For the currency. We have seen a number of effects on the u. S. Dollar, the japanese yen, etc. , but were compensating in our numbers. And cleaning up the mess. Jpmorgans close to a deal to settle u. S. Related problems. The bank could still face more legal woes. The edf is going to clean up the fukushima plant in japan. Announcer youre watching Worldwide Exchange bringing you Business News from around the globe. Hello. Warm welcome to the start of Worldwide Exchange for the week. Plenty to get through on todays show as ever. Finally, it is u. S. Jobs tuesday this week, but how should investors expect the bull market to go. The treasuries well talk about at 10 20 c. T. The weaker than expected numbers dont really move the needle. Well discuss that as we look at japanese exports at 10 30. As the new department gets set to protect data, well ask whether twitter and google are right to get concerned. Thats 10 45 c. E. T. Plus, its being billed as the biggest auction ever. Well hear from a latin american analyst and why the government has low expectations. Plenty of earnings state side. How is mcdonalds new strategy to manage low u. S. Margins fairing. Well discuss the q 3 numbers later. If youve got any thoughts or comments throughout the show, you can email us there worldwide cnbc. Com. Philips triples their net profits. Improvements in all three of its Major Business movements. In a first of cnbc ever, the ceo spoke about the Health Care Reform and said it proved to be an opportunity for the company. Ive always said the Health Care Reform in the United States causes uncertainty, but overall it will cause liquidation of the health care system. Thats a distraction in the short term. Hospital ceos are not doing as much Capital Expenditures as they did before, and we see opportunities to change the role of philips in the market. Im very excited to become Technology Partner in hospitals and want to drive efficacy. What about the Share Buy Back program here. Is that a reflection that as the board feels business markets may be improving the market isnt appropriately rewarding phillips for the work its doing and youre trying to get the share pry higher . We have talked about our Capital Allocation policy and our Capital Market in september. We have outlined we see many opportunities to grow phillips 4 to 6 offer the next three years. We see opportunities to further boost opportunity by 300 to 400 bases points. We hope to invest more in innovation to the tune of about 200 basis points. Net net this improves further the result of philips from 10 to 11 . Well be strongly cash generative and as such even accounting for some buy back acquisitions. It fits well into use of cash while also mitigating risks. This Share Buy Back program of 1. 5 billion will start in the month of october 2013 and run for the next two to three years. I think its a sign of confidence that we have in the performance trajectory of phillips. Take a look at phillips shares today. Theyre doing pretty well, up 6 , big move for a company like philips. Meanwhile, sap jumped 23 . The Software Company is warning Exchange Rate effects could affect them in the Fourth Quarter. The Third Quarter had seen improvements in the companys asian operations. Weve actually with the numbers were announcing today seen asia pacific japan returning from growth, which is of course a great news. Theres lots of companies in asia who need World Class Software to grow business. They are choosing sap. The growth in china has been very, very strong in this quarter. China is the locomotion for asia. We have a good outlook for the year. We are reiterating our guidance for the full year to be a double digit growth for the company for the full year. We also see an opportunity to continue to expand our margin. Can you talk to us, jim, about the pace of transformation in the company, this move away from people having the software on their own computers, instead accessing the Service Using your cloud. Has that transformed . As you look into the numbers, a good top line, a good bottom line, theres an industry with the world moving to the cloud. The companies dont want to deal with the infrastructure inside. The world is moving faster to this memory computing that sap invent invented. It can analyze large amounts of data and can analyze the future. We have 162 growth in the cloud. We have 90 growth and both of these businesses are becoming businesses of a billion euro size, which means theyre a critical mass. Sap shares doing well, up 5 . Equity strategist of btig joins us now. Two really strong share performances from your biggest blue chips. The sap a month ago lowered the expectations and managed to beat them. People are talking about that. How big an issue is the euro . Its a big issue. Q 3 moving up and q 4 higher than last year. Youre seeing a consistent increase in the euro which is quasi tightening. Mr. Draghi is talking about that. We dont look at the currency. Lets talk about philips for a moment. He came in to turn things around. Hows he doing . I used to like to call philips a gentomar hoping they would continue to improve it and they always came through. Since mr. Van hooten came in, it took a year for people to stop being skeptical. Today is a great example. How would you compare it against siemens . Two things to note. Philips did well in the lighting business which siemens got rid of it. The short term aspects arent very positive for health care. Im seeing this more as industrialized. If you look at sort of when philip ss was in its never doing anything right, it underperformed 50 . Since thin its only gained half of that. Those of you who are looking at these equities, you are seeing big institutional flows back into europe. Theres a cyclical recovery in europe. Whats the risk of disappointment . I think in the cyclical terms, its quite high. When the dax is underperforming, i think a combination because people are buying more risk which means it has been moved higher. The effects are hurting as well. On a cyclical side, at the beginning of the year if you said telephones would be up 30 on the sector in the market, you would have thought you were mad for saying that. Its been a big sell sector. Philips is in a category of selfhelp. What are the key earnings . Do you think were going to be meeting expectations, do you think . Are we going to be lower . A lot of companies have said theyve lowered in the first and second quarters. Theyre missing. They want to make it up in the second half. Which is a classic example whats happening in the last two years. You had companies missing the first two quarters, dont worry, well make it up. The second the same thing. And theyre pushing it out further and further. Weve seen that this year. First quarter actual earnings and the second half and on average they were 10 lower. I think were starting to see that come through. Third quarter numbers arent quite as good as people were hoping. Companies are having to look at the fouryear outlook. Add in the uncertainty of whats happening in the last four months. Nick, good to see you. Thank you from equity strategy btig. Take this picture of the dax 600. Hope you can see where we stand. Around 5 to 3 on the dow jones. As far as ftse is concerned, we were up 46 points on frida friday,. 7 . Early earnings dominating. Cac current is down slightly. Down. 4 of 1 . We looked at some of the leading stocks. Rbs down. A little bit weaker. The Dutch Company blaming adverse currency effects. Again, another Company Coming out from that as well. Selfgrowth for sap slowing in the second and Third Quarter. Its 5. 2 . Rbs, the worst performer, 5. 5 . J. P. Morgue gans reached a tentative deal to reach a prose. They could be close to a deal to split the bank. Bond rates, treasury yields down here, 2. 59 . We got down to 2. 55 last week. Post the nontaper decision. Yield is a little too high. Get minutes out this week from the umptd k. The currency market we saw the dollar on the back foot on friday. This is where we stand. 136. 67 for euro dollar. Aussie dollar with a 96 handle. Sterling cable around 1. 60, 1. 67. Thats where we stand now an hour nood traiting week. Were having the day wrapped up from china. Thank you for that, ross. Let me start with some Economic Data. Increasing exports slowed from the august level and imports rose 16. 59 . Short of expectations. Nevertheless, on the markets the nikkei gained almost 1 with the weaker yen gaining supports. Investors are eyeing the all important jobs data due out tomorrow. China markets outperformed the china market gaining a strong 1. 6 after the premier league ensures investors growth targets will be met. The hang seng added. 4 to end about flat. Over in australia minors pushed the asx higher. Let me show you some individual stock on our radar. Hutch chin son whampoa is calling off a plan to sell its park and Shop Supermarket chain and will focus on expanding in china. The shares tumbled. Thank you, sixuan. Thats the latest out of asia. Jpmorgan reached a tentative 13 billion deal to settle pending civil cases with the Justice Department. Federal Housing Finance agency and the new York Attorney generals office. It would resolve probes into the banks handling prior to the housing slump. The deal was struck on friday between jamie dimon and the u. S. Attorney general, eric holder. Of that 13 billion, 4 billion will go to a consumer relief fund. Jpmorgan tried to insulate it sieve from criminal prosecution, but the u. S. Wouldnt provide those services. Just half of 1 . Umpt s. Regulators are reportedly seeking more than 6 billion from bank of merck for allegedly misleading fannie mae and freddie mac before the housing bust. The fhfa is pursuing the penalty. Its cost the bank more than 40 billion in Legal Expenses and other charges linked to bad subprime mortgages. And Deutsche Bank is in discussions with 50 of its workers over the possible manipulation of the livor rate. The investigation is by ernst and young. The paper reported the staff was able to bring lawyers and witnesses to the meetings. Tom hayes is expected to plead not guilty. Serious fraught office has given anonymity to the former trader. He faces charges into the u. S. Into alleged fixing. Hes not had the opportunity to enter a plea. Umpt s. Treasury yield, how will jobs tuesday move things along . Well get into that straight after this. Announcer youre watching Worldwide Exchange. Brittain has signed a deal with edf to help out with the cleanup. Initial cost estimates for the two closed reactors are set to 40 billion pounds. Under the deal the u. K. Government will guarantee the price of 50 cents per megawatt hour. That will currently double the price of u. S. Power. Whats the best chance to provide the energys policy. Tweet us or go direct to me rosswestgate. Nuclear doesnt generate any carbon but it has other risks associated with. U. S. Treasury secretary jack lew says the u. S. Economy has been bruised by the fiscal fight in washington. Hes pretty confident america will recover. Speaking on nbcs meet the press the country cant suffer another round of brinkmanship. I know the direction. The direction is that it took an economy that is fighting hard to get good Economic Growth going, to create jobs for the american people, and it took it in the wrong direction. And in spite that in washington, companies are mostly upbeat about Economic Growth. In the latest survey, they had growth. 27 of economists showed riding in the Third Quarter. The quarter is expecting Rising Interest Rates to drag on sales over the next year. U. S. Treasury yields, we saw last week getting down to 12. 5 sorry, 2. 5 . We were yielding 2. 74 before we got the resolution in washington. Mark oswald joins us for more. Mark, good to see you. We know we have a faulk of Economic Data. We have a potential wrangle at the beginning of the year. Whats a conceivable or most likely i should say . I think the consensus will focus on march for the time being. I think how it pans out is dependent on a number of things. Being in control of the fed is fracturing. The not so dovish members, like mr. Williams from the San Francisco fed who is close with miss yellen have to look at the various aspects. The data and there is a threat of more shenanigans washington, they couldnt, could they . Well, on the other hand, whats the benefit of more qe . I think this is the question which is vexing a number of those people who are moving to a less dovish start in the sense that theyre worried that the more qe they do, the more that markets are chronically dependent on that flow of qe, not the stock of qe, the more the risks to financial stability, which is one of the arguments which was profit back in may and which seems to be swept completely under the carpet are becoming exponential. I think thats absolutely correct. Then we come back to this point, dont we . One of the reasons that they also didnt move was because they talked about the majority of qe. Market rate went up to 3 . Rephis stopped. Economic advantage was impacted. Yes. Youve got that risk, but that risk is always going to be there. At some stake its going to happen, and if weve got a recovery is the recovery Strong Enough to withstand the risk of that . None of us have fiscal timing going on. Im not sure thats the issue here. The issue is whatever recovery we have, when it does have traction, it will threaten to stall it partially. Were now in a situation actually where the more they do, the more damaging it could become, particularly from two aspects. One is all the Central Banks can ever do is buy time for politicians to act. Buy time for politicians to waste. Well, in this particular case theyve been wasting plenty of it. Weve been having the fiscal and budgetary discussions for 2 1 2 years. Secondly, its time for companies to invest and invest at low rates. Thats not been happening to the extent they would have wanted. There hasnt been that much investment in people. That survey from the nab shows us still reticent to hire because of the uncertainties. If you look at it, actually people have been more focused on buying back their shares, paying out big dividends than actually investing in new products, in hiring people, in improving production facilities. So youve got to this point four, five years in to qe where youre actually saying, well, if we havent got benefit that were meant to have, whats the point of carrying on with it . But its a difficult one for markets to digest. Yes. Mark, stick around. Meanwhile, chinese Rating Agency degong recently downgraded the u. S. Sixuan spoke with the chairman earlier. Sixuan, so, just explain more about this ratings agency. It wont be that well known in america. Yeah, youre right. Theyre in fact one of the local chinese rating agencies and recently it downgraded the United States from a minus to a. Also youchb graded some local Chinese Government bonds, dagong. They remain negative on the sovereign credit. I got to speak to the chairman and i asked him whether the debt deals dropping in washington last week puts americas credit worthiness on to firmer footing and have a listen. Translator the u. S. Will try to resolve the debt ceiling issue over the next couple of months, but this wont change the substance of the matter, which is the countrys deteriorating ability to repay its debt. It doesnt rely on its income or wealth to repay its debt. Instead, they borrow new debt to pay old debt. This is a very vulnerable relationship which can put the government on the edge of a debt crisis. This is a longterm problem and wont be fundamentally resolved by raising the debt ceiling. We remain bearish. Ross . Good stuff, sixuan. Catch you a little bit later. That was part of sixuans interview. Im just wondering whether we think dagong we care of what dagong says. Whats the validity . Theres a lot of merit to it. The counter argument, the u. S. Dollar remains the worlds currency. Its effectively like gold was 100 years ago. In 2011 chinese and japanese treasuries went up. If theyre accumulating it affects reserves, the pace they are, even if theyre diversifying. Their holdings will have to rise. In the long run were on the whole for the dpie lem ma. The dollars influence in the world ironically as its Energy Imports fall. The stock of dollar is going externally falls as well, its going to come less. For the time being markets will lean against the idea. Theres a big threat because the fed is continuing to buy. Good article last week about companies in asia. If you have to post security for trades, youve got to post it in dollars basically. No ones prepared to accept much else in treasuries. There you go, thats the other side of the coin, which is the failing of the big en countries. Creates local Financial Markets which would then offer securities for people to offer against trade. Nevertheless, you have the other side of the coin. There are a lot of cross border swap agreements where the government will post the security. In the long run, more and more trade is being done or settled not in the dollar. There is an increasing focus on it. That process is a very, very longterm process. Youre talking about something that will happen over 5, 10, 15 years. The u. S. Does need to address this problem of its fiscal problems because otherwise in the long run it may find itself on a trying to solve a problem in a more vexed situation. Tonl morrow we have the j