harvard professor ken rogoff is our special guest. >>> behind the wheel.nation's automakers rolling out monthly sales. >>> and 2017 resolutions. we'll tell you what facebook's ceo mark zuckerberg plans to do this year. it's wednesday, january 4, 2017, you're watching "worldwide exchange" on cnbc. ♪ >> good morning. welcome back to "worldwide exchange" on cnbc. i'm sara eisen. >> i'm wilfred frost. good morning to you from me as well. see that big smile? i just got grief from her during the break that i've been grumpy this morning. >> i thought you would be more excited about our one-year birthday for our baby, "worldwide exchange." >> it's like poor performance on a one-year anniversary. >> where are my flowers? >> she has a good point. forgot. global market performance, let's look at the futures board after yesterday we started the year on a positive note. that global reflation trade kicked off in earnest once again affleck luster final couple of weeks to 2016. we started yesterday with a percent of gains for the nasdaq. about 0.7% for the dow. s&p betwee

we will talk geopolitics with ken rogoff. ian bremer joins us as well.o many big stories to talk about. a forum of international leaders, ceos and global elite. >> starting in just about ten minutes time, president xi jinping, the leader of the biggest communist economy in the world will address a whole load of corporate leaders, likely to back up the argument for free trade. in three days time, the new leader of the biggest capitalist economy in the world will likely start articulating an argument against it. >>> they're really setting themselves up for two didn't sides of this globalization, free trade, interconnected type of world. especially with donald trump, the president-elect speaking over the weekend coming out against european integration. it gives us fodder to talk about with our guests here. >> as we said, president xi jinping will begin in about 10, 15 minutes time. we'll bring you the highlights from that. and we'll talk about the relationship between beijing and washington with ian bremerment. >> before that, let's check the global markets

we are back with ken rogoff, harvard professor and former imf chief economist. a telesat about how the authorities are trying to keep a handle on the chinese economy? ken: they understand that they have had a credit fueled bubble for a long time. they have to withdraw, they have to reorient the service sector. but of course they always want to put off that moment. they are having a very hard time struggling with how to bring down the chinese economy. i do not know about reading too much into this, except to tell you that they are not planning to go to 6% deficit and keep the thing going forever. on somerific research of the esoteric nature of foreign exchange in nations. do we know what reserves are, and do we know how much of a given nation's reserves are utilized? ken: that is a good question. in china there is a lot of bad debt, and the reserves are going to be used for that. on the other hand, they will be used to stabilize the currency. reserves have played a role similar to capital controls, where they are trying to stabilize currency in that way. there is

tom: my book of the year is ken rogoff's "the curse of cash." it is a wildly courageous book.en roundly criticized for it. india, with their own experiment, professor rogoff has been critical on how india has tactically imposed this reduction of cash. and i know it folds into negative interests and all that. abby joseph cohen, on our future with cash. are we going to be a cashless society? abby: not anytime soon. what we are seeing is a reluctance on the part of many people to give up their cash. and one of the issues now is not the theory about going cashless, it is the reality of cyber security. people's worry about the loss of their information, whether it is financial or other personal information. and i think that while we have seen a reduction in the use of currency in the united states, our currency, our large denominations, are used heavily in places like russia. tom: i look at all of this and the mixture of international relations and finance investment and economics, and i guess i have to come back to one of the clarion moments of last year. i was deeply moved standi

tom: i need to ask you, with your acclaimed work with ken rogoff and before ken rogoff. all -- can you say all clear before this financial crisis, that we have moved on to a new phase? carmen: a new phase of the crisis, yes. that the crisis is over, absolutely not. tom: thank you so much. from harvard. erik brynjolfsson -- look at a couple of summers ago, erik brynjolfsson with m.i.t.. coming up, and timely conversation, particularly off the conversation of theresa may. jacob frenkel on currency wars, a jacob frenkel on international trade. from the meetings of the world economic forum in davos, this is bloomberg. ♪ >> if you need support, i think the government will provide it. i don't think france is going to get rid of some of its major banks. an electric moment with david rubenstein, kenneth rogoff, and john cryan. mr. rubenstein really coming to cryan.ens defense of john that is a political backdrop in davos. tom keene and francine lacqua, as always. francine: you know what struck me? john cryan was talking about the complexities of making banks simpler. i think the

rogoff. fromdo you mean to observe the trunk cabinet and those within this new administration to soften the rhetoric of our new president? kent he listens to them. he has appointed some adults in the cabinet -- the secretary of state, the secretary of defense. but is he someone who will listen to them? is his behavior going to be erratic? i am not so much looking at the policies as the whole temperament. do they look like they are going to be a rational administration? tom: you have been a harsh critic of conservative economics and the politics and rhetoric of the president elect. how should democrats, progressives, in a liberal world, respond to the trump presidency? oe: i think we have to stand together and say this is not normal in the united states where we have been combating racism, bigotry, misogyny for decades. to have a president who so openly expresses those kinds of , and in many ways that is the number one issue. it is also a very big issue, to me, because of the rule of law, including the international rule of law. if you want, more companies to invest in the united states, you change the tax law, you change the