the amount of slack in the economy will decline gradually. >> but first, ryan chilcote and our markets editor. hans nichols is also standing by. let's pick up things with you. futures indicating a higher start. >> all of the losses we have had this year, it is back in the green. we have almost $3 trillion worth of losses. equity markets, a couple of things to focus on. car registrations. it comes a point where we all have to buy a new car. the u.k.. a little bit of inflation data later on today. and the housing prices. >> that is the one thing we are watching out for. some indication of what the ecb will do. you are watching the bank

of japan. unchanged.ram is the funding program over the bank of japan has doubled in size. it has extended the duration. here is the story. japanese companies a single record cash. who is going to borrow the money if the landing is one question. the symbolism of the move, you have the bank of japan that looks like we are ready to do more. year, thens this expected more. more easing. will they get it remains to be seen. >> it really does. to berlin. hans nichols, you are watching car registrations. >> francine, they are up for the fifth straight of mock. the month of january is a good news. across the entire european economy. even france. an uptick in sales. it was 0.5%.

i do not know if it means you will be buying a new car anytime soon. francine? >> we will see. thank you. ryan, you're watching bhp. works it rose over two percent, the biggest gain in nearly a year. l to make cars and iron ore was a big driver. underlying earnings up 30%. not unlike australian shares. the company is cautioned that this rise we had last year and consumption might be short lived will stop they think they are on track to cut costs. there may be a buy back, august. >> thank you so much. we'll have plenty more on the commodities and the dollar/yen throughout the morning and a little m&a. activis is said to be near a

deal to buy forest labs. the second-largest generic drug maker. it is not confirmed. that is according to people close to the matter. one of the biggest acquisitions up this year if it goes through. we'll find out more. $25 billion deal. homee also watching luxury prices in the u.k. at intercontinental. >> will talk about the luxury market. what is driving it. new cases as well. they all want to buy, billionaires. intercontinental hotels. up in 4%. isis the holiday brand that the engine of growth. we have the ceo on bloomberg.com/luxury, one of the things we will be looking at. let's look at equity markets. we have managed to undo the

tragedy and the losses which were delivered by the emerging markets. one juncture over $3 billion. that is more or less been undone. we have all toes rising. inflation data. schedule have automobile rising. and more liquidity that suggest more stimulus. -- we have automobile rising. the market worth in china are too low and they are trying to take money out. two. -- two very different stores. the markets today and we have the automobile reporting. that rises around volkswagen. they have new models. lt, the smaller car is driving. the smaller compact car. seeing, you are registrations rise by more than seven percent.

ryan was talk about bhp. underperforming. outperforming and the australian market last night. dividend and capital expenditures are the things that analyst will be looking at. an oversupply of iron ore. expect,r you might there will be pressure. the chinese has done the restocking. when it comes to industrial gases, these guys have delivered better than estimated. down by nearly two percent despite the numbers coming in better. we leave it there. >> thank you. manus cranny. joining us today, more on where he sees the market is andrew goldberg. jpmorgan.ve great to have you on the program. talk to me a little bit about your favorite lace for the next couple of quarters. be a more difficult

year than 2013. believe it or not, one of the toughest thing is rebalancing. if the equity part of your portfolio is into something too big, you have to pull back. my personal favorite is if you have the guts to have a long-term view is emerging markets. you have to be very -- >> which once? >> that is the thing. you want to avoid the ones with large deficits. there is a tremendous amount of the disparity between these countries. one of the frustrations that we have got is when people lump them together. it is easy for me to say either emerging markets. emerging markets are extremely diverse. if you look country by country, very different industries and type of companies. you areely, even if looking across the broader landscape in emerging markets, you have the right timeframe a

you would do ok. of people are saying we are seeing a bigger correction. having gone through structural reforms are needed. which ones would you invest in? >> actually equities. the currency game is a little over my head. tois funny if you look at key drivers of currency should be sometimes they turn out not to be. a tough game to play. we like equities. in terms of which ones, i have yet to pick specific countries. we tended not to invest in countries -- it is about finding the right stuff in the country you formulate your view of where the individual company is. it is eastern european emerging market countries look ok. and some and china. >> thank you so much. andrew goldberg. he will stay with us.

what else is coming up. executive will join is exclusively today and we'll get his views on the chinese markets. ♪

>> i am francine lacqua. this is "on the move." discuss theow to

latest numbers and his thoughts on the chinese market is the chief executive. thank you for coming on. i am glad to have you on the program stop chinese buyers are changing the way that they consume their drinks. what did you see as a makeshift the next 3-4 years and what can you do 20 out to that demand -- and what can you do to keep up with that demand? >> we were pleased with the performance we had a premium majority. it's a bit cheaper. it is definitely important. >> you make a lot of sales and cognac. chinese drinkers go for either domestic drinks or much cheaper end. you are for the moment a well-positioned. is it a danger they will go for a cheaper brand a local brand? >> if you look, they have cheap,

local drink. imported drinks are considered more attractive. we are also introducing a new version without a distinction. same pricee for the their premium. >> and give me a flavor and inside of how the chinese market will drink over the next couple of years? how they withdrew differently and have a drink it differently now? -- >> it is very popular in china and you will never find that in the western world. i would say the chinese market is normalizing in the sense we are widening the portfolio. it means for. -- it means from. two prestigious -- it means from premium to prestige and the type of tricks like a vodka is

booming. champagne as well and we are pleased. looking to expand somebody brands and china more? looking for acquisitions? the way china is shifting and the crackdown, how does that change how you view your strategy? but my strategy is very simple. if you look, china is expanding. the middle-class is more affluent. withbly 350 million people a sort of living in europe and they buy cars and clothing and fashion and of course, drinks. that is how i see the future. >> would be postponed? we have heard from rivals that there is a slowdown in emerging markets. but excluding the china. we saw seven percent growth.

>> there is no concern. there is nothing that makes you were ready for the next 12 months? what we clearly said is we do not expect a quick recovery and china at least for the fiscal year a may be 2014 calendar year. >> will be 2015 for the recovery in china or do we have to wait longer for them to normalize? >> not so clear about when. >> that is very honest. give me a sense of last week you announce a restructuring program. where would these cost cuts come from? >> it is not a restructuring program on a project. a project which we named as alegra, it means speed. simplifying our decision-making process.

second is prioritize. focus on what is critical and east central. at last, mutual. entity, we can share. looking at cost cutting. sharing resources. are there brands you would like? where's the bulk going to come from? >> it is overhead. it will mean fees, travel and expenses. >> do you already have an idea? say., too early to we launched the program last week. workingtwo other people and we are in charge of designing. >> and me a sense of europe. we talk about europe day in and day out.

i have a lot of investors say they are confident. as some are saying they do not feel quite right but we are seeing growth. they are worried about inflation. how do you see the european developing? >> i am not so much worried about deflation. what we needed to do is really shield the growth. there is a recovery. the question is speed. half, we have seen very good scores from the u.k. a good performance in germany as well. think it is, yes, the growth is there. >> what are the main pitfalls? you mentioned the u.k. where it seems to be a booming economy. the problem that the bank of england has is to maintain the growth. what are some troublesome countries? we focus a lot on spain. where do you see dangers? >> definitely spain remains a difficult country.

look is very positive. all of the good news we receive from the countries it should translate into sales. being a amid about chief executive. i love to get your vision of your priorities. you are focusing on the emerging markets and china. is there a challenge that you need to make sure you do not miss and the next six months? acquisitions or pricing or emerging markets? expandt of all, it is to our geography. i am very please of the performance in which we have in africa. we have opened a five new facilities in five different countries. it has grown by more than 30%. first of all a geography and being positioned to see the growth potential and where it

is. today, more positive news coming from the western world. that is number one. number two is to continue to invest and particularly and innovation. have a newinitely challenge and opportunities with the digital. the digital world. and we have a lot of new products in the digital world. we have antioned m&a, clear strategy. investment company. you will not see us making acquisitions but you can see out brands.very good >> when you talk about innovation, it is social media or selling your brand or new flavors? does the taste we have for drinks change and is there a cycle like every five or six years?

do people want something different or are we classic? >> all of what you say, the way we communicate to customers and it could also mean communication for a product itself. we showed two weeks ago a new concept. spirits in aver book format. connected withy your iphone and ipad. you can make the cocktails and order. a completed device. creation.bout a brand do people still want to buy the lifestyle? the way you position yourself. >> exactly. digitalization means it will impact the products themselves and to the way we communicate and the way we

interact with our consumers. >> as soon as you sat down to my asking you your favorite injuring. now you can give the answer. down on soon as you sat my i asked you your favorite drink. -- now you can give the answer. >> there are many but not all at once. >> if you have a stressful day, which one do you pick? know, a -- would be fantastic. >> thank you so much the stop a great pleasure. the chief executive of pernod-ricard. the world's biggest miners saw profits rise 30%. will go inside bhp's latest reports. that is next. ♪

>> welcome back to "on the move." i am francine lacqua. here are some companies on the move. activis is said to be nearing a $25 billion deal to buy forest labs. it could be announced as soon as today. forest labs'ceo is expected to be head of the company. ae retailer will have

slowdown of at least 25%. bhp said the price of iron ore will likely decline because of supply. calls from the chief executive echo investors. said profit rose 30% that beat as demand. for more on bhp, let's get to ryan chilcote. have come down a task. more muted response with the australian shares. pretty solid up by nearly 0 -- nearly 33%. $8 billion from under $6 billion. the biggest story. the biggest contributor. 6 billion came from iron ore. 50% the last half. the chinese were stockpiling. teel. it ore to make s

has been up taking in china. the problem is this year, iron ore prices have been falling and we are not done with february. according to the forecast, rises are said to follow every year for the next 4. that is a big issue. ubs said it when it comes to bhp is willducers, the lowest cost out of there. about the us industry. they have had to go through massive cuts. >> and that is right. that's in a rise in metal prices and they pumped money back into investment. the investment did not pay back and investors want more pay cut. bhp said they cut costs by $5 billion over the last year. they said they can dupe $5.5 billion this year. it will cut capital expenditures as well from $22 billion to $16 billion.

the issue is that they have announced they are going to increase their dividend by three .5%. rios said they would increase by 15%. they have catch up. the problem with bhp is debt. they have over $25 billion. if they can get it down to 25 bill -- $25 billion which they think they can do by the middle of the year, they announced they would and they would do a buyback. they hinted at the probability of a buyback. investors like that. that is what they want to see. >> thank you. the latest on bhp. up up and away. london housing prices keep rising. it has some investors were read. -- itm bubble territory has some investors worried. -- could it be in bubble territory? i will be back in a couple of minutes.

♪

>> welcome back to "on the move." i am francine lacqua. within 30 minutes into the trading day, a look of what to do and disease are telling us. we started on a high note. -- a look of what did the indices are telling us. on a high note. we are expecting german investor confidence data. we will watch out for that. also a look at the currencies. a little bit of data coming out of europe. seem to beries today

happening in asia. the yen weakening the most in a month. japanese stocks. look out for chinese shares. that is having an impact on some of the currencies we are watching. pound/dollar we will focus on the bank of england the next. these are bloomberg top headlines. the designated prime minister will begin talks with party leaders today in a bid to win a support for his political program. the democratic leader received a mandate from the president yesterday to form a government. thei pledges to overhaul labor market and modify the tax code and change the election law. japanese stocks burst after the bank expanded a lending program

to ¥7 trillion. the boj said individual banks to borrow at lower interest rates. pledgeve underscores the to do what ever is necessary to get out of deflation. the u.k. probably has more spare capacity. is according to policymaker david miles. >> there are some pretty clear signs that there is a flat. although unemployment has came down very shortly, it is very welcome. it certainly remains abe of a level consistent on average with our hedging target. people wanted to find jobs. this degree of slack of there. implement remains above that. -- unemployment remains above that. >> he spoke exclusively to guy johnson. prices have surged in the past year and the u.k. raising concern it may be heading to

another bubble. manus cranny has more. there are fears of a bubble. >> the research comes across my sets, -- said, with in london we have people borrowing three times or four times their multiples of their income. or crisisles are high level. marco carney said it is beyond my control. people do not need a mortgage as the high-end. it does not matter if i raise rates. we caught up with david miles yesterday. his view is still a mixed picture. level ofms of the transactions and the housing market, it moved up. it still remains rather a long way below average levels of transactions in the 10 years leading up to the financial mess. net mortgage lending is at extremely low levels still, it

has not bounced back significantly. it is a mixed picture if you focus on housing prices and a london. to the exclusion of anything else, one would reach a misguided view about conditions. >> you can see that. it is very much a debate on the committee on whether financials and traction with the market would actually do anything. the average price of a home and london is 600,000 pounds by 2018. 3.5 times in my, part of northern ireland at three times the northeast of england. what you have is a transactions are nowhere near where they were. >> will we look at the global property, what is driving them? >> there's a cracking report that talks about the most most expensive

cities. have a look at it this will stop new york and london -- have a look at this was to new york and london is where the wealthy wanted to stay. monaco. stop -- hongl kong. what you have got in terms of luxury is what is driving it is the fact you have wealth creators and one plays and nucleus of talent and knowledge and the growth of billionaires. from asia and africa and latin what toand that drives the rich want in their property. >> manus credi, thank you so much. still with us is andrew goldberg. andrew, thank you for sticking around. at the beginning of the show, we were talking about where you saw the most opportunity. you set you merge in the

markets. -- you said the emerging markets. there is still a lot of risk. >> there is risk. they keeping with the monetary policy is a lot of hubbub and much ado about whether the bank of england will remain in their credibility because they have shifted gears on what they are watching with forward guidance. it is all about unemployment rate and now it is not. now it is spare capacity. the key thing to look is for short-term interest rate which remains a very anchored over the last year. theyield moved but not in short. obsessingorried about over the credibility of marco carney. -- mark carney. >> you also have the housing bubble. you are not sure what you are looking at. but we are neutral on u.k.

equities. they have come a long way. the u.k. economy is looking good. pmi is in the right direction. lending whenip out it comes to housing. if you look across the rest of the u.k., prices are still below where they were. activity has plenty of room to go. we are nowhere near bubble territory yet. we are starting to get to the level where it makes you wonder if we are a long way off? the u.s. got into trouble with housing we long abe much of money who cannot afford -- when we loaned money to a bunch of people cannot afford it. and a london certainly. >> you said you are not too concerned. >> i heard a bubble that is defined that is overbought or

overvalued.r it is certainly overvalued. it does not necessitate a bubble. that floor for demand for london or berlin state is hard to envision that going away. demand for london real estate is hard to envision that's going away. the bottom line is -- [no audio] george had 5 billion pounds on it. inguess is he will still be favor of it. london real estate has legs. beginning, you said 2014 would be a more difficult year stop investors have to be more smart and more sophisticated. we talked about the emerging markets and the u.k. do you like the u.s. or anything in europe? >> i like the u.s. inh that said, what happened

2013 was after 2011 and 2012 earnings were not delivered, the markets did not pay off. with the tell risk any europe, some of the political uncertainty behind us. markets were able to reward and got a little ahead. in a 2014, you will not get to that. it will not be a simple data play. a more discerning market. you are starting to see that. correlations are coming down. i like the u.s. quite a bit. it is quite favorable. policy will stay loose. we see earnings will grow. just not a double digits smooth sailing environment. >> what is your take on japan? a little bit tricky isn't it? sales tax increase. and we do not know if it will work >> i agree. the interesting things

about the recent gdp report was it was originally interpreted by markets as a weaker number. if you dig down into the detail, you will find the prior quarter had a big boost from inventory accumulation. this time inventory do not contribute and they detracted a little bit. it was domestic consumption that drove most of the recent gdp reports. even though it was a weaker number, i prefer it. that is good news. i think japan can stomach. we like it in the near term. more qe to come. angiodynamics is the way to play it. in the long run, they have debt problems. and abenomicsoda is the way to play it. >> thank you so much for all of that. andrew goldberg. sales speed up for another month.

ist is driving auto sales coming up next. ♪

>> given our assessment of the situation right now, there is not a case for tightening policy because of there is slack and the economy and it looks like inflation is close to target. pushbly when we do come to policy back into more normal direction, it is highly likely that it will be a fairly gradual movement to a level which than what weower think is the normal. of england bank policymaker david miles speaking to guy johnson. die will join us -- guy johnson will join us for more. it was a great interview. it went through the thinking as the bank of england. quickly the output gap which nobody has been able to nail down. that is what the bank of england is targeting. concept ofs nebulous

the output gap we are trying to figure out a way of understanding so we can set policy. it is many moving parts. the bank of england, yes, rates are not going up anytime soon. lower than we anticipated. we still do not know which metrical we are going to use. the other agency thing he said was, he thinks it is probably more likely that if the spc will be the mechanism by which the bank will choose the housing market and the new rules and tools the market has at that will be the story moving forward. >> that is why he said the rates are lost. >> precisely. we have all the details. we'll get monetary policy. show, plentyof the more of this exclusive interview. it was a great interview. he has to cobble together.

>> it is fascinated. is werst-case scenario end up with more of the same. the same old faces we have seen with the forefront. here is this guy under 40. the youngest prime minister coming into the country in for ever. you kind of wonder if he will shape thinks of as if he tony blair -- you kind of wonder if you will shake things up. if he tony blair or is he margaret thatcher? >> like tony blair. let's see. [laughter] guy johnson. the pulse is coming up in 14 minutes. the bank of japan put its foot on the gas. markets tons for the jonathan ferro.

i was a pretty easy session and japanese trading. is yen is higher and nikkei higher. the arrow of abenomics is firing on all cylinders. shows no steps of stepping back. the amount of qe is unchanged. they doubled to ¥7 trillion. banks can borrow twice as much low interest rate from the central-bank stop a, a lending facility. great. a problem. japanese companies are already sitting on record piles of cash. at 220 ¥4 trillion. how much benefit will japan get from expanding the program? that remains to be seen. >> how high our expectations? >> incredibly high. check out our latest survey. expectations are calling for more action. -- byorecast the boj will

the end of september. here is what today's news is supposed to do. a symbolism of the move. andre not a stepping back we are committed. the perception is they are ready to do more. when expectations are this high, sometimes they are not quite met. >> jonathan ferro, thank you. that is always the risk of expectations not being met. it is in talks to take a stake in peugeot. the board meets today. it would include 3 billion euros. talks between netflix and time warner cable are set to be on hold. the cable operator is being sold. the discussions are unlikely to progress until comcast to please is acquisition for time warner cable. netflix which are to secure a place for its service on cable

top set boxes. new car sales arose for a fifth consecutive month in january. numeral just versus -- new registrations increased by 5%. numbers, let's get to hans nichols in berlin. hans? >> if you're looking for mildly qualified reasons this morning on the state of the european economy, look at these numbers. up for the month of january compared to last january. a bit of a slowdown. last month we had 13% increase. the fifth straight month with growth. the growth is throughout all five of the biggest economies in europe. .6% and the u.k.. 746% in spain. in germany. -- 7.6% in the u.k.

-- 7.6% in spain. of that is driven by clash for clunkers on a government program. these are solid numbers and they show continued growth. the auto economy has so much more to dig out. the second lowest a month for total sales since the numbers were kept track of since 2003. francine? >> how is peugeot doing? >> peugeot has had good numbers. it is at 30%. the only disappointing ones were mercedes. they were down a little bit. bmw had a modest growth. bad.- gm, not board is meeting today. will they get the 3 billion euro cash infusion from the french estate? it could change the look.

they will need stronger growth domestically. these numbers show maybe that is where we are heading and the right direction. >> hans nichols, thank you very much. it was fashion week. burberry keeps getting stronger. yesterday, the rebuilt -- and they revealed a new collection. , for the firstw time, the specially arranged runway was available for download on itunes. home on dedicated itunes. the first to capture the catwalk and stream it5 alive. such powerhouses coming together where fashion meets technology. we will stay with a luxury. how one hotel chain is breaking luxury to the alps, that is

after the break. ♪

>> a cosmopolitan city hotel chain has moved to the alps. a weeklong series about the highlife. the move into the alps. >> meet the newest full-time residents. four-star hotel

that will stay open. designers altered the slopes so guess kinski said -- so guests kinski right to the slope. do not like a typical w, they had to alter. whether their brand of urban luxury can survive at altitude. it begins on the mountain at the hotel's bar. under snow and stone, and underground club. its secrets are buried. we need the music which we have a we have three in house djs which are amazing and the atmosphere. the design of the bar is great. it is much more international than what people would find. suites that and

start at $500. fireplace and balconies in every room. the challenge will be to fill them in the sunnier and slusher your months. slushier months. this conference space is the largest and in this region of switzerland will help to sustain it in the off-season with the event of this is when the rest of them are out. a gamble that a full-service hotel can't thrive in a part-time town. it is different from what we are used to in the w. [indiscernible] sports or if people will get to business to the hotel. >> as every ski town to pit of the ski got, they will need

help. >> it is a challenge. it will take a lot of work and energy. >> hospitality and occupancy in a mountain resort when the snow melts. ♪ . .

>> miles away. a bloomberg exclusive. david miles says there is so much slack in the u.k. economy that rate hikes are far from priority. programs as its signals room for more easing. >> and a $25 billion drug deal. near an agreement to buy forest labs. good morning. you are watching "the pulse."