the prime minister's home. demonstrators are demanding that he step down. fifa's president says he never meant to imply that racism isn't a problem in football. earlier seth blater said players who think they've been abused during a game should shake hands with their opponent and move on. blater released a statement saying he is committed to fighting racism. president obama and australian prime minister gallard discussed troops. he announced a deployment of 2,200 marines to australia. i'm zain verjee. world business today starts now. good morning. from cnn london, i'm nina del santos. >> and from cnn hong kong i'm andrew stevens. top stories this thursday, november 17. china on his mind. the u.s. president outlines the new u.s. push into asia. the cleanup is under way in asia as factories get back to business as usual. yes, the camera does lie. benetton is creating controversy already with its new unhate campaign. it's already been forced to pull one of its images. first up, the european debt crisis. it's not a story that's likely to go away any time soon. france and spain prepare to sell billions of dollars of debt in separate bond auctions later on today. let's have a look at how the markets are faring at the moment. we're about an hour into today's trading session. red arrows right across the board. one of the markets in the big four hit the hardest is the cac in paris down .8%. this is how italian and paris and french bond yields doing at that. the italian bond yield has once again passed that crucial 7% mark, beyond which many an economist say this really is unsustainable in terms of financing your obligations out on the open market. now we do have a fully technocratic government in place in italy, and they're getting down to work. mario monti, the prime minister there, will be presenting his new austerity plans and exactly how he plans to get italy out of its precarious financial situation in the italian senate later today. also, spain should be going to the polls soon. its bond yields already up towards 6.61% at the moment. even france edging higher at 3.78 as we speak. an true? >> that italian bond yield just gives you an idea of the size of the mountain that the market thinks monti and his team have to climb to get back on track. certainly a daunting task. and that fear of what's happening in italy still playing out in asia. more of a mixed picture here. we've had two days or three days now of down movements, and today is a little bit more mixed. hong kong one of the most liquid markets in this region, down .75%. australia up by .25%. nikkei just above and shanghai composite just below. but we remain watchful until we get a decisive move on what happens in the euro crisis. nina? >> it's not just the euro crisis. i wanted to ask you about this imf statement that hong kong itself may slip into recession. how important is that. and why is it they're saying that? >> it's caught a few people by surprise. if you look at hong kong, you wouldn't think it's on the brink of recession. the shops are still continuing to buzz. because it's a trade hub and an international finance center, any hit on exports to the euro zone hits hong kong hard. and exports from china to the euro zone has been hit. hong kong's economy is already down. it shrank nearly lly 1/2 of 1% the last quarter. the imf says for every one percentage point knocked off growth, nina, in europe, that means a drop of 1.5 percentage points in hong kong because of the outside contribution of trade and finance. take a look at what the hang seng has been doing over the last 12 months. gives you an idea of how investors have been viewing the hong kong economy. if you give -- it's a given that europe obviously is rattling investors. also, it's this slowing economic growth here. that's the four year. if you look at that, the market is down nearly 20% over the past 12 months, nina. >> it gives you an idea of how global this issue is at the moment, andrew. let's focus in on u.s. markets because in wednesday's session, the picture in those markets wasn't exactly a cheery one either with all of the major indices epding the session in negative. some of the things that had investors royiled was a statemet coming out of fichl, a ratings agency, saying the u.s. banks could be affected themselves by the european debt crisis. and markets look set for a slightly higher open when trading begins later on today. that's how the markets closed yesterday. let's have a look at how the futures stand. take a look at that. pretty modest gains for the u.s. futures with the nasdaq up most. of course, we have a number of hours to go before the united states markets start trading. andrew, as you and i know, we have the italians going back to the senate for another vote. anything could happen between now and then. >> absolutely. volatility is the name of the game at the moment. the u.s. president barack obama spoke to australia's parliament a little earlier today. he acknowledged the growing importance of the asia pacific region to the world and explained how the u.s. needs to be a part of that. president obama talked about building cooperative relationships with china and emerging east asian nations. >> the tide of war is receding, and america is looking ahead to the future that we must build. from europe to the americas, we've strengthened alliances and partnerships. at home, we're investing in the sources of our long-term economic strength, the education of our children, the training of our workers, the infrastructure that fuels commerce, the science and the research that leads to new breakthroughs. we've made hard decisions to cut our deficit and put our fiscal house in order, and we will continue to do more because our economic strength at home is the foundation of our leadership in the world. including here in the asia pacific. >> earlier, we spoke to channel 10 political editor hugh rimmington. he says, whether obama is talking about politics, economics, or the military, this trip is all about china. >> this was an important speech he delivered today that had three audiences. one was to australia, his host here, reaffirming the strength of the bonds, the alliance which has been formalized for 60 years. the second message was back home to the united states. he affirmed that jobs in the united states was his highest priority and that he looks to the asia pacific region and the growth that is coming here as being a key element in his plan to bring americans back to work. unemployment still stuck at over 9% across the united states. and his third audience, perhaps the most important one, is the asia pacific region, and most notably, china. he says that there is a natural draw down of the united states from the wars in iraq and afghanistan. as that takes place, there will be a shift towards the asian region as the focus for the united states, that even as the united states goes through its budget cuts, its military budget cuts in particular, these will be somewhat quarantined in this region. he said that the asia pacific -- this is the century of the asia pacific, and the united states, he said, was all in. >> hugh riminton there. mr. obama's next step in the asia pacific is to the nation island of bali, where he'll attend the annual summit of asean, the alliance of southeast asian nationed. asean has become a much bigger voice in this region, particularly as north america and europe struggle with economic issues there. what does the president want to get from the asean group? >> reporter: andrew, president obama has been very clear all along this trip that he sees the economic long-term future of the u.s. with asia. this is likely to be what we'll hear once again here in bali. he is going to be putting the economy very high on the agenda, not surprising when you see what's happening in the u.s. and also what's happening in europe. when you consider that asia is the one growth area in the world at this point. so the economy definitely is going to be front and center. the u.s. and also russia will be attending the east asia summit, just after the asean summit. it will be the first time ever that the countries have been involved in that, underscoring, once again, the u.s. commitment to this region. just four years old, the jakarta fashion week is already attracting international designers, a sign that this is where the money is. both the united states and europe are now relying on an economically strong asia to pull the world out of its economic slump. >> the markets are here. consumers are here. they need to export more. they need to create more jobs. they need to trade more with east asia. we are sitting in the middle that have dynamic growth center of east asia. >> reporter: but financial stability does not guarantee security. the south china sea has seen escalating territorial disputes recently between china and some of its neighbors. it is a crucial shipping lane. it carries some $5.3 trillion in bilateral annual trade. $1.2 trillion of that is u.s. trade. so it is inevitable it will be high on the agenda here. the announcement by u.s. president barack obama of 2,500 military personnel being deployed to australia is seen by most as a response to china's military expansion. that and the u.s. and russia joining the east asia summit for the first time ever is being welcomed here as a deterrence. >> the chinese won't be so aggressive and probably less violent if they know that we've got the support of the u.s., australia, and russia. >> reporter: but the fact remains the u.s. needs china economically if mr. obama is to reach his goal of doubling u.s. exports. while obama is expected to push china once again to revalue its currency and move towards a market based system, it will likely be a gentle push. one interesting thing we are looking at here, andrew, for the asean nations meeting here today for this thursday is whether or not myanmar will be given the chairmanship of asean in 2014. the country has asked to have the chairmanship, and we heard from the indonesian foreign minister on wednesday, saying he thought it would go ahead as they want to encourage myanmar to carry out more political reforms. of course, the united states would not favor this particular decision. it also has many sanctions still in place against myanmar. the country has released about 200 political prisoners recently. according to amnesty, there's still 2,000 at least in prison still. that will be a controversial move if that happens, and there will be many critics to that. andrew? >> absolutely, there will. paula, thank you very much for that. paula hancocks, thank you very much live from bali. nina? andrew, after the deluge, the cleanup forced many thai factories to close down. we'll take a look at how companies are faring now. 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markets are faring. the euro rising .1% trading against the greenback, currently trading at 1.3473. the italian bond yields passed 7% for the third time in a week and a half. the british pound trading at 1.5744 against the japanese yen now holding at 76.93. welcome back. you're watching world business today live on cnn. breaking news we've got coming out of the british press wires, citing the treasury here. the british government has agreed to sell northern rock. this is the failed mortgage lender that it nationalized back in 2008. it's agreed to sell it to virgin money. this is the banking arm of sir richard branson's empire. this is the quote coming from the reuters news agency. it says the sale of northern rock to virgin money is an important step in getting the british taxpayer out of the business of owning banks. they've attributed that comment to the chancellor of exchequer george oz borne. this is the northern rock we're talking about. former mutual that used cheap credit to grow quite aggressively back before the british mortgage market had its troubles in 2008. it was one of the first of thousands of banks to be nationalized by the government. it was nationalized back in 2008 after they stopped lending to that particular company, and it had trouble meeting its short term and long term obligations. the british treasury will be selling it for a price tag of $1.2 billion. >> and the treasury will be very happy to get that sort of money coming in at the moment, nina. record flooding in thailand is taking a serious toll on the lives of people and also of businesses there. many foreign companies, like the japanese auto and electronics makers, have been forced to stop production because of flooded factories. toyota says it hopes to have things up and running again by next week. it all depends on the cleanup efforts. we go now to a thai industrial park to see how it's coming along. >> reporter: this is what a factory looks like after a massive flood, the ugly truth that hits the balance sheets and likely consumer wallets. before the flood, there was lig light, and this equipment cranked out precision plastics, everything from car door handles to engine parts. japanese company takkei plastics wants to gear up fast, but this factory may be a write-off. at this major industrial seat, many other factories are taking stock of the damage. the floodwater may still be pumping out here, but now they're also sweeping it out. predictions are for many restarts by early december. full operations may be only second quarter next year. the flood costs will be clear when all is dry, but estimates already are more than $6 billion in damage to industry. the waters dropped here at western digital, but they won't predict when they'll reopen. one of the world's largest disk drive makers, the company makes 60% of its disk drives in thailand. both of its factories and many of its suppliers were flooded. the effect a major impact on supply. these hard drives are the key component to produce computers in general, and thailand is producing about 25% of the global supply. at the smaller factory land industrial park, they're tossing out the sand bags and scrubbing down the walls. with the flood lines gone, the focus is on the bottom line. some are rushing to restart next week. this company makes plastic parts for printers and vacuums. just weeks ago this factory looked like this. they've recently made major capital investments, but now expensive electronics will have to be scrapped. good news perhaps for the japanese suppliers who were here busy consulting. but if insurance doesn't cover the $2.5 million replacement cost, this factory might be finished. >> we don't know the proper answer from the insurance company. we can collect, we cannot collect. we don't know. it's a big question mark. >> reporter: japanese semiconductor maker rome is relocating these thai workers to boost production at its plants in the philippines and japan. both its operations here were flooded. natural disasters like this one may force companies to take a hard look at diversifying risks. as the floodwaters drain from factories like this and the machinery starts to come back to life, the lingering question is can thailand show investors this could never happen again? liz neisloss, cnn, ayutthaya, thailand. coming up next on the show, beautiful game, ugly business. fifa's president seth blatter causes a football racism row. it's another trofrt the football body could do without these days. important phone call i mad. when i got my medicare card, i realized i needed an aarp... medicare supplement insurance card, too. medicare is one of the great things about turning 65, but it doesn't cover everything. in fact, it only pays up to 80% of your part b expenses. if you're already on or eligible for medicare, call now to find out how an aarp... medicare supplement insurance plan, insured by unitedhealthcare insurance company, helps cover some of the 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gesture which is not the correct one. but also the one who's affected by that, he should say it's a game. we are in the game. at the end of the game, we shake hands. this can happen because we work so hard against racism. and discrimination in the whole world is aware of the efforts we are making against discrimination. and on the field of play, sometimes you'll say something on the field which is not very correct. then at the end of the game, the game is over, and you have the next game where you can behave better. >> for many the comments themselves are inflammatory enough but the timing unfortunate. just hours after blatter's interview, the league charged snyder with racially abusing another player. the football association is also investigating whether chelsea captain john terry here racially abused another player back in october, andrew. >> certainly sepp blatter setting the cat among the pigeons. it wasn't long before those comments from sepp blatter were being retweeted by broadcasters and football fans all over the world. within hours after that, the fifa president issued a clarification of his position. he