ok. i did ask on time for a downstairs because i want to keep up to date with this morning world but still i would like to have camp my i am very ground zero my ancestors layard and this is my treasure very attachment to the church brought ninety's and sisters to this remote land deflate by call more than two hundred fifty years ago they were exiled in persecuted for not agreeing to the orthodox who forms introduced in russia in the sixteen hundreds they wanted to maintain their time honored rituals the old believers still baal and cross themselves with two fingers not with three as they do in modern orthodox churches in russia and never knew when praying but this father said he says it's not so much the rituals they cherish as the moral principles he does not approve of what ninety's doing was a pretty good old believe a woman must never show her naked legs and because this thing started to spoil

during the soviet union. was more and more young people leaving for big city the fear is the all believers culture could be imperiled nowadays young people prefer urban life to devoting their life to agriculture but it's not now sorry to leave it inside israel to remember that and try to keep their. plans to continue her studies abroad the grandmother says wherever she goes as long as the teen years are fresh in her memory so is the culture ok. a lot of welcome to businesses also has been ranked second for economic performance among the to. twenty leading nations the survey by the financial times ranks each

country with the same criteria applied to ministers including budget deficit government debt and unemployment rates now or which saudi arabia topped the ranking with one of the los levels of state debt accounting for seven point five percent of g.d.p. followed by russia with the public that at about nine point six percent of the nation's g.d.p. for the economy has grown four percent with an unemployment rate just above five percent china to third place with official state debt levels about twenty percent of g.d.p. jacob now from morgan stanley believes russia isn't a good position when compared to the developed world. around the world in the developed markets you have budget deficits of five to ten percent in most countries and you have g.d.p. ratios at seventy eighty ninety percent of g.d.p. and even higher in russia you have. under ten and

the government has about twenty five percent of g.d.p. so from the all from. creditor to the rest of the world and it's running a surplus at the moment so russia looks in a much better position from a budget point of view the nearly everywhere else in the world. that cyclical those markets and u.s. stocks rose in five days shortened dollars a session with encouraging economic data from germany and china helping to boost the mood as well those american consumers heading to the stalls to take advantage of black friday sales european stocks and second week gains are francs to german business confidence rising and investors are also keeping a close eye on u.s. shoppers now to help those bargains helping out retailers along the way the year ice drug goes to a three week high on the report europe's biggest economy whereas the ruble as a result was lower against the euro but did game against. that they have to stay in

moscow end of the day with day to day my friends and they are just adding just. helped along by the fact that oil prices are going north once again now talks to settle your budget for the next seven years has ended. brussels that means another meeting will have to be called to sort out the differences so joining me to explain what the conflict is all about and how i can find a resolution but nick poses that poised at the business desk. so nick we know these talks a failed but can an agreement still be made was there any signs of a compromise. what's perhaps most notable is usually when these summits end in failure there's a considerable amount of mudslinging that takes place as the world leaders the european leaders emerge this time that hasn't really happened but they were also not been that many signs of a compromise broadly speaking the use split of one side as the

next contributors to the e.u. budget and those into the u.k. germany france the netherlands and they want to see the e.u. budget either ferguson or cut they believe that in a time of public or steroids here across europe it seems entirely unreasonable not least perhaps politically offensive to be for the e.u. to be asking for more money now the other side got the ones the beneficiaries from the budget is include countries like poland which is sort of central and eastern europe they believe that the increase in the budget is the best way for them to raise the living standards to match those of kind of core europe ultimately that make which side you think is likely to wear. as you might expect in these sort of situations the side that is putting in the money is probably likely to succeed best the real problem here is that the the size. contributing

is not united france germany the u.k. and the others can also agree how much to come out all where those cuts should fall and which countries that do you think are proving to be perhaps the most difficult the most radical probably is the u.k. it's absolutely refusing to countenance any sort of increase in the budget. cuts it will not give anything back of you rebate this was secured by margaret thatcher in the one nine hundred eighty s. as a compensation the it doesn't get as much out of the common agricultural policy as perhaps france or spain or spain or italy does now agriculture and cohesion the funding of the two biggest autumn's in the budget and the next is the other segment this into things like research and design. course border communications except try and six point five percent ministration. poland is refusing to accept any cuts on

the cohesion budget and france absolutely will not accept a cut in the agricultural policy so because it has not a penny more from that budget so where else are these cuts going to be felt then where they're likely to fall when as you might expect is going to be from that segment. the u.k. is pushing for cuts to administration in particular. are also things that the e.u. prop perhaps does not need things such as a fifty million euro house of european history or the need to spend three hundred million on a new headquarters for the european council both of these that you're a crash should be were made to work you on the age of sixty three and allowed to pension themselves over time so basically there's some agreement on those areas but it's not going to be enough and we've been here many times before you're not.

greying does it really. it does yeah the amount of money involved is actually not that great is one trillion euros over seven years that's about one percent of the g.d.p. of the whole block because the commission has its fingers in so many parts has its hands on the levers of power the impact of not coming to a budget agreement is actually much greater than the amount of money involved might suggest as chris we've. explained if in the end they can't agree on a budget then spending shuts down you start to see promise a shutdown of a lot of the programs that are coming out of brussels the bottom line is you would be in a much deeper recession across the european union then we're in right now right now do your own is in a relatively mild recession it's fairly shallow but if we didn't get agreement on the budget and if we were to go all the way to you know past that line in the sand then you're looking at a several percentage point recession in europe for two thousand and thirteen and

that of course would have global contagion and not the least of which would be come out you could use such as russia. you know even if they could get together to morrow and agree this budget europe would still be in deep trouble as we know it's got problems with. mountain. recession in the euro zone so whichever way they cut it the economic point is shrinking and people in the block as a whole are going to have to get used to the idea that they're going to get less ok nick pole reporting from the business desk for us thanks for clarifying the situation i'm sure we'll be talking about it i say once again now those that are no longer a beef between russia and britain when it comes to meet russia has finally lifted a twenty six year ban on cattle exports from great britain now the bell was originally imposed to prevent mad cow disease otherwise known as b s a spreading to russia at all during the epidemic period two hundred people died of it nikkei a worldwide ban on british live cattle meat am products was lifted by the e.u.

though in two thousand and six now according to a new survey a third of russian men are ready to do pretty much anything to get a job even accept an indecent proposal and it's state officials who are the most likely to agree to an intimate encounter to advance their careers as a women only ten percent said they'd go that far for a job and only if they would lie to the employer the authors of the survey say this kind of career advancement what particularly well for highly qualified personnel and middle managers. that's the business for now bob let's hear a lot see we talked to nick leeson the rogue trader who calls the collapse of barings bank to get some insight on how the banking industry operates.

you know sometimes you see a story and it seems so for lengthly you think you understand it and then you glimpse something else and you hear or see some other part of it and realize everything you thought you knew you don't know i'm tom harpur welcome to the big picture. soon which brightened if you knew about someone from feinstein. to start on t.v. dot com.

good news if she could lumber authority to mccurry was able to build a new most sophisticated robot which all unfortunately doesn't give a darn about anything turns mission to teach the creation why it should care about humans and world this is why you should care only on the dog call. home. play.

play. play. play. play play play play play. play. live. more news today violence is once again flared up if these are the images the world has been seeing from the streets of canada. china operations are relieved

a place. the current financial system has received the ball called the blame for the global economic downturn of the past five years my guest today has a unique perspective on the issue joining me now is nick leeson the trader who is an authorized activities broad down ukase all those bank barings in the ninety's and who claims the system itself was as much to blame thanks for joining us on numerous occasions you said your story is that of gross incompetence and negligence on whose part principally on my part and there's no way of avoiding that but you know there are many levels of the bank both systems and controls the proved

ineffective. and there were a number of people that were in place to impose them make sure those controls were working on a daily basis and it's you know when you look at the whole episode it's impossible to avoid the incompetence and negligence of current many levels within the organization but mine is most definitely at the forefront there are a lot of cases similar to yours there's a recent case of a u.b.s. trader who is responsible for one of the largest losses like two two and a quarter of billion dollars and another case from societe generale why is it always the traders who get the blame never the top executives and well i mean i think that's a carefully worked. in my case it certainly certainly roy it serves a purpose for the banks it buys them time because then when eventually the media or whoever resolves can those questions comes back to why didn't you have the controls in place they turned around well we have got the controls in place now we've done

this and it's just a saw in that the culture isn't getting better now whether it's getting worse or not is. for somebody else to say you know in my opinion it's just stay in the same and and people are breaking the roles and being encouraged to break the rules. and push the barrier of legality as much as they possibly can and that's the way it was in my day you know banks employ rooms of technology and legal professionals to push the rules as much as they can and if you push the rules you need an effective fall against that to make sure that controls are in place and clearly they haven't what's your view on the state of the global economy right now in the state of the financial system is that something that you worry about it does worry you because because it's impacting everybody like it never did before and you know banks for far too long of existed because everybody's believed the financial markets are complex difficult to understand and therefore be left alone so i think the real

positive if there is a positive to be drawn out of the latest scandal is that banks are under more scrutiny than ever before they're under scrutiny from governments and the general public and the just general public of force in the governments into action because they want something done. so i really hope it doesn't get described as the wake up call like that nobody will ever forget it we forgot about in a very short period of time. we're hoping for meaningful change so it worries me from that perspective because it impacts everybody does it have huge impact on me personally. no and so i don't have the sleepless nights that you are alluding to put it but i certainly have firsthand experience of the fact that it needs to be solved and something different needs to be done in the future because if we continue doing the same we'll get the same result and the same result isn't good

and in fact you've said that in your opinion of risk management is an oxymoron is that is that the. why absolutely the i mean financial markets are based on innovation speed and complexity and there's always a new breed of people who are willing to come into financial markets and explore new ways of doing things more effectively more efficiently making more money developing new products to do it and that's what happens at the sharp end of the business where the traders are in the decision makers are in and that's what banks like to do because ultimately that's where you're going to generate your profit from there's not a new breed of people who are eager to get into risk management into compliance and there in itself you you have the risk because one area is running away from the other and that's the way it's always been so the challenge is hopefully this is what is borne out of the last scandal is that regulation starts to be more innovative so it's proactive rather than reactive that it is more efficient that

it's a burden and the worry at the moment but that i see and i've been speaking to a number of bankers over the last couple of weeks is that all of a sudden there is this massive regulation that they need to comply with regulation you know if you look if you look at historically at what's happened there's been scandal there's been a new raft of regulation which is very staid and you know it's imposed and you know exists for a period of time thereafter it doesn't change it doesn't keep pace and you need to continually from an organizational perspective you need to continually challenge what happens within it from a market perspective you need a regulator that continually evolves and challenges what's happening with it it's not a regulation that exists for a period of time but you've talked about the culture of success perhaps that regulation is not being challenged because nobody really wants to listen to the

wessel blowers everybody wants to feel that you know this train is speeding ahead. which is a real problem the you know if you the buzzword in financial markets at the moment is transparency you know everybody is seeking transparency both from a market perspective from an organizational perspective from a regulatory perspective but the problem is if you if you have an organization or an industry where people are scared to speak which is the way that i still perceive a lot of risk managers and compliance officers are then it is impossible to have transparency you need to have communication you need to have people prepared to speak and if something is wrong something needs to be done about it but if you when something. is wrong. you know you need to correctly define the parameters there needs to be some form of punishment and the punishment has to be sufficient to be a deterrent and the problem you know i've worked in the industry for an outsider

looking in an industry where if you speak up if you're a risk manager goes to a regulator because your c.e.o. is ignoring what you're telling them you then lose your job and you can't be reemployed in the industry that's not a good sign this is somebody trying to do their job correctly and then on the opposite side of that if you manipulated a right for an extended period of time and you've colluded with others to manipulate this right to your own benefit if you have been found out and you lose your job when you're the biggest punishment is that you move to two doors down the road to work for another bank it sends out the wrong signals how can the culture improve well you talk about not speaking out did you wish that somebody spoke out in your time to stop you when i didn't i didn't because you know if somebody if there had been a whistle blower in that time barron's would have survived from our from my own perspective would have gone to jail not gone to jail it depends where it happened

in the cycle so i wasn't actively waiting for somebody to find me out i was prepared for it but towards the end of one thousand nine hundred. which was the last year i genuinely given up i couldn't continue anymore and at that stage i expected somebody to ask ask those difficult questions and find out what was going on he said you were prepared to get caught or to get found out do you have a point and why and now i mean i have no plan for any day i mean. a lot of or some industry commentators of suggested it was premeditated and planned out it was nothing nothing like that at all it was a series of you know from the first day for the first few days you're expecting a knock on the door any particular moment you're constantly on edge and then strangely when that doesn't happen you going with sort of confidence that you can survive for another couple of days and then you think in terms of weeks or maybe months and then there's a external events like inter external auditors regulatory audit that you expect to

expose what's going on and you know you panic around those periods and you're maybe trade more aggressively because you're not going to get past this particular point in time and then when you do realize this realisation is that the incompetence and negligence extends further than your own organization and then you've got more time how did you fellow traders do you what you were doing and how did they feel when you got found out so this is a story that highlights incompetence and negligence and in order to be able to do that and it's a big one with you have to come to terms with what you did wrong and i think some of those traders probably still haven't come there i mean some of them are immensely successful i mean one of the most successful arbitrage traders who has built a huge operation for parents at the time and used to take my orders. and you know

good luck to him. but it's one of those things that you know they've gone on to have more success and they don't want to be remind. did about this dark problem that exists in the history but it's been almost eighteen years since your plates how did the financial system change did it change dramatically to to really prevent that from happening on a large scale like that clearly didn't change dramatically enough to use the usual phrase you know barons at the time in one thousand nine hundred five was described as a wake up call that the financial markets would never forget they forgot it fairly quickly you know you've you've had a legion of financial scandals since that time. in national strongly a bank that there were far too many to mention there's lots of been lots of corporate failures within that as well so history isn't paid enough attention to we are recreating the mistakes of yesterday the marketplace is far more

innovative than ever before it's actually more speed and complexity than ever before and the regulator is standing still why isn't it moving with the times they're not good enough the regulator needs to up by going you know and commentators have suggested that they're at the top of a game and if they are we we have a lot to worry about there's been a recent study by us west's university that found that traders are very similar to psychopaths except that well in terms of their behavior anyway except that traders are more reckless and manipulative than psychopaths any thoughts on that the first time i've heard. maybe that's a statement for a rock trader rather than than a bank or a trader. and you know it's certainly excessive risk taking and you know a lot of what i had to do on

a daily basis was manipulative. thank you very much. culture is that so much i'm going to give each musician the power of mind to mark less fragile ceasefire things over gaza after eight days of destruction and death what did israel actually achieve what about the palestinians.

who will go into the future to look at the world pass you by as the best and brightest to take my kids gather in moscow some came to work while others came to play to get up close and personal with devices that recreate masterpieces and scan russian treasures from inside and from space to keep us safe from oil spills and forest fires unleash your inner gadget geek as i see major search for the next big thing in the computer world and russia's numerous goodies going to take the fight straight to their competitors known jumping here on r.g.p. we've got the future of coverage. you know sometimes you see a story and it seems so silly you think you understand it and then you glimpse something else and you hear or see some other part of it and realize everything you thought you don't know i'm tom hartman welcome to the big picture.

do we speak your language anytime of the will or not a day of. school music programs and documentaries in spanish matters to you breaking news a little turn a tip angles keep these stories. are you here. to try to alter the spanish find out more visit. if.

the polls.