tv CNN Newsroom Live CNN June 26, 2016 11:00pm-1:01am PDT
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hello. great to have you with us. we'd like to welcome our viewers in the united states and all around the world. i'm john vause in los angeles. it has just gone 11:00 on a sunday night. >> and i'm max foster outside the british parliament in london, where it just turned 7:00 on monday morning. >> now, the british parliament meets to discuss the implications of voting to leave
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the british -- leave the european union, and we are expecting all sorts of things to happen this morning. so we are expecting to hear this hour from george osborne, a statement from him. he's going to reassure the markets, we understand, but also many questioning whether or not he can possibly stay within that job. and also david cameron holding emergency meetings today. we're also wondering what on earth is going on in the labor party. jeremy corbyn, the current leader, is facing a coup, a very bloody coup within his own party. but he's refusing to move. i'm joined here by robin oakley. we had to bring you back in, robin, because we don't know what on earth is going on in the building behind us. after this temporary recess for the referendum, all the mps are going to come back in here. but there's an absolute vacuum of leadership. what on earth are they looking to? >> political chaos. it's a desperately dismayed country, waking up and wondering what the hell have we done here?
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there is a battle for the labor leadership with a leader who is discredited trying to hang on. we've got a vacuum at the top of the conservative party. you know, we don't even know who is going to be leading the negotiations on britain's future relationship with europe until we get a new conservative leader. of course european leaders in the meantime want to get the whole thing sorted as quickly as possible because they don't want to see brexit movements in other countries building up. >> in terms of the labor party, just explain to us what's going on there. how can a leader lose -- how many was it? 12 members of his cabinet, possibly another 20 m.p.s going today from the cabinet, from those administerial positions. how can he stay in power? >> it's an unprecedented display of disbelief in their own leader. and 12 senior ministers going, trying to put the pressure on jeremy corbyn. basically they're saying you're not up to the job. and particularly they are angry that he didn't make the case for remain as was the labor party's official position on the
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referendum. they feel that he has a long history as a eurosceptic himself. he didn't put his heart and soul into it, and they're also deeply worried that there was huge leave support in labor's own heartlands, which gives labor a very big problem for the future. ukip, the united kingdom independence party, pinching an awful lot of their traditional powers. >> how is he able to stay in power? what's the process here? >> what we're going to see today is a motion of no confidence being pressed by his own party, which will probably be settled in a secret ballot tomorrow. but jeremy corbyn -- >> an election in the labor party? >> he's got to get somebody to stand against him, has got to get 20% of the 232 labor mps, i think it is, to back him. jeremy corbyn says he will stand
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again him simplself. >> he may well win again because he's got this massive grassroots support. because it's a young vote that he had, and they're pro-european, they're going to be pretty fed up with him. >> it's an ideal onlically based support that he's got among the activists, and many of them trade unionists. the problem then is if he is reelected after a challenge, what do all those moderate mps, or those who would despair of his leadership, what do they do? the possibility is they break off and form a new party, a new parliamentary grouping, rather like we saw after the 1975 referendum in britain. there was a break away. the social democratic party emerged, and the conservatives held power for the next 18 years. >> we are standing by for a statement from george osborne, chancellor of the exchequer. he's going to calm the markets. very important for him to do that today. the markets are opening in an hour or so from now. a couple of the markets in asia have just closed.
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we can give you a sense of what's happening there. european markets an hour away from opening. nina dos santos joining us. >> the reaction was much calmer here as the markets opened in asia after that extraordinary trading day on friday across the trading world. we saw markets seesawing a little bit today, but the nikkei, which bore the brunt of the selling on friday, as you see there, closing up around 2.4%. and a lot of this can be traced back to the fact that the japanese government has been meeting with the bank of japan, the central bank, to talk about what steps they need to take to protect the ever-strengthening yen. now, the yen is seen as something of a safe haven. in times of trouble, investors tend to turn to buying yen just to park their money if you like. that has the impact of
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strengthening the yen, which hurts companies, particularly if they're exporters. so that's what's been hitting the markets in japan. what we're seeing really is it's not physical intervention from the japanese authorities but they're making their intentions clear that they're prepared to, if this continues to be a safe haven currency. and to be honest, max, all indications are that it will be because we are, as you and robin speak, you made very clear we're no closer to any questions being answered. in fact, many, many more questions keep popping up. so while this goes on, there is going to be this massive uncertainty across all asset classes pretty much, across all markets. so we are going to see a lot of volatility in these markets as everybody has been warning. interestingly, underlying the real fear here is the european project going to disintegrate. george sore oes, the man who broke the bank of england, saying it was virtually inevitable now that the eu would
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fall apart, and that really is a doomsday or nightmare scenario for markets because it's turning their back on capitalism in many ways. it's getting rid of the european project and creating that sort of uncertainty that markets just hate, max. >> okay. andrew stevens there with an update on the trading day across asia. nina dos santos is standing by at the london trading floor. nina, what are they expecting there in the coming hours? >> reporter: yeah. traders are at their desks here in london. about 50 minutes to go before the opening bell strikes. well, they're basically expecting another 3% drop for the ftse 100. that's according to the futures markets. the real losses have been incurred overnight in the british pound. that currency sinking back towards 133. and perhaps even 132 at one point, it looked like it was going to hit. this is a currency that just one and a half trading sessions away back on thursday evening hit 150.
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and there's a lot of concern across the city of london that the british pound will continue to suffer as we see this political turbulence on both sides of the house of commons. there's real concern here that politically this is a country that is waking up to a rudderless future as it heads into its difficult negotiations to try to extricate itself from its relationship with the eu. somebody is going to be taking to the stage in the next hour or so is george osborne. remember the bank of england governor stood up on the stage just before markets opened. when i was standing here on this trading floor just on friday to reassure the markets, now it's the turn of the finance minister of the country to talk about stimulus. we've had monetary stimulus there from the bank of england, him saying that he's ready to pump more money into the system to cushion the banks as their shares were falling around 25%. so now we're going to be hearing from perhaps even the fiscal side of it. monetary and fiscal stimulus always going hopefully hand in hand to try and stimulate
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markets or at least calm the declines we're seeing. i want to talk about gold, though, because that has been the recipient of the money that's been coming out of things like the british pound, the money that's been coming out of equity markets. it's sold about 8% on friday's session, continuing to rise from here above 1,300. and some people say it could hit 1,400 if people keep plowing back into that ultimate safe haven asset just like the japanese yen as andrew was pointing out. people go to the yen. they also go to gold in times of turbulence like these. >> okay. kn ni nina dos santos. let's go back to andrew stevens in hong kong as we wait for george osborne to make that statement. right now, what these politicians and what these policy makers say matters, and it matters a lot to the markets. >> reporter: absolutely. they are the -- they're the last resort, if you like. they can make things happen at government levels. what we see in times of crisis,
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time and time again, final crisis is a coming together, a concerted action from central banks around the world, john. they're all singing from the same hymn book. they're all talking about offering the same sort of support for the markets, and that has the effect of calming nerves. now, we haven't seen it to the degree that we saw it back in the financial crisis of 2008. we haven't seen it because this has -- even though there has been the ripple effect around the world on the markets, it wasn't panic on friday. we saw a pretty orderly sell-off of both the pound and equities around the world, but there wasn't that feeling of, oh, my god, it is the end of the world, which we had very much so in 2008. so that's what the central bankers have in their pocket at the moment, concerted action. they're talking a good game at the moment, but they're not acting. they don't see the necessity to actually act, and that's key because once they start throwing things at the markets, that's a sign that they're getting very, very worried too. they're hoping to talk their way
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through this, to calm some of the narmarkets down. and like i said before, if you look at what's happening in asia today, certainly much calmer today after that big sell-off on friday. and to be fair, that sell-off came in the wake of several days of market increases because everybody was betting on the remain camp winning. when that didn't happen, all those gains of the previous day's trading, blown just over the course of the day, blown in the first few minutes basically. so we're sort of back to where we were. it's certainly not a free for all or a freefall around the world at this stage, but the central bank authorities are standing by. >> okay. as we are too. andrew stevens there in hong kong. nina dos santos in london. appreciate you both being with us. now, scotland's first minister says the country will do whatever it takes to stay in the eu. raise the prospect of legally blocking the brexit. cnn's david mckenzie is in edinburgh, scotland, with more on nicola sturgeon's strategy.
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and this is what is an interesting employ here coming from the scottish leader. essentially using a very obscure rule about the scottish parliament, which may or may not, depending on who you ask, block the brexit. >> reporter: that's right, john. you know, nicola sturgeon seems to be one of the few senior politicians in the uk who had a plan ready should there be a leave vote. and her latest strategy, as you suggest, is an obscure law, though well known in legislative process. it's the option that the scottish government might have to block the legislation that would have to be put through parliament to leave the european union. >> i'm afraid we -- david, i think we have to leave it there because i think we are now expecting george osborne to make that statement. so we'll now listen to what the chancellor of the exchequer has to say. >> from a position of strength. that is because in the last six years, the government and the british people have worked hard
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to rebuild the british economy. we've worked systematically through a plan that today means britain has the strongest major advanced economy in the world. growth has been robust. the employment rate is at a record high. the capital requirements for banks are ten times what they were, and the budget deficit has been brought down from 11% of our national income, and was forecast to be below 3% this year. i said we had to fix the roof so that we were prepared for whatever the future held. and thank goodness we did. as a result, our economy is about as strong as it could be to confront the challenge our country now faces. and that challenge is clear. on thursday, the people of the united kingdom voted to leave the european union. that is not the outcome that i wanted or that i threw everything into campaigning for.
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the parliament agreed that there are issues of such constitutional significance that they cannot solely be left to politicians and must be determined by the people in a referendum. and now the people have spoken. we in this democracy must all accept that result and deliver on their instructions. i don't resiel from any of the concerns i expressed during the campaign, but i fully accept the result of the referendum and will do everything i can to make it work for britain. it is inevitable after thursday's vote that britain's economy is going to have to adjust to the new situation we find ourselves in. in the analysis that the treasury and other independent organizations produced, three particular challenges were identified, and i want to say how we meet all three.
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first, there is the volatility we have seen and are likely to continue to see in financial markets. those markets may not have been expecting the referendum result, but the treasury, the bank of england, and the financial conduct authority have spent the last few months putting in place robust contingency plans for the immediate financial aftermath in the event of this result. we and the pra have worked systematically with each major financial institution in recent weeks to make sure they were ready to deal with the consequences of a vote to leave. swap lines were arranged in advance so the bank of england is no able to lend in foreign currency if needed. as part of those plans, the bank and we agreed that there would be an immediate statement on friday morning from the governor, mark carney. and as mark made clear, the bank of england stands ready to
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provide 250 billion pounds of funds through its normal facilities to continue to support banks and the smooth functioning of markets. and we discussed our coordinated response with other major economies in calls on friday with the finance ministers and central bank governors of the g7. the governor and i have been in regular touch with each other over the weekend, and i can say this morning that we have further well thought through contingency plans if they are needed. in the last 72 hours, i've been in contact with fellow european finance ministers, central bank governors, the managing director of the imf, the u.s. treasury secretary, and the speaker of the u.s. congress as well as the ceos of some of our major financial institutions so that collectively we keep a close eye on developments. it will not be plain sailing in the days ahead but let me be
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clear. you should not underestimate our resolve. we were prepared for the unexpected, and we are equipped for whatever happens. and we are determined that unlike eight years ago, britain's financial system will help our country deal with any shocks and dampen them, not contribute to those shocks or make them worse. now, the second challenge our analysis identified in advance was the uncertainty that a vote to leave would bring in the coming months and beyond as britain worked with its european allies to create a new relationship. the prime minister has given us time as a country to decide what that relationship should be by delaying the decision to trigger the article 50 procedure until there is a new prime minister in place for the autumn. only the uk can trigger article 50. and in my judgment, we should only do that when there is a clear view about what new arrangements we are seeking with
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our european neighbors. in the meantime and during the negotiations that will follow, there will be no change to people's rights to travel and work and to the way or goods and services are traded or to the way our economy and financial system is regulated. however, it is already evident that as a result of thursday's decision, some firms are continuing to pause their decisions to invest or to hire people. as i said before the referendum, this will have an impact on the economy and the public finances, and there will need to be action to address that. given the delay in triggering article 50 and the prime minister's decision to hand over to a successor, it is sensible that decisions on what that action should consist of wait for the obr to assess the economy in the autumn and for the new prime minister to be in place. but no one should doubt our resolve to maintain the fiscal
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stability we have delivered for this country. and to companies large and small, i would say this. the british economy is fundamentally strong. we are highly competitive, and we are open for business. the third and final challenge i spoke of was that of ensuring that britain was able to agree a long-term economic relationship with the rest of europe that provided for the best possible terms of trade in goods and services. together my colleagues in the government, in the conservative party, and in parliament will have to determine what those terms should be and will have to negotiate with our european friends and allies to agree them. i intend to play an active part in that debate for i want this great trading nation of ours to put in place the strongest possible economic links with our european neighbors and with our close friends in north america and the commonwealth and our important partners like china and india. i do not want britain to turn
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its back on europe or on the rest of the world. we must bring unity of spirit and purpose and condemn hatred and division wherever we see it. britain is an open and tolerant country, and i will fight with everything i have to keep it so. today i am completely focused on the task at hand as chancellor of the exchequer to bring stability and reassurance. there have been questions about the future of the conservative party, and i will address my role within that in the coming days. in conclusion, the british people have given us their instructions. there is much to do to make it work. we start from a position of hard-won strength. and whatever the undoubted challenges my colleagues and i are determined to do the best for britain. thank you. i think it's time for a few questions. let's take some questions. >> kamal ahmed from the bbc.
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chancellor, you said before the referendum that if britain voted to leave the european union, you would have to put in place an emergency budget within two months. are you still planning that? and also can you tell us a little bit about your position? did you consider resigning, and if not, why not? >> well, first of all, i've got a very important job to do, which is as chancellor, to speak to international investors, to speak to my counterparts, to do what i can to stabilize the british economy. that's what people would expect of their chancellor, and that is what i am 100% focused on and will continue to be focused on in the weeks ahead. there will be an adjustment in our economy because of the decision that the british people have taken. i respect that decision, and we're going to get on and deliver on that decision. but that impact on our economy will have an impact on our public finances. given the delay in triggering
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article 50, given the decision by the prime minister to hand over to a successor, i think it's perfectly sensible to wait for a new prime minister before we determine what that action is. i've got another question. joe. >> joe hills, itv news. chancellor, can i pick up on that? you seem to be suggesting there will not be an emergency budget. can we be clear on that. >> well, i'm saying that there will have to be action to deal with the impact on the public finances. but of course it's perfectly sensible to wait until we have a new prime minister to determine whether -- >> you said that a vote to leave would be irreversible, would cause financial instability and would demand an immediate response from government. you're now proposing to delay a response. >> well, what you have seen is an immediate response from government in terms of the financial contingency plans coming into effect, liquidity being available, work with our
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international partners in the g7 and elsewhere to provide reassurance about the fundamental strengths not just of the british economy and financial system but the global financial system. of course the economy is going to adjust, and there will be an impact on the public finances. that's what i said before the referendum. i don't resolve from anything i said before the referendum. and i said there would have to be action in the autumn to address that. i think it's perfectly sensible to wait until we have a new prime minister before we address that. let's take another question. ed. >> thank you. ed conway from sky news. chancellor, you said before the referendum that there was going to be a recession if we voted to leave the eu. do you stand by that? do you think we are now at the start of that recession? and, secondly, would you serve in a government committed to leaving the eu? >> well, look, let me take the first question. i made a series of predictions or, rather, the treasury made a
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series of predictions that i agreed with about the impact on the economy if we voted to leave the eu. and of course there were a range of impacts depending on the kind of new relationship that we arrive at with the eu. but all of them required an adjustment in the economy. after i made that analysis, actually a whole range of independent organizations came up with very similar conclusions. and as i say, i don't resolve from that. but of course i'm going to work very hard to make sure we mitigate the impact, remind people of the fundamental strengths of the british economy. as far as my position and my role, i've got an incredibly responsibility to people as the chancellor exchequer to provide stability in these challenging times, and i take a very simple view of life, which is it's my country, right or wrong, and i intend to fulfill my
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responsibilities to the country. let's take chris. >> chris giles from the financial times. can you give a message to british households or companies who are thinking of delaying spending. what would you say to them? can they go on as if nothing has happened? >> well, look, what the british people need to know is that the fundamentals of the british economy are strong. we have spent the last six years so that britain is prepared for whatever is thrown at it. there will be a period of economic adjustment because of the decision we've taken, but we will get on and implement that decision democratically arrived at in our country. but we do so from a position where we have one of the strongest economies in the world, where we have repaired our financial system, where we are repairing our public finances, and where we have record employment. and so people need to know the fundamentals are strong. we have dealt with the immediate challenge of an unexpected vote as far as financial markets are
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concerned. the calls we had in place, detailed contingency plans. there will be an adjustment in the months ahead, but i think we are well placed to meet that adjustment. and our message to businesses large and small is very simple. britain is open for business. thank you very much. >> we've been listening there to george osborne, the chancellor of the exchequer in london, delivering a statement. his first statement since the referendum for the uk to leave the eu. max foster and robert oakley have been listening along as well. so let's go back to max foster outside parliament. >> you know, that was a sign of defiance in many ways. george osborne, many expected him to be stepping down. he's going to stay in position, and he's been very clear. he's talking about that being the best thing for the british
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economy. and also, robin, what was interesting was before all this, he said if there was a brexit, there would be an emergency budget straightaway. but now there won't be one. >> yes. he's now saying it's sensible to wait a couple of months until there is a new prime minister before you have any kind of new budget, if that proves to be necessary. first of all, he's trying to reassure the markets. that was the first message, by saying that britain now has one of the strongest economies in the world, that the government of which he has been part had promised to fix the roof. he says they have fixed the roof. now the rain has come down. they're in a position to handle it. they had robust contingency plans. all of that very much addressed to the markets. in terms of what's going on inside the conservative party and his own future, the interesting thing was that he said he wanted to play a significant part in the debate about what kind of deal britain now achieves with the european union. >> yeah. so this is what boris johnson is suggesting, that before they
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invoke this two-year period, this article 50, there will be some sort of discussion about what would come out of the other end. he wants to be a part of that. europeans, though, don't want any of that. they want this process to start straightaway. >> they want it to start straightaway, but as george osborne was careful to point out, only britain can initiate article 50, the two-year process of detaching from the european union. and he makes it clear that, you know, that isn't going to happen until there's a new prime minister in place. he didn't say anything about who he might be supporting as a potential new prime minister, of course. and he's still holding open the possibility of some kind of emergency budget at the end of the process of producing a new conservative leader who will be prime minister. >> in terms of what does happen from here, we're going to talk a lot about that throughout the morning. there's a huge amount of confusion about what happens in the government, what happens in the labor party as well. there's a huge amount to analyze here, and we're going to be looking at the shock waves
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the fallout from thursday's brexit vote continues. we've just heard from uk finance minister george osborne in a tv address. he tried to calm doubts about the british economy. the uk parliament is also set to meet in the coming hours for the first time since thursday's vote to leave the eu. it's expected the brexit results will top the agenda along with david cameron's decision to resign as prime minister. meanwhile, opposition leader, the labor leader jeremy corbyn says he won't step down. corbin backed the remain camp, but some say he showed weak support for it. he's under pressure to leave.
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now, the eu says it wants britain out in a timely fashion, but it could take two years or more to actually reach a deal. our atika shubert is standing by in berlin, but first to nic robertson because he's in brussels. nick, everyone baffled about what is going to happen from here. we've heard boris johnson and george osborne saying this article 50 won't be invoked until they're ready. but brussels wants to invoke now. >> reporter: they do although i think there does seem to be a level of belief and understanding that perhaps some preparatory work in advance of britain actually triggering that article 50 to begin the formal negotiations for exit might be in everyone's interest. also, too, a little pause. i mean there can be no doubt while european politicians may have become frustrated over the past 40 years, britain's prevarcations on the amount of
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involvement it would have, not signing up for the euro, all these sorts of things which have really rankled here in brussels, there's a recognition that the political -- the political situation in britain at the moment is really not ready to make the decisions that brussels would like to have them make quickly. i think perhaps, you know, angela merkel has been the one to see that pausing for a short time will perhaps allow britain to come to a better or more sensible judgment over time about when to trigger and how to trigger and how to go through all of this. i think perhaps that is going to be a growing recognition here in brussels, and certainly when u.s. secretary of state john kerry arrives here later today to meet with fredricka mull greenny, the eu foreign policy chief, his main message here is about providing stability for global financial markets, not least of all in the united states of course. but that will probably be with a dose of political reality about
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it. look, we're all friends. let's work together on this. let's not throw our toys out of the pram so to speak. george osborne was very clear, saying it's not about to happen overnight. europe's not going to get what it wants. britain is a big power, and it's ready to walk into the rooms here and say that. however, it is trying to negotiate its way out on favorable terms. it's hard to square that, but that's where we stand right now, max. >> nic, in brussels, thank you. atia, you're over there in berlin. chancellor merkel has got to make a decision here, hasn't she? she doesn't have to go into any sort of negotiation with britain ahead of invoking this article 50. she would have to do that out of good will. i mean the brits are making this sound as if there's a duty to do that, but this is unprecedented. the only thing that we know is that britain has to invoke that article 50. that's the only fact here. >> reporter: absolutely.
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and merkel is the voice of calm in all this. her own foreign minister over the weekend was saying we have to see the uk leave as quickly and painlessly as possible. her finance minister has earlier said out means out. no special concessions or negotiations with britain. but the chancellor herself over the weekend said there's no need to get nasty, and that's a direct quote, about negotiations. what will be interesting to see today is she has a flurry of meetings. she'll be meeting with european council president donald tusk at 3:00. after that, she'll be meeting with french president francois hollande, and the italian prime minister. it will be interesting to see in particular what she says after her meeting with hollande because hollande has also been very clear. the uk is out. let's move on. this must happen as quickly as possible. merkel is playing the good cop, if you will, where she says let's take some time here. and perhaps the biggest indication that germany could allow, for example, for a little
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bit of an open door for the uk is that her chief of staff told the local rnd paper here that, quote, politicians in london should have the opportunity once again to reconsider the consequences of a withdrawal. so just a little space there for perhaps the uk to give it another think. maybe regrexit is a possibility for doing something over again. >> there's some suggestion here, some academics suggesting that perhaps the article 50 will never actually be invoked because it's all on the uk to make that happen. and until they've got some -- that's their bargaining chip effectively with europe. how do you think chancellor merkel would respond to that? >> reporter: i think that in a legal sense, this is absolutely true. the only person, the only government that can invoke article 50 in this case is the uk. the eu can put all the pressure it wants at this point, but it's the sovereign right of the uk to decide when it wants to -- when and if it wants to invoke
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article 50. and i think that chancellor merkel is being pragmatic here. she knows this. so she's saying, look, you can shout and scream all we want, but the fact is we can't pressure them to do anything at the moment. so let's take a breather, step back, and think about what our options are. >> okay. atika, thank you very much indeed. also nic in brussels. lots to digest today. lots of meetings. we'll bring it all back together for you. a brexit backer is backing away from a major claim meanwhile about the leave campaign. an interesting debate around this particular sign. ♪ you've wished upon it all year, and now it's finally here. the mercedes-benz summer event is back, with incredible offers on the mercedes-benz you've always longed for. but hurry, these shooting stars fly by fast.
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one promise made by the vote leave campaign may be hard to keep. this message was emblazoned on buses, you might remember, and is still on the campaign's official twitter account. quote, we send the eu 350 million pounds a week. let's fund our nhs instead. that was the leave campaign's pledge, to invest up to 350 million pounds a week on the national health service from money that was being contributed to the eu. nigel farage, though, wasn't part of the official vote leave campaign but was a key advocate for it. in an interview with good morning britain, farage now calls the claim a mistake. >> the 350 million pounds a week we send to the eu, which we will no longer send to the eu, can you guarantee that's going to go to the nhs. >> no i can't, and i -- >> i don't know how many people voted on the basis of that ad,
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but that was a huge part of the propaganda. you're now saying that's a mistake. >> we have a 10 billion pound a year, a 34 million pound a day that is going to be free money we can spend on the nhs, on schools, or whatever it is. >> but you're not guaranteeing that that money, as promised, will go to the nhs. >> you must understand i was ostracized by the official leave campaign. as i've always did, i did my own thing. >> do you think there will other things people will wake up this morning and find out aren't going to happen as a result of voting this way? >> they will find out we're back to being a normal country in charge of our own laws and able to make our own relationships with the rest of the world. >> an awful lot to talk about. let's go deeper into it with cnn political contributor robin oakley. john redwood and you promoted that 350 figure, right? >> no. i made it very clear that the grace figure was 350 million. it's actually 360 million now. but the amount you can spend
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extra is 10 billion a year which was a figure we always used. and we did a costed program based -- >> britain will not get 360 million pounds a week. there won'ti be 360 pounds a wek better off as a result of leaving the eu. so it doesn't count, the money you get back from the eu. >> we will get some of the money back to spend as we wish. and other money, we will choose to spend on exactly the things that the eu -- >> it was a very clear promise, and it's completely -- >> yes, i made a very clear promise along with my colleagues. >> 360 million pounds is a huge promise to make. >> we did all this for the referendum. >> you can't dismiss this. it's still on the website. >> 360 million is the gross figure, and it's entirely accurate. the net figure of extra spending that we can have on things like health and the cancellation of v.a.t. on fuel -- >> i'm more concerned about the figure. robin, do you think voters were coned? >> i think voters were misled by
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both campaigns. there were so many phony figures being floated, that i don't think a lot of people took too much notice of the figures at the end of the day. they voted on a general feeling of in or out. most people don't follow the detail in the way that you or i or john redwood will be doing. all the things that john and others have said in their statements campaigning, nobody will remember those in three months' time at all. >> well, if they're voting for the nhs, and that benefiting, they might be a bis frustrated now. >> there will be substantial money available to increase spending on the nhs, and a lot of us want to do that. and i'm very pleased the chancellor of the exchequer says he wishes to implement the wishes of the british people. he's wisely said, no, there will not be one. we made it clear in the campaign we wouldn't vote one for and there was no need for one.
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>> can you talk about article -- robin, will a brexit-style conservative-led government -- where will we go now in terms of the single market? do you still want us to be in the single market, and do you agree with boris johnson we can both be in the single market and avoid free movement of people? >> yes, of course. that's what we're aiming to get. that's what the british people voted for. we're going to have access to single market. they want to still sell us cars and wine and other things. >> freedom of movement comes with that. >> we wish to have our own migration controls. we're not going to stop all migration. there will still be quite a lot of migration, but it's going to be based on qualifications and contributions and potential investment and all those other good things. >> but the price for norway's access to the single market was an acceptance of free movement of people. why would it be different for britain? >> we're a much bigger economy, and we just voted for a different policy. norway accepted that because
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they had a government that wanted to belong to the whole eu and they had a people who didn't, and the government pushed it further than i think they should have done. we're going to have a government that believes in what the people believe in, which is trading with europe but not being governed by them. >> because it's a more powerful country, it's going to negotiate a better deal than norway could. >> and we have a massive deficit with them, and we've already seen quite right and mrs. merkel being very careful, germany industry saying they don't want any changes. the people that made the case that our trade was going to be wrecked never got any senior representative of the major trading countries on the continent to say what tariffs they wanted to impose and what new barriers they wanted to impose. >> the big debate today is article 50, which we all now know about. we didn't know much about it before. when will it be invoked, and should it be invoked? will it ever be invoked? we're now getting the impression it might not be invoked at all because that's the one bargaining chips that the likes
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of boris johnson have got with europe. >> a lot of us are not keen to invoke article 50. we'd rather sit down and negotiate with our partners under a sensible regime rather than under the treaty we are rejecting. that is a matter of discussion. there will be lawyers telling us we have to do it under article 50. but international law or international politics -- >> has article 50 become academic and irrelevant? >> we said very clearly in the campaign that we were not minded to use article 50. we would rather legislate in the house of commons. but to reconfirm our arrangements and all those kind of things in good british law and sit down with our partners and say, do you want any changes to the trading arrangements because we don't actually, and we're happy to live with them even though they're so much better for you than for us. >> how long would the process been be, though, because george osborne was saying today, already big companies are pausing investment and pausing employment decisions. and the key problem is
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uncertainty, isn't it? how long does the negotiation and the uncertainty go on? you know, how long before we see an actual economic benefit from brexit? >> well, it's going to take a bit of time because we need to get a new prime minister and change of government first because as we've learned, the present prime minister doesn't feel empowered to get on with it. they understand there's going to be a change of personnel, so there's going to be a little bit of delay. the conservative party wants to be as quick as possible to get in a new leader, and i think you'll find we'll be down to the last two before parliament breaks for the summer recess. we will get a move on. in the meantime, there's preparatory work and preparatory talks, but that depends on both sides being willing to do that. b >> okay. thank you. both of you. there's so much to debate. article 50 now possibly not even
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on the table. an extraordinary development in this ongoing story. we'll bring you much more on britain's decision to leave the eu after this. sir, this alien life form at an alarming rate. growing fast, you say? we can't contain it any long... oh! you know, that reminds me of how geico's been the fastest-growing auto insurer for over 10 years straight. over ten years? mhm, geico's the company your friends and neighbors trust. and deservedly so. indeed. geico. expect great savings and a whole lot more. hmmmmm....... [ "dreams" by beck ] hmmmmm...
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new developments this hour on the brexit vote. there's new developments every hour pretty much. we just heard from the uk finance minister george osborne, a televised address. >> good morning to you. it was a much more somber, much more serious, much more worried looking chancellor of the exchequer than i've seen before. and what i found particularly interesting was this is a man we have not seen until now. he has -- we've had a couple of tweets on friday, but we've had no hide nor hair of the finance minister until this morning. i'm just going to look at my notes. do forgive me as i do so. he talked about the uk economy being in a position of strength, one of the strongest economies in the world. growth was robust. and just about as strong as it could be to confront the challenges that we now face. but -- and this is the important
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bit. he said i don't resile from any concerns during the campaign. well, i have to go and look up what the world "resile" meant, and what it means is i don't pull back from or withdraw from or boomer rang. in other words, he stands by everything he said during the campaign. what does that mean in reality? it means a potential recession for the uk economy. it means very hard times ahead. it means lower gdp growth in his view. and, max, one of the most -- but of course he had to eat a good dose of humble pie because he had promised this emergency budget. that's now not going to happen. >> yeah, and that was -- you know, all these promises, which, you know, are being broken effectively aren't they during this campaign. but he was front and center with david cameron on the remain campaign. david cameron's gone. why has george osborne not gone? you'd expect him to, wouldn't new. >> no, i wouldn't have expected him to go.
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i mean he will go in time because there needs to be, you know, in the view of the leave campaign, there needs to be a brexiteer in the prime ministership, and they are unlikely to keep george osborne at the treasury. but i think to lose the prime minister and to lose the chancellor would be very devastating at the moment. >> i mean he's dead man walking in treasury. >> thank you very much indeed. richard, much more analysis of that and more developments as well we're expecting here in the labor party in particular. thank you for joining us this hour. max foster outside the houses of parliament in london. much more on the uk's decision to leave the eu right after this.
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shoshow me more like this.e. show me "previously watched." what's recommended for me. x1 makes it easy to find what you love. call or go online and switch to x1. only with xfinity. you're watching cnn's special coverage of the uk's decision to leave the european union. i'm max foster in london. >> i'm rosemary church at cnn center. welcome to our viewers in the u.s. and all around the world.
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>> now, the uk parliament set to meet for the first time here since that brexit vote. and all the political fallout since, the country's leadership is in disarray. prime minister david cameron will chair a meeting with his cabinet after saying he would resign on friday. and there's a revolt within the opposition labor party as well after losing the brexit campaign. half of jeremy corbyn's shadow cabinet has resigned with one senior mp fired for reportedly plotting a coup. but corbyn is refusing, of course, to step down. the uk's finance minister meanwhile in the last hour, george osborne speaking, hoping to smooth things over in the international markets. >> it will not be plain sailing in the days -- >> we'll bring you that a bit later on. but effectively he's saying we will continue and stabilize the economy so those markets don't fall. they're just opening, so we're watching that very closely for
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you. osborne made that statement less than an hour ago, so it's not clear if it will have the intended calming effect. here's a look at the asia pacific markets for you, though. the european wants just opening, so we're waiting for those figures to come through. and we can't bring you the asian ones. but they were too volatile. let's just say that. there wasn't that big capitulation that some people were worrying about. here to help us decipher the numbers our nina dos santos on london's trading floor. and andrew stevens. while nina is digesting the numbers as they come in, just tell us what asia did. >> reporter: we just saw the numbers there briefly popping up, max. a much, much calmer day here, and the big market to watch in asia today was japan. the nikkei down 8% in reaction to the brexit on friday. up today 2.4%. now, one of the main reasons that the nikkei was so badly hit was the fact that the yen soared in the aftermath of that brexit vote because the yen is seen as
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a safe haven currency. when all the other markets were plunging, people were putting their money drk parking their money in the yen, and a high yen is bad for corporates, especially if they export. so the nikkei fell sharply. now, today we saw the japanese prime minister, shinzo abe, meet with the key central bank players in japan. and they said -- or the message they sent was we're watching the yen very closely. we are not going to let it get too strong. as you see there, it's now trading -- it's still getting a bit stronger, up about a third of 1%, but certainly nothing like we saw on friday. so the central authorities stand ready to act, and that was a calming influence on the markets in japan. other markets around here in asia also taking stock somewhat today, max, after big falls on friday. really waiting to see what's next. we can't say that the uncertainty is in any shape or form been cleared, even a little bit. but certainly it's now more of a wait and see here in asia.
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>> it's only three minutes into trading. but as the numbers come in, what are you expecting? >> reporter: yeah. what we're seeing here, max is the ftse 100, it's down around about eight tenths of 1%, but nowhere near as much as people were expecting. a big catalyst of that has been that very reassuring statement coming from the uk chancellor of the exchequer. now, i've just been listening into the morning meeting here, and what they're saying based on what osborne has said over the last half hour or so is they're putting forward their expectations for a budget to be announced by the uk chancellor probably in the fall. so we're talking about october, september time here, and that that budget, instead of being a punishing budget here that could fill black holes in the uk's finances, it's likely to be a stimulus to try and cushion the blow. and they're saying nevertheless, whether the uk does go forward
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and invoke article 50, we're talking about bracing yourselves for a technical recession in the last quarter of the year, and the pound could fall to around 120 against the u.s. dollar by the third quarter of the year. why is that assistasignificant? take a look at the pound. it has tumbled. on friday, in early hours of the morning, it was going up as high as 150 against the u.s. dollar before plummeting back when we got that shock vote. it's currently trading at 134. some people saying it could fall as low as 120. some bright spots here. we're talking about gold, which has risen aabout eight of 1% in friday's session. it does have room to appreciate further. you're seeing that on the markets. you're seeing gold stocks on the ftse rise, and you're also seeing the commodity itself rise. currently at 1,330. and politically, that's the bit that's causing all the
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uncertainty across these markets. people across trading floors like these are gearing up potentially for a general election in the first quarter of next year. the kind of uncertainty that will keep markets on their toes. what happens between now and then is something that's very difficult to trade, very difficult to predict, max. >> andrew, back to you briefly. i was reading this morning about a chinese official saying that effectively all investment in the uk is on hold until they work what's going on out in the building behind me, really what's happening in the uk. are we going to see the british economy sort of tank pretty quickly because no investments coming in? >> reporter: well, probably not tank very quickly. but just in a broader context on that, max, exports from asia to the uk are pretty small overall. if you want a number, less than 1% of asia's gdp is tied up with exports to the uk.
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so it's not going to move the needle that much. having said, that the chinese are investing in the uk. they're investing in many parts of the world. they are going to be careful, as any other country is going to be careful, about investing with this amount of uncertainty. and the other thing to look out for as well is of course the city of london. a very, very important financial center for the world. one of its biggest operations is in financial services, and a lot of the asia-based companies have gone to london, set up operations in london, and then fou fanned out from london into europe. if britain is out of the eu, they're going to have to look at investing in london, in the city of london, and moving their operations into mainland europe. so that's going to have an effect on the city, which as we know is a very important part of the british economy. i think it's 12% gdp comes from the city alone. so that could hurt. but as far as broad investment
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with this sort of uncertainty, china's not alone in saying hold on. we need some clarity. we need something to hold on to about what the trade deals are going to be, if there's a recession, how bad it's going to be, all those sorts of things have to be factored in before they start taking big investment decisions. indeed, they may decide they're just going to put it all in europe. >> okay. andrew in hong kong. also nina on the trading floor in london, thank you so much. we've got some breaking news for you. another shadow cabinet member stepping down in just the last few minutes. this time from steven kinuck. robin's with me. his position? >> he's only pps. he's not actually a member of -- >> so he's pps, but he's saying in his letter to jeremy corbyn, i have the deepest respect for your long service. in light of the deeply disappointing referendum result caused in part by the half hearted and lackluster role that
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you played in the campaign, i've come to the conclusion that you are no longer the person to lead the party. >> typical of what we've been hearing from the people who had resigned from the shadow cabinet. they feel that jeremy corbyn did not put any serious effort into campaigning for britain to remain in europe, that he's a long time euro skeptic himself. but one of the difficulties that the rebels against mr. corbyn are facing is that, you know, one of the worries in the labor party is that ukip, with their very strong anti-european pitch, have been taking enormous numbers of votes away from labor. so there they are, you know, criticizing their leader for not making a big enough case on remain, but at the same time they're scared stiff of ukip and a lot of them are asking for a new policy on immigration because they feel that that underlie a lot of desertions by former labor supporters to ukip and to the leave campaign. >> we were speaking earlier with john redwood about where we go
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from here. we talked a lot about article 50, this process that's instigated by the uk to start negotiations to leave. he's suggesting we shouldn't bother with that anymore. so what is the next step in leaving the eu? >> yes. we're not hearing that discussion yet from anybody in the government. >> but he was a powerful voice in that campaign, wasn't he? >> oh, john redwood has been an effective anti-european voice for a very long time. he was also making the point in conversation with me afterwards that george osborne, you know, not only not producing that emergency budget here and now, but we just moved back into the ordinary budget cycle because this was an autumn statement. under review of the economy in the autumn. so he's saying that shows that the case being made by the remain camp that there was an emergency to be dealt with by such a budget -- he's casting serious doubts on that of course. >> they're coming in thick and fast.
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we've got more resignations as well. it's hard to keep up with at the moment. robin, thank you. back with you later on as we get more of those names. the eu says it wants the uk to make a hasty exit. but the whole process could take quite some time. international diplomatic editor nic robertson joins us. what do you make of this that they're not even going to invoke article 50? they're going to do it a different route? >> reporter: well, obviously what's emerging from britain at the moment is a robust position that's contrary to what most of the european leaders that we've heard speak on this have said that they want britain to do. there's long been antipathy that britain has taken over its membership of the european union. it didn't want to be part of the passport free zone inside europe. it didn't want to be part of the euro area either. it wanted to keep the pound sterling. so there's been a degree of
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impatience, of, you know, unsettled feeling over britain's real long term commitments to the european union for a long time. i think some of that we're seeing the frustrations and have seen over the weekend. it may be now time that obviously we've been in a period over the weekend as well where we haven't really heard from british officials about which way -- which tone they want to take with this. but now it's becoming clearer. george osborne has said he wants to take it slower. boris johnson in his op-ed over the weekend said the same thing. the europeans for their part are now going to have to take on board what british officials are saying as well. perhaps we may hear a tempering of this expectation and desire on the europeans' part that britain would begin to enact article 50 and would begin to negotiate its exit swiftly. look, one of the things the europeans want to do at the moment is to make sure that they sort of staunch this wound, if you will, that there are no
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other limbs will drop off the body of the european union. that no one else will try to go for, you know, a referendum on exiting the european union. that's a concern. perhaps stabilizing the economy is one of the principle issues, and certainly that seems to be behind why u.s. secretary of state john kerry is coming into town today to meet with the eu foreign policy chief federica mogherini. i think what he'll bring to the table is also a sense of let's slow this down. let's not get too angry and throw our toys out of the pram. this is what he said in rome yesterday before coming here. >> the most important thing is that all of us, as leaders, work together to provide as much continuity, as much stability, as much certainty as possible in order for the marketplace to understand that there are ways to minimize disruption. there are ways to smartly move ahead in order to protect the
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values and interests that we share in common. >> reporter: so i think when david cameron gets here later in the week and when you get all the heads of the what is now 27-plus one european union countries together, then perhaps we may begin to hear some of that tone change. it is too soon to say. i mean passions on this are going to be high for some time, max. >> okay. nic, thank you very much indeed. as you're hearing there, the eu wants to get the brexit done as quickly as possible. we'll discuss what kind of obstacles may be in their way. plus scotland's first minister wants to keep her country in the european union. she may look to block the brexit in her own way. we'll explain next.
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britons. george osborne gave a televised address in which he tried to calm the fears. the parliament set to meet for the first time since the brexit vote on thursday. and the resignation of the prime minister david cameron on friday. labor leader jeremy corbyn facing a bloody revolt within his own party. multiple members of his shadow cabinet have resigned. scotland's first minister, meanwhile, has said the country will do whatever it takes to stay in the eu. nicola sturgeon says she wants to make sure the country's democratic will is respected after a majority of scots voted remain in thursday's referendum. >> my challenge but also my responsibility as first minister is to seek to negotiate to protect scotland's interest. what's going to happen with the uk is that there are going to be deeply damaging and painful consequences of the process of trying to extricate the uk from the eu. i want to try and protect
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scotland from that. >> sturgeon has raised the prospect now of blocking the brexit legally. cnn's david mckenzie joins us from edinburgh with more on her strategy. how does this work? how does nicola sturgeon block the brexit? >> reporter: it's very much up for debate. but certainly what she's saying, max, is there could be a vote here in the scottish government, in edinburgh, to block any moves to formally exit the eu by doing a legislative consent motion. now, that's a setup here in scotland that would allow scotland to effectively veto any moves by westminster to do any major policy that would affect scotland. and that's the latest of several strategies that nicola sturgeon has put forward to try and keep scotland within the u and other areas talking directly to eu
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diplomats. we expect that in the coming days. and finally, of course, potentially for scotland to hold another referendum on independence. max. >> i mean the idea of another referendum in scotland and even in the uk is quite something. but it's going to happen, isn't it? if you look at the strategy and how she's played things from here and her language, it does feel as though she's moving that way. and it is, you know, fundamentally what her party is about. do you think there is the appetite, though, in scotland amongst voters? >> reporter: well, you know, if you believe boris jonsson in today's paper, a leader member of the lead campaign, he wrote in his column, i don't detect any real appetite to have another referendum here in scotland. well, i have to say in the last few days, speaking to scots in edinburgh and, you know, hearing from online polls, not scientific but certainly significant to look at through
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the weekend here in scotland, a lot of public sentiment pushing towards another referendum. and several people i've spoken to who said last time around, they voted to stay in the uk. so they've changed their mind because of the significant change in the political landscape. now, the challenge for nicola sturgeon and the snp is they need to get their timing right, and they need to make sure if they have another referendum that they absolutely get into the independents. other why it could be a very challenging moment for them. max? >> okay. thank you very much, david, for joining us from edinburgh. i'm talking to quinton peel. what do you think about a scottish referendum and whether it's likely and where it will go? >> i think it's likely. i'm not quite sure how quickly it would come. but i have no doubt that nicola sturgeon is looking for a way to hold it. and i think in the current
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climate, it would be really quite likely to vote for independence. so i think all that's's out there. i think what's slightly less certain is this other apparent strategy of trying to block the brexit process in the scottish assembly. there the legal opinion is divided. there is one legal opinion that says, yes, they must give their assent, and they could block it. and the other legal opinion says, no, that the uk government in westminster has actually paramount power, at least in emergency circumstances, and this is an emergency. >> in the last hour, we heard from a key member of the leave campaign, john redwood, saying there's a possibility strategy of not invoking article 50, which is what the howhole premi of the referendum was pretty much based on, which would undo anything oh la sturgeon's strategy as well, wouldn't it. >> well, it might. but i think nicola sturgeon's strategy is actually clear. she wants to get to
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independence, but she won't call a referendum unless it's going to vote -- >> yes. >> now, what on earth john redwood is on about saying we won't do the strategy, i mean i think all i can conceive of us is that he wishes to pro-sip ta -- precipitate if you like, a suspension of british membership by actually starting to break the eu rules without doing it in a legal way. >> so we come out of it that way. >> we'd come out of it by suspending free movement of labor and refusing to recognize the decisions of the european court of justice. >> and how would you describe the fallout from that? >> i think it would be much more poisonous. i think that actually it would deliberately alienate our partners, and then their inclination to actually, if you like, give us a good deal, i think, would be much less. i think the key person they're going to have to negotiate, as ever, is angela merkel. she's being very calm and very sensible and saying, we don't need to rush, but we can't wait forever. and then we have a sensible negotiation. >> we'll see. but john redwood doesn't seem to
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want that. >> no, but it's really about what boris thinks right now, isn't it? he's leading -- even if he doesn't become prime minister, certainly people are looking to him for leadership right now, and his strategy seems to be just to wait on article 50. keep it up in the air and invoke it as and when, and using that as a bargaining tool with, you know, berlin and paris and brussels. but those capitals don't actually have a duty to speak to boris jons hnson ahead of him invoking article 50. >> no, they don't. they don't have a duty to speak to him at all unless he's prime minister and so on. but i think that, look, everybody wants to limit the damage in this, and there are two large potential damages. one is the political contagion effect, and the other is the economic. political contagion is a reality. it could -- there could be other referendums in other countries. economic contagion, we're
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waiting for the markets. >> mm-hmm. >> we're looking at the markets, and london was not too bad as richard quest was pointing out. the germany markets are down more. >> either they know something we don't know, or actually there is -- >> it's all over the place. >> i don't think those enormous uncertainty and that's what markets thrive on and don't like. >> thank you very much. we'll try to explain this over the coming days and weeks. the brexit decision is done, but the rest of the deal has a very long way to go. we'll bring you the latest reactions from france and germany next. plus we'll bring you the day's other news, including a major victory for the iraqi army in the fight against isis. but the biggest challenge is still lying ahead. cry-proof, stay-proof look? neutrogena® makeup remover does. it erases 99% of your most stubborn makeup with one towelette. need any more proof than that? neutrogena. what are you doing?
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welcome back to our viewers in the united states and around the world. this is cnn's continuing coverage of the fallout from the uk's decision to leave the european union. i'm max foster in london. >> i'm rosemary church at cnn center. i'll be back with all of the other headlines from around the world in just a few minutes. first let's get the latest on the global market reaction to last week's events in the uk. max. >> yeah, rosemary. the european markets have been open for about half an hour, and most are down. you won't be surprised to hear, into that first 30 minutes. but they're not down as much as many people expected. analysts had predicted continued volatility in the new trading week of course. but you can see they're all down. actually the cac -- we need to
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talk to richard about this in just a moment -- down 8%. these are the asian markets. regaining some ground after friday's very steep losses there. hong kong's hang seng closes in about half an hour so you know. they're heading into the final straits. but generally pretty good news there. but that is the context of really appalling news on friday. richard quest joins me now here in london for more analysis on the global market reaction to the brexit vote. >> more than briefly, i just -- i'm not entirely certain on those numbers. >> they seem pretty dramatic. >> they were the numbers that i was seeing on my screen a short while ago. >> okay. >> but they're not the numbers i'm seeing now. so i offer a slight caveat that actually i don't think the cac in paris is off anything like nearly as that particular number. >> let's wait on that until we have firm numbers. oh, here we are. there you go, richard. what do you make of that? >> yeah, that's a lot better.
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i think what you were looking at was maybe friday's. what you're seeing, i don't say a calm before the storm. i think you're seeing a pause for breath. there is no -- here's the point. there is no obvious reason for markets to move in either direction now the news has been released, now that we know that brexit's happening. there's no economic data. there is no further announcements. all we have is uncertainty and fear about what might happen, and that's what the markets over the medium term are going to trade on. but they're not going to be a reason to fall out of bed. the falling out of bed happened on friday. >> and that's what george osborne was addressing just in the last hour. >> yes, the british finance minister, the chancellor, was quite clear. he did not row back from anything he said during the campaign, and he was one of the strongest remainers in the business. but he did admit that the uk economy would face a period of adjustment, and that was something because he said that the economy was robust and was
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able to withstand. the chancellor. >> it will not be plain sailing in the days ahead. but let me be clear. you should not underestimate our resolve. we were prepared for the unexpected, and we are equipped for whatever happens. and we are determined that unlike eight years ago, britain's financial system will help our country deal with any shocks and dampen them, not contribute to those shocks or make them worse. >> and so what he's said again and again, along with the bank of england, that there were months ever planning, contingency plans were in place. they would move into operation, and that there was no need, if you like, for undue panic. now, the big issue, of course, was the budget. he had threatened and feared an emergency budget and raising of taxes. he now says that will not happen until maybe a new prime minister
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comes in and the autumn, and there's a proper review, an obr, office of budget responsibility review of what the economy -- >> so what he's trying to do there is dwell tquell the short uncertainty. what about the lodger term? >> the lodger term on the question of a recession, he said, i do not resile from anything i said during the campaign. he said there would be a recession. he said there would be a recession. i mean most people seem to believe that you can't have this level of disruption. even though we're not seeing it in the markets, you're going to see businesses pausing for thought. you're going to see consumers not buying that extra fridge or that changing of the car because they don't know about their jobs. there will be unemployment. there will be employment uncertainty. in that environment, you've only got to knock a percent or two off growth, and you are in recession. so will there be a recession in no one can say for sure. is it likely there could be a recession?
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highly possible. >> how do you think everyone has coped in the last couple of days going into this week? >> oh, come on, max. this is unprecedented. you've got a government where the prime minister is resigning in the autumn. you've got an opposition, her majesty's loyal opposition which is absolutely teetering upon clapg collapse. you have got the pound, which is down 10%, 12%, 15% since its high on thursday. you've got businesses that have no idea what the future economic environment and trading environment is going to be. would you like an aspirin? >> i'm just -- i definitely need a lie down. it's very hard to make sense of the story. there's so many strands to it. >> let me just find the quote if i may. if i could just find the quote. i know you want to move on to other things. but the quote from citi, who basically said -- this is citi's morning briefing note to investors. it says the reality, however, is that it's extremely hard to predict with any certainty what
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the economic outcome will be. in that situation, investors tend to sell or sit on their hands. consumers don't spend. the economy goes down. >> it's raining suitably. richard, thank you. the uk's historic decision has sent shock waves, of course, throughout the continent as well as the markets above and beyond the initial chaos in the world markets. eu faces the risk of a possible domino effect from the brexit. our atika shubert joins us. chancellor angela merkel seems like the one friend that the uk has in europe right now. what sort of things is she saying today? >> reporter: well, she said on saturday that, quote, there was no need to be nasty about negotiations with the uk. we are expecting to hear from her later today. she's got a flurry of meetings. she's going to be meeting with the european council president donald tusk, but also with
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french president fra sncois hollande and the italian prime minister. hollande has been very tough, saying that once the uk leaves, essentially there must be a deterrent effect to make sure that no other eu members, nobody else thinks about holding a referendum like this. but clearly merkel has taken a more conciliatory tone, and the clearest message of this has come from her chief of staff. he gave an interview to the local rnd paper. here's what he said. politicians in london should have the opportunity once again to reconsider the consequences of a withdrawal. that seems to leave the door open just a little perhaps for those in the regrexit camp who want to see another referendum or find some way out of this. other eu members, however, have been very clear. britain has voted, and out means out. so we'll be watching to see what merkel says today on this. >> okay. atika, thank you. jim in paris, a very different story there. there's anger with the uk, and there's a sense that they want
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to punish the uk. they don't want to encourage any other similar movements, certainly not within their own country. >> reporter: exactly right. i mean there's a great fear here about a frexit. the effect is there is some nastiness here towards david cameron particularly. there's just an amazing amount of animosity over this idea that the referendum in britain was seen as something that was totally unnecessary, and it has led to the crisis that they're now confronting. president hollande on saturday had meetings with all the political parties here, including the front nash nal, which has been calling for an exit from the european union for france. she said afterwards that hollande made it clear to her in no uncertain terms and they have used naughty word, he was not going to have any kind of referendum in france as long as he's president. she said, though, if she gets elected president -- this is marie la pan, that she will, in
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fact, within six months call for a referendum on france's status within the european union. so there's a great deal of animosity here. there's a great deal of sentiment in the government corridors of the out is out camp. the fact is that people would like to see this dealt with in the shortest period of time. it doesn't look like that's going to happen. but the shortest period of time to eliminate the kind of uncertainty that richard was talking about earlier. and interesting, just a side note here is that ann hidalgo, the mayors of london and paris got together on the weekend and published a joint editorial basically saying that no matter what happens between their countries, that the two cities, the two capital cities, should work together to improve relationships between them. >> jim in paris, also atika in berlin. thank you very much indeed. we're going to bring in cnn money africa correspondent
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elenieeio koes. she joins us from johannesburg. quite extraordinary to see those african markets and currencies falling on friday in reaction to this. it really does express what a global story this is. >> reporter: absolutely. it's definitely a global story and one thing that we know is that emerging markets do not enjoy uncertainty. and definitely risk aversion is now at play. let's take a look at the south african rand purely because it is a very important proxy for a merging markets. when investors want to make a bet on ems, it's reflected in the rand. it dropped, max, 8% at one point on friday. it's the lowest fall that we saw, the lowest level for the rand since the 2008 financial crisis, which is really indicative of some of the uncertainty that emerging markets face. when you look at the turkish lira, we also saw a bit drop there, down around 4%. in brazil, pretty much the same picture. the markets coming under significant pressure.
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so a sea of red really dominating the emerging markets. when we look at what the south african market is doing today, it was down 4% on friday. the jse is down around eight tenths of a percent, but it's not all red when you look at the johannesburg stock markets. it's the gold stocks that are really doing very well on the back of the gold price showing some gains as well. financial stocks coming under pressure. any companies that have a global multinational footprint, specifically within the european markets, is also taking a knock. another very interesting thing to look at is we know the deal hasn't gone through as yet. remember, it was 44 pounds a shade. now that looking not very attractive for shareholders. so the ramifications are not just about trade. it's not worries about fragmentation within the european union as a result of this brexit, but more so about the companies that have that large footprint that operates across various territories.
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>> okay. thank you very much. that's the african view. it's extraordinary how it's having an impact around the world, thank you so much. coming up, our special brexit continues. what the u.s. presidential candidates are saying about the controversial vote after the break. and rosemary will have a roundup of the day's other top stories, including pope francis' comments about the church's treatment of gay people. what he said coming up. wanna drink more water? with sodastream® you turn plain water into sparkling water in seconds. and because it's so delicious, you'll drink 43% more water every day. sodastream®. love your water.
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a warm welcome back to our viewers in the u.s. and all around the world. i'm rosemary church here at cnn center. we are continuing to bring you coverage of the fallout from the uk's vote to leave the european union. but first let's check some of the other stories we're following this hour. hillary clinton says the u.s. will bounce back from the economic turmoil triggered by the brexit vote. on sunday, the presumptive democratic presidential nominee
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drew comparisons to what's been happening in the race for the white house as the decision by british voters to leave the eu. >> just as we have seen, there are many frustrated people in britain, we know there are frustrated people here at home too. i've seen it. i've heard it. i know it. that's why i've worked hard to find solutions to the economic challenges we face. a senior iraqi general says the battle for fallujah is over, and that government troops captured that isis stronghold on sunday. he says more than 1,800 isis fighters were killed in the month-long operation. but the situation remains extremely dangerous. iraqi forces are now dismantling land mines and booby traps that still litter many neighborhoods. the iraqi military now turns its sights to the even bigger
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challenge of retaking mosul. cnn's senior international correspondent ben wedeman has the latest on that. >> reporter: somewhere in that scrum is iraq's defense minister. he flew from baghdad with a gaggle of iraqi media in tow. isis, they say, is just a 15 or 20-minute drive away from here. the black smoke on the horizon, officers say, is an attempt by the extremists to obscure the vision of iraqi and coalition aircraft. iraq has been very publicly gearing up for the liberation of mosul, the mother of all battles in the country's war against the group. the plan sounds simple enough. what they're going to do is work on driving isis out of the towns and villages like this that surround mosul before finally going into the city. and they'll be doing it with a little help from their friends like these american and british advisers in the operation center
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nearby. as preparations mount for mosul, there are american boots on the ground and perhaps more to come, supplementing the well over 3,000 already here. and when will this much anticipated offensive take place, i asked the defense minister. the prime minister and the military leadership, he replied, have said that 2016 will be the year of the liberation of mosul and the rest of iraq. that leaves just over six months, and the clock is ticking. ben wedeman, cnn, south of mosul. pope francis says the catholic church should apologize to gay people and seek forgiveness for how they've been treated. he made the comments sunday in a news conference on his flight home from armenia. the pope also said the church should apologize to other groups it's offended. >> translator: i believe the church should not only apologize to this person who is gay whom it has offended, but it has to
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apologize to the poor, to the exploited women, to children exploited for labor. it has to ask forgiveness for having blessed many weapons. >> and in terms of the brexit, pope francis said, quote, unity is always superior to conflict. that is newsroom all around the world. keep it right here on cnn. just ahead, we will go back to max foster in london for more expert analysis of the uk's vote to leave the european union. ♪ headache? motrin helps you be an unstoppable "let's rock this" kind of mom. back pain? motrin helps you be a... "side planking, even though you'll feel it later" kind of woman. body pain? motrin helps you be an... "i can totally do this in one trip"
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shocked and ashamed to be british today. i can't believe it. i'm really disappointed. disappointed in the country. >> many britons feeling that way, it has to be said, after the uk's vote to leave the european union. welcome back to cnn's continuing coverage of the fallout from that historic decision. i'm max foster. leaders here in london and around the world are urging calm after a frantic response to the world markets. but the leadership here is in a bit of a shambles, it has to be said. a bit. we don't really know who's leading. the prime minister is in
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position, david cameron there. but he's going to be gone by october. there's no sign yet of who will take his place. we've got a couple of front-runners. one possible candidate, opposition labor leader party -- sorry. the opposition labor party leader jeremy corbyn, meanwhile, hasn't inspired any confidence from his own shadow cabinet. nearly a dozen of his ministers have resigned, and corbyn fired another for reportedly planning a coup. in the midst of this political upheaval, the chancellor of the exchequer insisting that britain is ready for what lies ahead. cnn political contributor robin oakley is here. robin, we're just watching these labor shadow positions fall in front of us. i mean there's been a whole load of them. we can't actually keep up with them at the moment. but also jeremy corbyn has replaced them with left-leaning members of his own party. he hasn't got much choice, has he? he can't have that cohesive shadow cabinet he had before. >> limited choice, but he's gone ahead. he's immediately filled these
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positions, signaling his determination to fight on and not to give way. we're going to have a vote tomorrow on a vote of no confidence in him as labor party leader. the significant thing now, i think, is that some of those who have rebelled against jeremy corbyn are not just the old blair-its and the moderate centrists in the party but some left-wingers have begun to lose their confidence in him. i think largely because the potential early election has concentrated minds. people thought, oh, well there's two or three years for him initially to make his mark, or we can decide to get rid of him before an election if he isn't up to him. now they're saying we might have an election within a few months and we can't afford to take the risk. >> your currents thoughts on the runners and riders for the prime ministership. >> inevitably boris johnson is a front-runner. but there are a lot of people who want a stop boris campaign,
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and that could focus on theresa may, the home secretary. she was in the remain camp but fairly reluctantly and fairly quietly. >> she had some strong views on immigration. >> yeah, she did have strong views on immigration, but she argues her case even when she, you know, wasn't particularly of the remain view. so i think she's given few hostages to fortune. she would be the ideal stop boris candidate if anybody is going to -- >> robin, thank you very much indeed. thank you so much for joining us. i'm max foster in london. i'll be back with another hour of news and analysis on the uk's zigsz to leave the european union. the houses of parliament where mps will return for the first time today after that crucial vote and the political meltdown that followed. if you have allergy congestion, muddling through your morning is nothing new. ...your nose is the only thing on your mind... ...and to get relief, anything is fair game. introducing rhinocort® allergy spray
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♪ thanks for joining us. i'm max foster live outside the houses of parliament in london. this is cnn's special coverage of the uk's decision to leave the european union and its truly global implications. last week's vote to leave the eu has left british politics in an absolute state of uproar. it's a mess, frankly. the finance minister george osborne spoke just over an hour ago to try to reassure some of the fears about the uk's future. >> it will not be plain sailing in the days ahead. but let me be clear, you should not underestimate our resolve. we were prepared for the unexpected, and we are equipped for whatever happens. and we are
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