declining sales in russia and eastern europe. organic net sales for europe down by 1.4%.estimate was actually for growth. north america, developed markets not picking up where emerging markets have fallen away. this is their biggest geography. business, they're struggling when it comes to getting these developed markets to keep momentum. -- nowbig companies you're seeing some weakness. that was against investment of a drop of just 4.5%. the company saying as the overall picture, the consumer trends are unchanged in the quarter. competition against vodka and united states is one of those. tax increases in kenya. a change in regulation in both china and turkey. remi has done quite nicely. it is around 54 euros per share. it is bouncing nicely this morning. they delivered a 5.5% drop to organic sales. this is the poster child for all the struggles businesses were having in china as we saw a clampdown on the gift giving culture. it has come a long way. >> that kind of day. with the exception of nestlÉ. they're sticking with their full-year outlook. missed estimates. hans nich

army europe well before the current security crisis in eastern europe. we did that with the restructuring of forces in europe and better integrate ourselves and we didn't know what would be next. what would be the next contingency. we wouldn't do it alone and if we were going to have to respond together, we need to train and work and live together and to understand and build that operability. the first exercise is called combined resolve one. dedicated our contribution to the nato element. the list was in the fall and sequestration they were not able to bring the brigade open. we didn't want to let it die on the vine so we used the signed forces in europe and used the 173rd airborne and headquarters. we had a mechanized from the republic and several platoons and companies from nine different nations. >> that was our proof of principals and getting after operational preparedness. we learned that inner operability was a buzzword. they defined it. some people think it was left up to the technology. they think it's putting two people together. we thought and

in europe. the ecb is in naples, policymakers meeting. this is one of the two meetings every year where they go somewhere else. mario draghi has a lot to do with today. the abs program is front and center. how we get the balance sheet -- how will he get the balance sheet up to thre 3 trillion question mark >> ? >> it is going to be about what is eligible to buy. the conversation around buying greek assets as well. the decision last month was not unanimous. a particular central bank was saying no, we don't want you to do this. there's a lot of pressure on him right now. the data is getting worse over the last month. plenty of questions today. will we get the answers? the boss of one of europe's biggest carmaker's. he is standing by at the paris auto show with hans nichols. >> good morning to you. ceo ofjoined by the renault nissan. we will hear your and -- we will see your new minivan. >> it is an important vehicle for us. 30 years ago, we came with the concept of the minivan. it was copied all o

what is the problem in europe? >> it was originally that there is trouble in the debtor countries and a very strong germany. now the problem is, after years of being worried about the wrong thing, too worried about debt and inflation, now they look around and discover they have turned into japan without the social cohesion. inflation is practically zero. essentially deflationary already. germany is slowing down sharply because it depends upon exports, and who will it export to? and it is just, it is -- they don't have, the scary thing is they don't have tools. the european central bank, mario draghi. a good man, smart guy running the ecb, but only so much he can do. fiscal tools are hard because there is no common government. the germans are not ready to change their tune. by the time everybody wakes up to the gravity of the situation, europe might be stuck in a deep depression with god knows what political consequences. >> pressure from the right? >> anti-immigrant groups, extreme nationalist groups. we say, what

many are saying china is being quite clever in its treatment of europe while europe imposes sanctionsa retaliates. up some ofry to pick the business europe has lost or will lose in its dealings with russia because of sanctions. what do you think of that? china being duplicitous here? >> if there are sanctions to thata, they try to take market. not only china but other ones. retaliation oft russia, the ban on import of , they comevegetables not necessarily from china but other countries. i think you can in a purely mercantile us way -- mercantile way. if you look at it in a political way, it is obvious we have moral obligation to take sanctions against russia, especially after with the airplane crash, that took more than 250 european lives and were clearly russia did not do it themselves, but a were responsible for what was happening. of aave seen the creation new conflict in the east of ukraine. we have to act. we would be cowards if we didn't take action. it does not mean they are ready to come to understanding with russia. i made an agreement with russia but made it possible the was

as well as europe. citing the gap between the u.s.eurozone manufacturing pmi is close to a historical high of around 8 points. what does this all mean for the currency space, specifically the euro? >> so there's no doubt about what we've seen now in terms of economic performance is highly unusual. we have an unemployment rate in the united states that has come down incredibly fast since 2010 whereas we've had an upward move in unemployment rate in the eurozone in that period of time. so this is historical divergence. that ecb will have to do more. whether it's corporate bond pure chases, i think something more will be delivered within the next three to six months from the ecb. that is going to push the euro lower. and i would mention one more thing. we have negative interest rates on a lot of assets in the eurozone. we have up to four years out on the bond curve negative interest rates. this is something that we gradually has a huge impact on location. european asset managers want to get out of those assets. foreign investors might ho

>> and the elite in europe have discredited itself, europe has always been this thing where the peoplewho know have been more or less, think they know have been opposing their vision of europe on the public without a lot of popular support, the european idea has never been as deeply rooted among the general public as it is among the european elite, the elite have to actually show that it is competent and everything from the last six years in europe says it is not. of course the radical groups are going to gain power. >> rose: and then there is russia, oil prices are declining. >> yes. >> rose: and they spend a lot of their economy, 60 percent or more -- >> yes. >> rose: is dependent on energy. >> yes, russia is a petro state, russia is in fact not a big economy, it is not, it is, its direct role is not that big, i guess there is probably some -- they are sort of a weak economy with nukes and so exactly what you think about that, i don't know, but that has got to be part of the feeling that things are going wrong. >> rose: what is happening in china? >> china we have been waiting, we kn

investors be about the slowdown here in europe? >> well, at the corporate level, in fact, it has an impact because a large number of companies higher in sales not only to asia but also to europe. if you think about companies like huet packard, and others. when the dollar isn't strong, exporters outside of the u.s. repatriate it back to the u.s. >> in contrast, we're seeing a weakening euro. >> i think it will, but there is a lag effect. if you're expecting to see it this month, next month, forget it. it takes three to six months for that to start to turn up. the german factory orders were okay, but they were poor, they were seasonal due to the holidays. but i expect that to pick up which give europe and other eurozone companies a competitive challenge. >> we'll continue that on the european markets. head online for a live blog, leave us your comments on why you think we are seeing a selloff. >> let's start to the markets and get top stocks or bottom stocks. finnen stocks fell and said it would be forced to reduce production levels.

that europe,show especially western europe can survive without russian gas at all.ussia and ukraine, this winter may become quite critical. it will mean a difficult winter for ukraine, but that will also mean gazprom will keep losing his market share in europe. >> we are hearing that you are in talks with statoil to provide 6 million cubic meters of gas at $60 per cubic meter. give us a sense what that would do for ukraine. that isly, confidential. secondly, we are working with european five providers who supply gas to ukraine. gas is there. of flowsa bottleneck from europe to ukraine. this is where we need to unlock more volumes. if there was more volume, there would be no crisis. ukraine could be sourcing all of its gas from europe. >> let's talk about politics. this crisis emerged, since the sanctions came through, ukraine is looking increasingly isolated. if you are a european country, you are probably thinking, why depend on a gas route that comes from ukraine? ukraine is looking increasingly isolated. is the best route out of this to look back to russia and tr

then there's stagnation across europe. and fiscal policymaker has his or her hands tied by fiscal constraint, by the rules of the euro area. if you're running deficit management, you can't put emphasis into markets so easily as you maybe could in the u.s. or uk. i think mr. draghi's points were well made. >> if it does come through and mr. draghi does come further, whereabouts do you want to be positioned in europe? >> i think europe, you would then look for the discount factor, the sectors in the short-term which have greater sensitivity to discount rate. i think in that respect, you'll be looking at the telco, some of the duration assets. some of the more cyclical areas wouldn't show is in the short-term. i think that will begin a second stage of recovery. that will come when you start to see real response coming through. i think the sort of asset, although the sector allocation we recommended in the short-term, which is i.t., real estate, health care, we would remain with that right now. the sector shift wouldn't come f

alcoa can't close europe.oa is a gigantic international company which needs to be involved with europe because 770 million people live there. who wants to forego that market? the answer, any ceo that wants his stock to go higher wants to forego that market. so any of the company involved by kleinfeld is also involved in europe gets crushed. the stock of any manufacturer that sought after 770 million people got killed today. seems silly, the market is not that bright. in fact, it it can be down right dull-witted. what makes it so stupid in my eyes, simple. this market is like the ignore am us that only reacts to the last thing you heard. when nike said europe was very strong. so the stocks rallied. when ford said that europe was very weak, the companies that sell to europe r were annihilated. when the fed said europe is weak and intends to keep it with low rates and that was yesterday. when alcoa said europe's anything downhill and then everything tanks. >> the the house of pain! >> for the record, this whoever

they're not going to be able to deploy troops from europe. but overall, the eu has already sent about 180 million euros worth of material and help to the affected countries. but next week, there will be a meeting of eu leaders. perhaps that higher level of meeting, there will be a more concerted discussion about what more practically they can do to get medical teams on the ground where they're needed. >> okay, chris morris, thanks for keeping us abreast of that discussion in brussels. also, you can get much more on this unfolding situation via a new program that we're showing you here on "bbc world news." at 1830 gmt, we will be bringing a special program with the very latest on this outbreak. that program is going to be on air every day this week right here on "bbc world news." i hope you can join us for that. >>> now, let's get all the business news, because we've had some bad news for stock markets around the world. lots of turbulence today. alice is here to bring us up to date with everything. >> it's been something of a roller coaster, h

you see auto sales coming back in europe question mark >> -- in europe? is coming back. we have had bad years but the market is growing slightly. >> it is slowing down a little bit. >> we have good momentum. we are going in europe, close to premaster than the three ium germans. >> who is the easiest of the premium germans to pick? off? >> we are not going after anybody. we are offering something special. one important thing is not to copy. you have to offer premium spots. otherwise, you are buying a copy -- making a copy. of europe, what do you see sales like eventually and china? besales in china will 200,000 cars in some years. this year, we are selling 80,000. we are good on the way. but a lot of things to do. >> russia, how do you see things were covering their? -- there? >> is a tricky situation. the market is down 20%. we will lose some things this year. you see that happening? we have had some soft economic data out of germany. it seems like wings are slowing down. >> i don't know if it is related to russia. the market is always nervous. it.re keep

flex in terms of flows into europe? had a massive impact on capital flows into europe.ulated until the most recent data available. about 860 billion euros worth of capital inflows since omt was announced. i think for now, given the fears over growth, even with the ecb is doing, that kind of capital story has moved away. improves, that though, i'm sure some of that money will be destined for europe as well. dollar-yen, a lot of you will get excited about that. how high do you see? >> it got to 148. that is when the japanese intervened to buy. we are some distance away from that, but the move has been very substantial. if you go back to the last boj inouncement, we had a jump dollar-yen, from 93 up to 100. that was a very well-telegraphed policy step. it was more aggressive than markets expected. today's move is completely on telegraphed. have't think many people this position on board. that makes me think that perhaps we could see another substantial move over the short term. about thee skepticism long-term impact. how high could this go? if you listen to the politicians

everybody looks at europe, and the europe is back in recession and inflation is falling. ecb is in the camp to do qe. the bundesbank must take the lesson from what ben bernanke said. there is too much deliberation about whether qe should happen or not. we have to achieve that and problem. solve the >> you look at the investment environment of where we are now. they are winding down qe again. wind down qe this kind of thing happens. there is still a cell down. you get a slowdown in the general economy. we have heard from the likes of stanley fischer, the fed vice chair, who is ready to say low rates for longer, but equity markets are not responding anymore. >> let's review the data. we have had gdp data in the u.s. there is a lot to do with sentiments. it comes back to the same thing. wobbly.r is the earnings numbers are very critical. i expect financial to report strong earnings. they don't have a hard number to beat. compare the average price it was 76.7 and not 78. i think earnings will be be. today. inflation is out is the bank of england going to stay on hold much lon

and russia, it will be very bad can economically for europe. how are these sanctions affecting you, your country, and what are your sense? are they working? >> we are among the top 4 countries exporting to russia. >> right. >>> it clearly has an effect on us. then there is the food import ban on the russian side which affects us perhaps even more. but not directly. it's not so much that question send things there but rather what has happened is the price of milk or various food products in europe has decreased everywhere because there is less demand. and so we have some -- all of europe has to deal with a angagricultural sector that is not happy. i don't know whether there will be a dramatic change if sanctions increase. on the other hand, estonia and neighbors, latvian and lithuania are the countries that have -- and poll and. all four countries have strong trade ties but we have been willing to grit our teeth because we consider the security or the situation in ukraine to be serious enough that we bite the bullet and deal with it. >> not all

europe is one step ahead and europe can study it.don that they have already started the stress reversals, that might be key. in see market reaction travel and leisure stocks, and my not going on my cruise because of this? fewer flights because of this? what is the real demand westmark -- demand? >> leisure and travel was one of the worst down 7%, its worst week in three years. down again today. the answer is, investors think that companies like carnival are going to be hit. carnival, obviously a lot of people aren't in a stop you carnival cruises but carnival has already had to reroute their cruise ships and that has a cost. to watch, itng depends how bad you think the referred going to get, barra berg say that it is overdone and it really comes down to what you think about the crisis in multiple think there is a lot more of a scare to this than reality. >> thank you very much. ," weg up in "on the move told you about pershing square, another stock planning to make its day to day, we will talk about the company's ambition. akin two.

this is the key for europe's recovery. you can see those have been pushing for reform. >> he did tell me he does see some room in how the rules are interpreted. >> very quickly. we were hoping he was going to talk to angela merkel. it is not happening, is it? >> it does not look like it. the the e.u. is going to discuss sanctions at the end of next week. the russian president and the german chancellor did meet last night. they met for more than two and a half hours. everybody is there. they are trying to hash out a deal. europe feelstern the russians are fulfilling their obligations when it comes .o the cease-fire i haven't heard them suggesting the sanctions are rolled back. >> thank you very much. still with me for some final thoughts. germany on the cusp of recession. you would expect them to back down. >> i think the sanctions are weighing on sentiment. has is the issue germany the slowdown in china. i think just as much as lifting the sanctions would help, arguably what would help is pick up of growth in china. .e are

made in europe, owned by china.peak with one chinese vester -- chinese investor who is buying into europe. ♪ >> welcome back. bloomberg european headquarters right here in the city of london, 30 minutes into your trading day. ftse 100 down by 10 points. the dax pushing higher again. ecbhappy talk about stimulus, the speculation about corporate debt. the eurozone seems to be pushing higher. here in the u.k., and giving good minutes in about an hour -- bank of england minutes in about an hour. plenty to digest and 60 minutes. -- in 60 minutes. >> we are looking at the biggest fall today. ikur pens, pencils, it is b of course. strong stationery sales in europe, but the united states looking weaker. the worst performer on the stoxx 600 here in europe. sales are improving, but profit missed analyst estimates as did the dividend payout. tablet? be buying a that the home space they will be wiping out a quarter of their stores by 2018. tobacco, downican by 4% -- british american tobacco, down by 4%. clearly, much regulation

we are taking costs out of europe. when you take a look at their market share or their percentage of sales from over there for ford it is about 21.5%. for gm it is about 16%. you can sit there and say it is not more than a quarter of their sales and the rest of the world is doing well. can't they get away with muddling along in europe? you can only do that for so long. i want to point to something said earlier about the rigidity in the european economy. that is at the part of the problem for auto makers. they should be closing down plants more often than they are but they can't because of labor laws. that is why they continue to lose money. >> phil lebeau, really interesting reporting. thank you for that. let's bring up a board on what the markets are doing on the back of the dovish minutes. the dow is up by 192 points here. another triple digit move. this has been the new trend and certainly something we have not seen so far this year but over the past 13 or so sessions we have seen majority of the sessions up or down

and europe.ve just seen google ventures launch in europe. 400 million euros for early stage in europe. we have many peers in the nordics and germany. venture a lot of capital and crowdfunding. the u.k. is probably more advanced than a lot of other economies. there are accelerators. today, argue that capital is a commodity. the best entrepreneurs have world beating businesses and they fight over getting into those businesses. you could offer more than that and be part of a great business. you spot a business like that? it is all about execution. it is not the genius idea. oryou prefer genius idea something that is executed to perfection? >> given that it is possible to start a business with very low cost these days, if you think about the infrastructure that you need to start a business, software is free. cloud computing allows you to pay as you go. distribution on social media. ofs or hundreds of thousands dollars you can get up and running. time businesses get interesting, they have some dated t

. >> europe led us to the downside. take a look at the s&p 500 because things have improved since the european close. simon will give you all the details on that. but the s&p well off of its lows and we're heading back up towards positive territory. the big problem with new york is the commodity complex. sue mentioned oil but it's not just oil. the individual commodity markets like aluminum and copper, the base metals, nickel and zinc, have been continuing to decline on a daily basis for almost five weeks now. that's a major problem. it's global commodity deflation that we're faced with. as a result, anything in the commodity stock complex, exploration of production stocks particularly have been hard hit. some of them down 2% to 4%. this has been going on every day for a matter of weeks now. aluminum stocks have also been weak. your alcoas of the world are down again here today. alcoa is down about 3% as you can see. we also have coal stocks. they've been having a rough time of it. they're weak again today as you can se

years in europe. specifically in the uk. there's been 500,000 companies register start up. while the overall economy may be up and down, the tech skter is very strong and i think this is a great example of that. >> mcdonald's releases earnings before the opening. [ male announcer ] some come here to build something smarter. ♪ some come here to build something stronger. others come to build something faster... something safer... something greener. something the whole world can share. people come to boeing to do many different things. but it's always about the very thing we do best. ♪ >>> prosecutors have opened an official investigation after ceo of total died in a plane crash. the driver of the snowplow that caused the crash on the take off was drunk. >>> nearly 130 s&p companies report earnings this week, which does include a big consumer name and that company is mcdonald's. it's announcing third quarter werings as well as same-store sales. analysts will be looking for growth in emerging markets, des

europe has been strong.t we are seeing is we have to emerging markets who are posing problems at the moment. we have russia for obvious reasons, which typically is a growth driver. , and in in the klein latin america we have political issues around the elections in brazil who have also brought growth rates down. i want toental topic make on the adjustment on operating results we just announced is this is due to the acceleration of our cloud business. we see exponential growth much higher than we originally anticipated. with a recognition that we don't book everything up front comes over three years. we have set up at the beginning. this market story for you -- i understand immigration. we all have been given the story, and we get that we need to be patient for those revenues to come through, but is it fundamentally a dissipation of when you focus on the cloud, because the cloud is 5% of your revenue. you need to get the core business on track. >> to be clear, we continue to increase profit while we go throug

italy is most stressed as europe tests banks. we speak to former e.c.b. president jean-claude trichet. and i quit. we consider the quit rate. good morning, everyone. this is "bloomberg surveillance." we're live from our world headquarters in new york. it is monday, october 27. i'm tom keene. joining me is scarlet fu and brendan greeley. right now let's get to our top headlines. here is scarlet fu. >> in brazil, the president promising great changes after winning a second term. she was re-elected with 52% of the vote, defeating the opposition candidate. rousseff says the challenge of pulling the country out of recession and slowing down inflation that is above the central bank's target. investors are skeptical. brazil's stock fell 7% last week on speculation she would be re-elected. in ukraine, they easily defeated russian supporters from eastern ukraine. president poroshenko brokered a cease-fire that allowed the voting to take place. ukraine has been battling pro-russian rebels for seven months now. >> most european banks that failed the e.c.b. stress te

we always talk about europe.ing -- you were telling me during the commercial break that you are having a better time in romania than you are in your business in belgium right now. i would think they would be hit harder, but they are doing well. >> all these changes we are seeing right now really reflect had gonethat if things up too high, they would have come down. any concerns that people have, you have a major reaction. reaction is always greater than what it should be, and that is what is taking place right now. as far as we are concerned, we have an international presence -- our biggest one is in china -- and also, we are in the , but inast and dubai europe, we have entered the belgium markets, which have been tough because of the fact that attitudes of people in western europe are much more conservative, much more cautious, and attitudes in eastern europe are somewhat like you might say the developing world and china. they are more entrepreneurial. the consumer is much more willing to invest and to spend, an

it killed the artist lorenzetti and half the population of europe.t was the greatest catastrophe in the modern history of the west. but surprisingly, for some regions, the plague was a springboard for economic growth. [bells ringing] for the survivors, there were new opportunities. florence recovered particularly quickly. by 1400, this was the city-state that dominated central italy. but bankers and textile merchants were expanding their trading empires all over europe. over the next 100 years, an extraordinary interaction took place in florence-- the innovations of artists and architects, the excitement of rediscovering classical achievements, and the patronage of a wealthy commercial class. these key elements brought about a series of artistic and intellectual breakthroughs that came to be known as the renaissance-- literally the rebirth of learning and culture. in the church of santa croce, a series of frescoes painted around 1320 were to have a revolutionary effect on florentine painting. here, the great merchant families competed with one anothe

putin in europe to face his critics. begun meetings with leaders and milan, the first face to face talks since the ukraine crisis. he tells bloomberg u's always accused of doing something. nish by mr. about the cost of sanctions. >> russia gets hit the hardest. they are at zero growth. add to that, the price of oil. >> let's go to ryan chilcote standing by at the summit. would you have for us? -- what do you have for us? >> the biggest topic is the crisis in ukraine. it is overshadowing the summit. bywas meant to be discussed two of the most powerful leaders in europe last night. they chancellor of germany and the president of russia. the d-dayt talk since celebrations on june the sixth. the meeting did not begin until 11:00 p.m.. president putin late in arriving from serbia where he oversaw a military parade. the leader did not emerge until 1:30 in the morning. i had a chance to ask him what he makes of the allegation he is not doing enough to resolve the crisis in ukraine. he told me quote i am always accused of doing

you talk about europe. markets five years out, investors are pricing inflation at 1.6%. if you are going to carry on delivering the kind of revenue growth you are delivering, how much money are you going to have to invest in the kind of innovation you are talking about? you have a great balance sheet. i am curious what the innovation story is going to cost. innovation, the biggest part of our growth. that is in ongoing investment and we are not going to stop. my focus this morning was also saying this short-term intensity to deliver growth is not getting -- is not giving for free. you have to go after it in a more intensive way. you have to keep investing for the long term. that is return on development and share acquisitions. also, the building of new platforms. we have brought in someone to build our growth sector. we are growing very nicely. that strategic direction , that is or you growth what we call wise resource allocation. >> you are investing for growth can we talk about the global economy? people

the imf has said europe, there's a problem in europe. europe has a problem? >> markets are frothing. >> first time i've heard that. >> a lot of what happens day today is random. it's noisy, there's a cartoon about what starts out as someone using the word "sell" becomes this giant climax, the same thing happens on the buy side. there's a tremendous amount of randomness. it is a crowd of monkeys punching keyboards. sometimes -- 300.0, down 300, up what happened that we didn't know? europe has a problem. ipos and tech, frothy. sometimes these things just begin -- >> you thought draghi could come to the rescue. we talk about his bazooka, "i'll do what it takes." when wolfgang shapleigh says -- when wolfgang schaeuble says no way, jose. they met in milan. problem between europe's policymakers. wein the u.s., even though have been cutting back jobs and the federal government's growing slower, by and large we've had a reasonable amount of stimulus. a reasonable amount of activity. plus, qe and tarps and all the other liquidity facilities the fed has put into place.

i'm damien mcguinness, and this is "focus on europe," showing you the people behind the headlines.hey are the stories you don't usually see from every corner of the continent. i'm really pleased you could join us. on the program today, the tragedy of migration. stolen children in spain. football fans in turkey under pressure from the authorities. and in italy, a clean slate for rome's piazzolla's -- piazzas. europeans are struggling to cope with a growing influx of migrants, desperate to escape war and poverty, and many undertake perilous and often deadly journeys to get here. the numbers of people trying to flee to europe have hit record levels -- around 130 thousand migrants have already arrived here by see this year. that's more than double last year's figure. this is, of course, big this is for human traffickers. our reporters have discovered that traffickers are now finding gruesome ways of using children to increase their profits still further. >> this girl, whom we'll call it via letter -- violetta, though that's not her real name came from africa two years ago. she was just

so i'm concerned about the total in europe. if you take instead capital to the balance sheet, then the european banks are still thin capitalized. >> weighted assets, but the latter is used by the americans, yeah? >> indeed. >> after this and many europeans have said these stress tests are more strenuous, the asset reviews, this is more strenuous than what we have seen from the united states. but in terms of the evaluation, we are still missing a trick in europe? >> i think we are. if the exercise is to not get surprised down the line, considering that the assets are under severe pressure when you have economic development like deflation and basically recessing in europe by the end of this year. >> that's it, isn't it? the americans at the moment rightly or wrongly still have economic growth. they still have a lot of metrix. although volatile, they are turning up good figures. good unemployment figures as well. yes, we have questions about participation, we'll get to that, but the fact is they don't have inflation issues as much

europe wants to send a strong signal.it wants partners like the united states and china to follow suit. >> when you have countries like poland that heavily rely on coal can europe afford to remain a global leader in the fight against climate change? >> that was the philosophical question debated yesterday. we have a compromise on the table. but you are right to point out poland. poland gets 95% of its electricity from coal. coal is cheap but the most polluting energy. poland is afraid of two things. it says, what will be the cost of the transition? they are afraid it will damage their industry. the second fear is by reducing the use of coal, poland might become more reliant on russia for energy supplies. this is the last thing warsaw wants to see in these troubled times. that is what a deal was found. in poland and a number of poor member states will be able to tap into a solidarity mechanism. they will get special funds from europe to help the carbonize their industry to help them get this green transition in place. >> a

europe is creeping to 0.8% growth. that is some progress. it is not the progress that you guys expected compared to u.s. growth. i think the world grows in general at a turtle pace. we have to learn to live with that. and the u.s. is leading. this is i think sometimes from the u.s. perspective looks a little bit strange. >> i will pushback a little bit with all due respect. how, then, do we explain the yields on ten-year german bonds which are yielding a couple percent less than a few years ago. what is that saying to us? >> i do think in europe is in some way homogenous bond market. germany is aaa asset. >> still? >> i think this is a safe haven driving germany favoring the german economy, low rates and very constructive dollar levels. >> being from germany, naturally, good for you for trying to support your country. on a daily basis we look at headlines like industrial orders sliding, industrial production sliding for the most in multiple years. this is the kind of thing that we are reacting to. do you think at the end of the day for an in

it would help peers in europe. it is not just europe waning on growth. brazil with the biggest cut citing weak competitiveness and tighter financial conditions. in terms of macroevents posing a risk to the global economy citing instability in russia and caution the conflict could derail the oil markets. there is something to cheer about and that is the developed economies. the american economy revising to 2.2% from 1.7%. the united kingdom seen leading the crisis behind. that is something to take away from that imf report. >> i will take it here. we hit a new low on the dow jones industrial average for the day. goldman sachs chief u.s. equities on squawk on the street. >> 3% growth you look into europe and looking at barely 1% gdp growth. this is an environment where as a portfolio manager you want to own stocks selling domestically. >> do you buy europe or stay home? the co-portfolio manager of the jensen quality growth fund and ron sloane. welcome. nice to have you here. eric, what do you make of europe? do you t

we are lacking of investment and europe. -- in europe. would appreciate that berlin would be less focused on austerity. >> just a one final question. questions. one, are we in a situation where -- and these two stand out of the way and let others do their job? is france under new management? does france need to be under new management? >> i think it is a new management. el, we have a social democrat approach. very much pro-business approach. everybody including the government and maybe the it a strategicde error when they decided to increase taxes. and now, we have to be very to support this government. even if you are from the right or the left of the left, it is all national interest to have this government. one final question. everybody is wondering what you are going to be doing next. france is under new management. any particular french companies under management in the near future? [laughter] know, from the week iers that said last would be the ceo of a big french electricity company. whichs a decision, belongs to the french preside

so look at the europe area as a big problem. and i think it's a really big problem, but we have been saying this for six years now. >> so what is going to change? draghi's speech was recovery versus reform. >> the way i characterize it. when i was at the bank of england we started to cut rates in october of 2008 2008 and realized you had to do qe and did it in about six months. six years in the e.c.b. still hasn't worked it out. it says something about the structure of that bank. a, how to do it let alone whether or not they should do it. >> or whether or not they have the way to do it. >> but you've had six years to prepare for this day. there's no excuse to say we don't know how. >> is that the problem with a fractured banking system? >> well, the ability of the e.c.b. to respond to things quickly, you can't get enough translaters in the right place. so i think it's just an indicator of look at the markets. you have a firm that's flexible and one that isn't. that's what we're seeing. >> is it true americans watching this. we l

so that would change so i would say in europe there are some things europe does better.n britain you are required by law to separate the chairman and c.e.o. because chairman's job is to look out for the shareholders. you've got that natural chain. so i'm in favor of splitting the roles of chairman-c.e.o. wherever you can and in britain it's easy because it's the law. so that's one example of making sure that the shareholders have a stronger voice not dominated trong c.e.o. >> to france's point they need shake up more than america does right now. >> i would say they need shake up. on the other hand the americans are more totally focused on simple financial measures of success of the company. in europe, they are all about the what you call the sg something or other, sustainability, the governance principles and gender equality in your boardroom and in your workforce. environmental concerns and all much weigh much more on the boards of european companies than on the backs of the american companies. >> do you think they are good things? >> yes. and it makes the job of the bo

there were questions in europe. overall, the economist view is that europe is slowly in a fragile and fragmented way slowly getting better and as the headwinds are abating in china, u.s. equity looking stronger. so not so worried that there's an ominous signal in interest rates and corporate bonds that we need to be concerned about. >> terrific question. i always think the first three quarters of the cyclical bull market, corporate bond spreads tighten and basically, high yields in particular, and then what happens is in the last yea should get rid of the high yield of your portfolio, and you should enjoy equities for the last eight months. we've had the lows and we've had the equity lows. they will trend up in the next 18 months. corporate bond spreads correlate very h highly with that. they both measure risk in the corporate sector. slow rising as george characterizes. what is interesting is we've had six years of corporate interest rates and a lot of money creation. i think that tells you it maybe shows, but ther

we are in the middle of a recovery in europe. actually 2014, particularly for the car industry >> has been pretty good with an increase of the sales of cars around 5 to 6%. this was something we didn't see for a while. it's based upon the fact it was about time that the recovery takes place, but it's being blocked by the fact that every time you have a major decision to be made, you need to make sure that all of the european countries are aligned behind this decision. every time you have an important decision, you have two, i would say, two schools of thought. and two different attitudes is process. >> that's what we are seeing and that's what we in the business world really don't like at all. >> and broadly speaking, those two schools of thought are about os tearty versus stimulus. i mean, there are lots of versus of them in between but do we, as central banks and governments continue to stimulate the economy or do we repair the inefficiencies of these european economies that have been there for general operations? this is a tou

europe is getting attention this morning. about expansion of its bond buying program. we have been talking about the dollar recently and the dynamic with the fed. you have to look at the euro. is are seeing what the euro doing today. we are seeing a little bit of a bounceback in the euro. in the longer term, we have seen quite a slump in the euro. is this a boon for the european economy? does this make you want to look at european stocks? >> the biggest real fear we have had as investors is what is going on in europe. it was on a gradual recovery and it has rolled over in the summer. i think what is going on with qe and the currency are great. they just became 7% more competitive versus the u.s. in the last month. >> i want to interrupt for a moment. the u.s. supreme court deferring action on same-sex marriage appeals. a lot of people were looking forward to the supreme court hearing. so far, this indication is that they will not take it up right away. they have deferred action on same-sex marriage appeals. >> how does that i

you are on europe. you go first. >> charles evans specifically cited risks to the united states which is why we are focusing on the risks from europe. you went through the unemployment numbers. we have gotten bad numbers out of germany. there is weak growth across the continent leading to deflation fears which could be quite problematic. we know that the head of the ecb will try to fight deflation. we hope the germans will let him. that means a much weaker euro which means a stronger dollar. those are head winds that we face here and could hurt the united states. 46% of revenues estimated for the s&p 500 come from overseas earnings. that is how you see earnings get hit here in the united states. >> interesting stuff. this is steve. this is steve on asia. what is going on there? >> the story in comparison with europe is that there isn't a currency effect. that doesn't mean there aren't effects. obviously weak growth is an issue for us. we sell a lot of stuff there. about $120 billion in exports in the un

europe was down about half a percent. in the u.s., we were just talking about brent oil and it dipped below $90 for the first time. we got a lot of economic data coming out today. job claimsd weekly are at 8:30 a.m.. the weeklyw you jobless claims versus the s&p 500 and the correlation is incredible. bloomberg consumer comfort insect -- index is at 945. >> that will set us up for the jobs report friday. >> the ecb press conference which we will go to at 7:45 a.m., we will find out what happens. finally, constellation brands are reporting earnings. they bought corona beer. be speakingama will in chicago at northwestern university on the economy. at some point this morning. >> we will give you those details when they occur but we want to give you the latest stories on the front page. start in hong kong where students are threatening to invade government buildings unless hong kong chief executive steps down today. pressure is mounting on him to at least open a dialogue with protesters. mayednesday night, they have seen the b

asia trades significantly with europe. even latin america has traded with europe.nd analysts changing their forecasts for the u.s. and the emerging markets -- of a terrible tragedy in moscow. the moving out of the french, replacing the united states and trade. >> he was unashamed to support russia. he made a real point of that. -- word youy see see the difference is breaking within europe between who handles russia? >> it's a terribly difficult question. you will see a united front between germany and france. they have to approach it in that way. has had a tendency to break away a bit from that movement. you will see a united front here. >> how do you respond to european pessimism? questioning the future of that european union. need this european union. how do you respond to the pessimism? they are fighting history. it's going to stay in place because it has to stay in place. at this point, there is no turning back. you will have some changes on the margin, but the union is strong and will stay strong. >> very good. we will continue the discussion. thank you for st