want to take you, however, to developments we just obtained looking at kmen commentary from uk parliament. let me share these comments with you. all in all, what we are witnessing in had the bond market is actually putting pressure on politicians as well. thinking about these latest comments, we heard the house of commons speaker granting urgent

question to ask the finance minister about the pressure of borrowing costs on the public finances let's see how this will develop and, indeed, what the chancellor rachel reeves will say to address the pressures. one of our guests earlier in the show was actually highlighting one of the points here is actually the latest budget investors are concerned really about the fiscal outlook here. we are, of course, going to hear from the government also in march. so, perhaps, we won't see any changes between now and then, at least then, we know that rachel reeves is once again expected to speak to address the white house of house of commence ons and their fiscal plans and tax policy going forward. because these numbers in the bond market clearly putting pressure here on the uk government speaking of the uk, we are also getting the latest flashes from

the bank of england. this is the survey that the bank of england has looked at it is actually saying firms in the uk, expectations for cpi inflation for the year ahead rose from 2.7 to 2.8%. this actually matches what we are hearing across the investment community in terms of higher inflation expectations. so, perhaps, a little bit more pressure for the bank of england. we were talking about, perhaps, the government coming up with tax policy changes and so on, but question marks for the bank of england to address the pressures we are witnessing in the bond market. staying with the uk, i want to take you to the latest earnings we obtained in the market earlier today. marks & spencer s for the period

8.9% higher. tesco faces higher costs from tax increases. now, we also heard from tesco. the company has maintained its full-year profit outlook after christmas sales period rose more than 4%. the supermarket group sees full -year retail rising for the year at 2.9 billion pounds. i want to see how we are faring for the companies for uk retailers. tesco under pressure there is pressure, really, across the board particularly, let's address this one. b & m, i should say, the retailer we are down more than 13% at the moment investors also disappointed with their latest soft sales figures. look at it we are down across the board really

sainsbury down 3.6%. marks & spencers, we are down 5% at the moment. indeed, investors here questioning the outlook for the company which has surprised with consumers saying marks & spencer's is different and it has changed. actually can it keep up with performance. let's discuss with chris beckett. good morning good to have you on the show, chris. first and foremost, i would like to pick your brain around the numbers from marks & spencer's we are down 5% on the stock at the moment just explain to us why investors so negative on this stock. >> i think, well, actually, they had a pretty good christmas. you already mentioned food sales up nearly 9% the clothing business is doing better than the market it is still growing up 2%. i think the reason investors

expecting something more positive with the outlook statement. the company weren't that positive there are quite a few clouds on the horizon and extra costs they are having to absorb minimum wage increase and national insurance rise. more generally, an uncertain economic position for the uk you talked a lot about what's happening in the bond market that effects investors willingness to buy uk centric assets and retail sector is one of the most uk exposed large cap sectors of the market which is why it is under a little bit of pressure or a lot of pressure this morning. >> right i also want to get your thoughts regarding tesco. they have performed so well in recent times, but once again, when you think about the pressures we are witnessing on the inflation front and also national insurance contributions being higher here, what is the outlook for the company as well?

>> um, tesco reiterated their guidance at 2.9 billion adjusted retail profit. their expectations have not changed since the half-year stage. the market would have preferred something better tesco is a well managed business and they are doing a lot of the right things the trouble is a lot of the self help measures and cost saving program should save 500 million pounds per year this year. that's going to be eaten up by wage increases and national insurance. before the end of the year when they've been talking to investors and analysts, they said the wages will cost them around 200 million national insurance, another 200 million. i think it's going to be similar to a lot of retailers. they've got to be well managed

and they're running pretty hard to standstill. they will be doing a lot of good self help measures to keep profit expectation stable. so, i think a lot of credit to tesco management and what they've achieved particularly over the christmas period. retail gets harder the lower down the income spectrum you get. taking nothing away from m& s, but if you are selling to a more affluent base, they are doing well the amount of money they've got to spend after they pay their bills is going up. as you go down to lower cohorts, life gets more difficult the more discount retailers in the uk and, indeed, around the world, are finding it more difficult. so, tesco, i think will be able to absorb the cost pressures on the economic side as long as tax

increases don't come mid-year and the loss of confidence doesn't extent from here i think the lack of the upgrade is why we see the stock offer up this morning >> well, you highlighted there how the affluent consumer is still doing quite well and still in the position to purchase goods. ultimately, the message we obtained from retailers today was quite negative really suggesting that consumers are very much focused on value so, what are you reading from the health of the uk consumer at this stage >> the reasons or the data that i can see that came out this morning that support the whole affluent consumer, the fact that more people can afford to do their food shopping at m & s with the food volume up 9% that's a sign that affluent consumers have got more money

and willing to spend it. tesco is reporting their up market range sales up 15%. so, that part of their business doing relatively, relatively well coming through with both companies in the numbers i think there is an uncertainty if you look at consumer sentiment. everybody is looking at the same news stories everybody is anticipating tax increases and things getting more difficult from here despite what the government is saying right now. so, i think there is a difference between how people are spending money and how they're feeling about the future right now. >> i also want to get your thoughts next on the report a couple of days ago when you think about the performance of next versus their peers. what is the competition like for 2025 is next still an outperformer really >> i think it is an out performer, but the places that they can get extra market share

easily have diminished if you look at the quoted clothing retailm& s is a lot better than it used to be. primark at the lower end next had a period where they're competition wasn't nearly as good as themselves i don't think they have that dynamic anymore. if you look at how next sales have performed very strong online, indeed, you have the same from m& s this morning. online clothing sales growing at a very respectable level the brick and mortar stores growing more modestly and at the next space, declining on the economic basis that makes the running of the brick and mortar stores more difficult. next is still a very good quality business it's run very well, but the

environment and competitive environment isn't quite as easy as it has been for the rate. >> let's see just the start of the new trading year i appreciate your time this morning. chris beckett, head of equity research at quilter cheviot. now the california wildfires continue to rage as the winds fan the blaze. at least five people have been killed and more than 100,000 have been ordered to evacuate. president biden canceled a trip to italy to focus on the federal response nbc filed this report. >> reporter: we are heading into night number two of heavy winds here in southern california after a difficult day of firefighting and a difficult night last night and a very rough day the day before when these winds started blowing and blasting down the hill here in

pacific palisades. the flames continue to go up the hill with the vegetation and blown back down the hill with the winds which is unusual fire behavior for this extended amount of time here in southern california, we are used to fires and we were prepared for the fires with strike teams coming from around the state because we knew the weather system was coming. the intense, it got out of the control in the neighborhood and continued to eat its way through neighborhoods in the surrounding areas as well. fire crews are spread thin across southern california with two other major fires that were burning nearby since yesterday now, a new fire in the hollywood hills called the sunset fire is threatening residents all along the hollywood hills, runyan

canyon and west hollywood and beverly hills on either side a lot of concern the wind is still blowing strong and erratically. we don't expect to get any r relief as far as firefighters are concerned until the weekend. coming up on the show, we will speak to marc (auctioneer) let's start the bidding at 5 m vanon dollars. thank you, sir. (man) these people of privilege... hoarding the financial advantages coming up after this break (auctioneer) 7.5 at the back. (man) look at them — unaware that robinhood gold members now enjoy the vip treatment — a 3% ira match on retirement contributions. (auctioneer) 11 million sir. (man) once they discover their privileges are no longer exclusive... their fragile reality

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welcome back to the show now, further news related to elon musk. the tesla ceo and close trump ally is examining how to remove

prime minister keir starmer from his role before the country's next general election according to the financial times musk is reportedly looking to see how he can stabilize the government and possibly building support for the political movements in the uk such as the reform party musk will hold a live conversation on x tonight with germany's far right afd party candidate for chancellor that is weidel having previously called the party the only hope for germany. musk received pushback from olof scholz for his interference in german politics ahead of next month's election for more on musk's new interests in german politics and whether there's anything european leaders can do to prevent it, head online to cnbc.com. as we approach the end of the show, here are the four things to get you up to date for

the trading day. u.s. equity markets are closed to honor former president jimmy carter government bonds are amid a selloff in the biggest fixed income markets microsoft has confirmed to cnbc it will carry out perform-based job cuts we will hear from a slew of fmoc officials starting with philadelphia fed president patrick harker minutes released on wednesday show officials concerned about inflation. elsewhere, president joe biden is looking for export hips days before leaving office that's according to bloomberg which says the president's plan would extend to most of the world with only a small number of u.s. allies maintaining total access to u.s. made chips.

in a statement, nvidia said the report proposal would threaten u.s. leadership and economic growth, but not reduce the risk of misuse. the u.s. treasury department says chinese state sponsored hackers stole documents in the breach in december and the joint investigation with the fbi is under way. my next guest says the weaponization of cybersecurity will become an increasing trend as geopolitical tensions rise and a.i. is set to play a key role in improving security technology i'm pleased to say marc van zadelhoff of mimecast is with us today. marc, what a time to have this discussion off the back of the cybersecurity developments over in the united states just explain to us why do you think this is a growing trend in 2025 and should we be worried? >> nice to see you, silvia good to be with you this morning.

listen, i've been in the security space for 20 years and it seems every year, we see a rise in the attacks. everybody is getting in on the game it used to be banks vaults robbed 20 years ago physically now you have organized crime and hackers and criminals using cyber and the internet as a way of attacking unfortunately, this is the game right now in terms of the way attacks happen you no longer hear about people robbing bank vaults, but you hear about this every day. i don't think it will change the geopolitical environment, but it will change with the ease criminals monetize this. it will be another active year in 2025. >> do you think there is growing awareness within governments about the risk are they actually doing nough to be prepared in case of potential hacks? >> yeah, i think obviously this whole topic is a topic for geeks to the topic for the boardroom and governments over the last

five years that has for sure reached the boardroom and awareness. we have seen a lot of time spent on investing in it technical layers of security and not enough in what we're calling the human risk element in securing the final vulnerability which is the users with hands on key boards or mouse to make mistakes that is where we spend time with our clients with the human risk piece. we have done a lot of investment with the technical stack and network and data how do we think bout securing the humans >> interesting i would like to understand where the threat is biggest really because in your trends for 2025, you do highlight how cybersecurity will be increasingly weaponized by nations. where is that more likely to happen >> i think in terms of, you know, the areas that you will see the attack is right around

the areas where you read the headlines that you report every day where you see tension between countries and outspoken statements from politicians or you see criminal organizations active that's where you see the attacks happening. again, it used to be physical to now, you know, virtual attacks with cyber you will see along the same fault lines you read about in news a lot you don't read about a lot of these are not reported until much later. >> i guess it also depends on the scale, to be honest. if we think about how these threats and how these events could actually look like, and of course, we have the example from the united states recently just explain to us how is the hacking most likely to happen. >> yeah, i think the techniques vary in technical. obviously, we have gone to a world where hackers are applying

ransomware techniques. you can look at the techniques they use and infiltrate with bad software or compromise a human and trying to take someone's identity and repurpose that for breach and compromise a user and make someone make a mistake. it is a slew of actions they will throw at an organization to try and get a key hold into that organization to try and get one user to make a mistake or click on something in an email we are looking at 1.7 billion emails a day and people only need to make one mistake and have access and they can compromise identity and it could take weeks or months before that ex-filtration happens or in systems.

these are the techniques they are using. often, it is the human they are trying to reach. the user at the treasury or company like ours to compromise them >> all right well, hence your focus on reducing the human risk. marc, i appreciate your time today. marc van zadelhoff at mimecast i would like to look at the market narrative today we are looking at higher yields across the board amid these growing concerns around inflation. let's see what will happen throughout the rest of the trading day. that is it for today's show. i'm silvia amaro stay with cnbc "worldwide exchange" is coming up next.

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it's 5:00 a.m. here at cnbc global headquarters. welcome to "worldwide exchange." here's your "five@5. the deadly wildfires in l.a. continue to spread now burning in the famed hollywood hills. we have a live report this hour. a tentative port deal is reached to avoid a strike from new york to houston. chip stocks under pressure with curbs from the white house. and quantum computg