being bullish the canadian dollar is going well. nk oil prices will bottom out before the wider commodity complex. the china story on the rest of the asian block will last longer. i think the canadian dollar is very cheap for a country with such a long border with the united states. you can only have so much of a move between canada and the u.s. exchange rate before goods and jobs move from one side of the border to the other. against thess frac swedish krona. the swiss franc will do well in the safe haven basis. they are slowly and steadily succeeding with their negative interest rates to get a grip on the strength of the currency. sweden is keeping their currency down as much as they can. they are coming out with great economic data. interest rates are wrong for the economy. it is growing 3% per and him -- year. scarlet: thank you so much. to positiveints signs in the euro economy. ♪ scarlet: the turmoil in markets today has muted this new year. our special report, bloomberg markets" at 5:00 p.m. eastern time. i am scarlet fu. hous

i was looking at the dollar against the canadian dollar. the canadian dollar fell up to its lowest love all thousand three. since 2003.vel check out this chart made. the u.s. versus the canadian dollar versus the oil price. oil prices are stronger, so is the canadian dollar. ability or dois you have the problem with that currency now. dissent,continuing its visiting the $35 level. not much mystery to the canadian currency, is there? we will be right back with more on "what'd you miss?". ♪ up, senator bernie sanders will join with all due respect of 5:00 p.m. eastern. you don't want to miss it. alix: i am alix steel. first word news. obama says it is time for the american people to demand congressional action on guns and for elected officials to stand up to the gun lobby. in an emotional appearance, the president unveiled a series of measures aimed at tightening control and enforcing firearms. he also paused remember the many victims of gun violence and wiped away tears as he remembered the 20 children killed in newtown, connecticut in 2012.

the beginningat, of the erosion dollar rally come? leios gkionakis: it is already being shown in the euro-dollar trade. you can see that in the last six months, the euro was down 1.i percent. it barely moved. over the last 3-4 months, the low in october and november. it has rallied substantially. the commodity is interesting, from the perspective of fundamentals, some currencies are heavily undervalued. until we see these bottoms being confirmed in commodity prices, i would not touch commodity currencies against the dollar. anna: here is a challenge to your view, the dollar rally has already happened. the former bank of england saying trust the fed's, not the market. how many rate hikes we get from the u.s. do you think it will be two like the market, or four? vasileios gkionakis: how many rate hikes the dollar has priced in? when i look at the trade with the dollar, and the real differential, i see a massive wedge between the dollar and the real rate differential in the u.s. and the rest of the world. which tells me that unless we see

it is not going to have a huge impact on the dollar. cine: we will be talking about the pound next. and thenext, metals miners drop on china concerns. we break down the losses. you can follow us on twitter. ♪ francine: welcome to "the pulse." let's get to the bloomberg business flash. caroline: barclays about to close most of its cash equities business in the asia-pacific region. the near exit from cash equities comes as about 50% of jobs will be eliminated. the move is said to be part of the chief executive officers push to reduce costs. -- chineseny might economic slowdown -- thinks growth will be 2.9%. netflix shares jumped more than 9% in new york trading. netflix was the best-performing stock in the u.s. last year getting more than 130%. check on the's markets. a lot of moving parts. equitiesay's chinese session lasted 29 minutes. they halted trading for 15 minutes. these are the new rules that were implemented on monday. trading halted for the second time this week because of a 7% decline. last fiveowing the days of trading. on jan

dan, the strong dollar is a head wind. >> think about when the dollar rallied. started to rally the second half of 2014 when the fed indicated they were going to end qe, and the group hit was consumer staples because largely 50-60% of the biggest names in the group have exposure overseas. we know that global growth is weak, and a lot of emerging markets so think about what happened in the end of qe, we had a huge dollar move, and, you know, consumer staples first hit last year, and procter & gamble traded at $90 at the beginning of the year and down 30%, but something happened last year. staples caught a bit largely because of the yield that a lot of them have. you know, coke, proctor, have 3.25% dividend yield and deemed defensive. to me, what happened this week means the dollar's going higher and staples will turn. >> in the short term, it streng strengthens the dollar. as others deface their currency on a regular basis, and we have a rate hike here, and the dollar has to strengthen, that's a necessary byproduct of that, but i don't know that they l and increa

look at the australian dollar, the new zealand dollar. for the first time there is some appetite for these high-yield currencies. rishaad: how does the chinese action affect the currencies that david has just been talking about? to then't want it pegged dollar. they want it pegged to a basket of currencies. robin: the impression is that they were trying to reassure the market that the currency itself is not weakening. all of its decline is against the dollar, strengthening or stable against the other major currencies out there. however, i think the market has been largely ignoring the index. of pulltempt to kind the wool over people's eyes. the market seems to care about china's performance against the dollar. on august 11 of the world finally realized how important china is. how it can affect global markets. rishaad: look at janet yellen. she cited the reasons for not doing the rate hike in one of the most china. the first time it has happened, china flexing its economic muscles. this huge powerhouse that can affect everything. we're seei

keep the upward pressure on the dollar, including the fed rate hike scenario. e many other reasons that will make people dollar bullish and there will continue to be pressure on the dollar. francine: what is your main concern for the ubs? what are your three main focuses? we've moved already on our strategy and we've seen our strategy layout. we are seeing that this is playing out and we will continue to execute our strategy and be a well mannered tour globally. well manager globally. in china we are seeing a clear benefit of having an investment bank with the strongest investment bank in china. that is a segue into the billionaire clients in china. the synergies are part of our business model and we are seeing that work. competitors are having a hard time catching up with the things we put in place over the last few years. i'm not making predictions on bonuses. we are in the middle of discussion so i don't want to prejudge that. francine: we have plenty more great interviews coming up. and we talk about oil will talk to the imf about china. anna: thank you very

i think the dollar is going higher. i think you can actually fade this move up to what has been technical resistance here. i want to make one point. the xlp, consumer staple epf, three of the top holdings make up 25% of the weight and all companies trade 22 times earning. two of them, coke and peps, will actually decline in 2016 so to me what are you buying here if you're just buying that 3% yield? >> that's the crazy thing. who is buying it and it's being bought because it's the best place to be. >> carter, you're putting out a fundamental sort of reason why there's an underpinning for this sector. >> i'm looking at the chart and what the charts are made up of are people making fundamental judgments. if a chart is good it's because the biggest mutual funds and ebb doumts are acting and they know that history tells us when things get bad. >> the chart is good. >> what i'm arguing against is the chart is going to be better regardless of what happens. if we're in trouble this holds up well. and from a fundamental standpoin

i mean what is the call on the dollar? do you see also energy prices currently bumping around the bottom right now and likely to get better? >> so in terms of the dollar, we're looking for maybe a slight appreciation from here. basically flat. if you think about what's been driving the dollar, it's really been the deverge ens in central bank expectations. we don't think that divergence is going to get much bigger than it is right now. in term of energy, there is clearly a lot of negative downward momentum. but prices look unsustainbly low. it's very hard for any oil company to make money at these levels. that means prices have to rise. >> you would be buying energy stocks? >> i think it's a great time to look for high quality companies with good dividend yields that are in the space where you think they can sustain the dividend yield. >> sustain the dividend yield. >> it will take balance sheet work. this is the time to step in and say wait a minute, energy is a commodity. it's cyclical. there is a lot of tax law selling at

the dollar is down 3/10 of a percent. e south korean currency is lower on the back of these early that test in north korea. money going into the debt market, the haven of sovereign debt. debtou see the 10 year coming down. a heady mix of concern. back to you. manus: it is, indeed. our bloomberg story this morning says since 1999, hsbc is cutting application by 50%. some fundamental rethinking about what is going on in markets, where to put your money in 2016. we will get the pmi data in europe this morning. with italy, france, germany, to follow. these are the final readings, of course. then we get figures from the eurozone as a whole. that is going to be at 9:30 gmt. that comes just a day after the euro area inflation came in weaker than protected. germany did not help that story at all in terms of the ecb target. hans redeker is still with us. at the very start of the show, you said i am worried about the export of deflation from china on a global basis. europe, nowhere near the inflation target. it is a milestone away.

see the earrings are probably out myself trystine about fifty dollars here's a pear on a competitor's website another shopping channel see the earrings and pearl earrings yet the senate to thirty five dollars left more than what i said earlier about twenty thirty dollars on the pearls the fifty dollars for this easier in some thirty five makes sense if you want turn another station shop for those thorite that the war in nineteen ninety nine for five pear three pearls to see these all together for nineteen dollars and ninety nine cents a lot of himalayan that one should be mount si solar time about four o seven was cut was writing earlier minute her mind about the shipping fees excited as i get on some of these memory set has a two dollars and cents shipping fee will this one shipping fee for the five pairs yet michelle's aunt forgot about that sante do and not to mention a man would lower the price a little bit lis de bats under twenty dollar bill will play at ok for fourteen eye denied that five pear that is your final drive this issue today's liquidat

this is the dollar down versus the yen.he yen having the strongest day since october against the dollar. bracing ourselves for more economic day letter, -- data. data, inflation data, the market is expecting stabilization. i as an manufacturing data comes out as well. keep an eye on oil. manus: thank you very much. saudi arabia is at the top of the news this morning. they cut ties after attacks on its embassy in tehran. we speak to our reporter in dubai. do by now. get to how is iran likely to act following this news overnight from saudi arabia? >> it is difficult to guess what iran will be doing, but we might see in the immediate term is a conflict between the and hard-lineons elements in the political establishment. we saw the initial reaction coming from iran after the execution. we have on one hand, the supreme leader, more on the hard-line side, coming out with a strong warning about repercussions. then we have the iranian president saying with a much more balance, nuanced tone, condemning, but at the same time condemn

almost reaching that 18 rant to the dollar mark. the sharp drop of 9%. rand going through that 14 rand to the dollar mark just a few months ago, that was during asian trading. just showing you that liquidity is very thin. guy: are we going to see the authorities stepping in? are we going to see possibly rate hikes coming through? this is going to have a huge impact on inflation. it has an economy that is on its knees. >> we have an economy that is struggling in south africa good we saw the rand. that coming from the lack of growth. a slump in commodity prices. as well as the setup and emerging-market currencies coming off the usa kicking off its rate hiking cycle. merrill lynch saying they are expecting south african reserve bank may have pressure to increase rates by 50 basis points later on this month when it meets. that pressure coming through, especially if the rand continues at its current levels. guy: great to give your desk great to get your thoughts. let's bring back in julian chillingworth. that is the dollar index spiking. you're in the right p

and a littles up bit of relief for the canadian dollar at the australian dollar. tom: the mexican peso and the resilient re-out -- the are rising.yale the idea here is economic 2006-2ion slowdown in thousand seven, up we go to a steeper yield curve. this is a rollover. , one point 20 difference in yield between the 10 year and the two-year. vonnie: it seems to be suggesting lower expectations for inflation. tom: they want a steeper yield curve to make the cash register ring. foreign exchange is front and center this morning. francine: let's focus on fx. we are joined now from the i know tomlondon -- wants to talk about the dollar strength, but how much extra pressure does that add to the european central bank? >> it is a major disappointment. we have seen this story again and again. inflation is refusing to that. another country with a similar story, it is sweden. look at what they did yesterday. they are sharpening their talk. low inflation is a big problem for these europeans still. what does that mean for the european dollar? jane: it is reflective. it is not re

he said i'm watching the dollar closely. i am watching the rise of the dollar very closely.so think that inflation is going to be very, very difficult to achieve. i want you to listen to what charlie evans said today. charlie evans: i have never seen china as being fundamentally off -- i'm not expecting will be seeing of period of deflation. i think that we might be challenged to get inflation up. betty: doesn't that then mean a weaker dollar that will not rise as much as some had expected with the fed rate hike? richard: it's almost a chicken and egg scenario. one of the things driving dollar strength recently is the expectation that the fed is going to be more aggressive than anybody else in terms of hiking rates. that differential would play in the dollar's favor. if the dollar strengthens, that has a dragon financial conditions. that make it less likely that the federal hike rates. i think that narrative is one that is shifting a lot but up to now the main thought has been if the fed is more aggressive, that would benefit the dollar. mark: it has fallen against the dolla

>> that is going to be the multibillion-dollar question. e we going to get an independent external audit of the kingdom of saudi arabia's oil reserves? i doubt it. of a there be an audit portion of those reserves that are somehow attributed to saudi aramco? that is possible. i think transparency is going to be nowhere close to what we are used to with someone like exxon. oil on the run level down to $32, the lowest level since 2003. saudi aramco can cope with that. there are many members of opec who can't. when did those two forces collide in such a way that provokes a change in this policy ? >> the saudi's have been very clear about what they are prepared to do. like ae prepared to act non-opec coalition. they acted very often on their own within opec. they are not prepared to do that any longer. they see that as a road to ruin for saudi arabia. they remember what happened in the early 1980's when saudi production fell from 10 million barrels a day to 2 billion barrels a day -- 2 million barrels a day. when does the dynamic change? clear ag

as the dollar gets a stronger, it is good for us. t places like russia, south africa and nigeria still have downside risk. the key for us as we are used to managing through this kind of volatility and with products like scotch whiskey which are imported, you just have to be judicious in how you take price increases, stay invested behind the brands. be sure you do not lose a consumer franchise as some of your products become a little less affordable when currencies depreciate. great to have you with us. thank you for joining bloomberg television. up next, we will be looking at why f x markets are telling the bank of japan's governor why he cannot turn back the clock. equities are marginally lower. the dax is up by 0.1%. the ftse 100 up 18 points this morning. good morning from europe and good afternoon in asia. jon: we are in positive territory here on the footsie. let's check in with nejra cehic. nejra: federal reserve change and it yellen and her colleagues have opened the door to a change in their outlook for the u.s. economy, and p

yen is slightly higher against the u.s. dollar. japan is fairly broad-based. one stock is moving the market. pick oned had to market that was the favorite in 2016, japan would be among that list. 225 target level, just under 20% from where we are at the moment. trading volumes are very light. 50% lighter than the 30-day average in australia. that will likely be the case during the course of today despite a fair amount of data. we're going to talk about pmi in just a moment in china. singapore gdp just came out. very good. you have inflation out of thailand and you have retail sales here in hong kong. before i go, can we get shares of takata? better than that. that is the most in nine years. a report suggests that japanese automakers are considering backing their airbag supplier, which will help cushion the impact. certainly something that is not going to come cheap. oil up for a second session. it is the worst rout between iran and saudi arabia in years. >> saudi arabia has cut ties iraniran after a deputy in was attacked on saturday. it has given saudi arabia

so, yeah, looking forward to the u.s. dollar, we expect it to remain strong against commodity currencies by the lefte felled of deflation and emerging markets. there are idiosyncratic risks elsewhere throughout the world. the u.k. referendum, for example, on his eu membership. continued fears the swiss national bank will devalue the currency. usd. a stronger it may not be because of fed action. it may be the actions of others that keeps the dollar strong this year. continue to rise like a rocket? will it be more choppy given this? think it will be choppy because the markets are still trying to get around the basis of how much or how much further the fed can go over the course of the next 12 months. maybe the easiest hike of the cycle has already come, that telegraphed.s so we are so pricing at, what? 48? i think we have choppiness. talk jeremy, we have to about oil, because as julie was telling us a few minutes ago, the price of crude has plunged in the last hour. it was 3.6% higher. it has followed roughly 4% in the space of on

the safe haven lately. strong euro, weak u.s. dollar. the stock market likes a strong dollar. his trade is reversing as well and has been very interesting to watch especially given what we have seen in terms of weakness in oil. >> the other factor will be the ecb meeting tomorrow. we're not expecting action but if he is not dovish enough with his rhetoric that could be a bad signal for markets. because we're not going to have action i think the risk is he und underwe underwhelms and there's the spread between the german bond and u.s. bond which is always highly correlated with the euro. we've had this action from the ecb. >> losing the fight against inflation. look at what's happening with oil. the ecb has a single mandate to keep it in target. >> i don't think it. >> he was so disappointed. he disappointed so many on last meeting in december. >> he did although i still think he's the best central banker in the world but we won't go into that debate. >> a lot of these concerns is underpinning this global market sell off. we're in earnings season in case you forgot. 54% of you s

but the australian dollar is nowhere near as weak as the canadian dollar. y trade we like is that australia captures up on the downside, so the australian dollar weakens more as oil prices remain subdued. francine: brendan, how do you view saudi aramco if it were to come on the market now? brendan: amazing announcement for speculation yesterday. i think it's going to be complex, as aramco was listed. we'd have to understand what the reserves, what they may look back. remembering back in 2008, when they spun off part of the business, maybe part of the business would be -- francine: do you try to calculate that? brendan: we had some of the fastest clients asking that question. francine: what was it? brendan: this is a big, complex animal. we truly don't know the full extent. transparency is going to be key with aramco. tom: you come at this from an engineering background, doing securities analysis on the individual companies. how do you use the macro economic oil babble day-to-day? what do you do when you read bout it? how do you synthesize their ork? brendan:

see the earrings are probably out myself trystine about fifty dollars here's a pear on a competitor's website another shopping channel see the earrings and pearl earrings yet the senate to thirty five dollars left more than what i said earlier about twenty thirty dollars on the pearls the fifty dollars for this easier in some thirty five makes sense if you want turn another station shop for those thorite that the war in nineteen ninety nine for five pear three pearls to see these all together for nineteen dollars and ninety nine cents a lot of himalayan that one should be mount si solar time about four o seven was cut was writing earlier minute her mind about the shipping fees excited as i get on some of these memory set has a two dollars and cents shipping fee will this one shipping fee for the five pairs yet michelle's aunt forgot about that sante do and not to mention a man would lower the price a little bit lis de bats under twenty dollar bill will play at ok for fourteen eye denied that five pear that is your final drive this issue today's liquidat

the dollar is firmer against the yen. the u.s. currency is climbing steadily, now at 117.66-71. that's dollar/yen. a couple of days ago it had hit a one-year low of below 116 yen. take a look across the asia-pacific region and see how everything is looking. everything's looking positive. australian shares are trading higher by 1.1%. south korea's kospi jumping up 1.8%. but tokyo obviously leading the gains. >>> authorities in russia are facing pressures to react as the ruble hit a historic low against the dollar. the ruble traded above 85 to the dollar at one time in moscow on thursday on the back of low oil prices. the russian currency is at its lowest level since it was redenominated in 1998. the country's economy relies on oil so it's been battered by the decline in prices as well as the drop in the ruble's value and sanctions over the conflict with ukraine. the government says it will revise this year's budget and cut its spending by 10%. russia is dependent on imports of food and daily necessities. many people are concerned about price hikes. >> translator: life is becoming

they never said anything about the dollar, which is quite understandable. 've heard from two of the big central banks. boj in a fewfrom hours. i don't think we will hear anything directly from china. tom: we will continue this dialogue -- the dow -103. a churn all in all within the markets. was texas intermediate getting euro-dollar 108.92 after the fed meeting. scarlet: this is the fed decides life on bloomberg television and radio. live on bloomberg television and radio. head of chinahe research, spent decades on the china watch, the king of anecdotal analysis on china. we've heard from two central bankers lately, mario draghi and from the bank of japan, regarding china -- >> with china so down a little and even if oil producers countries, there growth rate slightly slowdowns come i don't think there is any sort of global financial crisis. like the situation after the crisis. scarlet: so many people say china's market turmoil does not reflect what is happening in the real economy. what would you look for to signal there is spillage into the real economy? f

from the strong dollar in the first quarter. from the strong dollar in the first quarter. johnnie walker whiskey, smirnoff, captain morgan rum, you know this company -- betty: what are you talking about? mark: you can't kid a kidder. basically earning speed, but they underwhelmed analysts. it's all happening, and earnings dictating the move of the stoxx 600 today. betty: also in the u.k. there were economic numbers that showed the economy has got some good momentum behind it, right? mark: we, the u.k. -- i am the u.k. we grew by 4%. it is a very unbalanced company, principally the driving factor its services. we have sluggish manufacturing as well. they are going to push back any chances of an eminent hike in interest rates. the big risk are the upcoming referendum, of course. it could hit employment. unemployment has fallen to its lowest level in a decade. we have real wage growth, consumers are benefiting from all those factors varied the economy is in pretty good shape as we headed into 2016. betty: we are about 90 minutes in

and that is what is driving the dollar. think that is going to change for some time yet to come. sometime before the japanese economy gets into a growth trajectory. in the case of europe, we a miss growth trajectory but we need more to make a sustainable. there is nothing to hold back the u.s. dollar for now. you get temporary corrections like the one we've had in the recent past. in terms of the pain that is inflicted on the emerging market -- because of the stronger dollar, i think it stays with us for most of this year. guy: thank you very much for your time. the director of london capital. thanks for joining us. finishing up on the dollar, day one of the fomc meeting. we will have plenty of coverage on that story. right. let's talk cyber security. let's go to tel aviv. let's join elliott gotkine. by one of'm joined the biggest cyber companies. great to have you with us on bloomberg television. let's get this out of the way. reports of israeli crackdown on a checkpoint. jp morgan has said -- is there any truth to those r

over the weekend police say he did it (again ( only this time at the dollar tree on independence boulevard. beach police say he was in the toy section on saturday when he approached children and exposed himself. 2:27:08 its horrible and its scary its really scary the dollar tree, everyone goes in the dollar tree. 2:27:26 everybody is out here on saturday. i dont understand that. wow im shocked. shocked and frightened for their children -- parents telling newschannel three that until the man is caught they don t want to let their 2:27:39 i will never let my grandchildren go through the store every again by themselves. i mean i let them go to the toy isle to pick out something but no they are going to be right here by my side from here on in until they can catch him. we have breaking news this morning on the military watch: a u-s official says all 10- american sailors captured by the iran are on aboard the norfolk based ship the u-s-s anzio getting initial medical checks. the 10- navy sailors were captured after their two naval boats entered iranian waters yesterday. they were taken into cus

the dollar index is the inversion, the mirror image of the dollar versus the euro.he three-month of the dax is correlated. having a nasty day like all equities. when it gets dicey in the economy and equities, we find buyers in the fixed income market. especially skovereigns. carl, back to you. >>> stay tuned with an exclusive interview with john williams. and gm making a half billion dollar investment in lyft and planning to develop a self-driving car system with the car company. we will talk with dan ammond coming up. >>> look at the dow 30, jim made the point early on we're seeing a strange new relationship between equities and crude. oil is up about a buck. jackie is at the nymex today. >> good morning to you. we had come off the session highs after we bounced a bit on the geopolitical tensions between saudi arabia and iran. wti over $38 a barrel. brent is seeing more of a gain here since we are talking about international affairs that impact that price. in the past, traders tell me headlines like this could have driven the market up more. some of the conversatio

we're going to talk about china and the dollar and apple. on the move. ♪ jonathan: hello and welcome back to "on the move." we're 30 minutes into the session. tearing the early losses could ftse 100 down by .1%. the dax up by 25. such of the boards. you wake up every morning you want to know what is going on in china. down around 6% yesterday. lower this morning, up by .5% good brent crude lower by .8%. a u.s. two-year, guy, 1%, middle of december. you would think conventional wisdom would suggest the yield would go higher, it hasn't here it guy: the market is just chuckling. it is interesting to see how the shanghai went on a round-trip today. u.s. earnings are being hit by slowing growth and ethics moves. after theighlighted world's biggest company reported earnings last night. tim: we are seeing extreme conditions unlike anything we have seen before, just about everywhere we are looking. major markets, including brazil, japan, canada, turkey and the eurozone have been impacted by slowing economic growth, falling commodity prices and weake

betty: what about the dollar on earnings? t of analysts are saying, if we have a dollar that is flat and doesn't see the surge in 18 months, that is going to be bullish for stocks. it is still one of the biggest head winds. betty: oliver, thank you. of course, thank you to mike mckee. much more ahead on bloomberg television. yes, it isrming that .onsidering an ipo is it so big to value? the price of crude resuming trading near the 12 year low. investors are keeping an i on that volatility -- keeping an eye on that volatility. we are going to speak to the president of citizens for affordable energy. ♪ ♪ despite the strong jobs report, growth prices hitting their lows. down about 1.5%. close to that $30 a barrel. on thers are focused volatility in chinese markets. joining us now is john high-priced are, the former shell president. john, you say, things are going to get worse in the first quarter before they get better. how much worse can they get? john: i think we can continue the downward slide for some additional period of tim

if your earnings are weak because of the super freaking strong dollar, so be it, too bad. it counts and it can't be dismissed as one off like it's been for so many quarter ins the last couple years. yup, this time the dollar has become a cost like labor or interest payments or raw goods, sga for the accounting aficionados out there. in other words, no more asterisks no more "if the dollar had stayed constant you could income" as ibm told us after a bone-crushing quarter. nobody's buying it anymore. there's no add-back. there's no constant currency. we're in a world where if anything we expect the dollar to go higher because our country's central bank is is tightening while everyone else is debasing their currency to take away our business so stock buyers are on strike when they hear about how the strong dollar crippled earnings because they know the greenback is going to get stronger still and this is the new normal. you know what it's like? to analogize some of us are old enough to remember when major league baseball switched from 154-game season to the current 162 games m

that boosted the dollar, push back the end.s you can see, the yen is rising and the dollar is falling against the japanese currency. this is the chart of all charts for 2016. the price of oil -- we fell as as $26 for brent crude. not as low as we were earlier. international sanctions on iran have been lifted. country's deputy oil mr. says iran wants to raise shipments by half a million barrels a day and analysts are not quite so bullish. they say iran will only be able to increase oil production by 100 thousand barrels a day. 400,000 over the next six months. what matters are what hedge funds are saying that now. there have never been so bearish on wti, which for the record has fallen by 24% in 2016. what's his get to the big corporate story. you refer to it in your headlines. it refers to this company -- henkel and adidas. there are joined at the head today because one man is leaving henkel and joining adidas. he is the chief executive. he is surprisingly leaving henkel with shares down 5% and joining adidas, up by 7.3%. he wi

and the dollar is causing issues. and this is a ceo this is the world's causing him issues like he is never seen before. it is almost the very personification of every fx risk there is. >> i think that is right. it is actually the fed that has been communicating that for some time, in the sense that it has grown a number of worries about the strong dollar. i far as this is concerned, think it is not going to play the most important part and the policy going forward. but it is definitely one of the things in their. apple, the2014 for strength of the dollar, there were up $85 of them in revenue in these current years. quite phenomenal news in the f they are notx subscribing to the doom and gloom in china. manus: we will spend a lot of time on the fed throughout the show. obviously, it is that two-day meeting. we will see that statement tonight. we focus on china, the yuan, and the big question -- i had this perennial debate, you were here and we had it been -- i love this article on the terminal this morning. the numbery

up we go with the ruben dollar. the curve, and then up again. rn about dollar strength? this is a huge the med. of -- this is a huge theme at davos. was a: there coordination. i suspect the pressure now is for a physical response and fiscal coordination, the recognition that monetary delivered asaps much as they can, that currency wars, the race to the bottom to offer solutions, and the solutions for growth is a coordinated fiscal response when global interest rates are the slip -- are this low. of thevid goldman, one most important insights was ken rogoff showing how lonely china is now with a fairly fixed or managed currency. everybody now floating versus crises ago. what will china do within a floating world? china wants to stabilize the rmb against a basket of currencies, which is a sensible thing to do, abandoning the dollar, which cost a great deal because the dollar rose so half. the federal funds futures market, the federal reserve decided to normalize interest rates prematurely, leading to a spike in the dollar and an overall inflationar

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that left the dollar and the r&b. if you see where the world was to the end of 2015-2016, you have a world of the d valuers. economy trying to lower interest rates and devalue their currency. the two currencies willing to rally with the dollar and the rmb. they were linked to each other. it would make sense to me that if you were linked to a currency that is naturally rallying, because you're the one not lowering interest rates come you would decouple from that currency. you would them become more competitive in the currency world. that was exactly what china was doing. total rational sense to me. most market participants continue to believe that china theire -- devalue currency further. this is one of the areas of volatility. how will the devaluation go? will it be very slow, which i think most of us think it will be? very methodical, it will take a long time. it will not be the swiss national bank. the vast majority of market participants and their globally vision of how they value economies in how they value curren

the most volatile start to the year since 1999. 1.0732.-dollar at mark: china again devaluing its currency or weakening its currency in an orderly fashion. the currency falling to a five-year low. this is the last 8 trading days the currency has fallen against the dollar and all but one of those trading days. hen fall into a five-year low. the signal is from policymakers that they are more tolerant it seems of a weaker currency. yuan also sent to a five-year low in hong kong trading. that is freely traded currency. the gap between the onshore in the offshore rate was the widest on record. what is significant is that asia's currencies, ages, china's neighbors will be watching this closely because china's yuan currency swings does tend to impact exporters. many of these countries trade with china. china is the biggest trading partner after the likes of south korea and taiwan. treasuries rising for the fifth day in a row. the yield has fallen by nine basis points. this is a year when forecasters said the treasury yields would rise as the fed forecas

ou need to buy the dollars it repay that debt and it is concerning at the long end of curve where the demand is from those in need of dollars 12 road it is the stable. betty:one more on china. he chinese will say you are looking at the yuan all long and rbtd be watching it against a index, a baskets, not the dollar because if you were to look at it that way you see they would say we are not devaluing our currency, it an uncontrolled movement of the yuan. >> i agree. didn't a stat that attract considerable attention and away from the dollar and ndex to provide the reference for the yuan. from that point i would think that highlighted the down side for the kwraufrpb against yuan.ollar -- the euro is kind of getting close to multi-year lows so from that point of view you would expect if that is there the basis of their future exchange more weakness and could come. are think investors ustified in expecting further weakness. initial shock followed by trend ty but then the seems to remain one which still. betty: there's a great article on bloomberg talking about the entral banks overall, no

this year. >> when the dollar was weak, the japanese were happy to take their currency against the dollarnow that it is strong, they are poised to rise. i don't think china has the same incentive. if china devalues, it will be bad for commodity prices and emerging markets, and it will make it difficult for the fed to watch. scarlet: so he says it will be difficult for the u.s. to do much. joe: absolutely. what do you make of that? do you think china's ongoing struggle with the fact that they may have to weaken the currency further will be a drag on the fed's inclination to hike rates this year? >> they are going to follow the market. since we saw september elevated, they went on hold. then as fixed income normalized through the end of the year, they signaled they would go in december, and it did go in december. even if the data is saying you should hike here, the fixed income market refuses to a knowledge that, they will go on longer. alix: we have the criteria that say we are not in a recession, but could the be enough to derail? >> right now the dots the fed has put out are much higher,

>> the dollar's determining international markets. it's not something that the fed targets or has a goal objective around. obviously as the dollar changes, it effects our exports our inflation. clearly it's a factor that affects the outlook, affects the right policy mix. but it's not something, you know, we target separately from full employment and 2% inflation. >> john, thank you. back to john at the new york stock exchange. >> important insights on a day like today. general motors is betting big on lift. announcing a $500 million investment. we'll have the gm president along with lift co-founder john zimmer. and the sell-off meanwhile is accelerating as we're counting down to the european close. the ftse down 2.5. the cac down 3. german blue chips down 4.5%. >>> a volatile day in the oil market. saudi arabia severing diplomatic ties with iran which did push oil prices higher. wti has since reversed course. michelle caruso-cabrera has more on that story. >> the conflict in the middle east, sunni-led saudi arabia and shia-led iran, co

the hill. they began shipping dollars and demanding gold. mix in one day stunned the world and said the window is closed. you can accept, you can use dollars are not but if you come here and say we are going to turn it in to give you the same federal reserve to write back because that's all that's worth. treasury secretary john connolly at that point put a nice twist on it. he said the dollar is our currents in your problem speaking to other countries. some of these things, the expectations were that the dollar would completely lose credence. nobody would want it. it would be replaced by first the mark and then the yen and the euro. this was said again during the bernanke era when there was so much activity creating these dollars. in fact the dollar has maintained its power and more so on the world markets. the reason people have faith in the dollar or two reasons, because it has purchasing power in the united states and because it's based in a country where the laws of the legal system are trusted and there is a transparency so for instance

the russian ruble is tumbling to a record low against the dollar. saudi arabia is defending its currency peg to the u.s. currency. on bank ofng news canada -- i want to get straight to pamela ritchie. the bank of canada has decided not to cut rates for leaving them at .5%. we are watching the loonie down but bouncing up and getting close to the $.69 mark against the u.s. dollar. it has been down 17% over the last year against the u.s. dollar and there was a discussion that they probably needed to do something where there is panic in the canadian market and concern about the price of oil and how the loonie is tracking. the voices over the course of the last day or so have been saying the loonie is falling on its own and it's not needed for the bank of counted -- of canada to devalue the currency. this was to help exporter so more and more voices have been saying maybe it's not needed. consider ising to that fiscal stimulus from the trudeau government is on its way. the campse throughout and before he was elected is for $10 billion in stimulus per year

case, theto be the flipside of that would be the u.s. dollar be extraordinarily strong, way stronger than is in the interest of anybody, let alone the united states. it's there where you've got this coalescence of interest to intervene. joe: what would that look like today? the had a very central banks try to engineer something like that, or -- >> yes, everything the point is they should be getting together now in that eventuality. but the possibility that were to happen, they should be talking and thinking about that right now. joe: people have talked about the u.s. dollar as shooter of last resort. everybody gets to devalue against the dollar. what is the incentive for others to try to rein the dollar in? don't countries like having their countries weak? >> they liked it for a while, but it is a little too much of a good thing. you're seeing a lot of pressure from the dollar on to commodity prices. you have these huge terms of trade stock very negative, and the other element is that with all countries weakening, you're not actually getting an

the dollar is the aligned in the basket is the white line. because the dollar versus the u.n. yuan versus the basket. the thinking might be that the pboc is looking more at the basket unless at the dollar trade. so there's more depreciation to comment. i'm getting all tripped up by my own explanation. like there's more competitive currencies in asia that the yuan is very high. and needed to value more to make their experts even more competitive. julie: thank you for letting my chart. scarlet: as we been reporting, steve cohen may be able to manage money again, but not till after 2018, as part of a settlement with regulators over allegations that he didn't properly supervise a former trader. president hollande: let's get more insight -- alix: let's get more with keri geiger. >> essentially good news with steve cohen. at one point during this investigation, the fcc was thinking a lifetime ban on him being able to manage outside money. of course now, i think in 2018, there's a lot of people who are going to be rushing back into steve cohen's management world. he's had a phenomena