big money because of me, big money becae of me. >> you've got to love the donald. >> you got to. >> darrell, it's been great meeting you. inspiring book. i hope people read it in that way. >> thank you. rescuers in turkey are searching for survivors after a powerful earthquake struck the city of vann. more than 100 people may be trapped underneath collapsed buildings. the same area was hit by an earthquake less than three weeks ago. a dispute in cairo, egypt, protesters pelted the delegation with eggs and tomatoes saying

its members were too close to president bashar al assad. dissidents also say syrian forces killed 25 people across syria on wednesday. news corp. executive is preparing for his second appearance between british mps today. they suspect he misled them when testifying with his father, rupert, in july. police officials say 4,000 people may have had their phones hacked. those are the top stories from cnn, the world's news leader. i'm monita rajpal. "world business today" starts right now. we are in one of those defining moments where we either unite or face irrelevant convenience. >> europe at the cross roads.

t good morning from cnn london, i'm nina dos santos. you're watching "world business today." every time we think that we've reached the pits of the european debt debacle it seems as though another event serves to remind us there's no quick fix here for the moment. the markets continue to take yet another tumble after another day of declines. italy and greece are the twin beacons of the current crisis and neither has clear political leaderships nor the tactics in place to escape the mess they're currently in. investors are picking up where asia and wall street left off in wednesday's session. we have heavy losses right across the board. in southern europe, the markets reacted aptly enough, headed further down south as you can see. they've been recovering in today's session just a bit. ftse may be gaining 1% in the

first hour of trading.ç and in greece, which is facing the similar combination of political uncertainty and financial crisis, investors on the athens stock exchange losing patience with dragging talks in forming a new coalition government. the athens stock exchange rebound together tune of 2% for the moment. after enjoying what's being termed berlusconi bump, 7 1/2% has been proving that the impend ing departure of the italian prime minister is no guarantee of a brighter future. stocks took a battering, pulling hong kong down by the most among these major markets. hsbc suffering on all three counts on the one hand with

italian debt exposure being compounded by a drop in profits. it ended the day down nearly 9%. investors are looking -- those investors that are looking for reassurance are not getting those, it seems, those tasked with the process. christine lagarde has warned of a lost decade if the region doesn't get its house in order soon. and the european commission president says the escalating situation now risks a split in the euro zone. his message was stark, he said there cannot be peace and prosperity in the north and west of europe if there's no peace and prosperity in the south and east. >> we are in one of those moments where we cannot standstill. there are some moments when we can keep business as usual. but now, the dynamics of globalization, in financial, economic terms but also

political terms, put europeans in front of a choice, do they really want to live together and share a common destiny and count in the world or do they really want to face the prospects of pr fragmentation and decline. >> a rallying call coming from jose manuel borrego. on wednesday, the ten-year bond yields rose to a record euro year high of 7.84%. here's how they're looking in today's session. the yield is slightly down to 7.11% largely on the back of the fact that there may be news that the italian senate could be fast tracking the economic reforms they needed, economic reforms that when they went to vote in the lower house cost berlusconi his majority.

the bailouts usually follow once you surpass this level of 7%. the problem whitley, of course, is that it's considered too big to actually bail out. and intervention by the european central bank so far, it seems, has proved inadequate. >> i am rather surprised by the ecb yet again. the ecb, i believe, has played its own strange roll in per siding over this growing crisis in urtitaly. the ecb has to stop buying substantial amounts of italian bonds to get things down. to some extent the world's economy and markets can't cope with italy blowing up in the same way greece did. >> markets initially jumped on the news that silvio berlusconi was set to step down but they later slumped on the stark reality that italy is facing a political limbo that could there be for some chance to come.

matthew chances joins us. we have theseous ta austerity measures. >> the expectation now, nina, is that it will go through shortly, possibly through the senate on friday. probably be passed by the lower house of parliament in a special session that's been called by the lawmakers in this country. on saturday. that would clear the way for silvio berlusconi to step aside. he said he will resign as soon as the budget law passes into law, which is, of course, much quicker than had previously been anticipated. only a day and a half ago, silvio berlusconi gave an interview to a newspaper here, saying he foresaw elections in early february which would have basically set the scene for him staying on as a caretaker prime

minister possibly until march. that scenario appears to have been cast aside by the italian president. the situation seems to have been streamlined somewhat. we could see a new government in place,ç possibly by sunday nig or monday morning here, which is not necessarily going to address the underlying problems facing italy. but i think the perception may be that it's a step in the right direction. >> it might also give respites and relief to the bond markets. matthew chance joining us from rome. many thanks for that. across the aegean sea in greece, the search for a new leader was supposed to be finished by now. talks on forming an interim government seems to keep hitting one hurdle after another. diana magnay. you've been there for days. this impasse doesn't seem to be surmountable at the moment. is there a possibility that

italy could have a new prime minister, a new government before greece does? >> reporter: well, i hope that's not the case, nina, otherwise we'll be here forever. every day there's a declaration of confidence by members of the party, the prime minister himself. by the ends of play that day we would have an announcement. no more so than on wednesday. and yet that simply hasn't happened. the local press call it an opereta. if you missed wednesday's act then here's a look huddled around a monitor outside the presidential palace, reporters strain to hear their prime minister address the nation one last night as he wished his successor well. >> i would like to wish every success to the new prime minister and, of course, the new government. i'll be next to them, i'll support them with every cent of mine within greece and abroad. >> reporter: address delivered, it was time for the short walk

next door to the presidential mansion. and if appearances were anything to go by, it all looked set after three days of wrangling, greece was about to get a new prime minister, a new government of national unity. two more party leaders arrived. it was hoped to sign off on the deal. the first indication things weren't going quite as planned was when the leader of the far right party stormed out, shoulders hunched and stormed up to the microphones. >> translator: it's a shame at such a critical time for them to be playing tactical games and to be dragging the president down with them. >> reporter: so it all unraveled. there was to be no announcement on exactly how this country plans to lead itself out of economic crisis. in fact, listening to the leader of the main opposition party, one could be forgiven for thinking things were back to square one.

>> translator: my problem is what happens with the sixth installment and new bailout. we need to unlock to the point where we have elections so we can finally give the people the stability they need. >> reporter: last to leave the presidential mansion, the greek prime minister, still prime minister, despite all the talk of new chapters and historic moments. they're back in the presidential mansion now. talks resumed at the beginning of the hour. overtight it seems that papademos, the front-runner according to media reports, now seems to be back into the picture. there were a series of phone calls last night between the leader of the opposition, george papandreou and papademos.

we've heard so many names come in and go out over the course of the week, i wouldn't rule anybody out. >> diana magnay in athens. many thanks. as we mentioned earlier on, the euro zone fears have battled asia's mark thes in thursday's sessions. financial stocks fell about 5% on average on wednesday. the u.s. treasury secretary, timothy geithner is urging action to be taken. >> it's having an effect on growth around the world. growth is slower in the united states, because of the effect of europe on us, in part. that's why it's so important they get their house in order and move more quickly. it's putting pressure on us. european leaders have the ability to contain this. they have the ability to get on top of this. they have the ability to solve this problem. they just need to move more quickly to do it. >> you keep saying they have the ability. >> they do. >> are they doing it? >> they are. >> slower than you would like?

>> of course. but slower than they would like. but they're moving and making progress. they just have to keep doing it and they just need to put together a stronger package of commitments. you can see how politically tough it is. the leaders of greece and italy are trying to decide who will preside over a tough period of economic reform. >> by when? p &hc% >> by when what? >> they need to move by when or else? >> sooner, the better. think about financial crisis and how damaging our crisis was in the united states. the longer you wait, the more damage it does, the harder it is to arrest, the more expensive it is so solve. they're learning that lesson very, very painfully. this has been going on for 18 months now, progress ofly more severe. they've put in place, laid out a comprehensive, broad plan to make their system stronger and try to put in place the type of discipli disciplines, constraints on fiscal policy europe needs.

they need to give it more force and make sure it has more traction quickly. they may have been clapping on wall street at wednesday's closing bell but there was little to cheer. fears that ilt italy may be too to fail and too big to save, sent the dow jones industrial average tumbling to its worst day since mid-august. let's take a look at the numbers. a word of warning to our viewsers. the dow, nasdaq and s&p 500, all three plunged more than 3%. investors fled to the perceived safety of u.s. treasuries. the u.s. markets appear set for a slightly higher open following yesterday's rout. this is how the u.s. markets stand in terms of premarket futures.

the nasdaq is leading the way, up 0.5%. investors fret about policy vacuum knitly. when we come back, we'll hear from the imf chief christine lagarde makes of the ongoing political deadlock across southern europe. everything comes together.re where there's magic. and you now understand what nature's been hiding. ♪ at dow we understand the difference between innovation and invention. invention is important. it's the beginning. it's the spark. but innovation is where we actually create value for dow, for society, and for the world. ♪ at dow, we're constantly searching for how to use our fundamental knowledge of chemistry to solve these difficult problems. science is definitive. there is a right answer out there. [ male announcer ] the same 117 elements

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rock that's threatening the existence of the currency itself. one of those voices is the imf chief, christine lagarde. she's just held a news conference in beijing. let's go live to eunice yoon. what exactly did lagarde have to say and what do the chinese make of her. >> reporter: nina, christine lagarde has been meeting with business and political leaders for the past two days. people are very concerned about the help of the euro zone. people here in china as well as across the region volcano been voicing their fears that the problems in europe could hamper global growth and potentially tip the world economy into a double dipper recession. that's the main feed here. i've been speaking to a lot of fund managers who have been saying what they'd like to see out of europe is stronger action. they hope the european central

bank would come in with aggressive moves to buy more government bonds and also are hoping that the european leaders would come in and make a very strong commitment to solve this crisis. that is exact lit point that imf chief reiterated to reporters today. >> political clarity, that is what we need as a lender. i believe many lenders, many investors actually expect exactly that to happen. political clarity. it's much needed in greece. it's much needed in italy. there's clearly some rumors, allegation, trepidation, expectations, no one really understands exactly who is going to come out as the leader and when. and i think that that confusion is particularly conducive to volatility. >> reporter: and in the asian markets, shares of exporters nose dived. another thing that worried

people here in china is the october trade data, the october trade data here in china confirmed to people that the demand in western economies like europe has been dwindling. nina? >> eunice, the other issue that everybody wants to know about is whether china's going to be investing in this euro zone bailout fund or indeiana -- indeed funneling some of their money. >> we haven't had confirmation of that at all. there wasn't meaningful of that at the press briefing. that is exactly what people are hoping for. we heard her sort of moving the chinese in that direction by saying that no country is immune to the fallout, she said that the global economy would benefit by the participation of large emerging economies, such as china. however, nothing -- no details and no confirmation so far. as you said, the discussion

where you are as well as over here has been that possibly china along with other nations outside of the euro zone would be interested in taking part in a side fund to the efsf to the european bailout, they would take part in the new fund but it would be run by the imf. no details but that is the way people here believe china would participate. nina? >> eunice yoon, many thanks. still to come, what did he know and when did he know it? james murdoch faces round two over alleged phone hacking. some say the outcome could have big consequences in his future at news corp.

hello and welcome back. you're watching "world business today" live here on cnn. in less than two hours time james murdoch will be questioned by british parliament members about alleged phone hacking at the now folded news of the world tabloid newspaper. this time murdoch won't have his media mogul father, rupert by his side. we go to london. atika, is this likely to be pivotal for his fate.

>> reporter: it is likely. this is his chance to basically defend himself and basically without his father by his side. it's going to be a crucial test. now, what it really -- the crux of what they're doing to be question him about is what's been called the forenevel e-mail, an e-mail that alleged that this phone hacking went beyond just one reporter. james murdoch says he did not know about that e-mail later, however, news international's lawyer and former editor of news of the world both say they told james murdoch the contents of this e-mail as early as 2008. that's something that james murdoch disputes and is he expected to defend himself on that later today when he's grilled by mps. interestingly you point out the kind of public pressure he's under. we also are expecting a protest later today where they're

expecting to be an effigy of james murdoch put up and they will be putting out this mock-up of the son, another news international paper, you can see the fake headline, murdoch back in court for news crimes. this is from one protest group that's demanding that ownership of any one media should be limited to just 20% of a country's press. that's the kind of public backlash that's basically occurred as a result of this phone hacking scandal. >> yes. some of those news international editors are well known for choosing a title. the son with an "o" definitely caught my eye. atika schubert, thank you for joining us. we look to the world's top managers of money for clarity. when we come back, jim o'neil from goldman sachs explains why uncertainty isn't necessarily a bad thing.

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let's take another look at what's going on in the european stock market. 19 minutes into the trading day today. we have the stock markets mixed at the moment. modest gains for the likes of the paris cac 40. things fared worse in asia where stock markets are closed for the day. take a look at this, this is th picture across the main floor in the region. red arrows across the board, some of the heaviest losses coming from the likes of the

nikkei, which as you can see, closed down nearly 3%. hefty losses for the likes of the australian s&p asx 200 and the hang seng down by 5.25%. that was the market that fell the most on the day, largely led by decline in banking stocks. let's turn toward the issue of date, italy. which continues to suffer in the markets and also on the political front with a political vacuum now that we know silvio berlusconi will eventually be resigning after shepherding badly needed reforms through parliament. let's look at how it's affecting the bond yield. the ten-year yield stands at about 7.11%. that is actually slightly down from wednesday's record high of 7.48%. why is this important? well, italy is set to be testing the waters with a 5 billion eurobond sale later today which may push up yields. the question is how much more

does it cost this particular country each time its bond yields raise by so much. a think tank estimates 7.7% on the ten-year, italy will have to cap $38 billion euros over three years to service that debt. it rockets up to about 78 billion euros or $106 billion over the next five years. when you're talking about the entire debt power for italy, we're talking about an extra cost of 313 billion euros or $425 billion over the full life span of italy's current total 1.9 trillion euros worth of debt. that's about $2.6 trillion. it's the fourth largest debt pile in the world. italy's immediate cash crunch effectively is this, it will to come.r the next three years the country will be needing a cash flow of between 825 billion

euros to 907 billion euros according to open europe. we're talking well over a trillion dollars here over just the next three years to service or maintain its current debt and refinance at these levels. the italian leader say that berlusconi has been too long studying the wrong kind of figures. if you want to check out more on his economic legacy and probability, check out my blog on cnn.com/biz 360. just a reminder of the address, cnn.com/biz360. as the euro zone teeters on the brink of disaster, commentators are calling for a rethink of the way the institution handles debt crisis at the moment. one of those experts are jim o'neil, goldman sachs asset manager.

he's coined the terms like bric. jim o'neill has been taking the european central bank should be taking a completely different tact. >> you're talking of a huge issue here. i am rather surprised by the ecb yet again. the ecb is, i believe, played its own strange role in presiding over this growing crisis in italy. the ecb has to stop buying substantial amounts of italian bonds to get yields down. the markets can't cope whitley blowing up in the same way greece did. >> after the experience of italy and greece, portugal and ireland, there's calls for greater fiscal union, particularly from germany right now. is this going to be the straw that breaks the camel's back in a sense on the euro? >> well, you know, i often think that the german authorities and some key policymakers behind the

scenes have almost been trying to orchestrate this crisis, because the idea you've suggested is what the leading german thinkers actually argued all along back in '97, '98. you couldn't have a stable persistent -- without an eu political union to some extent. this crisis demonstrated that. the dilemma with that, of course, from simple economics, you're getting into the issues of democracies. and some countries might find that very difficult to stomach unless it brings in the electorates more. >> mrs. lagarde was saying that we've entered an uncertain and dangerous phase in the global economy. you seem to disagree with that premise that we could have a relatively even slowdown in

2012. why is that? >> well, there's a couple of things i'd say about to. many people make these grand statements about things being so uncertain. you know, things are always uncertain. one of the dilemmas we've ended up getting into here is in fact because people didn't realize a few years ago just how uncertain the future is. on the one level, i rather like the fact that so many people are saying that things are uncertain, because it's rather good when people worry. the time i really worry is when nobody worries. the second more substantial thing i would say, is the world doesn't depend on greece and italy. this year, the increase in china's gdp will be the equivalent of creating three new greek economies. the increase in the bric country's gdp, china along with russia, brazil and india will be close to the equivalent of creating another italy. yes, we've got enormous problems in the core of the developed

world but that isn't the modern global economy. the world will probably grow by close to 4% by next year despite the fact that the euro might be in recession. >> some other parts of the world may not be in as much financial peril as europe but they are still feeling the chill as european economies freeze up. the economic picture in the united states isn't a pretty one either, it seems, leaving asia is the region in the world looking as the beacon of economic growth. this is at a point -- this is a point that's not lost on the u.s. treasury secretary, tim geithner. >> the most important thing asia can do for the world is to make sure that they are growing more rapidly, growth in asia provides a source of strength for the world economy. you're putting some pressure. the most thing for us to do in asia is make sure asia is growing, providing an offsetting source of strength. >> if geithner is hoping that

asia will be riding to the rescue of the world economy, the performance of one ofç the region's biggest trading companies might be giving him pause for thought. this is what happened to share prices of the commodities trader noble group today. basically this company's stock fell off a cliff, losing more than a quart he of its value after they reported their first quarterly loss in some 14 years. they blame price swings in the market for cotton but its stock had been on a downward trajectory, it seems all year. that's a clear manifestation over concerns of the natural resources business as the world economy continues to slow down. pain from the euro zone crisis spreading right around the world, especially to banking stocks. hsbc shares have been diving 9.2% in hong kong on thursday's trading session. this was after the company announced that its profits at its investment bank division had been falling by more than half. the bank also increased provisioning for bad loans as

its u.s. uniut by about 23% as the american economy failed to recover, let's say. the hsbc's london listed shares now following that decline in hong kong, currently trading down 2.4% so far and going forward, the chief executive of this company, stuart gulliver says the bank faces significant head winds and it's largely, you guessed it, thanks to the crisis in europe. a year ago she came in second. but can she take the top prize this round as the new york's global fashion awards? next, we go to the big apriling. guys, it's demonstration time. let's blow carl's mind. okay, let's say i'm your insurance deductible. every year you don't have an accident, $100 vanishes. the next year, another $100. where am i going, carl ? the next year... that was weird.

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he had lone and welcome back. this is "world business today" live on cnn.

sara kern, theç boss, will she do it? it's time for the boss. >> last year on "the boss." >> the winner is asos. >> she missed out in 2010. now sara kern returns to new york for a second chance to walk away with the prize. new york, the city that never sleeps. bright lights and big dreams. here, to live that dream at least for a few days, is sara kern, the founder and chief

executive of mywardrobe.com. she's here to attend the global fashion awards. she's among the nominees. last year she missed out on the prize but promised she'd return to pick it up. >> now we go there and unwind. we'll get the global e-tailor award next year. >> reporter: today she's hoping the prize is hers for the taking. but before the big event and to help take her mind off the competition, she's spending the morning with her son jake and two family friends. >> can we have two pretzels, please. >> reporter: they take in the sights of times square and the south street sea port with stunning views of the east river and lower manhattan. >> look at that. >> reporter: finally as the sunsets on the big apple, sara gets ready for the big event. >> oh, perfect. oh, brilliant.

thank you. >> reporter: dressed to impress, sara climbs into her limo and heads off to midtown manhattan where the night's ceremony is already in full swing. as she mingles, she's sighting up the competition in her category. she's been nominated for outstanding customer experience. this time she's confident it's her name on the trophy. >> i'm immensely proud of the short list. i'm up against very established brands. so nothing's a given aall. i think i have an amazing business. i think i have the best customer experience. should i win it? absolutely yes. >> reporter: at least it's time for the awards to begin. >> welcome to the global fashion awards. >> reporter: and the moment of truth for this boss.

>> liberty, l.l. bean, macy's, jwt new york, mywardrobe.com. >> and the winner is my wardrobe. >> see, i told you i'd get it next year. >> reporter: as at wards ceremony wraps up and the guests head out for celebrations elsewhere, sara ponders her future of and that of my wardrobe. >> i've taken the business to where it is, mainly uk with a global kind of view as well. because we're online, so we're open. if you're going to take the business to the next level,

which is really global, it's going to need a different skill set. for me, i see that as really exciting and i see it as the really exciting next step of the business. so you never know, in six month's time we might have something else to follow. >> reporter: that's for the future. tonight it's all about savoring victory. next week on "the boss," two bosses, two different ways of recognizing and rewarding your staff. we're in macao and london. that's next week on "the boss." let's come back from state side and focus on the situation at hand here in europe. fe when we come back, we look at what a two-speed europe could mean for the entire block.

with all the turmoil in the world stock market, you would have thought people would be headed for the safe haven of choice, which is often gold. take a look at that. trading has been volatile. the gold price down by 5.30 at the moment. it's now topping $1,765 an ounce. down about $5. it did hit 1,800 earlier in the week, a seven-week high. hello and welcome back live from cnn london. you're watching "world business

today." let's take another look at how the european stock markets have been faring here. in europe, it seems we're in store for a mixed pattern today, things like italy hanging in the balance. it seems as perhaps they'll be fast tracking the austerity votes and emergency budgets through the upper house of parliament, the senate. perhaps as matthew chance tells us earlier in the show, as soon as friday. that's why some of the markets have been coming back in negative territory. we have better-than-expected gains at the moment. the cac 40 is making a strong rebound at the moment. the asia pacific markets ended the trading day on a low note on thursday. they are shut for the day but this is how we feared when it comes to the big three, the hang seng, in particular, down by 5.25%, largely thanks to banking stocks that were particularly harshly hit. we had hsbc coming out with its figures.

they weren't better than expected, quite the opposite and also affected by the euro zone debt crisis. that was one of the stocks that tumbled to the tune of 9% in asian trading. let's get back to europe, though. for years there's been talk of a two-speed europe and for years policymakers have completely dismissed the idea that some countries could be more integrated into the eu structure than others. earlier this week, the french president nicolas sarkozy came out and said that the euro zone will become a two-tier club. to look at what that might mean, we go to john defterios who has been following the events very closely. the two-speed, two-tier europe or a two-tier euro zone. let's put this into perspective. >> reporter: yes, in fact he raised a lot of eyebrows with these comments at the university of straussburg. you know the story going back to the creation of the single market and the ec-1992 project. back then you had the original

architects discussing greater integration and a federalism. these comments by president sarkozy brought back memories of that discussion. he said it's strange to create the euro without proper governance. when they brought greece into the eu system, some were questioning it back then. look between the lines here that even the international monetary fund as part of the italian bailout that's going forward and the austerity package from italy has imf people on the ground. it's another kind of hint toward the federalism and the original concept and the creation of the single market. now, the real question is here, what was president sarkozy really going for here? he talked about an interband of 17 countries and outer ban of ten that don't have the currency right now.

this is leading speculation to say is that inner band going to include all 17, including the greeks because of their debt challenges now. that leads you to the next tier. is that going to include italy because of its debt challenges going forward. >> it's going to be hard to see these other countries, so many of them wanting to to france and germany's opportunity to kings and queens of the euro zone if we have a two-tier system. >> no, it's a phenomenal point. if you look to poland as a very good example, this is not a fringe market, a small market. it's a large economy. it's growing quite nicely without being part of the euro. it's in the core of the emerging markets of eastern europe and it's been able to buffer itself from the downturn in debt problems we've seen in italy and greece. the other side of this, if you look at the core, some countries have been preparing themselves for this growth of the emerging markets. i would use the german example. even though you have very high

cost labor, the construction that took place under gerhart schroeder and was continued by chancellor merkel has paid off in huge dividends to german exporters. we've seen exports to china surge 65% in the last five years alone. even at the core we have countries preparing and restructuring but in the southern rimpf europe, particularly europe and in greece right now, we didn't have that restructuring take place and all that leftover, dirty laundry is being hung out for everyone to see what the debt crisis is we're facing. >> big question is will it eventually ever dry despite the good weather? john defterios, thank you vep f very much for your insight. that will do it for this edition of "world business today." i'm nina dos santos. you're watching cnn, the world's news leader.

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