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tv   Street Signs  CNBC  April 12, 2021 4:00am-5:00am EDT

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no, that's beyond callous. that's culpability beyond any rational defense. if you would interview him in prison, i'm sure he'd say, "screw 'em. i was there for the money." ♪ welcome to "street signs." i'm joumanna bercetche along with julianna tatelbaum with the headlines. jump to the stock of the top 100 after a deal and months of public wrangling the ftse accelerates losses despite reopening across england
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in the latest phase of the road map out of lockdown. and the bavarian premier announces the run for chancellor with party leaders set to decide on the preferred candidate later today. >> the expectation to come to a shared solution sooner rather than later regarding the question of the candidacy. both are feasible and willing. jerome powell says the economy is at an inflection point and the dow and s&p retreat ahead of the start of the earnings season. good morning welcome to "street signs." lots to get through on monday morning. i want to start with big
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corporate news from france shares in suez are rallying after they reached a merger with veolia it will bring an end to the legal proceedings with the companies pulling months of negotiations the groups plan to agree on the deal by may 14th you see a nice bounce in suez. up 6.7%. that has been acquired by veolia this has been an issue that has been ongoing for six months. now speaking to cnbc on february 25th, veolia coo says the offer of 18 euro per share is a value. >> it will be an equity and a price which is premium compared
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to the shared price it had before as well to employees and customers because we will be able to sell them on the wider basis. >> this was back when veolia put in an offer of 18 euro per share. they agreed to takeover the price of 20.5 euro per share they had to increase the price during the interview on february 26th with cnbc, the concerns were outlined with the veolia offer. >> we have had that offer which we had been expecting for months first of all, in terms of value, it is on point we have to look at the impact on our teams and we have long-term comm commitments. and our plans must not be the one paying for the operation
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we have the position and the market indicated it was open to dialogue and negotiation to find the landing point. this is one of the few expectations because of anti-trust regulation, they cannot keep all of the business. they have to sell a large portion and, the people working for suez are not sure where they will end up. >> big news in france. let's get to the french correspondent charlotte reied charlotte, we have talked about this and veolia had to raise the price several times since last summer listening to the ceo of suez, he
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said it is not about the price, but the impact this deal could have on broader society. it looks like they finally put to bed the concerns. what more do we know about the future of the new entity >> reporter: good morning, joumanna we read in the communication today the time for the communication is over. now this is an announcement of the agreement that veolia and suez came to the price raising to 20.50 euro per share. up until now, veolia paid the original stage from ng last summer they were trying to find agreement with the rest of the company. we know hasn't been the case
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it has been a bitter and public battle with the two french giants with the french government sitting on the sideline trying to work up this deal and wanting them to come to agreement. you had legal challenges white knights and the whole deal finally disagreement last night. from what we know and what has been announced, suspension on the legal proceedings and there will be a termination of the agreement that was done six days ago. suez sold assets days ago, which is now canceled. this is crucial. veolia with the divisions abroad and that was crucial for the growth of the company. also, another key element is the deactivation of the dutch foundation this was the poison pill that
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suez created putting the french water business up and could not separate that part of the business it was difficult because it meant there were hurdles in terms of competition with france and they had to dispose of the asset. that is why they announced the agreement with a new suez created. we have to see what happens. we know it will include other shareholders like the one lined up to buy the french water business and the french partner which was the white knight and it is interesting to see what this will look like. we know suez will have revenue of 7 billion euro. joumanna, talking about the commitment and they said it will not be job cuts for the next four years in the businesses
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interesting to see here what goes ahead we know they will try to enter and look to enter the measured agreement by may 14th. here we see positive reaction on the french market with suez shares and veolia up as well >> thank you, charlotte. thank you for bringing us the information on the longstanding situation. we finally have got some verdict on what is going to happen with the two of them. well, turngsing to the uk. shops and hairdressers are allowed to reopen today. pubs and restaurants can restart to customers outdoors. boris johnson says this is a major step forward in a road map to freedom, but urged people to
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behave responsibly we have julianna i have been waiting for months for this talk us through the significance of what this means for the uk businesses, particularly the shops that have been closed for the better part of the last three months >> reporter: today is a major milestone in the path to reopening. pubs and restaurants opening for outdoor service for the first time since december and non-essential retail opening it has been a difficult winter for shops and restaurants. eager shop keepers are roaming the streets behind me in covent garden this has been a tough time the restaurants and shops have been preparing for this day. here in covent garden, they have made 500 additional coverings
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available. a lot of activity getting going here this is a really exciting energy in the air here in covent garden this is possible because the case numbers have come down in the uk over the last three months on saturday, we logged over 2,500 new covid cases. down to 1/6 of the january peak. the vaccination rollout has been pour powering ahead with more than half being given the first dose. i want to bring in the managing partner with apex to help us understand where with we go as the uk economy reopens matt, i'm in covent garden right now. my question to you, with the restrictions still in place, how feasible is it for the businesses to actually make money in the environment
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>> well, good morning. it's great to be here. an exciting day, for non-essential retail and hospitality. i think to your question, initially, you would expect actually demand to be high there's a lot of pent-up demand. consumer sentiment on the back of the vaccination program and in the retail and early discounting to entice customers back with the spring and summer collection coming through. you would expect the customers could get out and those brave enough to get out and make the most of it in the next couple of months however, this is likely to be a short-term boom. as the time rolls on, you expect the new post-pandemic behaviors to kick in and things may not be rosie later in the summer.
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>> reporter: to your point, the pandemic influenced the way we shop i know from my habits, i buy everything on line that out of necessity. going forward, it is out of choice because it is easier. >> how much do you think the change in behavior that has been accelerated by the pandemic is a lasting feature and the way people conduct shopping? how much of an impact will it have on the overall industry >> i think the impact over time will be enormous we recently conducted research on consumer priorities it was really clear that consumer behaviors have fundamentally shifted, probably forever. over half uk consumers said their behavior in terms of online shopping and social
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conscience when they shopped has radically shifted. what we have seen is the rise of a new consumer segment it is the one based around anxiety. those who have had health concerns or financial concerns on the back of the pandemic, will shift behaviors to a larger extent those who are less anxious are back on high street and you saw them in the pubs at midnight last night those guys will be back on high street and shops and hairdressers in full you can expect a very different return to shopping behavior over the next few weeks and months. >> you mentioned anxiety do you think a covid certificate would ease people's concerns i raise this because we are seeing pubs and restaurants and retailers have rejected the idea
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of using a covid certificate if that is going to attract more foot fall, then it makes sense to introduce one >> i think for some people, it would help the practicality of operating a system like that clearly make it less attractive for the operators, and, of course, the information security is another aspect to consider i think there are pros and cons to it. over time, what you hope is the new normal starts to look a bit like the old normal and the vaccination program of people's confidence that infection rates are low and that will mean something like that is not required i think in the short-term, most operators will try and avoid the extra cost associated with monitoring a system like that. >> you talk about the potential short-term boost we will see and in may, we get another leg of
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reopening. people will be allowed to start dining indoors how long will it take for the data to smooth out the short-term impulses versus ending up somewhere how the industry will look versus pre-pandemic >> it will be a couple of months i think there will would be a short-term boom based on pent-up demand and all of the savings consumers have been make aing t last few months. people will want to get out and spend that as we get to summer, the impact of the pandemic, in how it plays out in the recession, will start to see a new normal. for businesses that have done well during the pandemic, the grocery industry, effectivelies productivity challenges with the online shift that actually costs grocers more to serve, will start to play in and you will see the real struggle in
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financial performance as the extra cost of operating online together with a lower sales increase as people go back to hospitality and will start to see the squeeze in the grocery sector and non-essential retail having to deal with lower products in the sctore you will see improvement and restructuring and more shifts between the second and third tier retail locations and back to more premier retail locations which should continue to do well plus, obviously, an increased online presence moving forward >> matt, to round out the discussion i cannot let you go owithout asking this. how important has the government been with the retail space they have thrown pa lot of money
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at the problem tax relief and loan guarantees did they do enough >> they certainly helped the industry survive through the course of the last year. as we move forward, how that support tails off and how businesses react and respond will be absolutely vital what we have seen in the pandemic is the businesses with the greatest level of agility and with the strongest leadership have done the best and obviously having a healthy balance sheet obviously helps. the government support helped retailers and businesses survive through the pandemic as we move through the post-pandemic world, it will focus on the proposition of the businesses and agility to actually open the right sites at the right time to attract
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customers back will be much more important. at some point, we have to pay for all of that support that the government has put into the industry you can expect over time tax rises which will have an impact on people's disposable income. we will see how it plays out the key thing is there is no certainty. everyone needs to look forward and hope for the best and plan for the worst and make sure they can adjust accordingly depending on how things play out >> matt, on that note, thank you. we will leave it here. matt clark lockdown restrictions ease for london today, but we are nine hours in. check out our web site for more on those who could not wait for the first round of drinks. to european markets. this is a negative start to the session.
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down .40% in early hours of trading. this is despite last week being a strong week. the stock 600 ending up 1.1% this is mirroring global equity as well. ending the week on a strong note over the weekend, we got more comments from the fed chairman jerome powell. he expects the data to start picking up, but also reiterates what he has been saying. a lot of slack in the labor market still a way to go to get to pre-pandemic level with the labor market that 100 down .9%. the uk index is the first day of the reopening with the gyms and
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hairdressers and outdoor hospitality open to the public not seeing a lot of movement in the names. if anything, we are seeing a big drive from resources and some of the oil names right at the bottom of the ftse 100 cac here in france is down .27%. we talked about the final takeover of suez by veolia that has been going on for a long time. w both are up 6% you would not know it by looking at the cac also the green on the board is in italy ftse mib is positive and here is the breakdown. not a lot of green on the board. we have oil and gas down 1%. resources down 1.1%. a china move and retail. by the rumors, retail is trading
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on the back today. down 1.2%. let's see how this fares in the coming months. at the top, we have auto up .50%. utility up .40%. suez and veolia is dryiving the gains. coming up, soder joins the race to replace angela merkel. we will haveor me on that story coming up in a few moments
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welcome back to "street signs. jerome powell says the u.s. economy has started to recover in the pace of vaccinations. in the interview with cnbc, powell warns of the headwinds of new cases. the fed is looking into the archegos to make sure it does not happen again
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marcus soder added his name to the race to replace angela merkel the parties will need to decide who will stand in the federal election in september. soder or laschet soder was not looking to expand the coalition. adding they were both suited >> translator: expectation to come to a shared resolution regarding the question of the candidacy of chancellor. conversation was not conclusive. we established both are suitable and willing. >> let's get out to anetta with more we are talking about this when you had interview mr. shultz
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talk about the candidate you would think the presumed candidate for chancellor would be the leader of the cdu party in this case, laschet. what's going on here >> that's the case if you look at popularity, that is crucial when it comes to soder and now laschet. only 15% of the germany think he would be a good fit as chancellor only 5% think soder would be a good candidate soder was saying he was prompted by the high showings in the poll and that prompted him to run for chancellor to give you an idea of how
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significant that is, twice in the lifetime of germany, post-war germany, a csu candidate was running for the chancellor essentially, both men failed it is a tricky issue there was a meeting behind closed doors with some prime ministers together with laschet. he is rallying his troops to get the support from the cdu he was stepping up saying he thinks he has the full support of the steering committee of the cdu and that he doesn't think that soder will get enough support. the race is very wide open it remains to be seen if loyalty
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is trumping the choice as the chairman of the cdu or if the cdu thinks we go with a popular candidate to increase our chance to stay in the chancellorship. with that, back to you sdplchlt thank you, anetta. we look forward to the rest of the coverage as we look to see who is the candidate from cdu and csu. let's turn to alibaba. stock price in hong kong, the stock price was up 6.5%. the u.s. listed shares are going to be up 5.9% in pre-market trading. very strong price reaction we are getting from alibaba this is despite a record $2.8 billion fine as a result of the
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anti-monopoly. the fact we have resolution in the space has been a positive for the investor community which removes the questions and the overhang shrouding alibaba now, microsoft is in talks to buy nuance. the $16 billion deal could be announced as early as today. the offer would represent a 23% premium on the nasdaq listed company's friday close if the acquisition is completed, it would be microsoft's second largest deal ever. and we'll cut to a quick break. when we come back, we will speak with with the ceo of citroen vincent cobee. that is coming up on cnbc in
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just a few moments
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i'm joumanna bercetche with julianna tatelbaum suez and veolia jumped to the top of the stoxx 100 suez valued at 20.50 euro per share. the ftse accelerates losses despite pubs and restaurants and shops reopening across england in the latest road map out of lockdown and alibaba shares rally in hong kong and ahead of the u.s. open $2.8 billion for violating china anti-monopoly law. the group does not expect to suffer material impact from the move cnbc assesses how to ensure a sustainable future as we launch the esg council
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we highlight the importance of fighting the climate crisis. >> inside and outside the company. i think we have to be part of the solution and we have to take the lead to make building. citroen revealed the latest flagship vehicle the carmaker will offer petrol and hybrid versions of the car which will would be available in the second half of 2021. vincent cobee joining us on "street signs" right now let's talk about the price point of the car the premium focus with the suv why does this premium price point make sense with the current environment? >> so, thanks for having me.
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what we really wanted to do is we wanted to first demonstrate the abilities of the citroen brand with the flagship. second, touring and traveling in great comfort and technology is something that is there to stay. suvs are one answer, but not the only answer. a lot of customers are looking for elegance and comfort and fluidity that is the car behind me. >> i can see it. it does look very nice one thing that caught my attention is a petrol version and hiybrid version. i'm surprised with most automakers launching electric cars and many governments are moving toward banning new cars
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that are run on combustible engines. my question is why launch a car that may have a specific time date or expiration date given the mandates coming from governments? >> you know, in europe as well as the uk, we are living through a transition from petrol-based transportation economy to an electronic transport in citroen, we have electric solutions from, i would say, convention defined to the new c-4 to the advance here we are talking about the de de-segment long distance touring in the environment. as of today, our position is plug-in hybrid which is the right answer enables you to be fully zero mode at the beginning and end of
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your journey while preserving the transport in the middle of the trip. that is today's answer it will be valid tomorrow as we refine the technology and approve the fully electric mode. one day this segment will move to 100% electric >> i guess looking ahead to that time when perhaps your whole range turns electric and also the range of other vehicle makers, we are seeing now the traditional heavyweight getting involved in big ways volkswagen announcing serious electric efforts and other automakers how do you think the competitive landscape is going to change as more traditional automakers make bigger investment and bigger commitments to going electric in the near future? >> that's a great question
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honestly, we know that auto industry has been built in more than a century and involves product and supply change and distribution and service sector. it is logical of the heavyweight of traditional carmakers have a huge set of capabilities with serving customers. not only developing technology, but delivering and maintaining them and delivering great service to the customer. we would say as traditional oems come into the electric movement. we have done this for a number of years and continue doing so when it comes to pure electric, the question is obviously about the right technology and the right type of chemistry at the right cost and right size of the battery pack it involves the charging infrastructure and the speed of
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charging that all needs to come together to answer the demanded for long distance touring this is ago a lot of progress has been made the last few years and continue improving i have no doubt that i will answer each demand with the fully electric option within five or seven years. >> a lot needs to happen in order to move to that kind of world. i want to turn attention now to the current supply situation we all have been tracking the global chip shortage the last several months can you give us a sense where you stand in term of access to the chips you need and if you had to make adjustments to the supply chains to adapt to the shortage >> as you know, one of the surprising consequences of covid has been a misalignment of
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production forecast from the manufacturers which is creating an electronic chip shortage in the car industry what i can say is to some e extent, we have been a, prepared for the disruption we have been experiencing disruption in the last ten years which made us more agile the case of chip shortage, my understanding today, we managed to be a bit less impacted that other regions or carmakers we have been reactive in resources and development of mitigating strategies and adjusting the mix of equipment and also looking at the alternative technologies today, yes, there is some impact, but we believe the impact is under control and we will be able to deliver our demand in the months to come.
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>> and mr. cobee, i want to ask you about the bigger groups. at what point do you expect to see synergy as part of the bigger group >> the group became one of the founding members this needs to be seen in two perspectives on one side, being part of the larger auto group gives us a lot of potential and assurance to face the regulatory and society issues of the years to come. that's an assurance that the future will look bright from the technology ability of the group. on the other side, it is very important that each and every brand and we have 14 of them,
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has a specific identity and can thrive in the differences and identity for citroen, we are based on comfort and that will elevate well being and art of living we have a human progress dimension. we think we need to help society move forward those three elements are quite relevant in the post-pandemic economy and quite specific within the company we have a role to play and all the tools to succeed >> very clear, sir thank you for speaking with us vincent cobee, ceo of citroen. thank you for joining us we will go and head to a quick break. as we come back, cnbc will launch sustainable future
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initiative we will ask paul polman how he is helping the business leaders meet their climate goals
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the strive for sustainability has been high on the business agenda. the onset of the pandemic has given leaders impetus over the challenging future we will look at the key areas where they can make a difference we turn the spotlight on money flows as shareholders s are increasingly holding the investment accountable and technology and innovation pro promises to make the future more sustainable. this is already under way. we will review how energy businesses are convincing shareholders this is a moment of fundamental change
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finally, we will address the industry response. we talk check points that the company s are driving forward. and we have a founding member of the council who spoke to cnbc earlier and asked if his company's commitment would incur higher expenses. >> i think the cost will not be the issue. we have new products we introduced right now which will have a high content of recycle and demolition waste less costly than regular or products used before we have a very good deal >> i'm happy to say our next guest is paul polman chairman of imagine. imagine is an organization aimed at helping business leaders realize their part in the 2030
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global goal. mr. polman, great to have you on the show i want to look back at the last 10 months. the year of the pandemic it has been a huge setback for the world in terms of exacerbating inequality. women leaving the work force unemployment shooting up for the lower income parts of society. when you look at that through an esg lens, do you despair the mountain we need to climb is much higher relative to where weswe were before the pandemic in terms of where you want to get to >> thank you for the question. the pandemic has put us back 20 or 30 years on the sustainable development goals and the people that were already marginalized in society, including the gender
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dimension, these people have suffered disproportionately. without a doubt, we have seen the biggest recession in the history of mankind the forecast is a little more positive governments reacted and enormous amounts of money has been pumped into the economy and we hope to see part of the spending and moving to greening our society and assuring we address the issues of inequality the good thing during the pandemic, to be clear, unlike what people thought a year ago, that esg would go to the back burner we have seen an acceleration we have seen investment moving in $53 trillion right now we have seen companies that have operated under a longer-term multistake holder model have been the ones better performing. there is actually despite covid,
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acceleration of esg with the important dimension of the health of the people and the protection of people in our value chain and social safety nets that have come with it and very much on the agenda. >> interesting that you say you are seeing more investment into esg space. there is a view out there that say governments have spent so much money shoring up the economy coming up with various programs to keep people in the labor force and rapidly expanded deficits looking ahead, the theme for governments is going to be one of maybe not austerity, but y tightening the fiscal budget where does green energy fit in the mix? where will they get the extra firepower in the next decade if there is pressure on them to
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reduce the public spending >> no question they have spent the money. the cost of climate change and natural disasters and cost of the pandemic they are all closely related cost of inequality in society cost us $22 trillion it is significantly higher than what it would have cost us to prevent the issues in the first place. the main area we now need to watch is social cohesion more people have been pushed into poverty 150 million according to the world bank if we don't create more jobs and better jobs coming out of the pandemic, then i think we will see more issues of social incohesion and undermining of democracies. governments have woken up.
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the biden administration has a strong package on protecting and rebuilding and green infrastructure package governments across the world understand that going back to where we came from is not the solution we actually need to redirect our policies and spending for the greening of society. you now see eight of the ten big p ev countries in the world are commits to net zero. china still is the exception to 2060 we see that behind the green deal in europe and we see that behind the spending packaging in the u.s. unlike the financial crisis of ten years ago, the limited amounts of spending. now we see 20% of the spending going in the right direction
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>> it is interesting to hear you talk about what governments are doing. of course, they are one part of the puzzle here. companies, corporates are another big piece of the puzzle. it is fair to say you are a pioneer for putting esg at the core of the business you ran for years. my question to you is from a corporate leader perspective somebody who is heading up a big public company how do you balance pushing ahead with creating a more esg friendly agenda when you are dealing with a lot of eager investors. hedge funds and potential activists and investors who don't have the patience to wait for the investment to pay off? >> that is a factor of this short-term that has crept into the financial market to some extent, puts the brakes on the climate change and inequality and destruction of the natural environment. we do need to move the financial
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markets to the longer term having said that, we have seen during the pandemic a sharp increase of esg funds. 75% of investors increased esg funds. europe is getting standards which are moving higher so there is no green washing in that respect. we have seen 80% of the esg funds actually out performed the general market so, it is becoming more attractive plus, we cannot as a private sector address the issues ourselves. we need government and we need to write policies. 70% or 80% of the solutions can be found with existing technology smart companies are positioning well for the future and obviously getting rewarded the financial market is increasingly trying to understand that. where we need to move is a higher level of transparency and
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accountability ultimately changing our financial systems accounts for social and financial capital >> sir, we will leave it there given you are the founding member of the council, we look forward to seeing more of you on cnbc paul polman. chair of imagine let's take a quick look at u.s. futures. we have a lot going on in the u.s. in terms of data to watch out, the congress debating the infrastructure bill. we have cpi data investors are watching out for that and retail sales and earnings season. banks numbers toward the end of the week for the first quarter all eyes on that you can see the three indices are trading in negative territory. s&p opening nine points lower. dow is 100 points lower and nasdaq 27 points lower
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this is equity, but on the fixed income side. investors are watching out for the three-year and 10-year bond action all eyes will be on those auctions to see how youthey wile received that is it for "street signs" today. along with joumanna bercetche, myself, julianna tatelbaum is live in london as shops and bars are opening for the first time this year. >> thanks for watching "street signs. "worldwide exchange" is coming up next. thanks for checking out what is happening on the streets of london
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it is 5:00 a.m. at cnbc. here is the top five at 5:00 april's red hot rolls on london calling small business in england finally allowed to reopen. julianna tatelbaum is live out and about and brings you a look at the big day in the uk and jay powell speaking out about the archegos collapse for the first time on "60 minutes"fo


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