the brink of another recession. another miss, another sign of weakness. what does it mean for the open, i am looking at futures, dax futures down around 20 points, really there are only two big main events. beit is obviously going to the ecb, where does mario draghi go? the bank of england, unlikely they will do anything but you never know. in terms of the market, the sentiment is much more to do with what is going on with other central banks versus the european central bank. this was the moment in time when the dollar-yen went 115 for the first time in seven years.

everything that the bank of mpedand does is being tru in japan equity's. that moment of deposit when you thought the machine would not work at the equity markets are opening up. weresense in the market we've gone so far and so fast on the equity markets in terms of revival that it is time to take irontle bit of a positive ore is at its lowest in five years. tinto down 1.3%, 1%.o-american down the dollar is still pacing ahead. we are down 4/10 of 1%. numbers, weheir

will go through those. have both beens reporting on the slate today. i picked up a couple of german names it delivered. adidas delivered. quarter.ncome for the running shoes and soccer. football. i don't know why people call it soccer. very american. soccer and running shoes do well. socgen down 3%, we spoke to them earlier today and he says he they't need the easing, have done a lot and reiterates the focus is on organic growth. bank, a love and .98, mr. blasi must be me. this is where a lot of the banks

had to make all of these positions for dreadful loan losses. crumblement didn't just , so the banks were able to release what we call reserves. releasing reserves allows you to flatter your results, all predicated on the view that things will get moderately better. long live reserve release and the reduction. >> that is the market open or here in europe, a lower open in london down .25%. but marioexpected draghi firmly in the spotlight. my colleague called this draghi's stress test. you see the core challenging his leadership and headwind from the east. you only have to look at a chart of euro-yen over the last month. we are joined the kevin durant

and the chief investment officer where he helps manage assets. does he need to respond to the bank in japan? europe arelems in all internal and you have to fix the banking system and then you have to stimulate money growth. the ecb are doing quantitative easing. there is lot of talk about whether they will or won't, the ecb are doing quantitative easing. you're looking at 700 billion qe over the next 12 months. >> where does he find 750 billion worth of assets in the next 12 months? >> very easy, it have people stressing whether they can buy government bonds, you can create asset-backed securities and cover bonds at will. you take some loans off the bank to much rink rap them and there you have an asset-backed

security or a covered bond. --he is outsourcing the acid balance sheet to the banks, it is up to the banks to do that. >> in the face of that demand it would be easy to trade asset-backed securities and you can create them at will. it is happening as we speak. >> when we talk about the mutiny at the ecb, how important is mario draghi performance right now? his speech was a seminal moment in changing market sentiment. there are some political situationstween the but let's face it, that bbc -- ecb is a democratic institution. >> can we do more?

that is the question always thrown at this man. when you pitch what the ecb are doing against the bank of japan they look very conservative. -- it would be very nice and i don't think it will happen today -- it would have been very nice if mario draghi can come out and drop a figure on how much, at the moment he has left a bit of a contrail we have to go back through the balance sheets and the figures and you come up with a figure around 700 billion but it would be nice if the ecb will come out and say we are doing qe and it is one trillion euros. >> is that wishful thinking? >> it probably is, but it is very easy to follow that contrail back to the figure of 700 billion. >> if you really expect that much, where are you getting the money? >> you have to buy real assets.

this is the investment call for the next five years, it mind the next five months. you have a clear situation, the u.k. governments, european governments, japanese government and u.s. governments. doran stays with us. profit rises beating estimates and provisions down for risky lows and the stock is up by three point 25% here is a picture of the market. equities lower down the margin. back in two. >> i am jonathan ferro, live

from london this is "on the move ." back to business, german factory

orders, the number comes in worse than expected for the month of september. another sign that the euro area largest economy may struggle to grow. hans nichols joins us live from berlin with the details. not pretty once again for german factory orders. we have asame time whole slew of corporate earnings. on there positive and upside, it is unclear what is happening on the german economy right now. 0.8%came in net .08 -- excuse me, and the expectation was for 0.83%. for the month of august they advise them down. confusing data and so much noise. last month we had a little bit of a jump at the manufacturing,

and then that unexpected drop in german unemployment. one theory on all this is that there is a lag in what we are seeing with corporate earnings and corporation numbers is that they are being a little more optimistic at the state of the we get gdpther way figures november 14, and it will be interesting. if they are negative, germany is technically in a recession. will catch up with you later on those german corporate earnings. a big miss for german factory orders this morning. forecasts on the bank of england rate kites being adjusted -- hikes being- rate adjusted. doran,ith us is kevin kevininvestment officer,

are we overdoing the threat of a european slowdown and what that means? >> i think potentially, you have a look at the domestic economy of the u.k. and it is running on all cylinders. strong services, strong construction and good manufacturing. the slowdown you saw was predominately driven by imports and exports. >> we've seen a slowdown in the pmi, you can't ignore that. services still operating at high numbers, manufacturing is slightly slower and you have seen that in the german area that you talked about, manufacturing is still a heavy industry, probably driven in large part by dropping commodity prices. domesticole, the u.k. economy is filing on all cylinders.

>> would you expect them to would you expect them to still raise rates? >> if you go back to the summer of this year, they introduced macro prudential holocene. it sounds newfangled -- and macro prudential policy. it sounds newfangled but it is an old idea. it --ice whaler they call in venezuela they collect presidential -- the first piece of macro prudential policy, if you are a first time buyer there is a quota on loans. -- if youis is you pretend -- intend to micro mortgage make sure you do it in the first part of the year.

country's large sovereigns will default. i'm sure at some point they will, but maybe that is the last page of the book. where are we? >> let's do this and household economic terms. 100% of yourard is salary, what is the impact? you will default. i have to bring this point in, if i had a money printer in my house, i won't default. england ise bank of ready so why would they default? >> let's define what we mean by default, when you default your creditors lose purchasing power. when iceland defaults on their debt and greece, the creditors lost purchasing power. march 2009, in the

.5% and 300 billion pounds. if you left your money and u.k. accounts, your savings has got up by 3% but inflation has gone up by 22% so you are 19% worse off, you have lost purchasing power. but it's debt monetization, not a default. >> it is debt monetization but the impact on the saver is the same, you have lost your purchasing power. this is what you're seeing in japan and will potentially see in europe. creditors get every single pound, schilling, pence back but their purchasing power has been permanently diminished. to two routes that have

devolve across the western world is we will increase inflation and we will create currency evaluation. the inflation you're seeing is an asset placed markets. >> kevin will stay with us, after the break we will talk old. if you are waiting for inflation, certainly gold will go high but it has not been. we will see what it means for the big miners after the break. stay with us. ♪ >> welcome back to "on the move

." i am jonathan ferro. larger goldt in a price. we spoke with the ceo and he gave us his outlook. >> because we have allocated for capital at $1000, we can store below 1000 before we go cash flow negative. there is a point, right now the question is, the industry it self -- the cash cross curve is now under pressure and you have to be very careful that you don't make short-term decisions when you are faced with an industry that needs to correct itself. >> let's continue this conversation, joining us now is

ryan, will be see gold dipped below $1000? the second big question is what does it mean for the guys who pull this out of the ground? they are forecasting that we could, and price of $800 by the end of next year. they allocate capital at $1000 what he is saying is he is ready to build a mind as long as the price of gold is above $1000. that is his business model and we looked at 19 if ringgold companies. 12 of the 19 at the current gold .rice are actually profitable that means seven of them are not. their production cost is higher than what they are able to sell the gold at. if the price of gold falls by another $50, that number of seven nonprofitable gold producers actually increases by two to nine. there is an awful lot of

unprofitable gold production out to onend i talked analyst who says about a third of all the gold being produced is produced at a loss which is a staggering concept. what you're getting in the situationa two-tiered we have the likes of rand gold which have been allocating at $1000 and are still sitting pretty because they are making money and you have -- the losers , who ran up to 19 other dollars an ounce and started allocating at $1500, building mines assuming the price would raymond 1500.ain above they are in a world of hurt because they are not making money right now. if i am looking at share prices is it time to continue? rand gold has been hurting the last couple of months but on the year it has held up. gold oneng of rand

thing to do is take those two shares and look how they compare. rand gold has been falling but if you compare it to a second tier company, a company producing at a loss like harmony minor -- harmony mining which is not in a harmonious situation right now is the third-largest producer because there rick even cost is $1200 per out. even -- break even cost is $1200 per out's. -- ounce. >> the break even cost for the couple ofor the last years is about $1000. i was asking the ceo of rand gold and he says what you get first -- you will have to wait a

little while, is gold producers selling off the assets that they don't want to. this will continue for some time before they really start to feel the stress. , he is concerned about a short-term view, you heard him say because there is a little bit of a correction necessary cause there is too much gold being produced. >> i will leave it there, thank you very much. i will bring back in kevin doran. the picture you paint of the someone would have painted a couple years ago, we will get inflation by real assets. down 30% last year almost, down another 5% this year, why do i want to hold gold? >> gold is not a real asset. it is a commodity and it will gravitate toward its natural

layer of production. if i look at the cost per gold i see them marginal cost is $1000 per ounce it is not surprising that it gravitates toward those levels. $1900 that was massively overblown. >> is there any way back for these guys? >> it depends where you are on the cost curve. all commodity producers are operating at leverage. a big impact on the bottom line, 90 get to a stage where marginal producers, the guys producing $1100 per ounce, they have to be eradicated. operationsdown their or be eradicated by m&a. quickly, what is your big call for the commodity sector where would you put your money? >> i am not a commodities expert so i will caveat that, we are

not going away from the well without oil so if i look at the oil prices, a cost curve you'res, at $80 a barrel looking at it going forward from here. kevin doran, we thank you for joining us, as we had to a break here is a picture of the markets. equities in london open lower down one third of 1%. ,t is decision day for the ecb with reports of dissent in the ranks, is mario draghi feeling the stress. in the meantime follow me on twitter. so much to discuss. a busy day ahead. back in two. ♪

>> welcome back to "on the move ." i'm jonathan ferro here in london. we are 30 minutes into the trading day. this is how things are shaping up. the ftse 100 opened lower by about 0.3%. we stay lower by 21 points. some big events coming up. bank of england rates, look out for that. ecb, mario draghi, we will discuss that in a couple of minutes. here are the stocks to watch. >> let's have a look at two tales from the banking sector. sosa get general this morning. this banking business giving us

results this morning. third-quarter profits rising. but they did come in below estimates. , the ceoonment describes as economically morales. this is a business very active in france and russia. the company says russian exposure is small and under control and they are not involved in any foreign exchange investigations. commerzbank on the other hand on the rise. up by 0.7%. it has found some success in increasing its lending to german consumers. this is a business that was bailed out by the german government back in 2009. q3 numbers coming in above estimates for commerzbank this morning as provisions for risky loans fell away. let's end on a positive note with adidas. it seems there is more money and running and in football then perhaps some analysts thought.

that has been helping them offset the weakness in their other business. they say they are restructuring and stabilizing tailor-made. that seems to be helping them out in the face of tough competition from nike in the u.s. back to you. >> a couple of bright spots, thank you very much. it is ecb day and mario draghi might have his own stress test to deal with. members of his team are reportedly turning against him and the bank of japan is giving him another headache by boosting pendulous. -- by boosting stimulus. joining us is ricardo barbieri. thanks very much for joining us. i look at him as he goes to the news conference. he has to remain dovish, you say. one big happy family. is it? everdon't think he suggested it was a happy family. i think he will try to downplay

the significance of this conflict that reportedly exists within the council. it reflects the fact that in recent months draghi says he had to step up the pace in response to the crisis. probably that men he adopted a slightly different process in terms of sharing some of the thoughts before the council meetings. that, i think, is what inspired the press reports we have seen this week. >> how significant are these reports of his leadership? i'm not concerned and i'm sure you're not either about disagreements and arguments on a government counsel when monetary policy is so stretched already. surely you expect that. i'm sure you would be equally as shocked if stanley fischer came out or someone on the governing council of the board of governors at the federal, to leak a story to the press, that

questions the leadership of janet yellen. significant. >> of course, it is significant. although they are not the same type of personal attacks, in the past we saw two resignations by german members of the ecb council. this conflict has been ongoing since the start of the crisis. in that respect, i think what is happening now is that draghi has decided to respond more forcefully. he obviously was reluctant to go to government bond qe, sovereign qe, so took a more complex route. i think the communication has become a bit less clear, a bit less transparent as a result. this is what we see from the market perspective. probably what they see in terms ' growingntral banks

degree of separation within the ecb, draghi's staff and some of the governors. euro-yenight also see over the last month, they look at that chart. tell me how concerned they should be. >> i think they will be a bit concerned about the immediate affect on economic activity, on the complacentness of european experts. -- exports. the policy that the boj has takes us into a different territory. in terms of share of gdp, share of government debt, it is almost as big as the qe program of the fed. the japanese economy is now less than one third the size of the u.s. economy. the endgame for japan remains quite uncertain. i think that is a big cautionary note on what the ecb might

decide to do. >> we could have a separate debate on the effectiveness of quantitative easing. as you see a fight for inflation take place throughout the currency markets, are we going to start talking about currency wars again? how does the ecb ever fight the bank of japan when governor corona is buying what -- governor kuroda is buying whatever he wants? remainsng as the euro relatively weak against the dollar, the ecb will be overall happy that things have improved somewhat in those respects. however, you also have the question of how our other asian countries going to respond to actions by the boj, particularly the chinese. if they were to change their policy in a significant way, that would have an impact on europe as well. i think at some point there will , whatever,a g-20

maybe just g-three agreement on monetary policy. these policies will have to be the us collated. -- de-escalated. >> when i look at the world right now, maybe today's news some time gives us to? mario draghi about these reports of dissent. as we go into december, and we have another auction, how crucial is the december meeting? is december quite significant? >> the ecb will release new focus. show a lowerl inflation projection. it will be difficult to argue that inflation will rise when we are lowering prices and the futures markets are saying there is only a slight increase one year out, two years out.

it is very difficult to get inflation up. i think that is the question for the early december council meeting which will precede the ltro. going into the new year, there will be no excuses. is low, then either change the message on balance sheet expansion or -- >> it is a great thing for the average person on the street. >> they are very slow in dogmang their targets and in a sense that they are following. 2%own feeling is that inflation in today's world is a very high target and it is difficult to achieve. we also need to look more at how they deflate gdp rather than

cbi. if we have positive inflation and zero cpi inflation, it wouldn't be a positive. it is whether we have nominal gdp growth and where the sum of that comes from. price growth as opposed to just maybe a little bit of real growth. if our consumers benefit from lower fuel prices, i don't think that is a bad thing at all. >> when we talk about sustainability, you look at sovereign debt markets, it doesn't matter what kind of budget deficit france and italy post, yields are low. the conversation about sovereign qe rolls on. my final question is this question we seem to be asking every month. when do they pull the trigger? >> on qe? at the moment, i would be surprised if they did today given that we haven't seen the

start of the abs program yet. we haven't seen the second ltro. make their want to expansion of the balance sheet approach credible, they have to do it early in the new year at the latest. >> ricardo barbieri, we will catch up later on in the year. coming up, we will talk banks. 57% but that rises is still not enough to beat the estimates. be speaking exclusively to the company's ceo and we will bring you more after the break. ♪

>> welcome back to "on the move ." time to bring you up to speed with some companies on the move this morning. astrazeneca raises forecasts for the second time this year after competition for one of its top-selling medicines fails to materialize. the u.k. drugmaker sees sales growth in the low single digits. it assumed the drug would have generic competition in the u.s. but a competitor has not won

regulatory approval. hermes posted third-quarter sales at the estimates. the man in japan and the americas help to make up for a slowdown in china. hermes sales exceeded estimates while watch sales fell 14%. global thousand arise 2% this year. largest personal computer maker most of the second slowest sales growth in six quarters. lenovo is trying to break into the global smartphone market but it is being overtaken by xiaomi. revenue in his estimates of $10.5 billion in the quarter. the shrinkingas pc market and swelling growth in china. let's leave it on companies. i tell whether german companies reported earnings this morning. in most categories, they beat estimates. nichols joins us from

berlin to make sense of them. the macro data is not so good, the corporate data pretty good. >> there may be a lag between corporate and macros. overall, pretty much all of these companies, siemens, deutsche telekom, commerzbank, adidas, beat analyst estimates. that means they can continue hiring. , unemployment unexpectedly dropped last month. it means these companies can be prepared for any sort of storm. deutsche telekom is the most interesting to me. they have the first time returning to profit in europe for the last two years. the added subscribers from their u.s. division at t-mobile usa. that is an interesting move. siemens did have to book a charge on win transmission. they came in at analyst estimates. commerzbank didn't have any big charges everywhere.

they had pretty nice upside surprise on net profit and net income. my favorite, we talk about adidas a lot. adidas is thinking about the reebok unit. they surprised on the upside because a running shoe sales and soccer shoe sales, football, excuse me. that is offsetting what you are seeing in the golf division. if more people are playing football and running instead of golf, i can live with that outcome. maybe you are a links man. over to you. >> plenty of people do. i am more of a football man. i am pleased you corrected yourself. good man. let's talk french banks. so see at jenner out third-quarter profit -- sosa get jenner out -- societe generale third-quarter profit rose. caroline conan, the bar was

pretty high going into this. >> the estimates were 872 million euros for this quarter. 2%,es are down more than leading the decline of the shares of societe generale. they have three main challenges for this quarter. france, their home market, the net profit is down 2.7%. second, russia, russia is 3% of their balance sheet but only contributed about 16 million euros to the prophets in third quarter. finally, the global market activities are down. revenues from their equities trading is down 25%. challenge the main going forward is european growth. i spoke exclusively to the ceo of socgen and here is what he told me he expects from the european central bank.

>> in terms of the monetary policy, the ecb has done a lot. bank record,t our we don't need liquidity. it is more of a question of credit demand then liquidity provision. i think it is a question of confidence. europe has to be more competitive in the global economy. we need to be able to innovate. education is also important. there are some structurally policies which need to be implemented. >> there has been a lot of pressure on european banks. considering the difficult economic environment, what are your concerns for growth in europe? thehis trend is related to prospect for growth in europe. it is something that -- we either see the kind of forecast

today, the one we had six months ago. it could take some time for europe to grow again. for next year, we know that growth will be limited. but what is important is again the perspective which it has given the consumers and corporate world. to ensure that you have structural reforms when it needs to be done and of course more consistency at the european level to give confidence. that is at the heart of the issue. doesn't neednerale more liquidity from the ecb, even if the situation in russia is what the, that ceo of socgen told me. he says the capital ratio is at 10.4%. he says that russia is under control.

>> caroline, great work as always. let's bring in francine lacqua who joins us on "the pulse" in about 10 minutes time. there we have one of the big ceos in europe. fivetually, we have exclusive interviews into ours. we are spending a lot of time talking about the banks. draghi has a difficult problem on his hands but his main problem in my eyes is how to transmit what he is trying to do to the real economy. he needs to make sure the banks start the lending to small economies or small companies. to onegoing to speak medium-sized italian firm to see what he needs to start growing. this is basically the transition mechanism. aqr to see how banks are feeling about lending.

>> i am very excited about the soap opera that will be the news conference. >> don't bash mario draghi. >> i just think it is going to be fascinating. >> this is about personality. this is not really about dissent on the board. we understand a lot of governors from different countries say mario draghi is not transparent enough. he makes decisions unilaterally. my question is, why not? you have an economy on its knees. you have everyone trying to have their own say and he is powering ahead. at least we have a strong leader. strangled by conservative straitjackets for the last few years and he is trying to break out. looking forward to "the pulse" in about 10 minutes time. in two.move is back stay with us. ♪

>> welcome back to "on the move ." let's get to our exclusive interview with the barclays ceo, antony jenkins. john dawson spoke with him in hong kong about the bank strategy and what it means. believerms of pay, we in paying performance and we believe in paying competitively. as we able to do that reposition the business. as we make our investment bank

more focused, that means we will have less very highly paid people within the organization. that is in line with the strategy. --19,000 job cuts by 2016 how far are you through this process? are you looking to hire? >> absolutely. this strategy is about focusing on the areas where we have growth. we have to reshape and refocus to do that. it is part of this evolutionary process we were discussing. now, we are largely through 14,000 of those 19,000 job cuts. us to invest back in our franchises. and in africa which is an exciting growth opportunity for us. >> you mentioned before that arguably the most destructive

.rea, technology what could that look like in five years time? >> we focus on things like regulation. technology is much more profound in my view. the reason for that is the cost of technology is falling exponentially. the capacity is increasing exponentially. >> that is almost it for "on the move." we are awaiting the european central bank rate decision which will be announced at 12:45 u.k. time. my colleague, simon kennedy, calls this the stress test. the ecb president is under pressure with reports of challenges from his team. the bank of japan's the prize stimulus is sending the euro higher against the yen. check out the move over the last month. here is a picture of the markets. the ftse open 0.3 percent lower.

it stayed lower, down 24 points. if you want to talk markets, follow me on twitter. ♪

>> drama for mario draghi. the spotlight will be on the president's relationship with his team. socgen ways in on the central bank. revamp, anthony jenkins tells us there will be fewer top paid workers. an exclusive conversation about how it is making use of the ecb.