Pricing scandal intensifies. Good morning, quick look at u. S. Futures and were expecting a bounce back in todays trading session. S p 500. Seen up by 12 points, could add 104 points even. Up triple digits and the nasdaq higher by 26 points. This is after we closed lower in yesterdays trading session and one of the biggest factors was walmart taking 44 points off the dow. I want to talk about another company first. Netflix. Third quarter earnings disappointed missing on the top and the bottom lines. The company cites low subscriber growth in north america adding 880,000 new users versus 1. 1 million. For more on the numbers she filed this report. Earnings came in a penny lighter than wall street projections. Total subscriber numbers grew better than expected to 69. 17 million around the world but that was driven largely by International Growth while u. S. Subscriber growth fell a bit short. The company says that was in part because of the transition to u. S. Chip cards making it harder to collect what it called involuntary turn. They were still very bullish on netflixs ability to keep growing its user base despite growing competition in part because of the value the company is finding in its original programming. The more we have amazing originals then overtime well be able to ask consumers for more. To be able to invest more. Thats been the rhythm we have been on. As for what type of original conflict netflix could make now, they ruled out sports programming saying its too expensive and not too entertaining to watch sports content after the fact but he did open the door to making a new type of news content saying that the likelihood that netflix will in the next two years complete directly with vice which is going to start making a daily news show, he said, is very high. Back over to you. Its been a big earnings day in europe too. Burberry trading lower. That missed forecasts which are looking for 5 growth. This is caused by the slow down in demand from china which accounts for between 30 to 40 . China is, specifically hong kong, its been, you know, Everybody Knows theres been a struggle there. The important thing is to just keep making sure you have a point of view. Making sure that you keep your authenticity and making sure that you give the best Customer Service in those countries. Right. Lets now look atwal mart which has stunned investors with an earnings warning for 2016. The Worlds Largest retailer by revenues now expects eps to fall by as much as 12 . The Company Blames the impact of higher wages, spending on ecommerce and lower prices. Walmart plans to spend 1. 5 billion on investing in staff and payrolls as well as another several billion dollars on lowering product prices over the next three years. And the news triggered one of the sharpest one day drops in the stock in 25 years and wiped out nearly 20 billion in market value. The shares also weighed down. The dow as well as other retailers, target and home depot, so walmart could spark a price war. Jim cramer spoke to the ceo that said markets knew the high wage costs were coming. All we did today was to quantify the move to 10 for everybody. That surprised some people. I think it surprised a lot of people. I think people were shocked frankly. The stock does not get hit like this. Communications . Weve known for a long time it was moving to 10 but it is what it is and the news was going to be new sometimes. Are you buying the stock tomorrow. I dont own banything but walmart. Rising by. 1 . Stripping out auto sales it dropped into negative territory even down 0. 3 . Joining us live from boston is ted peters. Chairman and ceo at blue Stone Financial institutions fund. Good morning to you. Were expecting the cpi print today. Thats not going to look very rosy either and if you take a look at what the bond market is pricing in now theyre not expecting the first rate hike by the fed until march. Do you think the fed is behind the curve . Were reaching rate increase fatigue. Everybody is ready to get these up and get them going. Thats not only in the United States. Thats overseas as well. Theres so many mixed messages at the fed. We just had two fed directors come out and talk about maybe we shouldnt increase rates this year. Janet yellen is saying we should raise them by the end of the year. Were not sure what is going to happen and i think the indecision and mixed messages, its difficult on the market right now. Do you think thats going to influence the fed . Those expectations that might be in the marketplace now need to be met . Because if they arent it sends out a signal that theyre too concerned about how strong the economy is. The fed said consistently that theyre data driven. Theyre very very data driven. On the other hand, 8 of the 12 Federal Reserve districts voted to increase rates. Thats really just going to influence whats going on there. It keeps improving steadily and the thing the fed looks at is employment. Employment has been good in the United States. Unemployment is down 5. 1. Job openings are up. People are leaving jobs more which is a good sign because it shows they think they can get other jobs. Theres a lot of really positive things on the employment front. Okay. Well lets talk about the consumer front, though. Of course retail Sales Numbers disappointed. Walmart obviously shocking the market with its earnings revision. Does that concern you more broadly for the outlook . Not just the economy but equities in general when you see that kind of earnings downgrade from the likes of walmart . Well, Consumer Spend z has been strong. That was one of the real positives in the economy. Its hard to look at Just One Company or whatever. Clearly the earnings season so far has gotten off to a very mixed start. Walmart down, netflix down, some of the Bank Earnings that have come out whether they be wells or jp morgan chase, theyre kind of mixed right now so well see how this thing plays out. A lot of ternihe earnings will coming out. The messages are mixed in everything. In the earnings and the economy and within the fed itself. You mentioned a couple of banks there. Well talk about that a bit later. Stick with us. Well be back with you in a few minutes time. Valiant pharmaceuticals received subpoenas regarding drug pricing. They intend to cooperate with the investigations. This comes at a time when the sector is under a lot of scrutiny for rising drug prices which is one of the prominent issues in the u. S. President ial election and of course one of the favorite topics on the part of hillary clinton. Right. Still to come here on the show, hsbc staff feel the squeeze. Its reportedly been a tough week for its Investment Bankers in london. Stay tuned to find out why here on worldwide exchange. vo what does the world run on . It runs on optimism. Its what sparks ideas. Moves the world forward. Invest with those who see the world as unstoppable. Who have the curiosity to look beyond the expected and the conviction to be in it for the long term. Oppenheimerfunds believes thats the right way to invest. In this big, bold, beautiful world. China weighs on sales and twitter ceos other company gets set to go public. Just want to share with you a comment, he says the chances of the oil price going belowbelow. Lets check on where we are in terms of oil prices right now. Were lower on the day. This is in part because we saw the jump in u. S. Stock piles in yesterdays trading session. Brent crude at 49. 10 just a fraction on the day. Wti crude off 46. 14. A little pit more than 1 . Now hsbc has given cnbc no comment on a report it will impose a 10 pay cut on hundreds of Investment Bank employees. A times article suggests they would force staff to take two weeks of unpaid leave as part of cost cutting measures. As routine practice we regularly review rates for contractors. Quick look at hsbc shares this morning and were up by 0. 4 . We have a slew of Bank Earnings this morning. We have numbers from citigroup, goldman sax and u. S. Bank corp. After jp morgans miss on the Financial Sector for more guidance. Still with us is ted peters. Ted, in this current environment do you want exposure to Investment Banks or retail banks . Well, we like retail banks, actually, specifically blue stone likes Community Banks because we feel that Community Banks are going to out perform the market for the next 7 to 10 years for a couple of reasons. Large merger and acquisition in the retail space and rising tied is going to lift off ships and Rising Interest Rates. We know theyre coming. But Rising Interest Rates are going to help the bank space immensely and help the Community Bank space because of the really strong core relationship deposit. Were bullish on the bank space in general and bullish on the Community Bank space. At what point are you going to be concerned about credit quality though . Well, right now credit quality is really good and theyre very good but nonperforming loans continue to go down but youre always worried that things could get risky. Bankers sometimes have short memories. I was a bank ceo. They have short memories and go back and start doing things which they shouldnt do whether it be in construction lending or Development Lending or things like that. Do you think that ceos in the banking space are too short sited . You mentioned the list of Energy Lending construction spending. Are we getting ahead of ourselves now in terms of lending picture once again having forgotten about what happened during the great financial crisis . You have to remember the regulators are tougher than they were precrisis. Theyre coming in and going through everything with a fine tooth comb. Looking at any concentrations in your portfolio. Do you have too much in energy, too much in construction, too much in manufacturing and so forth. So i dont see another crisis coming up. The only thing that bothers me is the biggest banks. Back doing risky things again. That poses a threat to our economy. Hopefully the regulators which have been all over them are are going to continue to do that. But lets go after the ten or 12 big banks doing crazy things. Lets stay away from the regional Community Banks who are actually doing the right thing. Theyre bringing in deposits and taking care of their clients. Its pretty clear you like those Community Banks but lets quickly touch on the big gaps we heard from jp already and the rest are coming throughout the rest of this week and next week. Which of the big banks if you had to own one of them would you own . Well, you know, we like wells fargo. We like it because it doesnt have a huge amount of International Exposure but we like it because its a very well run company. Good retail. Good Corporate Banking so if i had to buy a big bank i would go with wells fargo. We think its probably one of the best run banks in the country. Thank you for joining us. We have to leave it there. Chairman and ceo at blue stones Financial Institutions fund. Angela merkel says her country will work constructively on britain with european reform but some principles are nonnegotiable. Chancellor merkel is convinced that the countries will find an acceptable compromise to keep the u. K. In the eu. There has been some trouble ahead of the meeting as juncker seemed to suggest the u. K. Might be better outside of the eu. Take a listen. What do you think. I am 150 in favor of having britain as a constructive member state of the European Union. We need britain. Personally i dont think that britain needs the European Union but thats a matter of conviction others may have a different feeling on that. They will have the same feeling if ever britain would leave. And julia joins us live from brussels. That was quite an embarrassing slip of the tongue. Well, what an english french little translation slip between friends or frenimies. But the press jumped on this more because theyre not expecting anything news worthy today from the negotiations. The rumor yesterday was as far as future negotiations on the relationship together keeping the uk. In its not going to make much progress today. It will be pushed back to december. What everybody is waiting for is for David Cameron to be straight up and tell what he juans. The belief of course is that he doesnt want to write this down because a he doesnt want a benchmark fwe benchmark against which hell be accused of failure. So wait for it. Theres going to be way more talk around this for the next few months im sure. In the interim, lets bring it back to swagger. We have been talking about european swagger and confidence. Thats what european leaders like to show here. They also like to he show it back home of course. Until we start to see them showing some swagger, a blow up between the u. K. And french i dont think were moving toward a more formalized negotiation progress. I dont want to air the disagreements we talked about an hour ago. Is it fair to say these meetings of all 28 members theyre unlikely to be where any deals are actually made on this issue. It is surely the separate bilateral meetings which mr. Cameron had a few of with mr. Holland and chancellor merkel where the actual progress is going to be made and a lot of that is already going on. Its just behind the scenes. Youre absolutely right and the technical discussions are going on behind the scenes as well but remember when David Cameron did his whirlwind tours he said little about the progress he made so i think he got it short. It really isnt happening until after the german and french election. So theres a lot of willingness to negotiate but only as far as theyre willing to negotiate and David Cameron has to be cautious about the request he makes. Having said that we know George Osborne and the german finance minister are on board with giving more freedom along with closer integrations of the euro zone nations. If both can make those conditions work, it will work. Back to you. Thank you very much. Still to come on the show, reaching the Tipping Point. Why some Restaurant Owners are putting an end to that extra token of appreciation. Thats coming up after the short break. Care of my heart. Thats why i take meta. Meta is clinically proven to help lower cholesterol. Try meta today. And for a tasty heart healthy snack, try a meta health bar. The Ratings Agency expects more prolonged weakness for domestic demand amid the volatility in crude. Now the president of the worlds biggest aluminum producer told cnbc that glencores plan to slash its debt pile is feasible. I spoke exclusively to him and he thought the swiss commodities giant had been unfairly punished by the market. Rusal may be doing the best of our peers. Why . We have been in crisis since 2008. Debt crisis was very painful. We had quite a big chunk of debt before we step into the crisis and we have been successful to reduce our debt almost two times. Were a structural business, maybe most profitable in the world. You cut net debt from 13 billion back in 2009 to 8 billion at the end of june. Thats a really big chunk. What glencore is trying to do is a lot more. Theyre trying to cut net debt by some 10 billion by the end of next year. With your experience and how you can slash debt and how quickly you can do that, is that feasible . 100 . 100 it is feasible . Why . They have a diversified business and they have a lot of opportunity not to find it in some of the assets and i still believe its very its fundamentally very economically driven company. Not unless its a, you know, lets say colleague, you know, some are destroying the market. We can see whats happened in some other area. And theyre very different. Thats why they have been hit hard because of coal and Energy Prices but still, you know, people immediate our product and commodity, you know, needs a good trading mat form and glencore provides the best Trading Platform in our sector. Dont keep the change. Danmyny meyer is eliminating tipping from all of his restaurants. They will actively discourage tipping and wont allow a gratuity line on the checks, average hourly wages and menu prices are expected to rise. Now 25 an hour. Thats what many people are now paying. Whether its front staff not necessarily back staff and they always thought this is so unfair because the kitchen staff doesnt get to share in on the big profits. But this is a big change for Tipping Culture in the u. S. But Tipping Culture is very different. Totally. Here its added as part of the service and already goes to the restaurant. So this is a big change for the u. S. But it sounds like a sensible change because thats already whats in play here. But anyway, something thats going to change sentiment there but well discuss it more later in the show. Still to come on the show, a chip on netflixs shoulder. Theyre blaming their earnings miss on a very unusual factor. Stay tuned to find out what it is. Cme group can help you navigate risks and capture opportunities. We enable you to reach Global Markets and drive forward with broader possibilities. Cme group how the world advances. Good morning. Youre watching worldwide exchange. Here are your headlines from around the world. Red is the new black from netflix as the Media Companies sees its subscriber growth fall short of expectations. Burberry goes out of fashion. Th