Nigeria. All of this really having an impact on the markets. The Global Markets tumbling after the president s address last night. The futures at one point down by about 100 points. We have seen some improvement, that there are still some pretty sizable declines this morning. Youll see those dow futures down by about 47 points below fair value. The s p futures off by seven points. This is coming after the markets closed lower yesterday. The dow closing at its lowest level since april. The s p 500 closing at its lowest level since may. So again, pressure this morning. This looks like a third week in a row of losses for the markets here. Also in europe, if you want to see how things are reacting, you can see the dax down by another almost. 9 of a percent. The ftse in london off by. 7 of a percent. And in italy, thats the only ed a vancor that were looking at. In asia, the nikkei suffering its worst deline in five months. A decline of about 3 . Shanghai and hang seng saw much more modest moves, but again, a lot of pressure, and brian, well send it to you. As becky mentioned, the president giving the green light to airstrikes against isis if necessary. Were joined on set by cnbcs chief international correspondent, who was recently on assignment in the irbil region. Lets get first to eamon with the news. The president spoke after a day of speculation after what washingtons intentions were in the northern part of iraq as those isis forces surrounded an ethnic minority and the Minority Group about ten to 40,000 people were forced to flee to northern iraq. The president saying last night that the United States will undertake two missions in iraq. First will be a humanitarian mission. The second will be targeted airstrikes, if those isis forces move on u. S. Personnel who are located in irbil. And a humanitarian effort to help save thousands of iraqi civilians who are trapped on a mountain without food and water, and facing almost certain death. To stop the advance on irbil, ive directed our military to take targeted strikes against isil terrorist convoys should they move toward the city. We intend to stay vigilant and take action if these terrorist forces threaten our personnel or facilities anywhere in iraq. Including our consulate in irbil and our embassy in baghdad. Weve gotten information now from the u. S. Military of what exactly happened overnight. U. S. Air forces moving into the region with one c17 and two c130 aircraft escorted by two fa18 fighter jets for air support. They dropped, according to the military, 72 bundles of supplies, including 5,300 gallons of fresh Drinking Water and 8,000 meals ready to eat. But the president last night really had pains to make the point that he was the president who campaigned on getting the United States out of iraq, and he said he will not allow the United States to be dragged in to a fresh ground war in that country, guys. Okay, thank you, eamon, for that. Lets get some more color on the city of irbil. Michelle was there in late june and joins us now at the table. So, its extraordinary that irbil is under threat. There are reports of sheer panic in irerbil. It looked calm. Everything was moving fine. Thats because in part the kurdish region very much verges on a police state because they were very concerned about terrorism in general. To see this happening is really quite startling. The weakness in the markets, i think part of it is you have to wonder if eventually theres some kind of u. S. Military option that gets more involved, because remember, dropping water and food on these 40,000 ethnic minorities does not get them off the mountain. It keeps them from starving. It keeps them from dying of thirst. But the rebels control the only passage out. So are you going to have to come off the mountain. How. Thats the question. How. Well, somebody has to physically remove isis. Right, right. Exactly. If its not the iraqis, who is it . Or do they stay there . Chase them off with air strikes. The report suggested they were a halfhour away by driving . Oh, theyre far from erbil. How far are they . There was one report saying they were literally a halfhour away. From erbil . Oh, i thought you were talking about the difference i mean, they were in kirkuk yesterday. There were explosions in kirkuk. Thats 26 miles. We did that drive not very long when we were there when we drove to kirkuk. So its close. So heres a map. You can see northwestern thats the mountain to the left where the ethnic minorities are stuck on the mountain. Kurdistan to the east. Lets show you some of the we cover markets here. Kurdistan has a lot of oil. A Company Called jenel. Look at what happens to the righthand side of the chart last week as it became very, very clear that isis was moving towards the kurdish region. The price of brent, close to that higher by 92 cents. The lira borders on kurdistan. Fourmonth low. What are they going to do . Syria and turkey right there. What happens . And the weakening lira in turkey remember is a big deal because this is a country that has a balance of payments issue. If you dont know what that means, dont worry about it. When their currency gets weaker its a lot harder to pay back their debts. Exactly. When you look at german tenures, theyre about to enter the club of perhaps less than 1 . 1 . For over ten years. Did you see what happened yesterday . This is going to be the most boring thing ive ever said on television, which is the german twoyear treasury note had a negative yield briefly yesterday. Negative yield. You are paying someone to hold the money for you. Youre going give the money and when you get it back, youre going to have less money. Thats an extraordinary thing to happen. Its a signal of insane markets at that point. Intense anxiety. People say why are you mentioning this . Its such a sign of anxiety. The other thing i would point out is were starting to see now a wider spread between germany, spain, and the other peripherals. We used to see everyone go down together. That is not happening anymore. Theres now differentiation because theres increasing worries about the southern part of europe all over again, ever since the italian gdp, right . And that would suggest some concerns about the strength of the eu in general. What is todays date, the 8th . Yeah. Im going to give you some month to date number. This is like deja vu all over again. This month, on a few trading days, spain is down 6 . Greece is down 7. 5 . The stock market italy is down 7 . And the german dax is down 5 in just a few trading days. And can i point out something that is incredibly amazing . Because of all this news, do you know what we have not mentioned . In the last 24 hours, i would say across wall street, the expectations for russia invading ukraine has shot up dramatically. Were seeing now 50 50, whereas most of the time people were saying ah, unlikely, he wouldnt want to do this, etc. , etc. But now because the ukrainians have been so effective at perhaps retaking donetsk, they dont think putins going to be able to stand for that and is going to have to do something more. I mean, think about how much International News that is, that that is now a footnote this morning. Thats how crazy this is at this point. Whats the day like so far . Youve got now resumed possible air strikes in iraq. Youve got the syrian genocide which continues to go on. Youve got ebola in africa. Ceasefire over in israel. Hamas is ready for a long fight. Youve got two hurricanes hitting hawaii. The european stock market looking again like 2011. And we should point out our tenyear, too. Just been looking at the international bonds. This is something to really Pay Attention to. 2. 7 . You had a guest on whos guessing we fall to 2 or lower. Hes been right on a bunch of stuff. I think in six months, will be below 2 on the tenyear. When youre looking at the bunde at 1 , that explains whats happening. Its not the central banks, its what youre talking about just relatively speaking. That was a mark grant call, too. Rick santelli, too. Lets talk a little bit more about whats been happening here with the reaction to iraq. Joining us now, the managing director at bk asset management. Boris, we have seen oil prices push a little higher, but this is going to add chaos to just about every market. You know, listening to you guys talk, i cant help but think maybe were creating the new 1 , which is 1 jgbs, 1 bundes. I know it sounds very crazy, but the net takeaway i think very much risk aversion sweeping across all the markets right now, and definitely dominating headlines as you guys were talking about. The critical thing i think to take away from this is, you know, i cant imagine when you have these geopolitical events happening, especially in the middle east, i cant imagine its just beginning to be one and done. Ive got to believe that isis is going to press forward. And if they do press forward into the kurdish region, were going to escalate our response. So i dont think this issue is just a overnight issue. Were probably going to have this on our hands the next couple of weeks. Thats going to keep the pressure down. So youre seeing all the yen crosses, yen strengthening, and thats probably going to be a trend that couldntntinues. Its hard to imagine what makes the markets feel better, what makes anyone feel better, because these are not easily solvable problems. Theyre not things that can be cleared overnight. Exactly. And the other takeaway from all of this is that when youre looking longterm, the absolute critical factor that a lot of analysts have been making and i kind of agree with this is that the fed is really not going to go back to monetary policy. Until and unless capital assets, equity markets are relatively stable. If you get a situation where we continue to have relatively decent growth, but our stock markets decline precipitously, thats going to keep the fed much longer on the sidelines and i think thats going to be another interesting pressure to the downside as far as risk aversion flow. Youre talking about months and months down the road. Im talking about months and months down the road. Its very hard to forecast something where were in a very fluid situation. The net takeaway, if this is a correction that remains relatively chronic and severe, its going to keep the fed much more accommodating mode than we think it would be otherwise. Investors are nervous. What should they be doing right now . Investors are running a typical safe haven assets in a reaction. You know, its very, very hard to gauge whether this is just a 10 , but youve got to believe on the underlying basis, when youre looking at the various economic factors, the other thing we dont know and you guys were talking about this, imagine a scenario where we escalated our engagement in the middle east and putin uses that essentially as camouflage to invade ukraine. If we have headlines like that, i think you have another move to the downside. I guess my point is it is not time to buy just yet. I think the risks are a little too steep at this point. And on friday, its going to be interesting to see if people are going to be willing to make a bid ahead of the weekend, or whether youll see some selling accelerators. With the suggestion that theres more to go, how much more . Give us worst case scenario. Also because people are going to be sitting there hearing what youre saying, saying okay, ive got to figure out how much farther this has to fall before i actually do something about it. You know, its tough. I think you can reasonably say maybe theres three to four more percent to the downside. From the currency side, the very, very interesting thing here is the dollar yen cross. Thats something you need to keep an eye on. Dollar yen has had support at 175 for the whole yearlong. Thats been a major, major support level. If that breaks, its like a dam breaking. I think that could create massive precipitous stoploss selling. So you need to keep that marker on your screens for a while to see if the fear factors really accelerate. Can we just say, that again, not discounting anything thats going on, and you have to start somewhere, but lets not forget that in 2011, the german dax fell 32 in about four months. Were down about 7 or 8 from our highs. Lets put everything in context. The thing thats interesting is then we had much bigger economic worries. If you make all the geopolitical stuff disappear with a magic wand, the underlying numbers are pretty good. When you strip away the geopolitics away from this thing, the economic story is relatively positive and should be a positive investment. Its just that this unknown right now is really casting a very bad pall. Generally, the way these things have worked out, assuming the worst has always been the right thing to do. Boris, thank you very much for joining us. When we return from hot spots to hot zones, the mess continues. The World Health Organization calling on a Global Response to the Ebola Outbreak in west africa. What would a coordinated effort to contain the epidemic look like . Well talk about that when we return. Also, hawaiian punches. And now julio on its way. The forecast and the storm track, weve got that when we return. As we head to this break, check out the futures. Red arrows across the board with the dow looking like its opening off about 45 points. Were back in a moment. The cadillac summer collection is here. During the cadillac summers best event, lease this all new 2014 cts for around 459 a month or purchase with 0 apr and make this the summer of style. Welcome back to squawk box. A calm morning in new york city. A much different story in hawaii, taking on the full forces of two storms. One hitting now, the other close behind. Lets get to mike taibbi of nbc news, who is in maui this morning. Mike . Reporter they are feeling pretty lucky here right about now, what looked like an historic onetwo punch from two major hurricanes that were going to barrel over this island chain now looks like two Tropical Storms that are going to be nipping at an jabbing at the island from a less destructive distance. Its not to say that people havent been preparing for the worst in these islands. They have been doing that. The resorts and hotels boarding up or putting up wind barriers in the open areas of the hotel, setting up generators and light systems, removing anything that might become airborne, because those winds are still possible. But the full force of these major hurricane systems not going to be a direct hit on these islands. Now, there had been problems already and there will be. Theres been flooding in lowlying areas. The winds have already knock down trees and power lines. Here on maui where its not raining at all, the major Water Treatment plant is now out of commission because power lines have been knocked down to it and residents and users have been told to conserve water from this point forward. They dont know when theyll get that Water Treatment plant back online. The big concern right now is really not so much about Tropical Storm iselle. But about julio. Gusts to 145. Still a category three hurricane. Still heading to the west and on course. The projection is it might actually miss the islands and go to the north of this island chain, so again, not a direct hit on the islands. As one anchorman said about an hour and a half ago, we are lucky. Thats the word from here so far. Andrew . Okay, thank you, mike, for that. Appreciate it. The World Health Organization declaring the Ebola Outbreak in west africa as an International Health emergency. Meg tyrell joins us now with more. Weve been watching this so closely. It seems like things are getting worse, not better. Things do seem to be heating up. The w. H. O. Has said there is a risk of an International Spread here and there needs to be a coordinate ed effort among countries to stop the spread. This is the biggest and most serious outbreak of ebola in its nearly four decades of history. 932 deaths. As of august 4th. And the World Health Organization saying that could actually be underreported because theres so much fear and so much denial of this disease. But they are saying that there are no restrictions right now on trade and travel, importantly. There have been some reports of airlines suspending travel to liberia, sierra leone and some of the countries that are affected. Its important for countries with infected people to screen folks who are leaving, so when theyre leaving the airports, screen them for fevers, do some sort of questionnaires, figure out whether they could be spreading the disease. And they also emphasize that this can be contain econtained. Its not spread through the airport. Its spread through contact with bodily fluids. So by detecting who is infected, detecting who theyve come into contact with, getting them care quickly and enhancing the understanding that people do survive this, thats really important to try to stop its spread. Theres a lot of talk about experimental drugs here. Theres a couple Companies Working on them. But theyre in the very early stages of testing. The World Health Organization is actually going to convene a meeting next week to discuss the ethical and medical considerations of using these drugs, because theyre so early in testing. Tekmira received word from the fda that its changed a clinical hold on its development to a partial clinical hold, so it could potentially be used in people with ebola. So more news coming next week on the potential use of experimental drugs here. Theres a story on the front page of the New York Times this morning that describes how difficult it is to try and contain this, in sierra leone where most of these cases have come, the majority of these cases, people arent going to the hospitals anymore because the hospitals are seen as death places. They tell people dont touch the walls. Everythings infected. When thats the case, when people are no longer going to the hospital, thats a very tricky thing to try and stop, to even try and figure out whats happening. You dont have any official reporting on this. Absolutely. Its a huge fear. The World Health Organization was talking about this a lot today. They have to engage with community leaders, thought leaders. They also have to give more support to the hospitals and make sure that they have the protective gear that they need. That the workers have been protected. Thats one of