Transcript for Incomes Rise, Spending Doesn't
Dow futures were down this morning on new worries about Greece. -- -- -- discuss all the business headlines as we kick off the new week it's Susanna Helen -- from Bloomberg TV's good morning -- yet every weekend I did I did -- -- let's start with some new economic data out in the past -- incoming and spending -- cubs. Rose point 5% in December. Their biggest rise in nine months the consumer spending was unchanged soul. What are we make of these numbers yet that's pretty negative because what it tells us in December is consumers weren't spending. They're either saving more or using some of that increase in ink comes to pay down their -- today does signal perhaps at the US economy. The tepid recovery that were seen me he's lonely. This is also something that economists are paying close attention to you because consumer spending -- households really accounts for 70% of the economy. Since consumers aren't spending on a broad basis that is considered a negative Nelson tells us she -- that consumers -- perhaps worried about their jobs. Over the next six to twelve months even if you are working -- one of the fortunate ones here perhaps you are worried that that -- not be the case in six months or perhaps she could be making last in the following years out this is up pretty -- It negative sign for the US economy economists and the Fed would like to see consumer spending of course be a little bit stronger in what's really interesting as -- December is a big holiday month. And that tell rusty that consumers were very cautious in the holidays and he really I didn't do any spending -- -- -- -- national and as you say consumer spending dollars and important indicator for us to look at OK let's just to the big headline. The week FaceBook moving toward its IPO what is the latest. That's right we are hearing that perhaps as soon as this week perhaps midweek Wednesday we may get -- Looks ask one this is actually a public filing that its filed with the Securities and Exchange Commission any it will be the first -- In -- doing their IPO look at stocking and gives us is really look. Under the -- -- FaceBook will get the financials will find out how the company will. Use of proceeds from the DL how much they're planning to raise. Very interesting it will also give a lot of analysts are very curious about things like that as well and -- be very interesting because we'll figure out if they are in fact we're hearing they're planning to raise about ten. Billion dollars FaceBook could have a market cap. High high number of a hundred. Billion dollar house is going to be probably the biggest IPO of the year but certainly the largest tech IPO. As well and is -- as we now get so much -- It's the largest social networking company. But we really don't know the -- and investors an insight into how competitive they need be they media against some of their arrival so. This document is highly highly anticipated. Timing are hearing it could come this week in the second stage perhaps from more deals as well I know a lot of. Investors excited about that. Aren't another big headline coming out Starbucks announcing today that it is moving into India you know when I was based in China for ABC -- used to go to. Starbucks and China quite often but now they're going into the other big emerging economy. Is the drink. From here and you rest on how a little bit different an Indy isn't really -- Interesting story because just recently the government -- change some foreign ownership rules for businesses to come into the country I'm Starbucks actually is taking advantage of -- -- part -- partnering with. Company that you're probably familiar with Stephanie it's called top global beverages and they serve a lot of the Pacific rim area as well it through this partnership. The -- it will work is Starbucks -- Have to buy some drinks like can Malayan water. And sell that in the stores will also be buying coffee beans from local. -- suppliers and also I've -- going to be coming out with some. T.s that are geared towards the Indian customer seven that's -- -- deals not work and Starbucks does need some help in those emerging markets we heard from Starbucks last week it reported earnings. And they said there are not do you mean as well in Europe and China as they would like to be said this kind of partnership is very significant for -- for Starbucks and give them. A very good foothold in the region and I believe these stores -- yourself will. Be up and running as soon as August and -- Actually help Starbucks continue on their growth trajectory say in the US of course is a very well saturated market gas as we. We now as we know here in the -- just look around there's Starbucks everywhere especially over here on ever decide but certainly -- huge potential market for Starbucks okay. -- -- on to them at the news we mentioned earlier. Greece new worries there -- some breaking news actually in the past half hour that German Chancellor Angela Merkel is actually backing away from her own proposal -- what is going on. Yeah and that's why we are seen US stocks start the week on a lower now than we did see some selling in Europe as well. Listen they EU officials are having a first summit in Brussels of the year we'll we'll be talking about obviously gambling debt issues but. As you mentioned moments ago German Chancellor Angela Merkel came down said you know we don't really have all the details about Kris -- don't expect a resolution anytime soon and we continue to hear that the banks and Greek officials are going back and forth with potentially what type of hair cut investors -- bond holders may have to take because -- situation continues really too well the market sell we are expecting some type a resolution to -- Out of -- in the next few days but. I believe what economists are looking at -- -- -- comments from Merkel trying to temper investor expectations saying we are gonna get anything in the very short term. And today's meeting will largely be -- focused on broader issues and the market is going to be waiting for some headlines from that meeting as well in terms of how far along they -- with the broader rescue package and really controlling. Debt in the region as well I mean -- to the back to India as well I'll only take a look at -- potentially entering a recession. The Indian economy is growing between five and 6% -- very robust look at emerging markets. Compared to what's happening here up. Some news out of London this morning that rogue trader accused of losing 2.3 million dollars -- UBS was in court what happened there. Yeah -- he pled not guilty and this is very interesting because it doesn't raise. Concerns about. All all financial firms was this gentleman unsupervised when he made those trades that led to over two billion in -- isn't really ultimately. Cops and CEO of the company his -- so this -- actually this trial if in fact they continue to move toward that based on is that not guilty filing today appears. That could be the case it will really shed some unfavorable light on UBS one of the largest investment banks in the world will also. Give us an indication of what goes not appease Wall Street firms are -- aloud to you. The pretty free with the best -- me what kind of supervision policy under he says he was supervising banks says he's a rogue trader did an honest -- seven -- get the details but it doesn't look good for UBS. Because it does it could potentially show that someone there. Wasn't doing -- job. And we'll see how that shakes out and the world's going to be watching Alan camp from UBS RBS this CEO for the Royal Bank of Scotland is waiving his a bonus did he have much of a choice next -- now he wanted to take that out. Basically million dollar bonus a little bit more than that but he really got a lot of political pushed back in it's not unlike. What we're seeing here in the United States -- just in the past few days we had. Bank of America Citigroup. Morgan Stanley all cutting bonuses. Pretty significantly. And this is -- -- and similar situation this is also a bank that has not done that well as I mentioned the European economy is potentially. -- in a recession -- heading into one the fact that this gentleman -- -- -- take a -- it didn't go well we had political. Folks in parliament opposing that decision -- Basically his hand was forced not to take the -- perhaps he should have -- a little bit better that there would be some political upheaval but what's really interesting is. Banking analysts say you know -- Cut it deserves the bonus because it's part -- is is total -- -- you have two sides of the story but from a public perception. -- with the global economy in the states and the main street public it is sort of a slap in the face they don't like to see that you -- kind of take the -- -- he thirty name roughly something like a million dollars and a salary anyways so. He'll be doing you know Palin doing semi all right we're out -- -- exams aren't at Wal-Mart -- at the Dow because we're down at quite significant. Significantly in the first -- -- trading here the big board showing data 103 -- you think this is mostly news out of Europe. Well a I think -- -- -- -- Europe and also the US stock market has been on a pretty nice run since January. A lot of fund managers tend to get back into the market early in the year. Perhaps they're taking now a little bit of a more cautious approach particularly after we got city's economic data. And -- -- Friday we had that weaker than expected fourth quarter GDP and then of course we're reminded you know hey the European situation is far from resolved. Investors in a little bit more clarity so investors perhaps -- eighteen. Some of the gains we've made so far this year. Putting their money on the sidelines until we get more clarity. From Europe especially makes a lot of sense Suzanne -- how -- from Bloomberg thanks so much Suzanne.
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