Market. It is a knock off of the major industry right now. The chinese session is falling off a little bit and shanghai is down 1 . The thing i was reminded about economy and the secondlargest stock market. This is a point that everybody made and we are looking at the growth with the drop and the volatility in the stock market is horrendous. You see the move and you talk thet everybody saying that stocks and selling bands will billionsn end with the of dollars not doing anything and we see drops like this with the china index in the First Quarter and the chance the csi will be in the red. It is a bad omen. . Ill this come to an end this has been in formal messages. Maybe this will not come to an end until the other regulations are in place and we will get a read on all things china. Lets look at the program with caroline. The statecontrolled funds haltedtervened and they training. Sectors withking those familiar with the measures. Since biggest reverse september. 20 billion in the financial suspended the pboc they run with the cash injections. The regional Federal Reserve actors have dismissed the concerns with the stocks and they said that the u. S. Economy is on solid ground. We have seen the economy growing and there have been ups and downs and i think the economy came back significantly and the expansion is on solid ground here. Show this upt to 2 . It would leave things at the Obama Administration is warning widening who qualifies as a drug dealer to of firearms are the hands criminals. Although it is a strong getef that way need to complete arms around the problem and Congress Needs to act. I asked my team to see what more we could do to strengthen the enforcement and prevent the guns from falling in the wrong hands and make sure that the criminals and the people who are mentally unstable and those who could cause harm to themselves or others, they are less likely to get a gun. Story, you on this can go there. Lets check the rest of the asian markets. No reprieve from the intervention so far. Nothing prophetic. This is, by no means, as bad as yesterday and it has been all over the place in trading today. Back those to giving games and we have seen some games in Southeast Asia with a and the nikkeiry has been volatile today was some fairly good games. There are automakers and exportsensitive stocks in the they are reacting to the oil price, despite the iron they ares jumping, sitting a little bit lower and we have been talking about china. What else have we been talking it is the chinese is a 4 billion stake in legendary entertainment. Horizons and the this is a Major Chinese this isr down and steelmaker is up. So, these are companies where executives have been removed, and somenvestigations of those are underway. I want to take a look at the terms of how they are looking today, compared to yesterday. Is down andechanism there is not much in the way of gains. Having said that, arguably, it could be looking worse and, before i go, take a look at these yesterday and the huge theseto the downside with sitting at multiyear lows. Thank you for joining us from hong kong. We are looking at the big news out of china. The steelrop up sector. In equities, more than 20 billion are the biggest. Were joined live from hong kong. It is great to have you with us. Does this tell us something broader, in terms of the response mechanisms for 2016 . Is a significant move and there is a liquidity shortage in the system right now with the Chinese Central Bank responding on a scale. The holiday and them making technical changes to the reserve ratios. Encourageimes could lending in the economy to get things going. Prudentialthe macro side of things and this brings us back to a liquidity injection with a view that this is about putting money in a system and the rate cut that may not be there. Shiftnals something of a to the approach. Interesting. Lets talk about what we are the indices with the authorities intervening today. What do we know about the deadline where the Companies Listed the ability to shelve sell the stakes in the companys. Perhaps the limit will not go away in the date will move. This is how china intervenes in the market and it has been with or behind the scenes. This is six months after the last began and towards year. They are having to intervene to prop things up and it shows a degree of nervousness and a disconnect in the economy. By all accounts, things remain fragile. And at the capital outflow there is a look at the stock market. Is theltogether, it authorities choosing carefully to left the van on shareholders. Thank you, our chief asia economics correspondent. 11 minutes past six. Yesterday, the cleveland fed president was not too concerned about the impact of the chinese slowdown on the economy. We have built in a weakening path for china and i do not see that as significant. There is a direct trade channel and this is not that large. Again, will it have a direct effect on the economy . I do not believe it is significant. Happy new years. Welcome to the show. The chinese are intervening. How worried are you about china . Go more with one of the bestperforming stock markets last year and the difference between the economy and the stock market is not strong. Putting that to the side, you christmasmmented on and nike looking for the bottomup view on china to perform well and this is all about a move to services and consumption that seems to be working. That this is a volatile and casinolike market with a good chance that they will bring up the premium and it is a 35 premium. When we got involved in asia, ande was a small this batch we are out of those shares right now. The Global Investors get we fell into that too early. You like the reorientation of the chinese economy towards the Services Side and a new china. If youre looking to get exposure, where are you going to get that, if you think the asian market may be to casinolike . It is difficult with the consumers. The mediansive and is in the 30s. So, yes, we would typically by and individuals shares invest in the funds. Having a quality buyer and in thea quality by management would be a way to direct the volkswagen sales to china. You will look for the companies and spend relatively small amounts of money. The cheaper ones, rather than the luxury goods. Going to hong kong, rather than mainland china, that is fine. There is a story about a size of outflows and this is a balancing act they have to try to enact to stop the capital outflow and the Demolition Derby that could go on with the currency. As an investment manager, what are you looking at with the currency . How will they continue to rebalance the story . The rebalance happens naturally and we see that. Do you worry about the outflows . Yes, should it get out of control. There is a more important stock market, japan, in the 1980s, that was 50 of the world and it absolutely collapse and it was expensive. The spillover to the rest of the world was little and you needed to be a stock market investor in u. S. Equities. It was concerning and yesterday was a jolt in Global Equities. For us, we look for that to break. This reminds you of what theened in the market with Chinese Market finding it hard to make a direction and being supported by various buyers to pump up the stock market. Now, we see the markets coming on and the shenzhen composite is down. Caused so much trouble yesterday. This is where it comes down to. Whether itntion and kills or chairs or quells concerns. Can it chair . More of a chill, i think. The chair is when there is good value. But equities at good value. You are with us for the next hour. Thank you very much. Andt is a busy day for data we have spanish unemployment numbers. The german jobless figures are due. This is one that mario draghi will watch intensely. Next, volkswagen is sued by the night states over the device scandal and we will get the latest. Welcome back. You are watching countdown. Thank you. The Justice Department is suing volkswagen. Vehicles and this is the first case against the Company Brought by the Justice Department. Is the reason ted has been named the chief investment officer. He will start this month. Blackrock, the Worlds Largest aset manager will struggle the Federal Reserve raises Interest Rates. They lost 2. 5 , according to the indexes. You can get more from those stories. Thank you very much. Lets get more on the stories. Back in berlin. Is this just the beginning. The number is colossal. 80 billion is the potential upper limit. The challenge is how they argued the case in court. To get to that number, that is almost four times the 18 billion the government initially said and you are talking about more it is very clear they want to send a message to manufacturers tonight. Here is what they said tonight, they said the emissions control sessions disadvantage the competitors here in frankfurt and germany before the action was announced and the announcement ended at 2. 8 . Here is the other big challenge. They said they did not have a resolution on a solution to the via goals that are being worked that are vehicles being worked on. Andomes down to the engines volkswagen is not quite on the same page there. Out what youigure are going to do about the polluting portions. I will pass the intelligence on. What does this tell us about other civil suits and criminal charges . The department of justice is clear they will not forgo the opportunity to go criminal and these will be moved to San Francisco. It is not all bad news for volkswagen. 10 on theill be up year with the mexican market and, in the u. S. , we will get the final numbers and we expect them in the 17. 5 million annual sales. I have had many cars disappear of their own volition and one of those, i lost by my own carelessness. Thank you very much. Very nice. A literary reference. We will talk about volkswagen. It is default insurance. That is interesting and it shows a panic and a spike in default. The way of looking at it is a conversion and i would have to give credit to the bond team and they did buy into this and the Many Companies become running for bondholders and they buy is key. Se when it company feels it is in trouble and runs itself into trouble. Extreme and they are buying bonds in the market. That china is an important market. Storyis a good anecdotal survey was in china. U. S. Did not know about the survivor andt is a it will be worth watching because it does not sound like a big number. Thank you very much. Stay with us. Some of the richest people in the world impacted by the stock market slide. Lets get the news with caroline. Caroline intervening with theks and they called it shares of companies and steel sectors. The shanghai composite is trading off by 1. 5 . They injected 20 billion into the Financial System. And it is a sixmonth run of cash injections. Semester in cleveland and they say the u. S. Expansion has run aground. And there seen this have been ups and downs for times and sectors and the economy has come back significantly. The eurozone data is off and the rise would still meet the ecb target rate. It is likely to hit. T is aimed at until we get the complete arms around the problem and congress acts, what i have asked my team to do see what we can do to strengthen the arm enforcement and prevent the guns from falling into the wrong hands to make sure that the criminals and the people were are able totable get a gun. Thank you for that. Stay with that. The amount of money is seeing injected to stabilize the situation in china is really acting in the market right now. We are seeing a stock chart off 500. It comes to the cfi , to put that in perspective, that is the gdp of sweden and this continues, despite the pboc promising with regulators being familiar and senate will not lift the ban on selling these assets with the prevention and the halting of trade yesterday. What used and disturbed markets more. It raised more than a quarter and keep an eye on volatility, they have jumped 22 , the most since august. This nottalk about impacting me and the richest onple in the world fell monday. We are joined from singapore. Good to see you. Tell us how much was lost and who was hit. Hello. It was a tough day in the markets with the factory data and the tensions. Worldchest people in the buffett,gates, warren lost a . 7e of those billion in a day. The worst of all was jeff bezos, losing 3. 7 yesterday and it is a lot. I do not think you will fret and he will gain about 30 billion. I think he is pretty good. Alike the net effect. I liked the mets effect. Is there an increase . His wealthwn and is a relatively small some. And people lost on monday. Pretty brutal. Thank you for joining us there from singapore. The stumbling stocks as the u. S. Economy in good shape with the future rate rising. The path to rate increases is consistent with my view of the outlook of the economy and my forecast is for this to be between 2. 5 and three quarters in the next year. Higgins is with us. Lets look at the rates again and we heard the officials early. How many rate hikes do you factor into the end of the cycle . Not many. Not many. It is a little bit of a holiday malaise. We have much in the way of rate hikes and specific economic forecasts on the high side. A lownk that we are in we have the euro land. What does that mean with the globally andgame this is a forecasting function on the bloomberg terminal. Is there going to be enough inflation and hikes to get it out there . We have seen where these trade and it is remarkable how low the yields can be. 32 efinition, youll own and only make shortterm Capital Gains with the yields. Say they are Good Investments with equities. We are saying the yields remain low and give you low return. We go against the bond market trend and you have seen this kind of trend with the yields going much higher every single bias andthe bearish communities. We need to look at japan. It is incredible. They are saying that, by the end of next year, you would not go against that. , i do notanese bonds have great knowledge and it is perfectly reasonable that you would have a low yield and the debt to gdp is 250 . Withis is the big issue whether he goes for the election or the stimulus. Stimulusid a miniature with the bond buying and the equities to become significant and there is more of that. Buying. Et exactly. This cannot do much with commodity prices. Comes similar question with the inflation data and we will talk about that. You are a bond guy. 12 increase and the 7 increase in Global Equities this year at the start of the year. How does 2016 look to you push and mark there are reasons to be cheerful and, sitting here, it does not look good. Look and it fell 5 and it was a rocky start with the first few days sometimes misleading. We are positive about the Stronger Economic data and the values in european equities. You hate the comparisons and you say the u. S. Is overvalued with russia. That is good for the longterm investment and it does not tell you so much about the year, affecting the groundwork and the longerterm. Booker it is a priced to dividend yield, europe will stand out. The consensus is heard for a lot of people and, sometimes, the consensus is right. Based on this being supportive and the continuation in europe, you have the bank of america and Merrill Lynch outperforming. How long will that last . Earningsis superior and it has been all about earnings. We think that will continue this year. Coming up, tensions are off thend markets shrug round between the middle east nations. Paris are watching in over the last two days. Lets focus in on the futures markets. The worst days since 1952 and the equity was indicated to be openr with London Trading and you can transfer that true through. Ignore that. The u. S. Justice department and thisions testings is the first case against the Company Brought by the Justice Department. They have received offers and they said there was no certainty and the Restructuring Plan remain remains unchanged. Managers rock asset say that bonds will struggle and they raise Interest Rates would andsury returning in 2015 the sovereign debt lost 2. 5 . For more, customers can head to the top. Lets talk about the conflictg diplomatic and the ambassador saying that they were less than supportive. They have not been supportive and positive in these efforts and they have been taking the productive provocative positions. London, it is great to see you in the studio for a change. We know the specifics around the weekend and there are other reasons the things flared up right now. The execution was a massive and i do not think that anyone expected that to prisoners ande that was provocative. There have been underlying tensions for many decades and the tensions increased and escalated because of the conflict in syria and the crisis where other countries have been on opposing sides. With the different voices in iran and rouhani trying to thest quell or pulled iranian response back, what should we take from that. This is a critical global deal being done with a run. They are trying to draw a distance between the people attacking the embassy and the ordinary iranian government and states. He found that to be an important distinction to make. At the same time, it is very important that they show a thisg position against with the position being delicate se right now and there are broader questions to think about in addressing the issue and the Nuclear Agreement implementation may start at some point in january and will be crucial. Iran has to maneuver carefully. Does this have a bearing on . He welcoming by the west too many, it may look like saudi arabia has been provocative and they knew this would elicit a strong reaction. In the attacked on the embassy. We knew that it would be provocative for the region aoadly and they created massive backlash and there have been protests. There may be an argument when we are barely a month away from the