Transcripts For CNBC Street Signs 20170215

T aanarkets hav ha eert wa aupoo m d iterteer shellliaj ttei ord dts u usess t pnttheilonol itho ty rit wnoredt shares forvest for t this is the part with the technical strategy. It fits the companys long term plans to become one of the Worlds Largest asset managers. Its stock traded up more than 25 after hours. Lets go to akika fujika. I know youve been following the story pretty much all day. Does this match make sense . Yeah, you know, its an interesting deal here because on paper you think soft bank has gone after telcos and other tech companies, but certainly there is a personal connection here. They have been tapped to be in charge of investments and they came to soft bank two years ago. It makes sense in terms of the personal connection there. The broader connection here, of course, what does this mean for soft bank. Soft bank making it very clear that this is not tied directly to that 100 billion fund partly because the fund hasnt launched yet. Fortress could work alongside and be a big support. Lets talk about the numbers here. 3. 3 billion in all cash deal here. The deal up more than 20 . Soft bank paying 8. 08 a share. Thats a 30 premium on fortresses closing price. Lets talk about what exactly this means for soft bank because soft bank, as you know, has been really gone beyond just being a tech company certainly expanding their investments, not just in asia but also over to india as well. Softbank now oversees 170 billion of assets in management. That puts them behind black rock group as one of the largest private investors. Blackrock go ahead at 330 billion. Softbank has teemed up with saudi arabia and apple for the 100 billion tech fund. With this kind of Asset Management wrapped into the fold, what kind of opportunities does it present for softbank . So in terms of the opportunities for fortress, i think thats still up in the air. We do know that the ceo talked about what he wants to do with this vision fund when it in fact launches. Hes talked about going for emerging technology. Were talking about artificial intelligence. Were talking about the broader theme, talking about singularity. When we talk about singularity he sees a day where computers really are much smarter than humans as well. Theres a very broad ambitious vision that hes having with this 100 billion fund. We should say that softbank hasnt actually come out and said exactly whos contributing to it. Youre talking about saudi arabia as a big contributor thats being named, apple, several other tech contributors. We have been told by soft bank this vision fund is scheduled to launch in the first half of the year. Bet on emerging technology. Thank you so much. This news about softbank and fortress, we saw fortress shares up more than 25 after hours. Softbank up a little bit more than 1. 5 after the close in japan. Well, u. S. Stocks extended their rally overnight with s p 500 notching its 15th record close. Take a look at that. The dow jones s p 500 up by. 4 and nasdaq up by 1 3 of a percent. Now stock climbing higher after fed chair janet yellen signaled a more hawkish tone during her first day of testimony on capitol hill. Lets bring in tony nash. Hes at complete intelligence. He joins us on the line. Tony, there were a couple of things that janet yellen said overnight that the markets seemed to react well to. Was it surprising to you that she said that markets need to at least price in a hike at an upcoming meeting because she expressed worries that if you didnt let go of the combination soon enough you could be behind the curve. There was a risk of going back into the recession. The markets seemed to take that well. What was your reaction to that . Yeah. I think her use of the word unwise, saying it would be unwise for the fed to delay too long in raising rates i think is really what the markets are grabbing on to for the rally and for the expectation in movement on rates. She also said that she hopes fiscal policy changes will be consistent with putting u. S. Fiscal accounts on a sustainable trajectory. Were always talking about how were waiting for the specifics of details on tax reform and fiscal policies from trump. As we keep waiting for this we know that trump has said hes going to make a big announcement, a phenomenal tax reform announcement in the next two to three weeks. We dont have the specifics yet the markets keep rallying. She says she hopes these fiscal changes will be consistent with putting them on a sustainable trajectory. In other words, not to get too deep into debt with all of the tax cuts. Thats one interpretation of it. Sure. What do you think her concern is there of the broader fed . I think going back to the tax cuts, there is an expectation if the u. S. Can actually achieve a 15 Corporate Tax rate, that it could potentially create about 2 million jobs and these are the kinds of fiscal adjustments that shes really looking forward to. If the trillion dollar Infrastructure Program moves forward theres an expectation of 1. 6 to 1. 8 trillion added to the u. S. Economy so thats an 8. 9 to 9. 5 addition to gdp. Thats not all in one year, but this is where we see things accelerating. When we look at the job creation numbers we really are starting to see a break. I think in the first half of the year ever since the recession weve seen the first half of the year of the u. S. Economy to be generally flat, okay . If were starting to break that trend then that is absolutely good news for the u. S. Economy. We know that q1 gdp tends to be weak and revised up. Thats been the pattern for the past couple of years. In terms of march the march meeting being a live meeting, whats your expectations of whether or not the fed actually moves in march or whether or not it will wait for those revised estimates and perhaps move in may or june . You know what, i think march is a possibility because if you notice there was a snowstorm in the u. S. Last week and we didnt hear all of the earnings warnings that weve heard about january february snowstorms over the past few years, okay . So were not necessarily going to get this winter kind of impact on earnings that weve heard claimed for a while. I actually think thats very good news for q1 and has the potential to see a real you know, a real positive impact on gdp. All right. Tony, thanks so much for joining us today. Tony nash, chief economist for complete intelligence. And stay with us, our European Team will be back after the break with more of street signs. Hsay . Heavtotb cuoma wa. Rt jt chand. She dor. Ah, sc too ssfu on. U whatsimo fronow . Wharisteve. Veevev sjuis iness, powerp. Good morning, everybody. Welcome to slightly later start here on street signs. Im louisa. Banks are leading u. S. Stocks higher after janet yellen says the march meeting say they should not fall behind the curve. Waiting too long to remove accommodation would be unwise, potentially requiring the fomc to eventually raise rates rapidly which could risk disrupting Financial Markets and pushing the economy into recession. Retail bank reassurance cut call shares as investors chair net income beats despite a large writedown in the french retail units. Investors toasting behind a heinikins earnings. It might be affected if there is a lot of speculation if the world trade continues. Former Trump Campaign chair Paul Manafort denies talks with russian intelligence. Good morning, everybody. Welcome to street signs. Just want to apologize for the slightly irregular programming seen over the last 15 minutes. Essentially the London Office had to be evacuated because of a fire alarm. Onward. Very glad that youre with us this morning. Our European Equity markets were slightly higher. Were hanging on to slight gains for most of europe up to a half a percent. The ftse up and two lagerts trading lower by 1. 5 . A lot of focus on whether or not were going to have to go through some type of other crisis given the hesitation of the imf to be involved in further bailouts. When it comes to our European Equity markets, youre looking at health care. Food and beverages and banks trading up the most. Banks up 1. 7 . You would have noted a super strong session. Record high seen and we were very much helped along by the Banking Sector in particular, goldman sachs, for example, going through a previous ten year record to close at record highs once again and contributing to most of the gains on the dow jones, for example. Were seeing some of that feeding through into europe this morning. Retail, technology, chemicals and travel leisure traveling lower. Sticking to the banking theme. Posting Fourth Quarter net income and revenue figures which beat analyst expectations. Profits at frances biggest retail bank fell sharply after it took a writedown on the retail arm which it blamed on the low Interest Rate environment. Shares trading higher by 4. 5 an hour and 15 minutes into trade. Natixis is being placed under investigation. Two statements released in 2007 at the beginning of the subprime crisis and that it will help the auth chemicals and Paints Company is raising its dividend despite the Fourth Quarter operating. The head winds weighing on the companys earnings. Theyre telling cnbc that theyre taking steps to minimize the risks in 2017. We carefully watch what the developments in the individual markets were including the currency markets and the different developments in the different regions in the world. We build a Strong Foundation and strong ability to respond to it because were active in 18 countries and we can move businesses where we think its appropriate. Our ability to respond to all of these developments has significantly improved and well make full use of that. Now abn amro has beat earnings. That stock is up by just over 3 . And heineken is toasting to full year earnings. Shares of the dutch brewer have been rallying on the news up by more than 4 . Organic revenue grew by almost 4 . They see further room for margin growth in 2017 despite the volatility. So theyre keeping that margin growth target for this current year. Javio gonzalez is a senior beverages analyst. Good morning. Good morning. Thank you for bearing into this. Were all a bit scattered. Nonetheless, talk to me about heineken and what weve seen. Yeah, its a great year for heineken which ended on a high note. Growth in sales organic of 5 and almost 10 in profits. Its by all means a very good year in consumer goods. Within the divisions the two divisions that drove performance were again vietnam excuse me, asia pacific led by vietnam and the americas led by mexico. Funny enough, the we think that the margin in that division in the americas was helped by the weakness in the mexican peso thanks to as we know mr. Trump which has helped the margins of the brands sold into the southwestern united states. I was speaking about protectionism on the show. What impact do you think protectionism could have on a company like heineken . Its difficult to say. It all depends on what protectionism does to currencies in the countries that are are operating and ultimately import costs. Tariffs are only going to increase the cost bringing it into certain countries. Generally you would say the price of beer would suffer would have to go up to consumers. They are the second largest group, the second largest brewer behind abn bev which bought miller. 100 billion takeover. That was a big deal. The gap between the two is quite wide now. Yeah. Does that mean heineken needs to get out there and figure out who theyre going to team up with . Not necessarily. There is obviously scale benefits from being larger. I think heineken is on a global basis big enough to benefit from the economies of scale. A lot of it comes down to the competitive positioning by market rather than looking at everything on a global scale. I think both abi and heineken are very interesting, very probable companies. Whilst one is bigger than the other, it comes down to that competitive positioning market by market, company by company. What do you make of what theyre doing in brazil . The deal with the acquisition of the business is really good deal for heineken. Its a loss making operation at the moment, but its basically putting together two relatively weak players structurally speaking to create a much more stronger number too. I think its coming in at the right time. Obviously going through a very difficult time at the moment, but it will improve. And they will have a much stronger business going forward. It also means consolidation in that market which will benefit everyone in terms of the competitive situation. Javier, thank you very much. Javier gonzalez, senior beverages analyst. Financial stocks gained. U. S. Treasury yield spiked as u. S. Fed chair janet yellen gave her speech to the Banking Committee yesterday. She flagged improving Economic Conditions and indicated that the fed might be ready to raise rates as soon as next month. March. Richard champion is the deputy cio at an annuity Wealth Management company. Welcome, richard. March. Were going to get a march hike. Suggesting the possibility. Clearly the fed is looking to keep its options open at this stage. Thats what Janet Yellens statement was about. Its an open committee in that sense and a live meeting so the key sthing perhaps markets are looking out. With the economic momentum, i think thats the right thing for the fed to be doing. She did express caution though because of the uncertainty over economic policies that we dont know the details of yet. We had a guest on yesterday talking about how jpmorgan has seen four hikes in 2017 as they and the fed risk getting behind the curve. Do you see a similar story . Were broadly in that camp, yes. We think three is the bare minimum. It is all data dependent. We saw what happened when they promised three and delivered one. Well wait and see what happens with fiscal spending in the states particularly under the big Infrastructure Program and whether that can be delivered. What do you make of the high after high after high that were seeing in equity markets state side. Does it stack up with your earnings markets . For the year as a whole we expect earnings to grow 9 to 10 in the states, 9 to 10 in europe as well coincidentally. Although valuations are high, at this stage of the cycle where youre getting the early stages of the fed tightening, Economic Growth is delivering more earnings. I think thats a possibility this year. Youre expecting some of the numbers in europe, why not invest in europe then . Because there should be more up side, huh . Clearly at the moment we have more of a political risk. Trump represents a continued risk. 234 france, germany there is more of a political risk. What happens in the u. K. And the ftse during these next couple of months, both with the elections as well as through policy making . For the ftse, the focus is obviously on the International Components within that and we could see that continue. I dont think weve seen the end of weakness of what you might term u. K. Plc. The uncertainties from brexit and triggering article 50 are going to continue in our view. Im waiting for tapering to go back and weve put it on a ceipher. 60 billion is what the ecb is buying per month of bonds. Are they going to continue those . Are they going to start tapering officially in 2017 . I think the history of tapering as we saw it in the fed they talk about it way before it begins to occur. Of course the acb has gone from 80 to 60. In a way it already is tapering. 80 to 60 but for longer . Indeed. Wed expect that to continue. Perhaps a continuation. The fed started to phase down by steps of 10 billion at a time. Something similar after the end of this year we might see from the ecb. Always remembering the tapering of that nature still represents incremental easing until it stops. Richard, thank you very much. Richard champion deputy cio at cannacords Wealth Management. After the break weve got loads more for you. U. S. Politics. Well be hearing about a ubs report talking about what a u. S. Border tax could do to equities. While were on our market, take a look at World Markets live. Thats our blog. Theres lots of good content there. Well see you after the break. Hi, everybody. Good morning and welcome back to street signs. Your headliners today. Banks leading european stocks higher. Janet yellen hinting that the march meeting could be live saying the central bank should not fall behind the curve. Waiting too long to remove accommodation would be unwise. We may need the fomc to eventually raise rates rapidly which could risk disrupting Financial Markets and pushing the economy into recession. Retail bank reassurance shares are rising as investors cheer the beat. And investors toastin toasting heinekens earnings. Warning of protectionism. It might be affected if, if, and again if there is a lot of speculation, if the world trade would contract. And former Trump Campaign chair Paul Manafort denies any contact with russian intelligence officials as hes named in u. S. Investigations. Welcome back, everybody. Youre still watching street signs. Glancing at the data on the wires. Joo january adjusted jobless claim is adjusted at 2. 14 of the work force. December unemployment three to december month employment rate of 4. 8 . Thats down by 7,000. Average earnings for december three months to december, excuse me, 2. 6 . The average earnings have been forecast at 2. 7 and also looking at the, again, three month to november period, average earnings unchanged at 2. 7 . Average earnings in three months to november unchanged 2. 7 and this data just hitting our wires right now. Glancing through other details, wage growth slowing. Bonuses 2. 6 year on year. The polls have been putting that figure closer to 2. 7 . December alone, 2. 4 year on year. So u. K. Earnings growth slowing a bit. Employment though edging back up again. Our European Equity markets this morning happening on to some slight gains across most of europe. We saw that that early days here an hour and a half ago or so are still higher. Most of the European Equity markets a lot of focus on whats taking place in politics in the states. Multiple Trump Campaign officials were in regular contact with russian intelligence officials. Thats according to separate reports by the New York Times and cnn. Trump advisers cited in the report include former Campaign Chair Paul Manafort and then adviser Michael Flynn. Manafort denied any contact with russian officials telling the New York Times saying, quote, its not like they wear badges saying im a russian intelligence officer. Vice president mike pence was kept in the dark about a warning about Michael Flynn. The Vice President s press secretary said that pence only learned the truth on the ninth of february. That would be two weeks after other white house officials, including President Trump, were briefed on this matter. The revelation adds to a picture of confusion following mixed messages from officials before flynns resignation. Nbcs matt lauer asked Kellyanne Conway if she was out of the loop . Not at all. Both were true. The president is very loyal. Hes a very loyal person and by nights end mike flynn had decided it was best to resign. He knew he had become a lightning rod. But the fact is that general flynn continued in that position and was part of the leader calls as recently as yesterday. Was there for the prime ministers visit from canada yesterday and as time wore on obviously the situation had become unsustainable and general flynn kelly, that makes no sense. Last month the Justice Department warned the white house that general flynn had misled them and that as a result he was vulnerable to black mail and at that moment he still had the complete trust of the president . Matt, im telling you what the president has said, which is that hes accepted general flynns resignation and he wishes him well and that were moving on. There are at least three very strong candidates that will be considered for a permanent position. Obviously general Keith Kellogg is the acting security adviser and the president is moving forward. Joining us now from washington is james pepakook. Economic policy analyst at the American Enterprise institute and cnbc contributor. James, very good to see you this morning. What do you think is going on at the moment also with regards to all of the communication that seems to have been happening between some of these officials and the russians . Listen, i think right now you have a very chaotic white house. Theres going to be a lot of republicans who dont want to have any investigations. Certainly there are democrats that want a lot of investigations. I think youll see more public pressure to find out exactly who was talking to who, who told flynn to talk to the russians, so theres a lot of uncertainty. And to the extent that translates into a white house that cant execute its economic promises, that will have an impact on the u. S. Economy and Financial Markets. Lawmakers have called for an independent investigation as you say into what took place with regards flynn. Congressional republicans dont want that. Do you think that the tide will change where Congressional Republicans, they realize that its in their interests as well to investigate some of these happenings and also for future leadership of the states, democratic or republican, just so some of these measures are put in place . Listen, among Congressional Republicans theres a great deal of interest in executing on what they think is the agenda, which is to replace the Obama Health Care law, to do tax reform and i think as senator rand paul said, they dont want to get caught in this loop of investigating having republicans investigate other republicans and that begin to consume all the congressional band width. These other things which theyre not making super fast progress on, specifically taxes and replacing obamacare. That stuff goes even slower and starts to get pushed off into 2018. But one can certainly imagine a scenario if there are more revelations where theyre going to be forced to do that. There certainly are some republicans who think there need to be more investigations, senator Lindsey Graham being one of them. There will be a real tension of those wanting to get to the bottom of whatever is actually going on with the russians and those who really want to plow ahead and try to go after the economic agenda, which is why they feel they were elected to begin with. James, theres a New York Times piece this morning talking about with Michael Flynn gone russia is seeing a different President Trump given flynns connections to the russians. Are we going to start to see a turn in rhetoric or a turn in feeling, for lack of better word, from trump towards the russians given these events . Listen, you know, the secretary of defense, jim mattis, is very pro nato and very skeptical about the russians. It looks like the leading frontrunner for the new National Security adviser is a mattis protoge. Now whether this will translate into the president taking a tougher stance on the russians, listen, i think everybody has been waiting for various pivots recently, and you havent seen very many. He talked about getting tough on immigration. Thats what weve seen. He talked about building a wall. Apparently they are planning to build the wall. So whether youre seeing a much more confrontational donald trump, he may be the final holdout in this administration who think that, you know, much closer cooperation with the russians and the russians are willing to help him, he may be the last one who thinks it but hell be the last one standing. James, weve heard from a number of guests here on this show talking about how we could be looking at four rate hikes coming from the fed this year, not two, not three. Is the American Economy growing faster than what many of us think . Listen, there is some research to suggest thats always like the tension where you have very weak productivity growth, weak gdp numbers but much faster job growth and of course they have Silicon Valley remaining white hot. There is a lot of questioning whether maybe if the economy is growing faster than we think, therefore, maybe that will affect fed policy. Theres so much uncertainty right now. I mean, janet yellen said it yesterday, that you certainly dont want to base Economic Policy based on what might or might not happen coming from congress coming from the white house. Listen, there was a lot of skepticism. There was a lot of enthusiasm after the election and then skepticism with the Hedge Fund Community about the protectionism. Now i think the skepticism comes from whether this white house will actually be able to act on its economic agenda. Congressmen take the lead but at some point they need guidance from the Trump Administration and whether theyll get it which is being consumed by other issues, i think thats a huge question. James, thank you very much. James pepakokis, Economic Policy analyst at the American Enterprise institute. Thank you for getting up so early. Its like middle of the night for you. Been up since 3 002 30 . All good. Little early. I cant even remember anymore its that early. I know. I know the feeling. Go back to bed again if you can or get an early night tonight. Thank you. Now there will be no tax reform package without a border adjustment tax according to devin noons, a member of the house ways and means committee. They said the b. A. T. Is the only way we can get our tax code into the 21st century. Its part of the gops overall tax plan and it would tax imports and exempt exports. Best buy and target, theyll be in washington today to campaign against this tax. Jeff robinson is head of financial Equity Analysis at ubs. Good morning, jeff. Good to see you. Good to be here. How could this impact equity prices . I know you put out a report about precisely what happens if we see this import tax. It depends if theyre import reliance or export reliance. If youre an importer, youre bringing the goods into the u. S. Youre possibly going to suffer a 20, 25 import tax on your numbers coming in. That obviously puts pressure on margins and puts pressure on cash flows. Its a major change in tax legislation. This goes back. Its not a trump decision. This goes back to 20, 30 years of tax issues that new yorks tried to address to create a level playing field. So reading between the lines it looks like were planning for a split. Absolutely. Youre going to leave the u. S. With a possible rebate, 20, 25 . Largely it will depend on what the marginal tax rate will be. We think these numbers will be aligned. There is a split there. There was a big set of companies that are pro and a big set of companies that feel very vulnerable to this new reform. Who is leading the way in this . Is it just a matter of business listening to the administration and following on from whatever they decide or can business actually take a stance themselves . I know a lot of the Bigger Companies like the walmarts, theyre not happy at all. Not at all. Theres surely intense lobbying in the u. S. And d. C. There. This goes back if you trace the history back to the originations of the general agreement and trading back in the 50s. The u. S. Gave away the concession and then as b. A. T. Became more prominent it created a bigger and bigger issue in the u. S. Its been discussed for a number of years. The last eight years i saw theism pact with the senator this morning. Its been discussed and discussed and discussed. This is something thats come to a head. Now getting it through the senate, that will be an issue. With a 5248 majority you have to have a majority to get the legislation through. It will be difficult. Even after that you have the issues that you need to face with the wto. Would a tax impact valuations . I think so. Weve found this. It is a detailed and interrelated exercise. The tax by itself can affect valuation. Thats the first order impact. Second order impact is what happens to the u. S. Dollar Foreign Exchange rate. A lot of market comments saying that a 20 border tax might see the dollar appreciate 25 . Thats a huge shift. Ubss house view is that it wont go up that much. How much of this appreciation is already priced in . Also to what extent does trade purely drive the rate is debatable. We have the Foreign Exchange appreciation at a much higher level than has been suggested. The impact on u. S. Stocks and companies, how about Foreign Companies . Actually. The headline focuses on the u. S. Taking european companies, if you are exporting into the u. S. Youve got a high level of u. S. Exposure there. Your production facilities are outside the u. S. Your goods are going to go in. Theyre possibly going to be hit by this tax. Now to the extent that you can maintain competition and Competitive Edge with this higher pricing impact is debates among companies. If you have companies with those three characteristics, i think there is vulnerability there on equity prices. Jeff, thank you very much for being with us. Head of fundamental Equity Analysis at ubs. Now head online to see why one analyst is saying that stocks gains are counting on a tax plan that has become the, quote, hunger games for tax lobbyists. Much more online as well. Keep your comments coming through on twitte twitter louisaboyerson. If you feel like writing longer mail, go for t. Find us on email as well. Street signs up at cnbc. Com. Im interesting to hear how your valentines evenings went. Coming up, trumps new golf course that tees off in the u. A. Tourism in the middle east and the president s blocked travel ban right now. Well be back with more here on street signs. Hi, everybody. Welcome back to street signs. Warren buffets Berkshire Hathaway almost quadrupled its stake in apple. Meanwhile the peltz fund took a 3. 5 billion stake in procter gamble. Leslie picker has the latest on these big moves. David teppers appaloosa making some big bets on pharmaceutical companies. Buying 5 million shares on teva and 5 million in pfizer and 3 million in mylan and allergen each. They like bank of america. We saw more capital, Tiger Management and third point all adding more than a million shares each in b of a. They took stake in citigroup and jpmorgan. These are the first stakes taken since the election. Tech was also an interesting play this quarter as Berkshire Hathaway tripled its position in apple but other hedge funds were less optimistic on the sector. Tepper cut his stake in apple in half. We saw other sales in amazon, facebook, alibaba was another stock that experienced some selling. Back to you guys. President trumps sons eric and donald jr. , theyll be heading to dubai for the opening of a brandnew trump golf resort built by the uae based properties. The Golf Club Dubai has drawn criticism that it creates a conflict of interest with critics that say President Trump isnt distancing himself from the business. Tourism Development Authority is joining us. A lot of people are looking at whats taking place in the u. S. And theyre looking at ties to the middle east and theyre thinking, well, trump is continuing to profit from his investments in richer parts of the middle east while at the same time closing the country for people from war torn countries. Youre a two hour drive, hour and a half drive from dubai. How do you view whats going on . I mentioned this before. The middle east is 28 countries, its not one, and very diverse countries as a matter of fact. The uae in particular, we continue to focus on driving tourism which is our prime strategy today. Its an up and coming destination where we focus on driving tourism from around the globe. The u. S. Is a strong market for us. Weve seen 23 growth year on year in 2016. Guess what, in january alone weve seen a 32 growth from the u. S. It really looks great for us and very promising market to continue to drive tourism from. As a businessman and also as an arab businessman, isnt it offensive though the bands that trump is trying to put in place towards the majority muslim countries . The uae is not one of those countries that were on the list by mr. Trump and we pride ourselves in the uae for being very tolerant and safe. This is one of the emirates that enjoys safety, security, tolerance as well. At the tourism outbound from the uae to the u. S. , states like new york, california, and florida enjoy an abundance amount of outbound business that goes from the uae alone not to mention the gulf countries between saudi, kuwait and the rest of the arab world. This is very good for the u. S. Economy, especially in tourism, and also equally i mentioned earlier the u. S. Outbound into the uae is very strong. Were seeing this trend of growth into our area which has a number of great activities for the u. S. Market including the cultures that we offer. Sure. I note what youre doing as well in shanghai. Youve launched a chinese Representation Office in shanghai . Right. Are you pivoting east though . Surely it must be more comfortable to do business with someone who is open to all religions. Is there pivot east in terms of the business contacts that youre looking to establish . There isnt really any particular position on this to be honest with you. The u. S. Or the American People love travel and they enjoy experiencing different parts of the world. I dont believe anything is going to stop them from traveling outside the u. S. To different parts of the middle east. Whether you feel comfortable and safe, the uae has been a fantastic, safe destination. That has been our key selling point. At the same time, our strategy to open in china is merely to focus more on the Chinese Market as weve seen. Again, another fantastic growth from china and we really wanted to make sure we induce and enhance our presence in china in terms of pr, sales and marketing. Our drive for the key cities of shanghai, beijing is really where we see more of the outbound from china coming in. Dont forget india is one of our largest markets. If you think about the international markets, germany is our number one market with 25 growth year on year. Then comes the u. K. The u. K. Is our second largest market with a 35 growth year on year. This has been a very loyal market, very resilient and continues to fly for travel and holidays and that seems to be a Natural Choice for the market. Do you feel any of the uncertainty that were feeling in europe from a political point of view with elections coming up, again, a pivoting towards the right, brexit happening as well . Does that translate through to tourism numbers . The growth weve seen in 2016 from the british market has spilled over into january this year and also when we look at what we call the booking pace for the future, the british market tends to book well in advance and pay well in advance. This is great because it gives us a great indication of how this market is moving and we can still see this growth continuing on for the remainder of the first part of the year at least well into the summer. So, no, we feel the impact has not really done much for tourism and travelers and as you heard from also the United Nations world tourism organization, the growth in tourism is phenomenal and will forecast to grow continuously into 2017 and beyond. Thank you very much. Muhtar is rain . Yes. Our fx markets, euro dollar 1. 0553, a little bit lower. Keeping in mind that sterling is trading a little bit lower on the employment data. U. S. Cpi due later today. Retail sales due later and yellen speaking at the house of Representatives Financial Services Committee as well. We will be back tomorrow with another version of street signs. See you then. mus p eigho ito e go heigh es whoom a odelta, y ge the wldtsp n . G, shldb. Thonesanitgeout in youre a funny guy. Best of the oscars. Es whoom a odelta, y ge the wldtsp n . G, shldb. Funny how . How am i funny . Scorsese finally wins. Could you double check the envelope . Show me best picture. Whats the difference . Show me best actor. I do not take tonight for granted. Thank you so very much. Get all the greatest scripted and unscripted oscar moments on xfinity x1. The oscars, live sunday, february 26th 7ea4p on abc. Good morning. Markets point to another major rally with another set of record highs. Follow the money, buffet, sorrow, paulsen revealing what they bought and sold. The details straight ahead. Plus, washington watch. Some of the worlds most powerful retailers will head to the nations capitol to give their two cents on a potential u. S. Border tax. Its wednesday, february 15th, 2017. Worldwide exchange begins right now