sarkozy and elan. and this moment, my gets, my bet is that what is happening on the europe debt, what did happen on libya which is, how i would say that, written in a sympathetic ink on sarkozy might appear. and he might appear as-- it is not by wish. i'm a leftist, socialist and so on. but i feel that it might appear as a sort of signature of sovereignty or something like that. leadership, leadership. >> speak of that, are you also good friends, very good friend or a good friend of dominique strauss-kahn. he is now back in france, early on, you wrote that this could not have happened. because you knew this man. and did you not believe it. >> uh-huh. >> there is now some speculation because of things that have come up, that this might have been some kind of a conspiracy originating in france. do you believe that? >> you know, i read the article of-- in general, i don't believe-- i don't buy conspiracy theories. in this case i read the article in the new york review of books. >> edward epstein, i was no

he is visiting mr sarkozy today. i'm wondering if you believe either in france or in the european union if there's any interest in listening to mr. cam ranh? eron? does their voices count at all in paris? >> not really when it comes to discussing this plan with german chancellor angela merkel, which has occupied all their attention. they did have a very public row, as you know, a few weeks ago. all of the venom boiled over and sarkozy told david cameron to either get in or get out. i do not think it was personal. i think they are acting out the roles that have been trusted on hem from their countries' positions. from what i understand, david cameron is coming in more to listen than to the rest in any new debate or discussion. >> a final thought from you, steve. europeans are ruling out the idea that germany would ever sanctioned a quick fix solution, either based on using the european central bank as the lender of last resort, or a quicker version 2 euro bonds -- quick reversion to euro bonds. >> german chancellor an

nicholas sarkozy says this will not result in a two-tiered europe. also coming up, more than 70 elderly people are killed in a fire in india. also, is it change or no change in the climate change talks? hello. a long night of the drama and disagreement has finally led to a deal, but it is limited. the leaders of the 17 countries inside the eurozone have accepted a plan that brings stricter control on their economies. germany has a new treaty involving all of the countries in the eu was scuttled when the british rejected it. david cameron demanded concessions on financial services that germany and france would not grant. >> david cameron of arriving at the summit this morning after 23 leaders agreed to a tighter integration with stricter budget rules for the single-currency area, mr. cameron, among them. during the night, britain said it could not accept proposed amendments to the eu treaty after it failed to win concessions for itself. >> the key question for britain is do we allow that to happen within the european union treaty if you are not happy

you may be interested in listening to the french president, nicholas sarkozy. he is speaking now >. >> we will make progress to strengthen the euro and to see all the franco-german proposals accepted. that will settle the legal arose, mainly what form will this take? it will be an intergovernmental agreement. important decisions have been made. for instance, the exclusion of all p.s.i. each european country reimbursing its debt. if there are any questions, i will try to answer. >> well, as a chance a lot merkle and i have determined, -- as chancellor merkle and i have determined [unintelligible] the question was not audible, but the answer is. we have decided to study the possibility of strengthening the fund to the tune of 200 mi llion euros. the question was have you considered increasing your contribution to the imf? >> yes. it is rooted in our conclusion. i hesitate to say conclusions, because it is not the conclusion of the 27. it is the conclusion of the 17. [speaking french] >> you just heard the french president, nicholas sarkozy, speaking at the press

sarkozy has been prepared. feels almost as if the groundwork has been done. >> reporter: yeah, we often have this when we have one of those big powwows to sort out of situation while the two strong men of europe, angela merkel and nicolas sarkozy have their own summit to hammer out what they'll put forward earlier on in the week. that's what we're seeing. as you said before this kicks off a really pivotal week with all those series of meetings, even the u.s. treasury secretary tim geithner arriving here later on in europe. now, we should talk about exactly what they'll discuss and they've often clashed on various things in particular how to try to change those rules, it governs how much other countries, germy and france just two of those. how deep will the changes go and will they trigger referenda in various countrys? hopefully not because it could take months, if not year, to be ratified. >> i think that's the point. all very well for those two to get together over a cozy lunch at the palace elysees. particul

sarkozy has to get a deal, has to save the euro. otherwise, it's really going to look bad if france loses its triple-a rating. on the other way to do that, -- politically, he is weak. he was stronger during the g-20 and all that. >> if you were one of the socialists, the opposition in france, you are thinking this is lovely. here is a right wing president dancing to the tune of the germans. >> some leaders, some anti- german leaders, are using that. he does not want to undermine the euro. how far are you willing to go? >> here is a french president, ok, with all the splendor and grandeur that implies, and here is a man who is telling you i'm going to sell you a deal. the deal means we will be punished if we ever go off of the straight and narrow. how do you sell that to an election? >> that's the reason why he has not done this before. the austerity measures might have been a year ago, 18 months ago, when greece started to tumble. it has not been done because it was not popular with the electorate. now there have been measures annou

what do you make of sarkozy's plans for changing the eurozone? >> he did not spell them out directly, though he gave a hint monday that when chancellor merkel comes to paris still be some kind of announcementusselsd of next week. there was a hit in what he said about what will be announced. he is talking about the idea of sovereignty the key thing was he said that europe needs more sovereignty, not less sovereignty because it increases our capacity to act. it seems they are preparing the french public for an arrangement where this issue of sovereignty will be addressed, where france will give up a certain degree of its sovereignty in the interest of this idea of greater european solidarity. it is sovereignty, which is the key. the french are not too hung up about sovereignty, but the germans are not happy about giving up this. >> you get the feeling, don't you, that we see a states men and preparing his electorate for a huge change, talking about the summit coming up on december 9. sovereignty may have to be given up? >> yes, the speech was part

do we have sarkozy and merkle hand in hand on this? >> well, i think that's what they are trying to get us to think. we'll have to wait until next monday when they get together here in paris and then the busals when they come out with any big bazooka announcement. but they do seem to be edging towards something. i mean, sarkozy was clearly hinting yesterday that the french should be ready to give up an element of their sovereignity. that's always been it, giving up a bit of the euro state is something they cannot do but europe doesn't mean less sovereignity, it means more sovereignity. that's sort of buttering up the french in that they will have to give up a little bit of their sovereignity to europe or budgetting supervision from europe. but it's not clear how much chancellor merkle is willing to give up. that just hasn't been spelled out. >> thank you. they spread far and wide these days. let's take you to china for a moment. we have pictures of hundreds of laid off workers staging a protest outside a shanghai factory. we have manuf

tomorrow, david cameron comes to see president sarkozy. people want to explore the proposals for the treaty change and what they mean, and whether an exchange for british support he could win important concessions. gavin hewitt, bbc news. >>> still to come all the program -- the new challenge for china, the world financial problems threaten the health of its booming economy. >> 50 years in the making, elizabeth taylor's glittering gem collection is going under the hammer. >>> the governor of the bank of england has described the current economic situation as it extraordinarily serious and threatening. and his latest assessment of the state of the u.k. economic health, he urged british banks to build up their financial reserves even further. archie's economic rest on its -- are chief economic correspondent has this report. >> there was a warning a financial storm could be on the way brewing and eurozone and could be battling our shores before too long. that forecast came from the governor of the bank of england and his financial watchdogs,

at the beginning because at the beginning of his term sarkozy was a little negative about russia but usually after the while when the when the newcomer sees job so to speak to the classical relation is restored. so it's exactly what happened with president sarkozy by the way so and also it's important to see that in russia in france. russia is culturally quite popular for instance many of you know best hope. because the deal with russia when they want to have a special relationship you have a rapport and right now we are always agree politically for instance in case of libya sarkozy was so adamant for cafferty russia not so much what he thinks well. i think two things at least. there is you know when you have circumstances such as the so-called arab spring that some people prefer to call the islamic spring which i think is a little bit exaggerated but the way to behave is not obvious at all because we know that doing nothing is not desirable and acting too quickly has also some drawbacks so the choice is difficult and we know that there are many obstacles for instance the postcard i

nicolas sarkozy faces an uphill battle to keep the presidency of france. his approval rating is at bell lowest since the and it -- fifth republic began in 1958. anti-german feelings are having an influence on the way that people mean to vote. >> the german imperial eagle allies defeated. the memorial north of paris is dedicated to world war i. almost forgotten in germany, the remembering of the war is fresh in france. >> there were dead and wounded in every family. all of the families were badly affected in the first world war. that was not the case in 1940. >> despite that, both world wars play a role. >> the armistice was signed in this railway carriage. so was the one signed in 1940. >> in 1940, the nazi regime forced them to surrender the same place that the germans had accepted their defeat two decades earlier. a humiliation that the french had not forgotten. symbolism's still plays a role in french politics today. when angela merkel it focuses on facts and figures, it does not necessarily go well. they say that many stereotypes' have remained unchang

so it's exactly what happened with president sarkozy you know by the way so and also it's important to see that in russia in france. russia is culturally quite popular for instance many of you know our best hope. because the deal we even though we do have this special relationship that you have a lot more of you know right now we don't always agree politically for instance in case of libya sarkozy was so adamant for khadafy to go not so much what he thinks well. i think two things. at least. if there is you know when you have circumstances such as the so-called arab spring that some people prefer to call the islamic spring which i think is a little bit exaggerated but the way to behave is not obvious at all because we know that doing nothing is not desirable and acting too quickly has also some drawbacks so the choice is difficult and we know that there are many obstacles for instance the postcard i feel will not be an easy one. but this being said i think it's important for russia not to give the impression that. it is always on the on the side. of dictators. so to be too much conserv

merkel and sarkozy. borrowing costs for spain and italy, they remain well below the levels we saw a couple of weeks ago and, in fact, have been flirting with going down below 6% for both of those countries. so there we are. in terms of the dax that really has been off all the way through and explains the picture for the paris cac 40. the ftse at the flat line, andrew. >> yeah, charles, interesting in asia-pacific, there was a much stronger reaction to that s&p downgrade. perhaps that had something to do with the fact that the u.s. markets came off from their highs once that was announced but certainly sent jitters pretty much through all the markets through asia-pacific. after several positive sessions they all fell and banking stocks taking a hit and australian stocks broadly lower after the central bank there had a warning. they cut interest rates by 0.25 to 4.25%. it is the second time in as many months that australia cut rates to stabilize the economy, so the fears about growth are outweighing the op

the summit in brussels is to consider the angela merkel nicolas sarkozy plan. meeting with france, spain, and italy later in the week, with a simple message. the fall of the euro will cause much pain. " we do none know is if he is also bringing promises of money for rescue funds. bbc news, berlin. >> i am joined by the former adviser to the british government, now a senior managing director at fti. thank you very much for being here. i want to pick up quickly on the visit of timothy geithner. is this a sign of how crucial this week's meeting is going to be? >> absolutely. president obama said to get your act together. the euro zone collapse, it will ease pressure up to a point. they are very anxious on what will happen as it leads to serious problems in the euro zone. >> having mentioned to the meeting yesterday, i was on the air when the markets were going up and everyone was saying look, it is not signed and sealed, but they are absolutely for the first time giving an indication that they are entr'acte. >> what they really want to do is make sure that everyon

but french president sarkozy says france and germany will propose changes to the eu treaty on monday. speaking in southern france thursday, sarkozy said the crisis in the euro currency needs a structural response and that the foundation of europe must be rebuilt. he noted a revision is necessary to address the credit uncertainties in europe. sarkozy also said for quicker decision makingmongst eu members, more should be decided by a majority vote than a unanimous vote. >>> in the financial markets on thursday, investors bought government bonds of euro zone nations with excessive debts. this buying caused the yield on tenure bond to go below 7%. now, 7% is a level that's considered difficult for the nation to rebuild its public finances on its own. investors took heart from the previous day's announcement of a concerted action by central banks to expand liquidity in the money markets. the central banks include the european central bank, the u.s. federal reserve, and the bank of japan. another positive factor was thursday's relatively smooth auctions of french and spanish government bond

stays a hobbit zooming on food fights in europe's corridors of power between french president nicolas sarkozy and british leader david cameron the kaiser report has all the gory details up next. max ties are this is the kaiser report yeah we got a lot of very interesting comments based on my exploding eyeball stacy herbert tell us about it well first of all look at this i bet you he's checking the phone book right now for all the djimi diamonds that's the max an eight or you see there max that's fantastic i'd like to make a movie like that where i roam the streets looking for banking terrorists with like some huge. fifty caliber weapon on both shoulders you know looking for these guys tearing them down shooting them all knowing them all down well the top comment comes some elite one to eighty's on you tube when he said max is the terminator with one mission in mind take out j.p. morgan goldman sachs citibank wall street bank of england the rectally george bush and tony blair my local police force scumbags david cameron before i have run out of space max just finished the mission you were assi

where is it that nicolas sarkozy can perhaps compromise? >> he must find agreement quickly because this is already tough on the current economy. their credit rating is under threat. if they don't find an agreement on friday they will lose out. he must find agreement and must convince his voters that these are steps that have to be taken. that is what he was doing last thursday and spelling out the consequences for them. when they present this in brussels on friday we hope they can find an agreement among 17 countries. >> thank you both. let's look at some other stories making headlines around a world. 10 years ago world leaders met in germany with the hope of ending the afghan war and brokering a post-taliban government. they will be meeting now in bonn. another estimated 90% of the afghan budget is funded by foreign donors. foreign ministers from 90 countries are attending. neighboring pakistan is boycotting the meeting in protest at the killing of its troops in a recent nato air attack. the afghan president hamid karzai said that his coun

nicolas sarkozy promises a legal framework for last friday's deal in weeks. his presidential opponent says that he renegotiated. one man now. david cameron, feeling the heat at home and abroad. -- one man out. david cameron, feeling the heat at home and abroad. hello, welcome to "gmt." also in the program. voting is underway in local searing in elections. many are staying away, fearing more violence. school is stressful, but japanese mothers are under pressure to make lunch a work of art. it is early morning in washington, mid day here in london. david cameron is due to make a key speech in the next few hours, explaining his lone opposition at last week's european summit. he will do so against the backdrop of criticism at home and abroad. hear, nick clegg says that he is bitterly disappointed. in france, the head of financial regulations says that the british way is the stupidest in the world. his words. and >> britain's parliament is getting ready to hear from the prime minister, david cameron. many of his own mp's will welcome his decision. but nick clegg s

obsessive david cameron acting like stubborn child sarkozy said cameron behaved like an obstinate kid with a single obsession protecting the city which wants to carry on behaving like an offshore center no country supported him and all the tories in the u.k. are big babies because they're all born with silver spoons in their mouth they never worked a day in their lives they got these public schools look at boris johnson the mayor of london the biggest baby of all no one can be trusted their immature they don't know anything about financing about lots of markets they take all the advice from shysters in the city of london and then the camera is on the way out he's not going to be reelected he's not going to make it maybe the tories will be but he's gone as a party leader well this is an important story however max for the united states in the us citizen and the taxpayer of the united states because one thing that is never addressed here in the u.s. market is just how much london plays how crucial a role it plays in the fraud and the and the theft of u.s. investors and taxpayers all of

it is the latest day of reckoning for the single currency french president sarkozy says a key two day summit in brussels is the last chance to decide the euro zone's future germany and france are pushing for a new you treaty is to buy the nations into a close knit fiscal union with its own taxes and penalties across this story in brussels artie's tessa receive them. initially there are expectations maybe they can come up with some sort of a semi solution but right now after the speeches made by. mark merkel and you commissioner byrd also as well as the chief drug replaces actually the leaders in ma say there are the expectations sort of went down and markets have been reacting to it first of all merkel and sarkozy have been using the arguments over this is a make or break day the euro could collapse that if we don't come up with a solution by to morrow evening there is no second chance but on the other hand you can see that they are trying to rally support for their calls for those new treaty changes there are still those who who oppose having to rewrite the treaties and changing fund

. >> the document in sarkozy for's hants could hold the plans for saving the euro. he and german chancellor merkel have come to get -- to the summit with a proposal, and they are determined not to leave until they get what they want. >> the key outcome for me is that the euro can only regain its credibility if we amend european treaties in such a way that we move toward instability union. >> but opinions on how to achieve that differ, and the euro skeptics british are already threatening a veto. >> we need obviously to get the stability in the eurozone that is good for european countries, good for britain as well, but also, we need to protect britain's's interests. >> but britain does not have the euro and it looks like eurozone members are willing to go it alone. >> the 17 euro member states have a common currency. the ties between them are deeper than the ties between the 27 eu member states, but of course, we will only make changes to the treaties for the 17 eurozone states if we cannot get all 27 to go in the same direction. >> chancellor merkel has indicated th

a franco german alliance which is historically interesting here with uncle and merkel and nicolas sarkozy kind of taking a front position here what they have sort of spent several very painful very expensive very destructive weeks doing is trying to push through a wish list of fiscal control policies on their weaker partners under the guise of making this a precondition to a bailout the longer they wait the more expensive the bailout is and the bigger problem the less assured it is to work there if there still is a path forward so i don't think this is over but i think the situation grows more dire more perilous more expensive and more internationally problematic literally with each passing hour it would be nice to see people put aside their narrow political agendas and go for a solution here because we're all waiting in the balance and the you know it's the eleven and a half hour for sure and we do have this e.u. economic summit on friday and this is supposed to be at the forefront of that summit i mean we've seen there's been a bunch of recent summits economic summits recently what is t

in a word merkel wants to impose discipline french president nicolas sarkozy is generally on the same page but is resisting giving more powers to brussels whoever pays the piper gets to call the june germany price we've all of you in the euro zone want to keep the single card safe you must be prepared for that you must be prepared for giving up your fiscal sovereignty perhaps maybe you can even save some public money by distorting your national finance ministries but this german m.e.p. begs to differ but what is the sovereignty for germany at the moment paying billions and billions of risk there's no sovereignty we are forced to do this because the euro is with reality so basically regaining sovereignty by sharing it on the european level is what the whole operation is about. while germany may be for greater fiscal integration it's dead set against the euro bond idea for euro countries sharing debt and idea pushed by the european commission albeit renaming it stability bonds in effect italy's debt interest rates for example would go down from its worrying six to seven percent level wh