brought to you live from london, singapore, and around the world, this is wo"worldwide exchange." welcome to the program. the headlines today from around the globe, one hour to go greece faces apparently a midday deadline to adpre gree to the t of a second bailout. eu pash eptience is running out. reports glencore sweetened its deal for xstrata. stocks haven't moved higher. and china wraps up a dispute, say iing they will hav

counter measures to protect chinese companies. president obama says it would be very risky to launch a military strike against iran saying he prefers a diplomatic end to the nuclear standoff in the persian gulf. hello and welcome to cnbc's "worldwide exchange" with christine tan and i'm ross westgate. the new york giants walked away with the super bowl prize and madonna's halftime performance was pretty good, although i wasn't there personally up last night to watch it. christine, i don't know whether you decide -- i don't know how the timing is for you. you'd have had to get up early. we could have done it. get up this morning. >> we could. no, i was more interested in the snow that fell in your neck of the woods, ross. you know, was it cold er than expected?

>> dealing with the snow post last year so then a new way to cancel all the flights before the snow comes. that's how we deal with snow now apparently. >> okay. better to be safe than sorry, i guess, ross. in the markets today we're looking very happy for a monday with the exception of hong kong. a little bit of a correction going on. this market had rallied 3,000 points so a little correction taking place down 0.2% but 0 over in shanghai flat. a lot of people are taking some profits now ahead of key economic data coming out from china later on in the week. financials led the way a little bit higher. the nikkei 225 up 1.1%. a pretty good session in japan. investors really ignoring disappointing earnings session focusing on the u.s. jobs report on friday giving a boost and increasing risk appetite. the kospi pretty much flat because a lot of profit taking going on again. because of the u.s. job data, miners lady led the way higher.

the sensex up 0.4%. a lot of people are seeing growth in this particular market. it seems they're buying into the indian market. ross, a pretty good session for monday. what's the heat map showing? >> i'm afraid it's the other way around in europe. one hour into the trading day greece has outweighed the benefits of that better than expected earnings report from friday 8-1 decliners being outpaced -- or outpacing advancers. the ftse 100 down half a percent. we're off three-we're of a percent of the cac. ftse mib three-quarters of a percent. we did did see treasuries reeleding quite a lot higher. remember, before friday 1.28%. we are down in terms of yield in the last session. we saw quite a lot on friday. yield continues. treasuries 1.9%. ten-year bund 1.86.

will they add to their constant easing despite the strong data we had last week from pmis? ten-year btp down to about 5%, 5.5% on yield towards some parts of friday's session right now yields are higher at 5.8%. as we continue to monitor what's going on in greece it's not just the psi negotiations but also the government negotiations with the troika. euro/dollar has come down. get willing up to 1.32. 1.3044. it is crunch time for greece. the country's lawmakers now have until midday local time. to respond to demands by international lenders to grant a new bailout package. lucas papademos has said they have agreed on 1.5% gdp.

a warning there are a number of major issues to be resolved. julia, last week we spent three weeks wondering where negotiations were with the psi and then the osi and now we haven't even gotten negotiations between the political parties and the troika. where is this deadline coming from? they seem to be making it up as they go along. >> reporter: well, this it deadline is to get feedback from the coalition government on the agreements that were made over the discussions that were had yesterday. it's not an official deadline. it is just about getting feedback back from the coalition partners and they will be meeting with papademos this afternoon to continue with those discussions. and you mentioned they have agreed on 1.5% of gdp within that we're expecting cuts to pension payments. we're also expecting potentially to see cuts to bonus payments. there were discussions from greek officials over the weekend

they would be protected. obviously if they are it's going to mean something else has to give. local media reporting up to around a 20% cut in those private sector minimum wage levels. so signs of ro degrees we're around the table talking about these things. a distance to go in order to lock down details. we've confirmed the two leading unions in greece are going to strike tomorrow, a 24-hour strike planned. now they represent around 50% of the workforce. from what i'm hearing on the ground there is a discussion they are considered to be quite closely aligned with the government so participation may not be be quite as high as that 50% figure suggests. but you only have to look at the polls to understand how the population feels about this coalition government. 92% now saying that they're unhappy with how things are going. so it's all very fluid here.

we are waiting to hear what comes from the meeting later today not necessarily based on that midday deadline according to reports. back to you, ross. >> and the elections are when? april? >> reporter: yeah. the 8th of april is a date that's been muted. the new democracy leader said he wants to agree to a bailout. in fact 45% of the population in recent polls suggesting that they want immediate elections. so very is fluid but sooner rather than later. >> well, that is greece. thanks for that. we'll catch you later. the chief economist at independent strategy is with us for the next hour. surely the only date that matters is march 20th. and the only question that really one needs to argue is when push comes to shove are europe's icb prepared for an uncontrolled default or does greece get the money? >> greece gets the money, i

think. what they really want is some firm resolution on the part of not just the party leaders but the parties for supporting the current coalition government to agree to these proposals. >> if they don't get an agreement they get the money anyway? >> i think the argument will be they'll get an agreement from the leaders. now i actually don't think this particular crisis yet again is one that's going to end the process or be the last one. there will be an agreement on this that will be applied but we've seen in the past agreements reached with the greek government to meet fiscal targets not being met because they are contracting at 6% to 7% per year. it's almost impossible without a huge reduction to meet those targets, so the private sector involvement process is also necessary and that's probably still not enough to ensure they can get debt stabilized so i would say this takes place, they get the money in march, the new

package is in place. and then down the road as we go through 2012 we'll see the targets not met and we'll be back in the situation, say, in august. >> so essentially, bob, once we get the greek deal out of the way, what do the markets focus on next? portugal? >> that's what the market feels could be the next stage. portugal will be under pressure. i think portugal is in a much better position. much better attitude on the part of the eu leaders and imf for what portugal is doing. portugal has a stable government just elected, committed to carrying through fiscal and labor and competitiveness reform unlike the greeks who are about to have an election and who knows what that might lead to. portugal has a stable government committed to carrying through the program as it exists at the moment. yes, its economy is contracting but given that the government wants to carry through the program set by the troika and, also, its electorate is on the whole prepared to support that. there's no major general strikes

coming up to try to threaten the government. i think portugal is in a better position to carry through the program. if there's no growth then it's continually under pressure. if greece should fall by the wayside which in some way or the other it will by the end of the year, then portugal comes under pressure. the eu leaders and the imf will come in with extra support for portugal to ensure that it has any repercussions from greece. it is supposed to be a one-off and that is the determination, i think, the imf leaders will try to achieve during this year. >> all right, bob, we'll leave it now. plenty to discuss. bob mckee at independent strategy. let's talk about other stories making headlines. iran appears to have softened rhetoric to europe threatening to cut oil supplies to places the oil minister described as hostile countries. a pnfinancial times report has described the threat as only symbolic. the revolutionary guard continued extensive military

exercises on sunday. in the latest show of force speaking to president obama said the country would not be left to continue a nuclear program unhindered. >> i've been very clear that we're going to do everything we can to prevent iran from getting a nuclear weapon and creating an arms race, a nuclear arms race in a volatile reason. >> what can you tell us? >> reporter: well, we are getting reports in the last hour or so, comments by china saying that they have yet to agree on the terms of their contracts for iranian crude imports and, remember, those did dwindle in january and february. china is a very important client/customer, if you will, of iran, talking close to 600,000 barrels per day. 25% of eiranian crude exports. and you're asking yourself, well, what's going on here? are the chinese actually supporting the sanctions is this well, not the really. what they are trying to do is to

make use of a discount. they know iran is under pressure and that is a chance to press down those praises of crude a little bit, at least when it comes out of iran. if you look at the official price, there's no indication as of yet that eiran is giving in o the calls for discount but that is something to watch out for. of course the economic noose tips to tighten. reports by the organization swift that it is working with eu and u.s. authorities to really implement the framework that would allow it to comply with the latest round of sanctionses and swift, of course, provides the mechanism for a lot of the world's economic financial transactions and a move there would be another blow for the iranian regime as well. the oil minister has made more comments about the current situation. you mentioned that they would target hostile states. you could argue it is a softening. we have enough comments from other iranian officials, again, maintaining that their nuclear program is peaceful and they have nothing to change and nothing to hide and, of course,

the west, the u.s., european union and israel have made it clear that they disagree and they want to see a change on that front, ross. >> yousef, thank you very much indeed for that. an official says there is no deadline on monday for political leaders to respond to the bailout terms. this greek government official says the only deadline is for the greek government and the eu and political leaders to reach a deal before the next euro group meeting. we don't know when the next euro group meeting is. there may be one today, may be one this week, there may not be one this week. >> we don't know. there's an official one every month. >> the only deadline is march the 20th. the only deadline that matters is march the 20th. and even that one may go longer. >> the argument about march 20th was for the private sector involvement they needed six weeks to sign up the contractors.

but, of course, they can shorten that period of time if they need an emergency. they've still got time to reach an agreement on the elements of this package and probably need to increase the package a bit because of the high level. >> i am prepared to let greece go or if they're not, they'll find a way to give them the m money. >> they will. >> still to come on the program, sealing the deal. glencore -- a different deal -- they are set to to pay higher premium for miner xstrata. this new at&t 4g lte is fast.

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deutsch bourses ceo is reportedly facing pressure to step down following the failed merger with nyc. >> reporter: the first name is rico. at the moment the shares are not necessarily the key foe can cuss on the way they're trading but the story what will happen after

the failed merger which will be the third in a row and there's a lot of press coverage on possible change and management. somebody has to give. somebody has to take on the consequences of that failed merger. bors is e talking about not willing to give up his post or bonus for 2011 but he also says for the long-term survival of positive position it is important to find a part mer perhaps soon. the other interesting stock, though, in terms of movement, is douglas. douglas is a company that sells fragrances, accessories, they are trading up about 5%. one of the major investors holding about 10.8% could

increase the stake in the company to over 26% because, ross, that particular person, that investor, is a counterpart of a put option so he would have the obligation to buy the shares. >> all right, thanks for that, patricia. the european banking authority and the plans put forward by banks, moving deadlines are weighing on the bank stocks. stephane has the details. >> reporter: is that the end of the rally we've seen? that's the question. french banks have reached the highest level in six months for their share price. the discussions in greece are worrying the financial community. not that the french banks have significant greek sovereign d t debt. of course the outcome is very much in focus. the french prime minister

admitted that negotiations with greece were difficult and this morning at lunch time in paris angela merkel and nicolas sarkozy will hold prices, a joint press conference. they will talk, of course, about greek discussions so we have to wait for two hours to know more about the greek outcome. also in the banking sector focus saying that the french government is close to a deal to cruiserweight a new structure. the new structure, a lending unit of dexia would be transferred to the state bank, the french state bank that would become the main shareholder. they still have a couple of issues to discuss with the french government. one, of course, being the value of this unit. ross, back to you. >> yeah, thanks for that, stephane. julius baer stocks fell this

morning. cut its margin targets. carolin has more on that. >> reporter: yeah, ross, let's put it into perspective. all banking shares are lower today. you're right, there was a certain sense of disappointment about the fact that a medium term financial target was lowered, not just the margin target but it's forecasting slightly higher cost ratio and citing a number of reasons for that not just the strong but declined activity and also it indicates that restructuring costs could be higher than expected. overall earnings were a mixed bag, we saw overall net profit down by 27%, slightly below expectations. however, the money figure which is crucial, a crucial metric for private banks like julius bear was in line with expectations. on a more positive note it's now starting a 500 million swiss franc buyback program.

what we wanted to know is how much julius baer is putting aside for a u.s. tax evasion investigation. it didn't specify a number but said they expect it to be resolved by the end of the year. not much clarity on the issue, unfortunately. back to you. >> thanks for that, carolin. in switzerland xstrata and glencore is going to offer a premium. according to the ft under the deal they will receive 2.8% in the commodity share for each share held. more news is expected on wednesday. could be some hurdles ahead. had he suggest the european commissioner wants to investigate the deal. joining us for more, news editor at deal europe. ed, let's just pick up on that final point. where would the overlap be if these two companies got together?

where would the overlap be, some issues of competition? >> it's hard to see. glencore is marketing the idea here for the merger is to put the markets in capability glencore has with the asset base of xstrata and extract increased revenues all going forward. difficult to see where -- why the ec is going to get involved in this. having said that they view xstrata and glencore as one company. >> i said it was wednesday but it's tuesday, xstrata will be coming out with their earnings. expect more details on the merger. this is being portrayed as a merger of equals but glencore is trying to make a bid for xstrata.

do you think they're going to go for it? >> the way the deal was leaked, deliberately leaked on tuesday night, tuesday morning, came out on one of the news wires, it was bloomberg about 4:00 in the morning came out with the story. why did that story appear at that time? because it was a deliberate leak. it may have been xstrata board leaking it knowing that if they announced the deal without any investors having this any say in the situation, the xstrata chairman could look stupid. so they left the shareholders have a bit of a say and they are having a say and they're crucial to this deal because of the arrangement vote. >> so what happens, do you think? what's your best case scenario? >> well, i don't know what happens. i can tell you that the main risk i see here is it's all about price and there was talk of a little premium deal. i'm sorry, it was the merger of equals which you suggest, and

now there's talk. all the headlines is, oh, there is going to be a premium. there's going to be a premium. and the way the pr on this has been spun is quite clever. you have richard buxton at schroeder's, the other minority shareholders in xstrata saying they want 15% more than that maybe. and i know the hedge fund community is looking for significantly more than an 8% premium. and they could be actually quite important in this deal due to the mechanics of it. >> christine? >> if this deal goes through, glencore gets together with xstrata, what does this mean for the other players like rio tinto, bhp, it will be a true rival to them, do they put pressu pressure?

>> i've spoken to a few bankers about this and taken a few views. i don't necessarily think there will be that much impact, i'm afraid to say, because i think this deal is about growth in copper and the rio tinto/bhp merg merger, if you remember, that was all about growing -- that would have set too big a market share for those companies in iron ore. so this is about copper growth. i don't know -- this is more about the smaller players where they will be and who combined here might go after rather than the big players. >> ed, good to see you. thank you very much. news editor at daily reporter for europe. bob sticks around for more. still to come, christine? >> plenty, ross. coming up next on "worldwide exchange," a view, of course, on the road ahead for the japanese

auto sector ahead of earnings with the likes of nissan and toyota this week. will 2012 be the week of revival for the ailing industry?

this is cnbc's "worldwide exchange," the headlines from

around the globe. greece says there's no deadline to agree to terms of the second bailout as talks of the troika continue. shares in glencore fall following a report commodities trader sweetened its bid for xstrata. china ratcheting up trade dispute with the eu banning its airlines from pay iing a carbon tax without its permission and saying it will continue counter measures to protect chinese companies. the elsewhere president obama says it would be very risky to launch a military strike against iran saying he prefers a diplomatic end to the nuclear standoff in the persian gulf. a greek government spokesman now says there is no deadline to agree on new bailout terms today as lawmakers continue their negotiations. according to a spokesman, politicians are still divided over a thumb of major issues

including labor reforms and how to support the country's banks. lawmakers have been asked to agree on the terms of a new rescue package ahead of the next euro group meeting. we don't quite know, though, when that next meeting is going to happen. one country that despite accepting acceptance, the kun interest try has been held up as the post er child of austerity. a report by the economic and social council says austerity on its own is not enough and additional policies needed to boost economic growth and employment. bob mckee, we hope to be joined by michael sullivan as well. hopefully we'll bring michael in on this. you're an expert on ireland anyway so that's good. here is the deal because the national -- the necc is saying that you need to do more than what is already agreed so if ireland, if even ireland can't get through on the current program, what does that mean for everybody else? >> they're in a much more

difficult position, they have made big progress, keeping all its targets. the export led economy much more than greece or portugal is 100 is% of gdp exports driven by significant foreign nationals, a young workforce that can produce a much better value added economy so it has a lot of things going for it. the problem it's got is it needs to deleverage particularly in the housing sector and that is putting pressure and the level of it debt on growth so growth is weak and i think the institute is correct to say that it's not just a question of trying to meet fiscal targets but it's also a question of getting growth going. that depends on two things, being xcompetitive which irelan is getting more competitive. if you talk about devaluation, ireland is achieving that, and having growth in the rest of europe that ireland can sell to and that's the issue, the problem they've got. if they see no more growth in europe over the next two years

instead of just this year then ireland will not be able to at this point to grow and that's the issue and they need more measures at home but also measures in europe across the board. >> a number of things it talks about, the sme, large private contracts, they need a more intensive structure for people unlloyd to provide certificaser time to design more force of the labor market intervention. the nec has come up with a whole se series of things they think ireland needs to do. why have they up to this point been able to separate themselves from portugal or spain or other are areas? >> well, the electorate have taken significant cuts in the public sector in terms of wages and services and jobs but also in the private secotor and to accept basically a fall in real incomes in order to try and provide a much more competitive economy. and it if we look at the unit

labor costs for ireland which were much higher than germany, 20% at the peak of the crisis is, they have come down significantly relative to germany which shows that process is working. therefore ireland has been able to sell its exports more effectively than the other countries in bailout packages and they appear to have been in a better position. the issue now is two things, one, can that continue if europe goes into recession? and that's an issue which is out of the hands of ireland so they're looking to the eu and the imf. they give them some sort on the cost of borrowing so it's a little easier for ireland and, secondly, that they can get perhaps a little more competitive action within its middle strata. >> michael is with us. let's bring him in, ahead of research. michael, how important as well has ireland's -- let's just load

the corporate tax rate and the fact so many u.s. companies are headquartered in ireland for their european operations. >> very good point, ross. when you look at one of the key differences between ireland and greece and ireland and portugal is the presence of a very, very large multinational sector in ireland, dublin, and that's been going on the last 20-30 years. and if you look at recent news flow, unemployment is suddenly very high but there is a steady inflow of new investment into ireland. the low corporate tax rate is a key part of that together with their other parts, education which needs more investment and also the role of bodies like the ida that are very good at bringing in companies from the states in particular. >> and bob talked about the unit labor costs coming down in ireland. this is what germany wants. what germany wants the rest of europe to do. do what we did in the boom times

when we had wages coming down significantly for ten years post reunification. people going to put up with that and is there any translation that the rest of europe can deliver the same thing? >> i think the private sector wages for new hires to come down very aggressively. europe is now in year three or maybe more of recession type conditions. growing recognition that austerity itself is not a solution to ireland. i'm a little skeptical of trying to cut and paste models so there's, i think, a limit that greece can learn from ireland. maybe stronger between the likes of chile and ireland.

>> we'll leave it there. a unique situation is what we're seeing. michael, thuchl for that. michael o'sullivan from credit suisse's private bank. bob sticks around. christine? focusing on what's happening in australia, the dollar has been under pressure today ahead of the reserve bank of australia. policy meeting tomorrow. investors are pinning hopes on further easing from the bank and the speculation got stronger. as australia's retail sales fell unexpectedly. data showed retail sales dipped 0.1% and the forecast was a rise of 0.2%. something like 18% of australia's gdp and the second biggest employer after the health industry with nearly 10% of all jobs. ross? >> it's colder here. freezing temperatures grip europe. the death toll up over the weekend with a state of emergency being declared in

bosnia. 220 people have died as a result of the are weather with forecasters predicting another week of arctic conditions. transport networks have been badly hit. london's heathrow, europe's busiest airport, is aiming to operate a normal service after a number of flights were canceled on sunday. after last year heathrow hit very badly by the snow shutdown and so they decided, i think they spent quite a lot of money on new snowplows but the best way is to cancel flights ahead of it. don't deal with the snow. just stop people coming to the airport which is not really what we want. we want them to know that it snows and planes can still land and take off. that would be my idea with telg with snow. >> yeah, open for business. we need to keep that concept going. you know what, maybe better safe than sorry. safety is clearly the issue when you have that sudden kind of snowstorm.

the shanghai composite flat today. we have some optimism coming in because of the risk appetite and the strong u.s. jobs data. financials have the market ending flat. 0.2%. some say it's a correction because, bear in mind, this market rallied 3,000 points since december so a correction is due. so this market pulling back a little bit. they're holding on to the key 20,000 level. the nikkei 225 brushing off disappointing earnings. that strong u.s. jobs report really lifting sentiment there. the kospi flat as well. investors taking some profits. the miners got ahead of themselves, offering a strong jobs report. a bit of optimism coming back into the market. we have the rba meeting tomorrow. a lot of people are expecting a cut after the weak retail sales number and the sensex up 0.5%. a lot of people expecting this economy to grow. some buying in this particular

market. overall mostly higher today for a monday. ross, is your heat map still down? >> yes, we are weighted to the down side, 8-1 advancers being outpaced by decliners this morning. the ftse 100 down over half a percent. the xetra dax down a little bit more than that, around three-quarters of a percent at the moment. and the cac down nearly 8%. the ftse mib down three-quarters. we saw a big sharp rise in treasury yield. they've come down today. we're 1.82% before the employment report on friday. greece outweighing any kick we might have gotten from the stronger number in europe. ten-year btp, keep your eyes on this, down on friday. the yields have gone higher, 5.75 is where we stand. and euro/dollar has come down during the session. we're now below 1.30. 1.3042. we were this time last week above 1.31 going to 1.32.

chris team? >> watching the airlines closely, apparently banned its airlines from joining a european union scheme to charge for carbon emissionses for flights in and out of europe. beijing is talking about counter measures to protect chinese companies. delving into the details tracey chang. beijing has been banning chinese airlines from joining an eu scheme 0 to impose a charge on emissions for lights in and out of europe. the chinese government has also barred airlines from charges passengers extra as a result of the eu scheme. the state consul says airlines would, quote, need approval if they want to join in the eu emissions plan. they have previously denounced the scheme as an unfair trade barrier. they believe beijing could have strong leverage in the dispute because its carriers fly large numbers of chinese and other asian tourists to europe. any disruption may hurt europe's

travel industry. the dispute has erupted right after german chancellor angela merkel ended a three-day visit to china. the trip was widely seen as an attempt to seek china's support to solve europe's debt problems. according to chinese local media, chinese premier wen jiabao said during his trip with merkel that china needs to help europe stabilize its market. wen jiabao said they are the largest export market and biggest source of technical imports. back to you. >> tracey, thank you very much for that. tracey chang. stocks are higher today, better than expected u.s. data boosted investor sentiment. the nikkei 225 reaching its highs in three months. among the top gainers were auto stocks. in the midst of the earning season, check in on the trading day there.

toyota climbed 3% on heavy volume. the firm is scheduled to release its earnings tomorrow. investors seem hopeful after the firm announced an ambitious plan to hike its annual global sales target by more than 20% to nearly 9.6 million units for 2012. that would be a record for the company. toyota is expecting sales to grow in emerging markets but seeks to expand in the domestic market by 30% where the strong yen won't eat into profits. its prius hybrid has remained the best-selling car in japan for the eighth straight month for a report released today. other automakers also gained about 3%. mitsubishi motor rose 1%. it will end auto production in europe. it will discontinue operations in its factory in the netherlands by the end of this year due to slumping sales and it is seeking to sell the plant. after the market closed suzuki

motors set its operating profit for the nine months through december was down 5% to about $1.1 billion. it suffered from slashed output due to the march 11th quake, the strong yen and strikes in its factories in india, but the firm capped its forecast for the year ending marseillesing net profit will likely grow 11% due to reduced costs. and stocks added 1.6% today. that's all from the nikkei business report. back to you, christine. >> makiko utsuda, thank you. joining us now for a panel, japanese automakers seem to be heading for a rebound after taking massive losses last year. joining us to talk more, what's the output in 2012? we have our panel andrew jackson head of automotive analysis, the vice president automotive and transportation at ross and sullivan. thank you for being with us. last year was terrible for japanese automakers. we had the disruption coming

from the earthquake. we had the floods over in thailand. we had the strong yen. is 2012 going to be the year with japanese automakers coming back in a big way? >> i believe so and that's what we are betting on. the reason is last year the disruptions were mainly due to natural causes and if you take that as a base then 2013, the next year, will be better because automotive products backed by companies are pretty relaxed. there is nothing wrong except for the supply chain disruptions and they'll learn from their mistakes. if you consider 2012 as a base, 2013 is the year. >> the japanese yen is so strong. is this going to spark any structural changes in the japanese auto industry in the long term? will we come to a day when we see oil production down outside of japan? >> it may not be all but the new capacity will definitely stop --

will definitely halt, the yen has a significant correction. unless they have to bring the yen to its new level or the can companies have to say that they would produce -- they would have to add all the excess new production compaapacities outsif japan. that has started happening. so we have started seeing the initial signs of this but if the yen continues at this level, the production in japan is not very sustainable. >> do you share the same outlook, andrew? >> i would largely agree to an extent. certainly, as we've seen with regards to the manufacturers out there, certainly the it thai floods and the tsunami. it's not just the actual manufacture of the vehicles but one of the reasons why effectively the shock wave has been felt through the global manufacturing agency, companies such as renaissance producing a

huge number of semiconductors for the automotive electronics essentially and when their supply gets hit so does the actual manufacturing system of the auto manufacturer. >> supply is one thing. how much do they need to up their game? we have honda, kia, the change the u.s. automakers have come in with products. >> this is very much an issue that they need to address and toyota's new camry in 2012 and also with the offerings from honda against the crv this year. the big issue is obviously that in the down time essentially that the japanese manufacturers have had there has been this gain by the u.s. manufacturers, for example, and against what used to be strongholds especially when you look at the likes of kia as well.

their popularity, the loyalty that is seen with bias for these vehicles is now seen just as high as the japanese brands and is very much the case they need to ensure that they make the gains where they can. >> who is going to win here? japanese, korean automakers? who has the better product mix and supply chain? >> the answer is not straight forward. the japanese have always been strong. they are strong. they are leading it when it comes to technology. they have the next generation technology firmly entrenched into their products. on the other hand. in the budget segment because of significant offerings in their products which are better styled and quality is part of the japanese and any other global manufacturer so they are also very strong in emerging markets.

and the u.s. manufacturers, the ford and the gm, are with their renewed focus on emerging markets also getting -- so the answer is not simple. the field is wide open and there are different areas to be captured by every manufacturer in the global market. >> i was going to wonder if europe is in recession or pretty flat this year that would suggest what you're going to need is growth coming out of the u.s. if japan has lost a little bit of its market share there, do we think it's going to get it back or will it require a weaker yen or can it do that without a weaker yen? we haven't seen any weakening of the yen. >> i think we're going to see a resurgence of the manufacturers in the automotive, the u.s. sales were up 10% last year. they're forecasting 6% growth this year and you take a look at honda, for example, they are producing 2008 or the beginning of the recession.

they now have double shifts through their factories in the u.s. and produced more cars in december, 18% year and year so they are trying to fight back but with the recent financial results it's just basically kind of a legacy issue you're seeing what's happening. what they're doing now is getting back to their feet. >> thank you for joining us. automotive analysis. thank you, vice president of automotive transportation. we'll take a short break. still to come can on "worldwide exchange," just how super was the super bowl? we look at the winning and losing ads and find out why the queen of pop might have been the real super bowl champion besides, of course, the new york giants.

european banking authority set to challenge a significant number of recapitalization plans put forward by the continent's banks according to "the financial times. "the lenders had to outline how they would meet them. the plans are set to be discussed by regulators next week. this comes ahead of the latest ltro.

we had good jobs data out of the u.s. the liquidity measures of the ecb have restored some sort of confidence to the banking system. at least we don't think it's going to collapse overnight. do those things weigh out over weak growth in europe for investors in the short term? >> it changes week to week based on the data. they can drive prices up and have done since the beginning of the year. there's more liquidity in europe provided by the ecb and the u.s. economy seems to be relatively growing better than europe in other areas. it's a big market which helps everybody else. every time we get a bit of data, the market can change. what's against us is still the debt crisis which is in the eurozone plus the fact it's clear just from that news item that deleveraging the banks engaged in is still a long way

to go and the eba is trying to get them to raise capital. people think that's not even enough. they can't do it by going to the market. they can't really do it by going to the government anymore so they're forced to deleverage and we see that the loan growth in europe across-the-board is terrible. we have that pressure. >> credit suisse will be the worst. bob, good to see you as always, chief economist at independent strategy. still one hour, of course, of program to go. i have a feeling courtney is a giants fab. i don't know why but i have that feeling. >> how did you guess? yeah, i am a giants fan. what a great game. i don't know if awed chance to see it but i was up very late in order to watch. you can't miss it. i was at a bar in new york city. i don't know what could have been better. so much fun. not quite the repeat of 2008 but the hype was still there, unbelievable. really, really great game and the halftime performance, the commercials --

>> another very close game, though. >> yes. a really, really close game. a couple of really key plays. came down to the fourth quarter. i'm happy they pulled out the win. go new york, go giants. we're all happy. hopefully wall street will be happy and take cues from that momentum in the game. >> madonna, queen of pop, she performed. was there any wardrobe malfunction this time? >> no, thank goodness there was no wardrobe malfunction. she did a wonderful job. i know a lot of people were skeptical ahead that have performance saying -- some people said i don't think anyone should perform at the super bowl that is older than the super bowl itself but she did a wonderful job. every girl across america squealed when she sang "like a prayer" at the end. i thought it was amazing. >> why was she dressed like russell crowe in "gladiators"? >> i was surprised. madonna is so famous for her arms and the biceps and she is

in such good shape and she was all covered up. i was really surprised about that part. >> ross is just jealous because she has bigger biceps than him. >> than all of us. i wish we could talk about this forever and ever but we have to go to a commercial break but still to come on "worldwide exchange," we go back out to athens live very shortly as lawmakers are still deadlocked over the terms of a new bailout package. and in the middle east the latest from iran after it tried to turn down the heat in its conflict over europe over oil. and, as always, keep the e-mails and tweets coming in.

welcome to the show. the headlines from around the globe that we're following today -- >> greece says there is no deadline. the terms in the second bailout talks with the troika continue. president obama says it would be very risky to launch a military strike against iran saying he prefers a diplomatic end to nuclear standoff in the persian gulf. and shares in glencore fall following a report the commodities trader has sweetened its bid for mining giant xstr a xstrata. in the u.s. looks like the rally will roll on thanks to the

better than expected jobs report. you're watching "worldwide exchange" with christine tan, ross with westgate. let's take a quick look at u.s. futures and see where the market is poised to open. it looks as if right now we are under pressure. the dow futures down 71 points or so. if the nasdaq were open we would be down by 13 points. we've had a good run. the dow at 3 1/2 year highs. we'll see if we can continue. ross, what's the action overseas this morning? >> we're concentrating on greece and no followthrough from the employment report, of course, we got halfway through the session in europe. we are down. the ftse 100 and the xetra dax and ftse is mib down 0.9%. what's going on in greece, a

spokesman now says there is no deadline to agree on new bailout terms today as lawmakers continue their negotiations according to a spokesman for the socialist party. politicians are still divided over a number of issues including labor reforms. they have been asked on terms of a new rescue package. and here is the thing, we don't know when the next meeting is. there may be one this week but, frankly, who knows? julia is in athens. are things any clearer on the ground? we've got negotiations between party leaders and the troika. we have negotiations between private sector investors and the troika and we have internal negotiations going on between the ecb and the imf about whether they should take a hit on their haircut. do we know for sure anything about how any of those talks are going on?

>> reporter: good question. local media reports this morning that everything has been agreed on the psi that they're just waiting for an agreement on the reform measures the coalition, the greek coalition, are discussing. so one piece of the jigsaw, according to local media reports, is in place. of course the first thing that has to happen is agreement on these reform measures. as you mentioned the deadline we passed through, in effect, is not a deadline. we've got discussions going on between the greek coalition parties and that's what we need to look for headlines on this. either way, whatever does get agreed and decided has to be passed through parliament by february the 16th which is the final deadline for the psi, the debt write-down to go through. now within the announcements that we've had over the last 24 hours, that 1.5% spending cut, a percentage of gdp, i want to give you a look at numbers there

when we look at potential minimum wage drops, between 20% and 22% drops. that would be taken to 480 yor yoes. you immediately see a disincentive effect for a minimum wage worker here so some of the discussions going on right now is does this mean we're going to see some sort of drop to the unemployment benefits. we're talking about a country that has unemployment pushing 20% of the working population. now this morning, too, we've confirmed there are going to be strikes from the two main unions in greece tomorrow. it's a 24-hour strike. it's expected to start at 11:00 a.m. athens time so that's something we're going to be watching out for. they represent around 50% of the population, the working population. but there is some suggestion that the population feels they're too closely aligned so support may not be reflective of

that 50% number. timing, though, is key. we're pushing up to elections as early as april and that possibly means that there are obvious problems with each of the coalition parties supporting further austerity measures particularly for the new democracy who have now got the highest proportion of folks looking around, 30% according to recent polls. of course for now, though, it's all about the latest discussion and decisions on these reform measures and we're watching that coalition talks this afternoon. back to you. >> they all have is an eye on the election. for now, thank you very much indeed. courtney. joining us now is our guest ho host, joe, i want to pick up where julia left off. >> sure. >> what does this mean for the u.s. markets? it seems it's the boy who cries

wolf. do it we care anymore? >> it doesn't seem like anyone cares. that's the interesting thing, the thing that's defining 2012 so far, basically the indifference everyone has towards this. people aren't really even interested in the story as much. the markets aren't that interested. headlines last year would have sent the market down 2% or more on the day, people are just ignoring them. i guess i think the feeling people have is now that the ecb has clearly stepped up its game in terms of back stopping the banks and making sure there's plenty of liquidity in the eurozone system and now the feeling is, all right, if greece defaults or disorderly restructures, however it is, whatever, it's not going to skip the wire and come over here. that might be naive and, you know, people -- that happens all the time that people think they can have a default and it won't be a problem, so the market might be totally wrong but at the moment the market is down this morning. >> i'm wondering if that is the

assumption. greece gets the money and there won't be a disorderly default, that cds won't be triggered. every time i speak to somebody, look, one way or the other greece is going to get the money that it needs, however it goes on. i'm wondering if there is a sentiment risk at least of a disorderly default and a cds triggering. still, we don't actually know -- we think it would be all right but we don't know how that would play out. >> i'm not sure if people are too worried about the cds trigger, it is ultimately fairly small. it's not the avenue that's going to take down the banks in europe and my impression is people don't really think that there's going to be a big difference twaen a disorderly default at this point and an orderly default that's not the a credit event. the banks have minimized the

exposure. anyone holding greek debt at this point, you know, isn't in a position of probably being systematically valuable. i think the idea here is just the headlines, no one really cares about them anymore. and even though the math hasn't changed in the last few months, scare headlines across europe having the same impact at all. ever since it seems like the ecb's ltro action in early december. >> joe, christine here. speaking of headlines, we had good headlines from friday, a strong jobs report. have the prospects gotten better in your opinion? >> yeah, it seems like it. one month of nonforeign payrolls report is just one month, one data point. what i think else was interesting in january is there were a lot of other measures that really helped confirm what we saw in the jobs report. auto sales were really strong. a really high correlation

between auto sales and jobs. if you look at the ism surveys in the u.s., hiring intentions was robust. so i think there's a lot to be happy about. i'm pretty eager to see the consumer credit numbers coming out tomorrow. that's been expanding nicely. we have another good number there. that is the kind of thing that looks like real robust recovery, another shot in the arm for us. >> right now, joe gets to stay with us for a while. that's where we have to leave the discussion for now. ross, over to you. >> plenty more to come, iran appears to have softened its rhetoric to europe, threaten in to cut oil supplies to what they skra as hostile countries. a report the middle eastern country has described the threat as only symbolic. the revolution guard has continued military exercises. speaking to nbc, u.s. president barack obama said the country would not be left to continue a

nuclear program unhindered. >> i've been very clear that we're going to do everything we can to prevent them from creating a nuclear arms race in a volatile ra region. >> back below 113.71. yousef is with us from dubai monitoring the events. what do we make of the latest volley of communiques? >> reporter: well, ross, i think softening would be a bit too strong a word because there are enough comments from other iranian officials that indicate they are still quite aggressive in their stance and adamant to change any of their policies at the moment. remember that the iaea just wrapped up its visit and is said to have made little progress in answering the suspicions that they have about the nuclear program. just to pick up on the comments by that oil minister in iran, it is ups to have written a letter

to opec asking all members to operate. saudi arabia promised that they would fill any gap or shortfall in the market and that is something that the iranians are worried about. also reports earlier in the day, ross, about china further cutting imports and this is not because they necessarily endorsed the sanctions on iran but because of differences on the terms of the contract. china trying to secure a better deal. iran is under pressure. they are going to be looking for a discount here. if you take a look at the official selling price, that hasn't materialized just yet t. may down the line again. comments saying that the talks will continue between the chinese authorities and the national iranian oil company. of course china imports almost 600,000 barrels per day, ross. that's 25% of iran's oil exports and now after the shortfall from the european union that, of course, will be critical for e

iran. >> yousef, thanks for that. china defended its decision to reject a u.n. resolution pressing syrian president to abandon power. vetoes from both china and russia followed reports that syrian forces had bombarded the city of homs killing more than 200 people. chinese state media said distrust laid behind the veto. we'll it take a short break. still to come on the program, all the nonsporting winners and losers from the super bowl. which were the best and worst ads and what's the verdict on madonna's perfeormance? that after the new york giants walked away with the prize. spark card from capital one. the. spark cash gives me the most rewards of any small business credit card. it's hard for my crew to keep up with 2% cash back on every purchase, every day. 2% cash back. that's setting the bar pretty high. thanks to spark, owning my own business has never been more rewarding. [ male announcer ] introducing spark the small business credit cards from capital one.

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welcome back. you're watching wo"worldwide exchange." it's about 5:15 a.m. here in the u.s. be a time for your global markets report. take a look at where the futures are right now ahead of the u.s. market open. it looks like we are down. if we were to open the dow would open lower by 70 points. the s&p 500 down. and the nasdaq down by 12 potentially giving back some of the gains we've seen the last week and last month or so. it's been a nice run in the u.s. we don't have a lot of economic data points out but the earnings season does still roll on with very familiar names we will hear from today. what's going on overseas, ross? >> we've been down just over two hours into the trading day.

a little less than 8-1 at the moment. that translates into losses of the ftse 100. down around half 5% for most of the session. xetra dax down 1%. the ftse mib down 0.1%. we saw a big sell-off in treasuries. treasury yields just come back from those levels but still 1.91%. this time friday 1.82%. keep a focus on gilts as the bank may well extend its quantitative easing program at a meeting on thursday but we did get stronger data last week and ten-year btps earlier on today we were up 5.7% on the year and has come back the last half hour down to 5.6%. the key indicator, of course, of ri risk. euro/dollar has been weaker as greece worries over negotiations and deadlines outweighing any benefit from the employment report. euro/dollar as you wake up state side, 1.3045.

christina, what kind of day have you had? >> asian markets mostly higher. the u.s. jobs report gave a lift to risk appetite here in the region. some buying across the region but as people were buying, a lot of people were taking away some profits. pretty much flat. investors taking some money off the table ahead of key economic data. the hang seng down 0.2%. 20,000 level, the key level still holding on to that. a lot of people are saying this rally at 3,000 points since december so a correction is due. the nikkei 225 is up. investors shrugging off a disappointing season to move higher. the kospi flat. some profit taking going on. 1.1% higher on that robust jobs data coming out from the u.s. we have the rba, reserve bank of australia, a cut is expected. weak retail sales data coming out today. the sensex is up.

investors are now seeing growth in the market and piling into the sensex. that's it for me today. i'll be back with the news moving markets here in asia. thanks for that, christine. glencore will offer an 8% premium to secure its merger with xstrata according to the financial times. under the deal shareholders would receive 2.8 shares in the commodities trade for each share held. full details are expected tomorrow but there could be some hurdles ahead. the daily telegraph suggests the commission might investigate the deal. we were trying to work out where the overlap would be for them to do that earlier. we were struggling to do so but we'll have to wait and see. elsewhere the banking authority is set to challenge a significant number of recapitalization plans put forward which the company's banks. this again according to the financial times. the lenders had to outline how

they would meet tough new capital requirements by the end of last months. they say as many as half the measures proposed don't look that credible. the plan is set to be discussed next week. things like planning to sell a business that you can't solve. courtney would be one example of things regulators say maybe that doesn't cut the mustard. >> that's true. just one thing to consider. boeing has identified and is fixing a problem with the fuselage of its dreamliner jet. the company says repairs won't affect production. the issue here is known as structural spaces won't properly attach to the fuselage. boeing has built 50 dream liners and delivered five to japan's ana. they had three years of delays. take a look at shares of boeing, down slight ly about half a percent at this point in time. now today is the deadline for state attorneys general to sign is on to the landmark settlement

with the big banks over mortgage and foreclosure. the measures may be close to gaining support from a key state which will expand the scope of the deal. "the new york times" reports california has returned to negotiations after a four-month absence that could boost the amount of mortgage relief for struggling homeowners nationwide from 19 $19 billion to $25 billion. the pizza and chicken wings have been eaten, the pints of beer tossed back. now a little bleary-eyed it's time to recap the big winners and losers from last night's super bowl and that goes well beyond the play on the super bowl. the highlight reel is set to roll. ♪ ♪ [ male announcer ] offering four distinct driving modes

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attention on site, attention on site. now starting unit nine. some of the world's cleanest gas turbines are now powering some of america's biggest cities. siemens. answers. welcome back to "worldwide exchange." i'm courtney reagan here on the east coast. looking at a live shot of times square. it's 5:23 in the morning. a lot are more today after the big new york giants win but back to business. let's take a look at how the u.s. markets are likely to open. we are under a bit of pressure if the dow were to open now we'd be down about 70 points. the nasdaq down by about 12. we've been at about this point for most of the hour so far. not a lot of movement in either direction. earnings likely to guide some trade today as we don't have a lot of economic reports. but for the second time in four

years the new york giants faced off against the new england patriots in the super bowl. the matchup in 2008 went down to the wire as well as this one. trailing 17-15 in the fourth quarter giants quarterback eli manning hit receiver mario manningham with the sideline catch for 38 yards. then with about one minute to go running back ahmad bradshaw scores a touchdown to put the giants up 21-17. that could have still been plenty of time for pats' qb tom brady to are march down the field and win it. it came down to one final hail mary pass to the end zone batted down sealing the giants' win. it's the fourth super bowl victory in team history. manning wins his second mvp award. the super bowl is always more than just a game. there's also the glamour and flash of the halftime show which featured madonna. she proves that at age 53 she's still got it. she performed hits like vogue, music and like a prayer and

lavish costumes on a decked out stage. the show wasn't without controversy. her special guest m.i.a. made an obscene gesture that nbc was too late in preventing it from going on the air. it would be nothing with all those ads. companies paid $3.5 million for a 30-second spot hoping their products would catch the public's eye. we came out on top. accord i according to voters on today's super bowl ad meter it was this commercial by doritos. ♪ >> honey, have you seen our cat?

>> nope. >> that still makes me smile even the morning after. i'm sure we will see is more. joe weisenthal, we both stayed up late and we're champs for being here this morning. what was your favorite ad? >> honestly, i don't think i have one this year. i was talking about this afterwards and, i don't know, no-ad this year. >> what about the teleflora ad? >> that and the fiat ad sort of took it to a new level of sexiness of chergs ads -- or super bowl ads. usually they flop on that score. so those were pretty good. this was kind of a weird year where they thought the game was better than the ads and i have to agree with the conventional wisdom of that. >> what about the clint eastwood ad? >> i thought it was good. i saw a lot of people complaining, grumbling, bailed out company, talk about how great things were again and people thought it was implicit

political message and there kind of was. i was born in detroit. and i think the chrysler did detroit ad last year and that was pretty awesome. it made me feel good. >> me, too. we're both rust belt kids. >> i think it's kind of nonsense. detroit is -- i'm glad the automakers are doing well. detroit is still kind of place es miserable, the economy is kind of depressed. >> i'm an ohio kid. you're a michigan kid. we feel for the automakers. you get to stick around for us so we have a little bit more still to come with joe weisenthal of business insider. up next in what seems like no time at all the u.s. markets have gone from lows to multiyear highs. an improving economy, is there anything to get in the way of the steady march upwards? we'll discuss it all up next.

welcome to the show. thank you for joining us. here are the headlines we're following today. president obama says it could be very risky to launch a military strike against iran saying a diplomatic end to the nuclear

sta standoff in the persian gulf. in europe greece says there is no deadline today for them to agree to the terms of a second bailout as talks of the troika continue and europe's top banking regulator hints that banks are on the right track with their plans to raise capital. they say the majority of outlined measures are in line with the authority's requirements. and the ten-week market rally looks to roll on this week thanks to momentum from friday's better than expected jobs report. it's nice to have you here joining us on "worldwide exchange" wherever you are this morning, this evening, or this afternoon around the world. a look at how futures are doing ahead of the u.s. market open. it looks as if we've improved since our last check. the dow jones futures down about 57 points. the s&p down 8 1/2. the nasdaq down about 11 if the markets were to open.

right now this is where things would stand. we have a relatively quiet day when it comes to economic data. there are still a handful of earnings. i believe we have 65 s&p 500 companies. it's another big week there for the corporate outlook. ross, over to you. >> yeah. ahead of the european open, stocks have been down, half a percent losses. we had good gains up 3%. 4% for the dax. solid gains on friday. the ftse -- well, we've come down from the worst session, 0.4%, the xetra dax. try day overnight deposits of the ecb hit their second highest ever. it's still being rechannelled back into the ecb so i guess there was a weekend and nobody want that had money in other places, courtney. >> another weekend.

another negotiation session. well, just four months ago u.s. markets sitting at 52-week lows but how the fortunes have changed since then on wall street. the dow is nearing 13,000. the s&p hovering close to 1350. the dow became the last of the major indices to officially cross into territory now 20.7% since its october low. joining us now is the managing director at chicago based spectrum asset management and still with us is joe weisenthal. michael, if i could, i'd like to start with you. we had a very good jobs report on friday. we've had a nice run in the market. but can this continue? is this really a magnet to get buyers in today? futures are somewhat lower as they have been all morning. >> i think the common base here is you're going to continue to see low volume not just because of people on the sidelines but just skepticism about if this

rally can continue. one of the factors that's hard to argue is the fact of keeping this pace. if you look at just on the year to date, now granted it's only five weeks, but the dax is up 14%. the nasdaq 11%. holy cow, those are some unbelievable moves already to start and technically they are in slight breakout mode but, again, referring back to your first comment about the jobs report, there's a lot of skepticism about how real that number really is. i'm not just talking about revisions but how they're counting the labor force and actually who is applying. there's a lot of things you can look at here. silver is giving a key here because it is so big now but, again, watch ten-year yields. the whole point here is that if we can see that above 2% again, then you're going to see a precursor to a change in the market and then again we hold that as resistance and you start seeing a long bond sell-off again and that's positive for

equities. >> and, michael, i want to pick up on one of your comments. we've seen volume so low for so lopping. is this really the new normal, what we should expect and forget about thinking about what we had se seen in the past? >> i think it's more of a passive investor for the same reason i think institutional investors as a whole really can smell value here and they're always putting money to work and that real hi has shown itself in the nasdaq. so i actually think that you're going to start seeing that pickup and as we go quarter by quarter it will go piece meal and considering the way the markets have traded so abruptly in the last year or going back to this is actually a very good anecdote for good moves. technically again this market seems as though it's ready to take off more to the upside and i would not be surprised if you maybe see that abrupt move volume wise if we start seeing

sharp sell-offs because everyone is kind of weighted for that anticipated move and you're getting better levels to sell into. >> we put a chart up of the ten-year treasury yield and, i mean, it's been pretty volatile up and down sort of just over 2%, back -- put it up again at 1.8% here. we can still send the yield quite a bit higher before we change any fundamentals. >> there's no question about th that, ross, and, you know, there's a couple things first. let's look at the fundamental factors involved here and extraneously obviously a report by the imf saying if europe continues to look bad here and actually gets worse, that could drag down gdp in china by as much as 4% and we know where that will take us here, trickle back to the u.s. and then all of a sudden we have confidence

factors coming back into the market as far as the way the drag is there and that will show in the treasury market but as a whole one of the things that did happen, i think, from friday's report is this whole notion that qe-3 is off the table. if you start taking the way the fed has been printing money but how they use the market as a whole, taking long to shorter date treasuries and notes and effectively buying and selling one for the other, that's going to put somewhat of a ceiling in that part of the market and what you are not seeing, again, is how that starts to move on who i consider the leader being long bonds in germany. that same chart if you superimpose it over the u.s. is showing you why there's a difference in yields and how they found a marriage at this level of 2% and below and, again, if we're going to keep rates here in the u.s. steady going out a year, a year and a half, it will be hard not to sell in from a yield basis that exceeds 2% or get anywhere near

to 2.25%. >> thank you so much, both stay with us, so we get to check back in with each. up next, we'll take you live to athens where lawmakers are still deadlocked over the terms of a new package crucial to avert bankruptcy.

the latest with greece. the government spokesman now says there's no deadline after initially there were reports there were new bailout terms. they continue their negotiations. according to a spokesman, politicians still very divided over a number of major issues including labor reforms and how to support the country's banks. lawmakers have been asked to agree on the terms of a new rescue package ahead of the next euro group meeting but we don't know when it is. there was supposed to be one today. there may be one at the end of this week. this comes as the latest information from the eu statistics office had a percentage of gdp came down slightly. crucially for all three countries who are currently in a bailout, greece, portugal and ireland, debt to gd p actually rose.

joining us is peter from the university of maryland's school of business. joe is still with us as well. peter, right now we still don't know there are three sets of negotiations going on in greece. there's the politicians and their economic plan to get the money. there's the psi discussions and then there's a discussion about whether the ecb should take the hit or not. give us your own view about how much this matters or does it matter whether we trigger cds, whether we have a controlled default or an uncontrolled default. >> well, certainly no one wants chaos in an uncontrolled default but there are alternatives to what is being worked out here. my feeling is the ultimate package that we get will not be a solution to greece's problems. in order for greece to pay off whatever debt it has, it's going to have to export to places like germany and no matter how much you suppress the wages, i'm very skeptical as to whether

countries like daimler and siemens will source components from greece the way americans say source from china. an orderly default would be essentially readapting the local currency but doing it in a way that it is negotiated through and the debt is remarked, but that's not on the table right now. so this could all end in chaos. they impose a package that doesn't work. greece goes into a severe recession that lasts a very long time and ultimately a political upheaval pushes thei issue in directions no one wants. >> have we caught rised greece? i mentioned that euro stat figure there. in the three countries that have bailouts, debt to gdp is going up. >> that's right. because the same medicine is being applied to places like spain and ireland but even italy -- italy i don't see a combination of growth rates and

interest rates that would permit italy to get itself out of debt and considering that -- you know, to start to pay it down to get things more manageable so that long term there's confidence. i believe that the market is moving on bond rates right now in the direction of wishful thinking. i don't think that usually is really moving to a systemic solution. the southern countries have deficits. the northern countries have chronic current account surpluses. the euro is overvalued for the southern kcountries. undervalued for the northern countries and as a consequence there just isn't the kind of balance and financial flows that is necessary for a long-term solution and i don't see the germans accepting that. >> peter, this is joe weisenthal here in new york. i wanted to follow up on the last point you were just making. is there anything you think europe can do within the current eurozone system to address these imbalances which seem like a

pretty deep flow but, also, and in the short term do you think they're working on anything that could spur growth? we could talk about all the debt issues but in terms of the immediate problem is that there's no growth and contraction. what could be done in the short term to bring growth back and what perhaps policies could reverse the trade imbalances? >> well, europe can't continue in the eurozone type framework without significant deflation in the southern countries so that their products become more competitive. that's the first thing. the second is thing there has to be a willingness to shift industrial activity to the south and a conscious acceptance on the part of germany. it's doing to the southern countries what china is doing to the united states. and the third thing is in the united states we have very substantial labor mobility that the europeans lack because of language differences. no matter what they do.

and we also have folks taxed in manhattan to subsidize folks in mississippi and that helps smooth things out a lot. just controlling budget deficits. that's not the solution. look at spain. spain was a surplus country until the bubble burst. it had good finances. there are more fundamental problems than the size of budget deficits. the germans seemed to think that austerity is the solution to everything. frankly, i have to say that angela merkel's solutions to greece's problems remind me of george washington's doctors with his throat infection. several days before the man died, they bled him three times. >> wref, and a lot of people would share that view. george soros is amongst them. you mentioned employment. post that u.s. jobs number on friday, can most investors in america and people in america now actually say it doesn't really matter what happens in

europe as long as we have growth in china and other parts of the world and we can concentrate on ourselves, you know, we can worry about it a lot less. is that a valid viewpoint or not? >> i don't think it's valid at all. one of the thing that's contributed to the recovery that we have had and it's not as robust as the jobs numbers indicate but what recovery we've had is a growth in our exports. the united states is now dependent on global markets. in a variety of ways, one of think is exports to sustain its industries. our strongest manufacturers are global manufacturers in the sense that they send products everywhere. we can can't ignore what's going on in china or europe. in europe we need a rebalancing of the continent so the place makes some sense and it makes no sense at all right now unless you're a german liking to brag that you're the most competitive person on the planet with your 3 32-hour workweek. and we need a rebalancing of trade with china. because we can not go on indefinitely with these very

large trade deficits with china and borrowing from china and in turn having very large budget deficits of our own to sustain aggregate demand. a trade deficit is a negleative. a budget deficit at the federal level is a positive. but we can't go on that way indefinitely without ending up like athens. >> all right. peter, good to talk to you as always. thanks for getting up this morning. did you watch the super bowl last night? you've had no sleep, right? >> absolutely. i'm running on three and a half hours of sleep. i was up at 2:00 this morning. i'm a giants fan going back to the '50s. i think it was '54 or '55 and the goal post coming down. i've suffered through every championship game including a lot of those losses. >> in that case, you don't mind getting up early. you're feeling good about life. there you go. a lot of you guys around,

courtney. >> there's a lot of us giants fans around, ross. you cannot escape. not today at least. president obama says there are plenty of risks to consider before taking any military action against iran, and he would prefer a diplomatic solution to the standoff in the region. in an interview with nbc news sunday the president says the u.s. will work with israel to prevent iran from becoming a nuclear power. he says israel is rightly concerned about tehran's ambitions and believes they must stand down. >> we have mobilized the community and they are feeling the pinch, the pressure. they have not taken the step that they need to diplomatically which is to say we will pursue peaceful nuclear power. we will not pursue a nuclear weapon. until they do, i think israel rightly is going to be very concerned and we are as well. >> and this morning a german government spokesman has said that syria's president assad has no place at the helm of the

country. the comments follow controversial veto of a u.n. resolution against syria. china defended the decision to abandon power. vetoes from both china and russia follow reports they have bombarded the city of homs. chinese state media said western intervention lay behind the veto. goldman sachs has cut ceo lloyd blankfein's stock bonus, the first since the financial crisis. a filing shows he was awarded $7 million in restricted shares. 44% from the $12.6 million in 2010. he didn't get a bonus in 2008 when they took government bailout money. profits fell 47% last year and it cut 2,400 workers amid lower trading and investment banking revenue and tighter regulation. well, coming up next, the trading day ahead on wall street.

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welcome back to "worldwide exchange." let's take a quick look at how the u.s. futures are trading right now ahead of the market open. it looks as if we are still lower down by 68 points on the dow and the nasdaq down by more than 13, almost 13 1/2. there is no economic data in the u.s. today, but we will get reports this week on things like jobless claims, consumer credit. the trade deficit and consumer sentime sentiment. st. louis fed president speaks at 9:00 a.m. eastern by inflation targeting. dallas fed president richard fisher gives an outlook on the economy and monetary policy at 12:15 p.m. hasbro reports results before

the open as do humana and cisco, the food distributor company, not the tech company. after the close we'll hear from the parent of pizza hut, taco bell and kfc. still with us michael, the managing director at chicago-based spectrum asset management and still with us, our guest host, joe weisenthal. michael, unfortunately, we don't have a whole lot of time left but looking forward to the day ahead on wall street. so far futures are not indicating that jobs report is positive sentiment will at least trickle into the beginning of equities trade today. what's your outlook? >> my outlook is that the s&p will just chop lower. i'm not looking for dramatic reduction to start the week but what i am watching is 2050, some of the moving averages all up at the 99 handle were lower below that. can we sustain that level? it's hard to see crude going lower from here. >> and to you, joe, earnings are

going to be in focus again this week. we're mostly through the earnings season but what do you anticipate the market, revenue, top line, bottom line, what's the combination? >> earnings haven't been that great this quarter. they've been okay but not amazing. i think the question i have is what's going to be next? right now there's a lot of optimism in the market, that jobs report was really great, but with so much optimism what will surprise people to the upside and that's hard to see where it comes from but curious to see what it is. >> and the jobs report was good but perhaps is it a trend? >> it would be great to see if it was a trend but is one data point and it'll be tough for the data to continue to make people as happy as that number did. >> michael, just a quick view on gold, it slipped today but i know you track this. what's your own forecast? >> i'm still targeting by the middle or the end of the year up at 2000. i'm extremely bullish this metal. with all the reasons, what's going on in iran, it's very hard not to pay attention to that and

of course syria because of who is involved and what kind of rhetoric it is. i think the precious metals will be a big benefactor. people are sticky on how the markets look at things now. they don't want to 0 jump on the bandwagon on the jobs report. >> i want to thank you so much, michael, managing director out of chicago and our guest host, joe weisenthal at business insider. it's been a very full program. we thank you for joining us but that is it for today's show. i'm courtney reagan here in the u.s. >> and i'm ross westgate. that's not it for cnbc, up next "squawk box" and the countdown to the opening of markets state side. there may be more postgame chat as well. we hope you have a profitable day. so uh this is my friend frank and his, uh, retirement plan.

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good morning. stocks on a hot streak. the dow at its highest level since may of 2008. euro stress, greek officials fighting to find an agreement on the terms of a second bailout. and the super bowl champions for the second time in four years, the giants pulling off a big win against the patriots. it's monday, february 6, 2012. "squawk box" begins right about now. ♪ vogue let your body go with the flow ♪ ♪ you know you can do it ♪ all you need is your own imagination ♪ good morning, everybody. welcome to "squawk box." i'm becky quick along with andrew ross sorkin a