mr. erdogan going to go for economics? his neighbor russia?always worked out historically, how about the persian influence with iran? oh, they have always gotten along, how about the middle east with the arab nations? they still are stung by memories of the otto man empire. mr. erdogan doesn't have a lot of friends and he is not making new ones that are going to be in his favor he is in a tough spot. >> harris: are we going to get our pastor home? >> i hope. so we have worked tirelessly on this issue in both the house and senate. our hearts go out to his family. is he being unjustly held. there is nothing that they have on it. he is now being used in a new chapter of political leverage to try to address the problems that are going on within turkey it's very sad. >> harris: congressman russell, thank you for bring us information today. we appreciate it. president trump's attorney is now calling on the doj to now get involved and force a special counsel to wrap up investigation before the midterm. he has some dates and new information now, rudy

mr erdogan said turkey will remain defiant against what he called ‘threats.’ring turkey to its knees using threats. let me address those in the us again — what a shame. what a shame. you are trading a strategic partner in nato for a pastor. there are 81 million people in this country, the position of those 81 million people in this strategic partnership can't be traded for anything. whatever our stance was to this day, it will remain our stance in the future. we will comply with the law, we never compromised on law and justice to this day and we never will. with me is our europe regional editor, mike sanders. the us and turkey are supposed to be nato allies. they are not behaving like that at the moment. you would not think so. the pastor he is referring to is andrew brunson, a presbyterian minister who has been running a church in turkey for the past 20 years who is on trial in turkey for alleged terrorist offences, supposedly supporting the banned kurdish militia, and also for supporting the turkish cleric who lives in america who mr erdogan blames for the f

mr. erdogan understand? yousef: at the moment he does. ations on the street in istanbul and beyond say it is critical that the steps that president erdogan has taken, he is seen as a defender of turkish nationalism and will not let anybody just stopped in and do what they want. you have seen that, the nationalist card is always easy to play. if the currency has lost 35%, even if the lira stabilizes at this level, over the next few weeks and months, that will feed into inflation. then his supporters will ask why is my paycheck no longer lasting until the end of the month? what a lot of investors are looking for is a change in tone from the turkish president because of some of the domestic realities he has to live up to. he is willing to go far on this. you have heard what he has said in terms of the boycott on american goods. in terms of total trade, it is not the u.s. that is the most important trade partner. it is china and russia. tom: thank you so much. yousef gamal el-din. we appreciate that. with our asia foreign-exchange team, he has

mr. erdogan feels strong in his beliefs about interest rates, about the stewardship of the economy. how do we resolve this >> i think this is going to continue for a while i think the volatility you've been observing with the lira is not something that will be fixed any time soon. what markets need to see is action by the central bank that's the one thing that's not negotiable for erdogan it would take a lot to convince him to make a change given all the public statements he's made, even what he said yesterday about being the enemy of higher interest rates so they might look for some kind of negotiated solution with the united states that restores some level of confidence, but all the vulnerabilities there and the loss of credibility with government policy, those are problems that will persist >> how much damage has already been done? we're seeing a strong rally from the turkish lira today, 6.6% higher on the screen there the equity market up 2.2%. banks within that moving higher, sharply this morning how much damage has already been done by this currency appreciation >> quite signi

mr. erdogan is willing to swallow his pride enough to save his currency and his country rather than his immediate political image. >> gordon, in the past erdogan has suggested they could get help from china. is china in a position to help them >> well, china does have money, but china is overcommitted we've seen this with belt and road the death trap diplomacy around the world china has money to do it, but right now it's a political issue in china where you have a lot of people right now criticizing xi jinping and the political leaders spending money elsewhere when they believe it should be spent internally >> are you suggesting president trump's tactics are actually working on china much better than is reported back here >> you have a lot of people in china in peripheral media and hong kong saying now is the time for the chinese political system to raise the white flag of surrender because china long-term cannot compete with the united states. that's a developing theme, and clearly the chinese don't think they can win this. >> fascinating stuff from all three of our outstanding guests. >>> we've

mr. erdogan is just not there yet. but what lever could they pull if they decided to for a first maneuver? ben: the different things they can do of course, they could do a unilateral intervention in the currency itself. by erdogane allowed for that matter. or, you know, the worst thing is you have capital controls, a bank holiday, and worse, even, that they would call to stop doing debt payments to foreign creditors. that would be negative for foreign markets. we'll sit here with the turkish until thereolatile is some sort of diplomatic solution. one of the things that would happen today that i thought was important is the german prime minister merkel did put her support out there for turkey to not be destabilized. that was picked up by markets. yvonne: what does this mean for emerging markets? i have a chart showing the correlations we have seen with the lira and the rest of the space and that correlation has only gone stronger in hitting a one-year high right now. hiff of a have a w crisis or is this something differ

mr. erdogan keeps it fluid, the greater the effect on the market. vonnie: the u.s. dollar strengthening by 2.9%. the turkish markets are closed. let's check in on first word news. here's courtney donohoe. of jury day three deliberation from the fraud trial of paul manafort. he hid tens of millions of dollars in foreign income. the defense did not call witnesses and said the prosecution did not meet its burden of proof. president trump has ramped up its attack on a little-known justice department official. the president tweeted -- will thee ohr ever be fired from justice department? a joke, where his wife was a contractor for a research firm they compiled information about the president during the campaign. in southern india, flooding caused by monsoons has caused more than 900,000 people to flee to relief camps. officials are worried about the outbreak of disease. the floods are blamed for damage in kerala. authorities say 341 people have died. in venezuela, president nicolas maduro is testing the capacity of a population to face more pain. he carried out one of the

mr. erdogan. we go with a nice move. we roll over.are now to where they were at the beginning of the crisis in 2008. this is they should have, could have line for turkey. this is the gap in the piggyback as they go back to 2008. that is rolling over as well. francine: i like that chart. mine is very similar. lira, itok at turkey's hit a record low yesterday. that is why this chart matters. i am charting lira against 10-year yield. the move came amidst heightened concern over a diplomatic spat. how much further do with authorities need to go to shore up the lira and avoid further market turmoil? economyus is our reporter in istanbul. capital controls is certainly one of the hot topics that investors and analysts, everybody outside of turkey have been talking about for some time. turkishaid that, when officials, whenever this comes up, they have been adamant about not imposing capital controls. they think this would be economic suicide. they think it is an unlikely scenario for turkey, and unlikely tool they would resort to. whether it

mr. erdogan back from our emerging market crisis 101?ard would be the best option. turkey has a high inflation rate at the moment. if you start having a currency managed against the dollar, the lira will lose competitiveness and that may worsen the balance. the move to a floating exchange rate was seen as a strong shift toward orthodoxy and helped booste policymaking and investor confidence. what it needs is higher interest rates and lower inflation to make it work. uniqueit seems this is a circumstance. canhere any precedent we look to in turkey or other markets that can show us a way out? >> i think emerging markets have been through these. nejra: like this? >> the difference we are seeing here is that policy makers not seem to be responding in the way markets are wanting to see. ist we have seen policymakers have gone to the imf, they have kept interest rates high. nejra: all of which turkey is not doing and has said it will not. >> what causes things to change? some governments have managed to get through without the imf. then, we ha

mr. erdogan? potential assistance in the future would depend on a request from the turkish government. as far as we know, there is no such a request and no pressing need for such assistance. turkey does have external from their ability -- external but it is ay, funding gap not a funding shortage as we speak. back to square one because of inflation, undoing rate hikes. how does the president look at this? does he care? the president's view on inflation is quite well known in the sense that he has an economic view that goes against orthodox ideas about where interest rates should be in relation to that. if there's a runoff in inflation as we and markets expect, i don't expect president erdogan will be pushing for more rate hikes, to say the least. was it has been h melcher 2-3 weeks -- it has been h mulch tumultuous 2-3 weeks. -- >> he has been out of a job and has been succeeded by the former energy minister. i think he is still trying to get comfortable in his new position. it is a huge change fra

what mr erdogan says is his calling turks to convert their money into lira under the mattresses but it. so president erdogan does not want interest rates to rise but are turks adhering to the advice to change theirforeign currency adhering to the advice to change their foreign currency back into turkish lira or are they largely ignoring it? in a way this call has resonated with supporters. also we seek on social media there is cause from shop owners saying they would give away free goods or discounts to those who come with receipts for their money converted into liras. the majority of turkish people worry they might have to shut down their businesses. over all their purchasing power has been reduced by 20% and especially those relying on important goods, they have to raise the prices so again this reduces their purchasing power so it will be difficult for an average turkish citizen. how bad have things been going before this latest spat? actually the stand—off with the us is aggravating the issues because first of all the overheating economy was the major source, especially the constru

mr. erdogan was doing fine at destroying his own economy. we should have left him alone to reap what he had sown. and instead we gave him an excuse to blame it on us. we should have just watched. didn't have to do anything. we ought to be less reliant on it, be critical of it. i testify next week in europe -- on europe before the senate foreign relation committee. there's not a solution. we use the word solution all the time. turkey is not a problem. it's a condition now and it's a condition so long as mr. erdogan is president and i think we have to basically manage as best we can. wait him out and hopefully one day we can have a better relationship with a different turkey if he hasn't transformed turkey in way that is that becomes impossible but we have to face up to the facts he's taken turkey in a different direction and we shouldn't treat them as allies in any way. and congress is right to put a hold on the aircraft. why should we be sending them are most advanced aircraft affair by an air defense systems from russia and what they learne

mr. erdogan is president and i think we have to basically manage as best we can. reduce our reliance on him. wait him out. and hopefully one day we can have a better relationship with a different turkey, if he has not transformed turkey in way that is that becomes impossible , but we have to face up to it. he has taken turkey in a different direction and we shouldn't treat them as allies in any way. and congress is right to put a -- and congress is right. what am i missing here? this is preposterous to give them the aircraft. so we need to address to -- adjust to reality. propaganda. first of all, there's more of it than ever before. if you're looking at the arrows in the world, they're not moving in the direction of greater transparency, openness, democracy. just the opposite. if there were a share of stock called "openness" in the world, and what have suffered a correction. russia, china, philippines, we can go around the world and even the democracies aren't as democratic. look at eastern europe. there are some elements here. we are seeing attacks on the judici

mr. erdogan's rhetoric may he gone down well th supporters but not international markets. another majoblow camehen trump tweeted this toe annoudoubling of steel and aluminum tariffs on tukey -- "our relations with turkey are not good at this time," he commented. the tariffs were against the rules of the world trade organization. the rift between the nato allies deepenedth. these aroptions that turkey has at the moment -- interest-rate hikes, which president erdogan sees as the n.ther of all evils, is not likely to happe he might seek help from the imf, following the example of argentina, but that is not likely, frowned upon in turkey. there is a feeling that the quickest and most efficient step could be to ease tensis with washington. for that to happen, washington expects an american pastor under house arst in turkey to be released and sent home. otherwise, washington warns, more sanctions could follow. rajini: fomore, i spoke a short while ago to the director h programrkish resea at the washington institute. thanks for joining us. >> my pleasure. rajini: president trump

mr. erdogan says the crisis is part of an economic war with the united states. u.s. president donald trump triggered last week's events by doubling the import tariffs for turkish steel and aluminum. would you agree that this is economic war againinst turkey by the united states? garethth: no, i think the doublg of the tariffs on aluminum and steel l was a criticalal decisi, but what we have b been -we have been waiting for somethingng to happen i in the turkisish e ecoy for quite a long time. the expectation was it was goiog to come a month or two m months later. the political crisisis with the u.s. is acting as a trigger and revealing the underlying weaknesses of the turkish economy. that is not the reason the turkish lira is crashing at all. christoph: walk us down the line -- what does turkey, the president of turkey, have t to o to resrere confidedence in his country?y? gareth: the f first thing he e s to do o is do somomething.. it is now a day since the crisis really broke come since thehe u. imposed sanctions on to the tuturkish ministersrs. we h have not seen

relations have been strained since the attempt to overthrow mr erdogan in 2016. at the centre of this latest spat the two countries. turkey is holding the american pastor andrew bru nson over suspected links to that failed coup, and the us wants him back. on this, president erdogan remains steadfast. they said, release the pastor, and gave until last wednesday at 6:00pm. if we did not release him, they said they would sanction us. for ordinary turkish people, the ongoing row has contributed to rising prices and savings that are worth even less. many small businesses are at risk, and there are fears the currency woes could turn into a full—blown economic crisis. the finance minister says a plan has been prepared for banks as well as small to medium—sized businesses. berat albayrak says he will share it on monday. turks can only hope it will be enough to calm the markets and give the lira a much—needed boost. lebo diseko, bbc news. there has been a rally by white supremacists and far—right supporters in washington, dc, but only a handful of people turned up. they w

relations have been strained since the attempt to overthrow mr erdogan in 2016.atest spat the two countries, turkey's holding the american pastor andrew bronson over suspected links to that failed coup and the us wants him back. on this, president erdogan remains stead fast. they said released the pastor and gave until last wednesday at 6pm. if we did not release him they said they would sanction us. for ordinary turkish people, the ongoing row has contributed to rising prices and savings that are worth even less. many small businesses are at risk and there are fears the currency woes could turn into a full—blown economic crisis. the finance ministers said a plan had been prepared for banks as well as small to medium—sized businesses. berat albayrak says he will share it on monday. turks can only hope it will be enough to calm the markets and give the lira a much—needed boost. lebo diseko, bbc news. fighting continued on sunday in the afghan city of ghazni where the taliban attacked a police headquarters and government buildings. 17 years on from the us—led invas

mr erdogan said turkey will remain defiant against what he called "threats".e, it is wrong to try to bring turkey to its knees using threats just let me address those in the us again, what a shame. you are trading a strategic partner in nato for a pastor. there are 81 million people in this country, the position of those 81 pit million people in this strategic partnership can't be traded for anything. whatever our sta nce traded for anything. whatever our stance was to this day will remain oui’ stance was to this day will remain our stance to the future. we will comply with the law, we never compromise on law and justice to this day and we never will. the headlines on bbc news. chemical giant monsanto is ordered to pay nearly 300 million dollars in damages to an american man who said its weedkiller made him terminally ill with cancer. the company insists its weedkillers are safe to use. police in seattle say they don't believe that an airline employee who stole an empty passenger plane from the airport had any terrorist intent. a 29—year—old man is killed and

mr erdogan said turkey will remain defiant against what he called ‘threats.’ wrong to try to bring turkey to its knees using threats. let me address those in the us again — what a shame. what a shame. you are trading a strategic partner in nato for a pastor. there are 81 million people in this country, the position of those 81 million people in this strategic partnership can't be traded for anything. whatever our stance was to this day will remain our stance to the future. we will comply with the law, we never compromised on law and justice to this day and we never will. the headlines on bbc news... agrichemicals giant bayer monsanto, insists that its weedkillers are safe to use, despite the verdict of an american court that they caused a man's cancer. police in seattle say they don't believe that an airline employee who stole an empty passenger plane from the airport had any terrorist intent. a 29—year—old man has been killed and another man is seriously injured after an explosion at a military hardware factory in wiltshire. is brought to come into the pill a

think he will do going forward are there any signs or some people rather say there are signs that mr erdogan will try to find some sort of deal some sort of diplomatic solution with the united states over this well that is the only way to go forward but it's not very easy either because through is very firy twitter messages president trump has done two things first of all the years dig his heels into his current position which is that there can be no solution pastor branson is not released immediately body has done also another thing year is denied any on the way out for president added on if turkey and now you know left to do the duty these past two bronson than president would look defeated so a diplomatic solution should be sit within these parameters pastor branson should be released and the united states in return should your president add on it would not make this look like a defeat for him. as far as the opposition is concerned clearly one would assume that the opposition is going to capitalize on this in fact the c.h.p. that is the main opposition has said this that the turkish lira

than forty five percent against the dollar since the beginning of this year the turkish president mr erdogan is now targeting cars where tariffs have been raised to one hundred twenty percent he's also raised the charges against alcoholic drinks to one hundred forty percent and tobacco is also in the crosshairs even though the most popular brands in turkey are from the u.s. they'll be subject to a surcharge of sixty percent tariffs on cosmic. rice and cole will be doubled. his life for us in istanbul is this a difficult proposition for mr cinema because if he carries on this road he makes borrowing a lot more expensive for turks and pushes up the cost of living when the currency is going in the wrong direction. well in a way yes you are right but however. when you consider the diplomatic relations between two countries these are considered as more diplomatic and symbolic responses as a retaliation. to the other remember the united states impose tariffs on turkey's steel and he didn't want to stay unconditional and today the vice president stated that this decision of increasing the tariffs w

boycotting us electronic products in retaliation for what he calls an economic attack on his country mr erdogan has repeatedly denied that the national currency is in crisis even as it continues to slip against the u.s. dollar the lira has dropped forty five percent this year the central bank is easing bank restrictions to stabilize the currency at one blames the decline in a plot against the turkish economy. fighting is continuing in the afghan city of gasoline at least four hundred people are known to have died over the past five days around half of those who died were civilians according to the united nations that ghana stands military sending reinforcements to help defend the city from a taliban attack. police in london are treating a crash outside the house of commons there as a terror incident a man in his twenty's was arrested by police shortly after he drove a car through a group of cyclists and pedestrians before crashing into security barriers at least two people were injured the u.k.'s prime minister to resign may went to twitter saying she's thankful for the immediate and courageous

mr. erdogan has other ideas of things he might try trading,o restrict there has been no sign of that.y: they had the opportunity earlier but decided to hold against that. it has pollen 40% against the dollar year to date. bloomberg news markets editor garfield reynolds, thank you. check our gtb library for the charts you just saw on the bloomberg terminal. let's head to the central bank world. the people's bank of china drew a line in the sand with its move to make it more expensive to short they -- short the yuan. in trading today, the yuan is moving about 0.33%. our policy editor is watching this. what is the pboc doing? to what degree is this going to work? >> they are pushing back against an traders. yu last friday, they announced a on reserve are why are meant selected foreign exchange trades. they are trying to remind traders, short the yuan if you want but it can be dangerous. let's take a look at a chart from our library. this shows you for eight weeks in a row, the onshore renminbi has been declining anywhere from 1.7% to 4%. it is the length of decline and it is escalating t

erdogan ands on mr. the lira. ♪ >> turkey turmoil, no end in site, investors prepare for erdogan's address as the bottom gives out in turkish assets. beware contagion from emerging worrys to europe, the over turkish exposure to european banks. and the chicago fed president, evans, talking about restrictive policy while the markets wait for the rate is to read on inflation. happy summer friday. welcome to "bloomberg daybreak." . david westin is off today. three people probably trading, everybody is in the hamptons and we have contagion worries and huge news from turkey. jason: we are awaiting president erdogan, who talks all the time, yet he has been silent for the past couple days, except for a brief comment earlier, eagerly awaiting what he says, but not sure if anything he says will make a meaningful difference. alix

mr. erdogan's they are digging themselves in for the long haul. they are also fighting this other front with the united states, deteriorating relations, and they are calling the united states basically a country that stabbed them in the back. sends a very clear signal to investors around the world. julie: right. amidst this sanctions from the u.s. over turkey holding the pastor. you are there. telling us what you are seeing on the ground. what is the public sentiment like? are we seeing any kind of a run on the banks? do people seem broadly supportive of president heard --ut the president erdogan president erdogan? yousef: there is no run on the banks. a higher level of uncertainty. i have spoken to a of shopkeepers and taxi drivers and retailers and investors in some of the institutional players.the feedback has been one of anxiety . what do you do as your currency depreciates 15% to 20% and a matter of two trading days? they are struggling to keep up. if you are holding lira, this is a good time to buy something because who knows what it will be

mr. erdogan himself has been incredibly critical of the united states and president trump in particular theuple days, talking about being stabbed in the back by an ally. clearly that relationship forged through nato initially is now clearly under a bit of pressure. in terms of the crucial role played in this part of the world, there's a huge thing in intellect for all efforts against the islamic state in iraq and syria with u.s. war planes flying out of there for the last few years in terms of relationship with europe, we heard merkel talk about need for independent central bank, but we also heard from one of her major ministers, economic minister saying that these sanctions from president trump's administration instituted on turkey were unfair and illegal. that's very much echoing talking points we heard from erdogan the son-in-law that thanked the economic minister for making those comments >> thank you willem marx in turkey. >>> let's get a news update from sue herera good morning, sue. >> good morning, carl and everyone here's what's happening. mcdonald's investing $6 billion in a natio

mr. erdogan does not resort to conventional measures to restore things, such as introduction of imf measures want to ask about your bank, its role in poland you were looking at merging with a smaller rival, but you walked away from those talks. what happened? >> first, poland has avery goo growing double digit growth in the banking sector and robust growth in the wider economy. we intend to grow by 10% this year we are the largest corporate bank, we tend to see everything happening in the economy the sector has been consolidating. so santander is active in the market bnp, european banks, so the sector will consolidate around six players. our bank is a good bank, but we have come to the conclusion given where we are in the global macro cycle, given where we are locally, given the fact we have exposure mostly on cash loans and we could not agree on a good exchange ratio for shareholders, we have decided not to do the merger this time around. >> you have said you're not opposed to non-organic growth so you're willing to look at other m&a options down the road. you mentioned significant consolid

brief point given that the indian economy is not the same old will as the turkish economy even if mr erdogan won in ankara manages to to hold the flow this downward spiral of the turkish lira if that contagion has spread independently to weigh you all might it be more difficult for the indian government to step in and do something to mitigate the losses there. i don't i don't think that's a good just because you know. we had to be beat along with michelle along with south africa going to a few countries called to be fired. and then been dead for a wider because the plaintiff had a kind of honor those who break up and we haven't had that it was a bad we had the biggest and there was well that's not all done all the other things are happening the deal of you know is there's a little problems but it's not a lot of people here the medic and the human physical problems actually there are there is even here it's rather friendly to who residents are so you know it is very talented but realises he wasn't going to be part of it we're likely going to be one of the ones that so i think things are good

mr. erdogan is looking at new ways to hit the u.s.rate headquarters, i'll break down what's driving the strong numbers. >>> i'm morgan brennen in new york the next generation of spaceflight. spacex unveiling its new castle and i'll have the details. >>> coca-cola making a new

mr. erdogan has obviously got that pamphlet written by hugo chavez and nicholas maduro how to run a country in the toilet. that is what he is doing. he is actually following their template to a t. guess what they will not have any toilet paper or diapers on the shelves that will come real soon. >> the election was a few months ago. i think they're stuck with him for the long term. >> that was no election. david: gary, lenore, good to see you both. melissa. melissa: here at home president trump's tariffs on steel and aluminum imported are providing benefits but some businesses are not faring as well. adam shapiro is live in popular bluff, missouri, i'm sure i said that wrong with details. adam, straighten me out. reporter: you got it right, i'm at pollar bluff. largest maker of nails like you use in the nail gun for construction. the tariffs hit hard. this facility is totally empty. they got up to full production this facility in november. they shut down in june. 150 people laid off. look at some video we shot this morning. they are still producing nails here but only 50% capacity. they're n

mr. erdogan made it very clear, he's opposed to interest rate increases at all costs big, big questions remainbout the independence of central bank, whether they will be able to take action unilaterally and get approval from the president after he strengthened his grip following the recent election, brian. >> is there a feeling on the ground, willem that this is an economic crisis or simply more of a currency crisis and/or attack on that currency? >> one of the big questions is about what will happen to this huge number of foreign deposits, almost half of all turkish bank deposits held in nonlira foreign currency people concerned that the government could step in they said they will not do that. something i've spoken to have been concerned about in terms of rising costs for businesses, it's a huge challenge for servicing some of their debt a lot of that held in foreign currency people saying they don't see this is something caused by the united states. they don't believe in this national rhetoric from president erdogan. not trying to prop up the currencies as he's urged them to do, brian. >> h

mr. erdogan, he has been very silent over the past week, which is not something common for a politician likeated times. he made an unscheduled speech with off-the-cuff comments in his hometown outside of a mosque and told people that even if they have all this, we've got our people, our rights, our god, our allah. what that means for policy, we don't know but it looks like erdogan maybe more defiant than expected when he speaks today in eastern turkey. anna: some of our mliv colleagues making the point that those comments in themselves perhaps underlining that president erdogan was not willing to do anything drastic enough to satisfy -- markets. garfield reynolds and bloomberg's economy and governor reporter onur ant. the lira move, slipping as much as 13.5%. as is set to be the big theme that dominate the european trading day. look out for a cross into european banks. this is bloomberg. ♪ welcome to bloomberg markets, the european open. we are live from london. i am matt miller. stocks across asia are in the red as the lira hits a record low carried the cash trade is less than 30 minutes aw

mr. erdogan. let's get your first word news., the trump administration has restored sanctions on iran and reaffirmed plans to impose tougher penalties on the country's oil sales. the measures restrict purchases of dollar banknotes by tehran, and ban imports of persian cashews and pistachios to the united states. iran's president said he is open to talks with the president, but not while sanctions are in place. >> if somebody stands in front of his rival and pushes a knife in his arm and seeks talks, he should put the knife away and use logic. juliette: the turkish lira and the countries bonds tumbled over concerns about a diplomatic spat with the united states. and fell as much as 6.3% while the rate on 10 year bonds fell just below 20%. president erdogan has promised to respond in kind after the u.s. imposed sanctions over the detention of an american pastor. 's final right-hand man has broken his silence and offered inside testimony about how wealthy the ukrainian businessmen used shell companies to pay his boss millions of do

some infrastructural issues having said that these issues translate into personality problems and mr erdogan and president have not had yet a chance to wrap it to sort of reconcile those personal differences aside from sort of more institutional differences that we witnessed the past few months talking about you know. getting close. to china. reaching out to countries like france germany but how much do you think of a trade investment relations with them. provided the situation with the u.s. doesn't improve and the end of the day you can have as good a relation you want to have friends cutter saudi. the great britain or germany but again the vast majority not all of the world's banking and trade sort of transactions go through one and one and sort of transaction route and that's new york that's american transactional route the united states decides what sanctions on those which control the vast majority of the banking transactions. turkey doesn't stand a chance now you can get some direct investment from being get some direct investment. but again your bank is beholden and also that and then

mr. erdogan back from emerging market crisis 101?ot sure the currency board would be the best option. turkey has a very high inflation rate at the moment. it has very high inflation expectations. if you have a currency managed against the euro or dollar or a basket of currencies, the lira will likely lose competitiveness. that may be worse. i think the move to the floating exchange rate in the early 2000's was seen as a strong shift towards orthodoxy at the time and help improve policymaking and boosted investor confidence. it needs higher interest rates and lower inflation to make it work. >> it seems this is a unique set of circumstances. is there any other precedent we can look to in turkey or other emerging markets that can show a way out of the crisis? is everyone just stabbing in the dark? >> emerging markets have been through these crises at various points. >> exactly like this? >> the difference we are seeing here is policymakers don't seem to be responding the way markets are wanting to see. hadorically when we have this, po

how on earth do they row back from this because mr erdogan is regarded as no more column instrument thenhe has been reluctant with enhanced powers as well. truly, the americans believe the economic situation in turkey, the economic situation in turkey, the currency there has tanking frankly. another has been increasing inflation. they believe that so the pressure is the pressure that really will pay on the president of turkey. but there are other issues apart from the preacher of course underlying this tension at the moment. turkey for a long time as an very unhappy about america's support for those syrian kurds in northern syria there. and another issues around some russian defence systems in turkey. this is a cavalcade and complex relationship. and on the other hand, the turks are infuriated by america's review so to deport an islamic preacher here who the turks claim stirred up and brought about the attempted coup in turkey in 2016. just finally, on a somewhat happier note and in time for thanksgiving dinner, the white house 01’ thanksgiving dinner, the white house or maybe down in fl

mr. erdogan is talking about. david: he cited economic vision converging with china.about one belt, one road? is that a way for china to make some of the infrastructure he wants to make? bulent: we will see. been accusations against china that is engaging in predatory lending. did take a lot of money from china as part of its involvement in the project. it has had problems with respect to the $9 billion loan it took from the imf. president us back to erdogan's dilemma. the imac had come in in 2001 with major standby loans. since he came into power he has been saying that unlike my predecessors i'm not going to look to the imf for support. if turkey is forced to go to the imf, there will be the question of u.s. opposition for a number of reasons, not least turkey's involvement in the chinese vri project. david: thank you so much for giving us your time. dr. bulent aliriza. alix: there is a lot of question as to what is to blame for turkey's downfall. mohamed el-erian says it is tightening global liquidity. he wrote that when it comes to global liquidity the world is in

mr. erdogan said he shares a vision of economic convergence with beijing, just a couple days ago.ided to move towards the east, towards china, is the cost so prohibitive that it actually would not be able to happen? what are we talking about here? bob: that's the interesting thing, talking about convergence with china. china actually has very highly-regarded financial experts running the country. ramy: that's a good thing. bob: yes. working for xi jinping. they are very competent people, and they are relatively conservative in the way they borrow. they do not engage in big borrowing. if you look at the debt to gdp ratio, it is pretty modest. and they also have a lot of public opinion that says, you cannot just use your reserve for anything. it is our hard-earned money at stake here. the chinese are very smart, very shrewd negotiators, and if he goes to the chinese, i think for political reasons they will want to help him, move turkey away from nato, toward the beijing area of influence to a greater degree. that's something they probably would do, but the question is, what are the

mr. erdogan is looking at new ways to hit the u.s. economy >>> at cnbc corporate headquarters, i'll break down what's driving the strong numbers. >>> i'm morgan brennen in new york the next generation of spaceflight. spacex unveiling its new castle and i'll have the details. >>> coca-cola making a new bet in sports drinks they have to do with nba superstar kobe bryant. "the closing bell" starts right now. >>> good afternoon, a very warm welcome to "the closing bell." we'll get to all those stories in just a moment, but first let's check in on the market stocks rebounding today. helping the s&p rise for the first time a little bit more than that for the s&p, nasdaq and russell. >> all 11 s&p sectors are higher we'll have much more on the markets in just a moment, but first let's begin today with the latest on elon musk's attempts to secure funding to take tesla private. cnbc.com's alex sherman joins us on set he's been reporting incrementally. we know according to the tweets elon musk has advisers, we know the board has formed a commit

mr. erdogan's travels in september. guy: i think he is in for a busy time.ave the relationship with germany, which i think is going to be interesting there. it is going to be interesting how he plays the europe angle, the iran angle, the united states angle, and where russia fits into all of this. tom: the jigsaw puzzle of it. right now in new york with your first word news, here is taylor riggs. taylor: the u.s. and mexico could renew their trade talks as early as today. bloomberg has learned there have been significant breakthroughs during the past several days on two of the biggest issues, cars and energy. the u.s.'s trade war with china is about to get uglier. talks and the trump administration have gained the upper hand and are about to launch a fall offensive. last week's talks resulted in little progress for the cease-fire. the u.s. is planning new tariffs on an additional $200 billion of chinese products. beijing has vowed to retaliate. you could say that apple is trickling down on the iphone x. bloomberg has learned that the company plans to relaunc

mr. erdogan is giving no indication that he will allow the turkish central bank to stem the fall of the letter a. we went through the mexican peso crisis in 1994. you're frying to find out where the exposures lie. turkey has 50% of hard debt in its currencies mostly in dollar. we're trying to find out which european banks hold turkish debt and how much exposure do they have? that would be the big question right now. neil: it happens again and again, right? every time we see this sort of thing crop up, we could go back to thailand and the bat crisis. seems like the exposure would be minimal, never deemed minimal or reaction is never deemed minimal. what do you make of isn't. >> you always worry about collateral damage. go one year to 1998. when russia defaulted on its ruble-denominated debt. everyone thought i don't have ruble denominated debt. i don't have their "gq"s, but guess what, long-term capital management went under. they had to give super medicine to get liquidity and confidence back in the market. the question is there a hedge fun levered up and got it wrong? the dollar is rising aga

mr. erdogan is jawboning the higher inflation in the turkish lira. each bank has its own stories.t admit what we've seen out since politburo headlines of yesterday has really been extraordinary, the slowdown that they are managing right now. francine: that's exactly it. the headline coming up today as part of a bigger story of them trying to stimulate the economy. you wonder what that means if they then leverage too much. that is a concern, something they need to fine-tune. let's get to the bloomberg first word news in new york city. is taylor riggs -- here's taylor riggs. taylor: bloomberg has learned trump administration more than double its plans tariffs on $200 billion of chinese imports. china says the issue should be resolved through talks and that threats are counterproductive. the u.s. and mexico are close to resolving one of the biggest sticking points in rewriting the north american free trade agreement. bloomberg has learned that the two countries are in the final stages of negotiating a deal on rules for cars sold under nafta. willo's economy minister come to washingto

mr. erdogan on the financial system.ngton for a statement within the paul manafort trial? it may be a statement from the president and how he will campaign, to the first tuesday of november. stay with us. this is bloomberg. ♪ two, down and back up. our phones are more than just phones. they are pocket sized personal trainers... last minute gift finders... siri: destination ahead. and discoverers of new places. it's the internet in your hand. that's why xfinity mobile can be included with xfinity internet. which could save you hunreds of dollars a year. plus get $150 when you bring in your own phone. its a new kind of network designed to save you money. click, call or visit a store today. tom: this morning, call it idiosyncratic thursday. , theuble strengthened kremlin denies they assisted in those murders in the united kingdom. the turkish lira weekends. how will president erdogan respond to 20% plus interest rates? how will president trump campaign to keep the house. when in doubt, send ivanka trump to the suburbs. ast

relations have been strained since the attempt to overthrow mr erdogan in 2016. latest spat between the two countries. turkey's holding the american pastor andrew brunson over suspected links to that veiled coup and the us wants him back. on this president erdogan remains steadfast. they said "release the pastor" and gave until last wednesday at 6pm. if we did not release him they said they would sanction us. for ordinary turkish people, the ongoing row has contributed to rising prices and savings that are worth even less. many small businesses have at risk and there are fears the currency woes could turn into a full blown economic crisis. the finance minister says a plan has been prepared for banks as well as small to medium sized businesses. he says he will share it on monday. turks can only hope it will be enough to calm the market, and give the lira a much—needed boost. presenter and campaigner katie piper has been revealed piper, who survived an acid attack ten years ago, was unveiled as the first contestant on bbc breakfast. it is for me really out of my co

demands from washington but will president erdogan and mrtrump, washington but will president erdogan and mrate? that will be devastating, not only to turkey's economy but also for america's regional interests. thank you. the family of a nine—year—old chess prodigy in south london have been told they no longer have to leave the uk in a matter of weeks. shreyas royal has represented england in international chess championships, and is ranked four in the world for his age group, but his family was told their visa wouldn't be extended unless shreyas's father earned £120,000 a year. but today, the home secretary, sajid javid, said he had taken personal charge of their case. 0ur correspondent chi chi izundu has been to meet the family. this is shreyas royal. he may be only nine, but he's ranked fourth in his age group in the world. he's a silver medallist, and, according to a former chess grand master, the greatest chess prospect in a generation. he only started playing chess three years ago, and was told he would have to return to india with his family, unless his dad could get his work visa ren

mr. erdogan to fort -- to compromise. the turkish president lane for u.s.or stoking confrontational -- blamed the u.s. for stoking confrontation. american pastor, risking decades of partnership against the allies. if you go to the washington times, defense secretary james mattis is heading to south america for a series of visits. he left yesterday and the chief will first visit military and national security counterparts before traveling to argentina and chile and ending visits with administration officials of the newly elected colombian president and the youngest president in south america's nation. the visit coincides with the trump administration's efforts to expand cooperation with allies in america's. visit comes weeks after the -- president was the target of an assassination via drone attack. national security officials grapple with groups taking root -- he region and possibly beyond the is next from -- bia nca is next from florida, republican line. caller: i don't believe that woman. she is just out for money. she wants to get a lot of money from her