Coming up later on the show, speak to the former u. K. Chancellor at 10 30 u. K. Time. First, today is the day and just a matter of hours we find out whether the fed will raise rates for the First Time Since 2000 6. A Bloomberg Survey of 113 economists have found just over half say they do not expect a hike today. That ties in with comments from Lloyd Blankfein and ray dalio. What to the markets think . Lets check in with jonn ferro. Jon no consensus. Nobody knows what is going to happen. That is the first time we have a live meeting of the Federal Reserve. When they sit around the table today, what are they going to be looking at . The good, the bad, the unknown. Unemployment down to 5. 1 percent. Potentially bad the inflation numbers. What is the outlook for inflation . How certain are they that in the mediumterm inflation goes back towards their target . Completee is a unknown. How did they factor in the global situation. What is happening in china . How conscious are they of the 15 major Central Banks that have hiked since the financial crisis only to turn around and reverse course. Theres a lot of questions the fomc is to answer. Francine is there such a thing as a dovish rate hike . Jon i think what is going to happen. But the focus will shift to is the path. Janet yellen has been key to get the focus on not the first lift off but the future rate path. Where will rates be in 12 or 18 months from now . What next . Janet yellen, yes, we may hike. But look at the dot plot. A loose tightening. Back to you. Francine thank you so much. Of bridgewaterer associates says he does not see the argument for a rate hike. He spoke to tom keene and mike mckee. Ray i didnt care if they i dont care if they raise 25 basis points. I do not see the reason for it, frankly. 2007 i was watching this incredible bubble happening. An asset bubble and it was a finance of a lot of debt. It was an obvious bubble. Thefed give attention to gdp gap and missed the whole bubble and we had an economic collapse. Now we have a situation in which we are in the midpart of the cycle. They are trying to identify where the inflation is. What they are worried about and we have a lot of included. There are glimmers here and there. But basically, i think that theyre wary too much about the shortterm debt cycle and not enough about the longterm. So i dont get it, given those risks. Look at the world. Where were in a World Economy. Tell me companies that should be tightening or easing Monetary Policy. Francine that brings up todays twitter question. Do you care if the fed raise rates . I know someone who will care. Lets bring in our guest. Great to have you run the program. Always a pleasure. Do we care too too much . Because it is stated dependent. Andreas i care a lot. I was on the program at the start of this q. E. , global q. E. , and i thought it was a very sinister type of Monetary Policy because it redistributes on a massive scale to debtors. I do not know if the fed will raise tomorrow. The question is, should they raise . Absolutely. Policy hasary allowed the system to stabilize but we have not seen growth pick up sufficiently. The argument i made several times before is probably q. E. Policies and zero interestrate policies are counterproductive because they are telling investors, telling industrialists, there is still a crisis going on. It is unsafe to invest. Nobody knows with the discount rate is. He reasonse of t that fixed capital ratios is that it alltime low. Francine there might be a credibility problem if the fed has raise rates and reverse it. Andreas there is always going to be turmoil. A competing show last week in new york. Already the fed hike was being discussed. They were framing the question as to whether the fed should hike in the context of the earnings disappointment from apple. The downdraft in the stock market on that day. That is just completely ridiculous. Not about stabilizing the stock market. Francine absolutely, but im looking at china. Is it a Market Correction or much more sinister hard landing . Did the authorities lose control . When you look at world growth, it is going to. We may hit a recession at a rate hike would not help that. Andreas what does a rate hike to . Neednt basis points have a Significant Impact on the yield curve. And may have some impact on currencies. If anything, if it improves the Exchange Rate of the dollar, it could be positive for china. So, that is not such a bad thing. More importantly i think is what a rate hike would signal to the Financial Markets and to decisionmakers. It would signal a going back to normal. Right now it is signaling we are still in crisis. Francine is it that you want to say that we are back to normal or the party is over . Are the markets in a necessary correction . Eas they are probably in the necessary correction. That being said, they are not equities. Seennk volatility we have over the past 18 months, which seems to be increasing, is due to the uncertainty around Interest Rates and uncertainty around whether the central bank, the policymakers have confidence we are through the worst or that were probably worried about the next recession. Francine are you not worried about the next recession . Andreas absolutely, i am worried. But i think zero and destroy policy may be conjured into a recession rather than causing it. Francine the point is that because then if you are at zero then Central Banks do not have the tools to help a possible recession. Andreas they need to give themselves firepower again to counteract any possible flattening of economic growth. You as a question earlier, is there a dovish rate hike . Absolutely, there is. In 2006, that was. We know what happened after that. Francine talk to me a little bit about how you actually invest around this environment. Youve talked about this a lot. Secular trends. Chasing dividend and income. There are many ways people can do that. There are market Asset Strategies that will vary be very diversified that can target a return at about 4 . Nominal third i think that is return the people can hope for. It is similar to the dividend yield of many stock markets. Dividend shares will give that over two to three years. The other way is to look at Investment Strategies that generate sustainable performance. What that means is that either, if people want to have they theyuy that strategy, if want to capture the performance at 4 over the benchmark, sophisticated investors can hedge out the beta risk and still get their 4 . Now, that is of course in a lower environment which we anticipate for the next for seeable future. Alpha is going to be a much more important component of peoples returns that it was the last 10 years. Francine thank you so much. He stays with us. Plenty more to talk about. Heres a look about what else is on our radar. Bank of it when governor mark carney has signaled that there is a chance the bank may raise rates in early 2016 if the economy continues to grow and inflation pressures pick up. He made the comments during the parents before the treasury select in an appearance before the Treasury Select Committee. The economy if follows the path consistent with this forecast, then the decision will come into sharper relief around the turn of the year. Francine a french cable operator has agreed to buy cablevision. It accelerates the European Companys expansion in the u. S. Lasta 22 premium over nights closing price. Three people are known to have died in the 8. 3 magnitude earthquake that struck the north of chile. Authorities affect critical scenarios as waves washed ashore. The president says the government is assessing the thege and warned of potential for strong aftershocks could police in hungary have fired tear gas and water cannon and refugees trying to break through the border. Hundreds of people have been trapped at the crossing after hungary closed it to stay. It has been a main entry point for those trying to get into the european union. The e. U. Is dealing with the worst refugee crisis since the Second World War and tens of thousands flee the war in syria and iraq. The second republican president ial debate took place in california lesson. Theres tommy got personal as the more politically experienced candidates tried to gain an advantage over donald trump. I think there a sophomore quality that is entertaining, i am worried. Im very concerned about having him in charge of Nuclear Weapons, because i think his ceral responsevi to attack people on their appearance, short, tall fat, ugly, my goodness that happened in junior high. Are we not way above that . Would we not be worried to have someone like that in charge of the Nuclear Weapons . Ump i never attacked him on his lip and there is plenty of subject matter on that. Takes to janet yellen the podium today. We will continue to look and had after this very short break. I do believe the fed is not going to hike Interest Rates in september. But there will be a rate hike in december. They put themselves in the best possible position. Whatever they do, nobody would say we are discovering something which is entirely new. Withhave a lot of trouble this idea that lets do it now and then we hold our breath. If you really dont know that you have room to raise it, why are starting out . Case fork the domestic raising rates is solid. Has been for a while. They should have moved when both domestic and International Elements were aligned. The question is, are the conditions facing the u. S. Economy in terms of the objectives of inflation and on a plummet such that an increase make sense . That is the only criteria that matters. Imf there is any reaction, talking about the u. S. , outside the u. S. It is going to be much bigger. It is much more about setting precedent or getting started. If the u. S. Economy is in anything like normal shape, 25 basis points should not matter that much. By 25 basis points, if they dont, then the narrative about why they dont is important. I do not think they should do a hike just because they want to start hiking. I think that would be poor judgment to make the move. If things go badly in the rest of the world, Financial Condition spillover, in that case, they should push it into 2016. Francine all right. Those were some of our key guest weighing in on the fed Rate Decision over the past week. Lets continue the conversation with our guests. Before the break, you were saying, it matters to you what the fed does. Because they need to give a signal to the markets that actually the party is over. Andeas the party is over central banking normal operations has resume. The Central Banks have done with a needed to do in the immediate aftermath of the great financial crisis stabilize the Banking System and now they need to resume normal operating procedures. In the case of the fed, that means we are at full employment. The a country has picked up, Consumer Confidence is high. No reason not to hike Interest Rates. Francine you look at charts all the time to ensure they are shouldnt they . Mark what a failure of Forward Guidance. What was supposed to be a new era of central bank Monetary Policy. And to consumers and businesses who have to make investment decisions. Its appalling . Francine do you really think that, because the guidance was on messages till we had emerging markets in china. Mark it wasnt. Look at the parade of clever people we had with the diversions of use, even about whether the economy can sustain in interestrate increase. It all seems to be more about the psychology of central banking not liking the zzeero. It has got almost nothing to do with the current inflation backdrop and little to do with the inflation outlook, because there is not a lot of forecast for 2 inflation. If that is what Central Banks are holding their hats, on, its a ridiculous situation. If they raise rates, they will be accused of ignoring international backdrop. If they do not raise rates, they will be accused of cowardice. They cant win today. I think it is their own fault. Francine two you agree with that . I always read it to say that toically they were ichingtching go and turmoil scuppered everything. Andreas i think for guidance will be ditched. And Forward Guidance needs to be ditched, because it is not what Central Banks should be about. I think Central Banks should be able to keep their options open and not be guided by the markets. Weve got the cart in front of the horse here. It is the markets, as i referred to in the early block, the markets seem to be dictating fed policy. And that is what the market is expecting. That is fundamentally wrong. That has basically happened since the greenspan put. We have got to get away from that policy. If that means of setting the markets for a while, that is a necessary price to pay to avoid a much greater calamity that might happen. Rocause right now the ze Interest Rate policies have achieved the opposite of what they were supposed to. S global stock ofh debt i higher than it was precrisis. We are in a worse position with less growth. That is a real conundrum. The policies and quantitative easing on top have not produce the goods. Mark i went back and reread Ben Bernankes famous speech on deflation. The polity is and has been followed to the letter. Its failed. Its turns out quantitative easing does not avert the risk of deflation. The employees of citigroup is talking about the global recession. He also seems very worried that they have not slay the dragon of deflation by any means anywhere. And the japan experience seems more and more instructive as time goes on. In the u. S. He u. K. You are not seeing that inflation forecasting horizon. And that is the bit that worries me. That if Central Banks have steered businesses if i was running a business in this environment, mi going to build a new factory . 0 am i going to build a new factory . Andreas it is a discount rate. Thatine do you agree deflation is a huge concern . Does it mean the ecb, whether they do extra q. E. Or not . Andreas of course it is a huge concern of the markets. That is part of the reason we are seeing volatility. Because the narrative today is that deflation and anything that might possibly lead to deflation such as higher Interest Rates is on them vigorously ba una mbiguosly bad. The western world is facing democratic challenges. It is not a given that growth of two or 3 nominal and 1. 5 real is sustainable for the next 10 years. And therefore, if that is the case, then we are aiming for the wrong boogy and we are consistently disappointed. That narrative needs to change. We need to reexamine how bad lower nominal growth really is. Real growther really is. And if zero Percent Inflation or flat disinflation is as various as the markets are making it out to be. We dont know. Francine you and japan and the stock theyve been stuck. They have been stuck in this vicious circle for 20 years. Mark you can persist like that for a long time. And you may have to use different stabilizes to adjust for that environment, would be one argument. Are idea that low rates contributing to the problem. Emailsad a load of about this. And i am starting to worry that a thought expense. If the fed move traits to 3 later today, would we be in a better or worse Economic Outlook . What do you think . Andreas it is a very interesting question but i would not say we would be in the worst environment. The yield curve for not necessarily stephen, which would hardly impact longterm investment. It would send a positive signal to savers. They would get return on their investment again. Spend that money. I dont know. It is a very good question. That is why think 25 is not going to do any damage. We should definitely get on with that. And perhaps be even more aggressive and get the markets used to an Interest Rate environment which is not on the surface there to support the financial system. Francine thank you so much. Andreas stays with us and mark calvert. And mark gilbert. The european cable operator is buying cablevision for nearly 1 8 billion. For more, lets bring in matt campbell. What does this mean for altice . Matt this transaction, was completed, it will make them into the first rank of the u. S. Cable industry. He was a bit player cablevision operates in the new york metropolitan area, not in new york city but in the suburbs. It is one of the top five or six u. S. Cable operators. With this, and, nation with sutton link and other deals, in combination, this makes altice heavyweighta in the u. S. Francine it means that what u. S. Pay tv, that industry is growing and it makes sense to own . I am not sure if this is driven so much by growth as by the opposite. The u. S. Business is consolidating among cable, Telecom Media in general. Everyone is buying each other if they can. We have seen at t making major acquisitions. Charter getting bigger. This is about the netflix effect and the amazon affect in the apple effect. These are company that once upon a time could count on a very lucrative Business Model in which basically everyone had a cables excursion. Cable subscription. These guys are trying to come together in an effort to take on the big beasts from Silicon Valley who have cut into the revenues. Francine are they going to see many more u. S. Acquisitions from altice . An extremely is ambitious person. He is aggressiv