>> a chance for peace. ukraine's president announces a plan to resolve the political crisis, but will it stop the bloodshed? rbs retreats. a report that it will shrink its investment 19 in unit with 30,000 jobs lost. and the cost of free texting following facebook's purchase. how much cash carriers lose out on. one firm puts the figure at $33 billion. welcome to "the pulse," live

from bloomberg european headquarters. i am francine lacqua. guy johnson is off today. also coming up, how to survive an avalanche. we speak to the pro snowboarder who had the technology to save her life. and its chief executive tells us why. now let's get a quick market check. this is what we are seeing. we did start the day on a high. for the moment, we are down from the days highs, but still gaining weight three percent. heading the stoxx 600 for its third consecutive weekly advancement. o is the one to watch out for. this is the french auto-parts maker that posted earnings that beat analyst estimates. a very quick look at fx. we are looking out for the g-2 0 this weekend. janet yellen arrives tomorrow morning for the talks. in ukraine, the president has agreed to plan to resolve the

political crisis that has caused chaos in the country for weeks. an accord will be assigned in about an hour. david tweed has been following the story from berlin. first of all, give us the latest. >> just that accord that is supposed to be signed in about an hour. it looks shaky as to whether that might happen. the president of poland, whose foreign minister has been at the negotiations all night with the german foreign minister, saying that the opposition has only just started negotiations about a potential cord -- a potential accord about an hour ago. the leaders need to sign off on this as well. i think we need to wait and see what happens with regards to the signing of the accord. it is hopefully supposed to happen in about an hour. as to the details of the accord,

interfax is reporting that it includes constitutional change to take the constitution back to the form of 2004, which would -- a takingackdown back of some presidential powers. the other aspect of this accord has to do with presidential elections, which might not happen until the end of the year. we know that the opposition has been calling for snap presidential elections. parliamentary elections. that could perhaps be a sticking point. with a freshme out downgrade on the country. give us the details. >> they are beginning to look through the present crisis as to what might happen if a new government is formed. financialned the difficulties that the ukraine has at the moment, pointing out that the central bank and the state-owned gas company have $13 billion worth of debt repayment

to make just this year. the foreign reserves of ukraine have fallen to about $18 billion. that does not leave very much change. money coming from russia, $15 billion, that appears to be tied to mr. yanukovych remaining in power. if there is a new government, then the eu, the u.s., one would expect the imf to be involved in coming up with some sort of bailout. p points out that that bailout would likely be conditional. would every -- would any government formed out of this crisis have strong enough leadership? that is why they are concerned about the potential of a downgrade. >> thank you so much. david tweed with the latest on ukraine. rbs is planning to/30,000 jobs -- to slash 30,000 jobs. donovan ferro joins us with the

details. what exactly does the report say? >> they are shrinking the investment bank. a spokeswoman with rbs has not confirmed this. if you get these figures, it will be in the strategic review next week. potential huge, deep cuts to this staff. i think the number, the big headline might be a surprise. got a ceo that is going out and talking about expansion, going on a hiring speed. -- a hiring spree. it seems to be political pressure. a large number of institutions in this country scaling back on investment banks because of a lyrical pressure. -- because of political pressure . >> switzerland, a separate story. ubs going back to its core business, wealth management. rbs feels like a significant story. 18% government owned. a lot more socially-palatable for this bank to become more of

a consumer, business-lending bank. there is a massive lyrical tread going right -- a lyrical thread -- political thread going right through this bank. we are well below rate even crisis. the biggest banking bailout in the history of this country. osborne and cameron have an election year. they want this bank off the books. it is about making progress now. it at the bottom of the chart. they have not made progress. >> they want a share price increase so they can sell off nicely before the election. withe same way they did lloyd's. rbs is something they want to get rid of, but cannot at the moment. you have got to say, they probably are not going to be able to. >> the latest on rbs. and earnings drop in 2013 due to the weakest growth in the gucci

brand. manus cranny joins us to break down the numbers. ,> it is the gucci brand overall sales, in terms of what decentvers, it is a carry and that is where the transformation of gucci is not playing through in the numbers just yet. the weakest footfall for tourists and quite a while. just to give you a sense of the numbers, we talk about the story -- net income comes in at comes in down from over one billion per year before. is what cantort fitzgerald are calling these numbers. there is also the question of leaning on other brands. up 13 point -- 13.4%. that is where the transformation is coming through. balancing out the downside of ysl. against vanetta an

the market is asking if the transportation -- the transformation is taking longer. keringcaring brand -- brand is still in transition. where is it in that process? >> when you look at what the ceo is saying, kering does not plan to bring the core brand into the lower segment. it is about the premiumization within the gucci brand. but that logos are essential. i find this interesting. logos are essential for new customers in china. is to accelerate the gucci innovation strategy. it is really that balancing act between dispensing with this gucci logo or the stamp on the bag and moving to the paradigm of louis vuitton, non-monitored non-monikered brand and

product. it is going to take longer than the market originally anticipated. and then there is a whole proof story, which we will get to shortly. $90 million to facebook, lots of money, but less than half the amount phone carriers may lose in the coming years to the mobile message applications. hans nichols as the number for us. it is expensive for facebook or not, it is taking a lot of market share because it is sending many more messages on this kind of application instead of text messages. >> that is absolutely right. there are two sides to this story and that is that they are sucking a lot of revenues away from mobile phone companies. in 2013.on that is an estimate from a consulting firm. that will grow all the way to

$54 billion in lost revenue in 2016. the u.s. market, it is declining, text messaging revenue defining 3%-4% every year. it is a $21 billion market. for the most part, we are talking globally. the u.s. has been out front and giving free text messaging to a lot of their clients. first text message, i look this up, 1992, sent over vodafone. at a country like mexico, 90% of messages are sent this. they have a clear advantage in emerging markets. that is one of the reasons why mark zuckerberg season value in it and the phone companies are losing value. >> if you are a phone company, what do you do? >> you give it away and tried to get customers on data plans. you are seeing unlimited text messaging coming in the emerging markets and parts of europe.

before, you would charge per message. is companies like to have the chair and allow you to message by using a small amount of data. you will see phone companies try andweak their data plans give away messages as part of that overall plan. so much.you hans nichols with the latest on how phone companies can or are trying to counter these message applications. here is what else is on our radar. o shares shares -- vale are soaring this morning. the company says demand for cars has increased in china and north america and the european market has also improved. finance ministers meet in sydney, committed to developing new measures to bolster growth. adam pozen says the world economy has stabilized. >> we are getting back to normal. and i hoped china

japan are arguably on a stable growth path. still a bit of consolidating and moving forward. europe is not as -- i expected to stagnate. but it will get through and be all right. up, thenadd all that you take out the spareribs of many of the major emerging markets, even extending to sub-saharan africa, on a reasonable path. former national security advisor says the unrest in the ukraine relates to broader issues with russia. >> the issue goes beyond ukraine. it goes to the heart of the issue. what will russia become over the next decade or so? is embarkingtin rush on some sort of nostalgic, irrational, imperial restoration.

the eurasian union that he wants to create, of course, centered in moscow, would be a restoration of the soviet union minus some european portions and the russian empire. >> you can catch the full interview with jimmy carter's former national security adviser on charlie rose. that airs at 10:00 p.m. u.k. time tonight. coming up, we will keep the focus on ukraine. the president announces a plan to resolve the political crisis but will it stop the bloodshed? ♪

>> a moment of calm in ukraine. the president has agreed to a plan to resolve the political crisis that led to deadly clashes in the country. the agreement is expected to be signed in about 45 minutes. the emerging markets chief economist at standard bank joins us. thank you for coming in. when you think this agreement will be signed. i am hearing a lot of skepticism. we had to chief economist on this morning and they said it would be -- 2 chief economists on this morning and they said -- >> it has been announced, but the opposition has not confirmed it. clearly, jan ninkovich likes -- vych likes the deal.

this deal sees him out of office 12 weeks earlier than he would have been ousted. i do not see that being sold. the opposition leaders, they do not necessarily need an ultimatum. >> you think that no agreement that would involve him staying in power would be signed. >> the general consensus across the board is it will be very difficult to sell a deal that is not something like early elections within three months kovychn echo mitch -- yanu want toster and people see people brought to account for the violence. question about a whether the military would follow his orders. >> i do not see that. >> in sending him or the military following them? try, but my feedback

on the ukrainian military is -- there is a relationship with nato, perhaps more so these days than russia. and we saw two heads of the army have been ousted. i think that suggests splits in the military. vych goes for that, it is a very dangerous, high risk strategy from his perspective. >> will this escalate to civil war? >> civil war is a big word. it is not looking particularly hopeful. a lot of people have made the point that it is not east versus west yet read -- yet. on the about guys street, a majority of the population that just do not feel very happy about their leadership. it is about rule of law. it is about fairness. it is about justice. that is what it is about mostly. it is about the leadership at the top. ukraine,grade of the

it could default. it is not what is on anyone's mind at the moment, because they are about their safety and security. ais is not systemically-important country, yet it is a worry for the emerging markets that are tied to russia. >> yes. the holdings of ukrainian debt are relatively modest, something like half of the levels of russia in 1998. that said, it adds to the generally negative musings about the emerging markets. you look across the spectrum. egypt, venezuela, argentina, ukraine, thailand, a whole group of countries that are in disarray. it is a challenging global environment, i guess. a fear that this may spread? this is something that kind of took us by surprise. >> which makes it very unpredictable going forward. no one knows where it is going and that is the reality. i think the biggest knock is on

russia, in my mind. that a lot of this is related to developments in russia anyway. russia's greatest -- greater vision is driving this. i think russia's problems at home, a weak economy with a lack of structural reform, i mean, where is russia going? in a way, putin is creating a lot of distraction. >> you say that this will hurt putin because investors will see his -- i mean, he is not heavy-handed. i guess it is the advice he is giving which has been taken badly by the west. >> russia has underlying both foreign investors and locals do not want to invest in the russian economy. they are taking money out because of the rule of law, structural problems about institutional strengths, bureaucracy, corruption, that

kind of stuff. the perception of meddling in ukraine is going down very badly. and also by locals. putin and prudent -- and are worried about copycat events. the kinds of things that kiev wants, rule of law, i think a lot of people in russia kind of want that stuff as well. >> timothy ash. now we will cross live to kiev for the view on the ground in a few minutes. still to come, sky high fashion. drones hit the catwalk. ♪

>> welcome back to "the pulse," live on bloomberg television and radio and streaming on your tablet, your phone, and bloomberg.com. time for a look at today's hot shots. a resounding victory for the german cycling champion in the third stage. toughders will face a hill climb in the next reggie the competition. and the motorbike grand prix title is up for grabs after the world champion rider. the honda rider had been forced to pull out of the competition. his team expects him to be back

in action in just a few months. a long-standing chimney was demolished in a controlled explosion. 1965, the 200-meter tall until 2003.od many spectators cheered as dynamite tumble the chimney, creating an enormous cloud of dust. now let's get your asset check. manus cranny is that the touchscreen. >> a bit of a mixed picture on this equity board behind me. g-20 starting, the potential of some agreement and perhaps these lines to be drawn within the ukraine. willhe debate at the g-20 be between the federal reserve and the rest of the emerging markets countries. the united kingdom, the london market rises for the sixth day in a row. vodafone tops the agenda. to close a deal where they sell their stake of verizon wireless.

that, ubs says, leaves this stock particularly undervalued. they raised their price target to 275. thatsts making the call verizon will come back and bid for vodafone. once the verizon wireless portion drops out. rbs up 1.5%. waiting for confirmation in terms of the story that we will see a radical shakeup at the investment bank at rbs. u.s. equity futures, at the moment, we have a bit of a data crush in the u.s. today. existing home sales, we are expecting those to drop by about 4%. at. equity futures trading 18.39. we wait for the retail sales in the united kingdom as well. back to you. >> up next, we speak with a pro snowboarder and all around

adrenaline junkie who survived an avalanche. we will show you the technology that saved her life. just a reminder that you can follow me on twitter. i will see you in a couple of minutes. ♪ . .

>> welcome back to "the pulse" live from bloomberg's european headquarters in london. i am francine lacqua. guy johnson is off today. rbs is planning to retreat from its investment banking business and cut 30,000 jobs according to the financial times. it says britain's largest government-owned lender will announce the restructuring next week. a spokeswoman for the bank declined to comment on the report. italy's incoming premier matteo renzi will present the ministers last to the president today. that is according to the news

organization ansa. agreed's president has to a plan to resolve the political crisis that has caused chaos in the country. the agreement will be signed in about half an hour. france's foreign minister says it is premature to say that an agreement has been reached. standard & poor's earlier said ukraine is at risk of default as the political crisis deepens. joining us over the phone from tf is hellmuth thromm. what is the situation on the ground like? >> i am standing next to the first line of barricades. freshwatch people loading supplies onto trucks to transport them onto the square which is just about -- less than a half-mile from here. people are putting on protective gear, bullet-proof vest.

people on the evene are highly skeptical though the president has signaled he will sign some sort of agreement. >> i guess the million dollar question is whether the opposition leaders will agree to any plan which doesn't really account for the violence and still keeps president yanukovych in power. >> that is exactly right. another question is, whether people on the square will listen to the opposition leaders. what we have been asked. singh over the past couple of weeks is that people on the square have really lost confidence in some of the opposition leaders. i think we will have to see what exactly is in that document that president yanukovych will sign. rumor has it that he will stay in power through the end of the year and elections will only be

held later in the fall. may just say that is not good enough. , thank youhellmuth so much. we have just had some breaking u.k. retail numbers. they are a little bit softer than expected. excluding alto, 1.5% for the month of january. it is lower 1.5%. ofwere expecting a decline one percent. g 20 finance ministers are meeting in sydney. they will commit to developing new measures to bolster growth, global growth. jonathan ferro with more on this. the focusmoment, seems to be on monetary policy. you have emerging markets worried about what the reduction

based federal reserve stimulus is going to do that our economy. you hear from the fed, reality check. our mandate is the u.s. economy, not the world area -- the world. if this doesn't feed into the domestic economy, it is not our problem. you also have to think about the inconsistency of the message coming from emerging markets. two years ago, it was stopped quantitative easing. now it is, stop tapering. >> this was flagged, right? , evenwas a surprise move if you are focusing on domestic, you say -- is a little bit unfair. this was signposted. fed tapering is coming soon. last heard about it since may. we knew it was coming anyway. it is not going to be qe forever. is other side of this growth, growth, growth, and a lot of people still talking about monetary policy.

these governments need to do more themselves. general was talking this morning and i think is comment are pretty interesting. >> we have run out of room on the monetary policy side. we ran out of room on the fiscal policy side meaning everyone is trying to reduce the deficit and debt. what we have left is structural change. >> you can see the message coming from him but the mab and -- the problem is that monetary policy is still center stage. i think that gives you a strong message as to where we are still at. even though people are talking about this recovery, the likes of china, there is concern there. .k. have seen the u retail sales. growth is not a given, neither is recovery. >> it is time for the latest part in our series on the

business of ski slopes. they're taking safety more seriously in recent years. -- therenot be enough is also more offbeat exploration and that means more danger from avalanches. can leaveee that we under an avalanche, 15 minutes, you can be completely broken. suddenly everything cracked around me. i understood that i was on top of a huge -- it just fell and fell and fell. i was in a huge avalanche. it is so much power. sometimes you just flipped over. it depends on the time of the year. in spring, i would say that

after midday it is very dangerous. you have to be in the mountain, you have to write in the environment. --the beginning it keeps you out of -- it keeps you floating and you don't really need to swim. even if you are unconscious, you're out of the avalanche. our ski specialist hans nichols joins us. you spent a week in birdier -- in verbier after davos. is security a big concern? >> there is a big difference between skiing in europe and skiing in north america. you go off-peak so much more in europe. --france alone, one average

or is an average of 30 deaths a year from avalanches. in europe, you see people wearing these bags because even if you take all the necessary precautions, if you follow all the models, they have a rating system, very wet snow, warm conditions, even if you follow all the precautions, you never know what is going to happen. you're seeing sales of these take off in europe. will they take off in north america as well? they are pretty light. they are not terribly cumbersome. you forget you have them on at the end. it is potentially life-saving. >> do people actually take them all the time? operate -- maybe that is where you can be safe and take it off. people keep them on all the time. you are safety first, i know you would keep it on. i don't know what you get up to. >> i don't know, a cocktail --

it could take off. i am also for safety. you are right there. hans nichols, our resident expert with anything expensive or ski related. here is some company news. shell is selling its refinery and gas stations to vitol group. about $2.6aying billion for the businesses. a chinese group is considering buying south african assets after their value was depressed by strikes. they are reviewing a decision to hold off purchasing the assets because of labor issues. the gucci brand posted its quarterly sales growth, the slowest in four years. fendin fashion house showed off this years autumn collection at the milan fashion show. the most memorable thing about it was the drones hovering in the sky. >> this is fendi going

high-tech. can see the gadgets? don't worry, the whole show was shot on drones. italian fashion house fendi teamed up with a french company to stream this season's show live online. has always been in the history, an innovator. a traditional brand with a sense of innovation. >> as with all new tech, there can be problems. this is what people actually saw when they tune into the show. take theat didn't sheen off the glamour of the event. >> i have never seen anything quite like it before. it feels like fashion going into the future. i think it is great. its get different camera angles of the clothes. show, there is one thing tech isn't replacing anytime soon. the models. i guess bennett, bloomberg.

just one of the uses that we will put drones to. coming up, your own tailored suit for just $100,000. that is coming up next. ♪

bespoke suit designer for the megarich. they make one of the most expensive suits in the world.

it takes taylor's 50 hours to produce it by hand. there are no more than 50 of these suits made each year. they can also cost up to $100,000. we take an exclusive look. >> i am working here 26, 27 years. there is an unbelievable tradition about taylor. 50 is a special model that we make for a special customer. there are only five taylors in our custom-made -- in our cost -- in our company. instead of 25 hours that we spend for a normal fit, we need 50 hours to make. we can go from $10,000 to $100,000.

all the stitches that you see inside the jacket are made by hand. they are very flexible. >> you can sleep in our jacket. you can use it like a pillow. you can do everything. you can try. customer -- the label is always inside. they want something that is really made for them. >> let's continue the conversation on this pope tailoring technology making personalization cheaper. does that mean machines could one day replace taylor's? joining us is the cofounder of an online shop. great to have you on the program. give us a sense -- are there more and more people that want custom suits?

>> absolutely, once you have had your first suit tailored, you can't go back to getting something off the peg again. once you know how fitted you like it, how tapered you like your waist, even if you ask a guy how narrow they like their ankle with. a lot of them will say normal. when you ask them deeply, they will get down to half an inch of the howard narrow they like their ankle with. it is something that once you have a suit made and you have a suit that you love, you can never go back. >> everyone has an opinion once you start trying them on. we were just hearing from a suit maker from naples. it seems like a preposterous amount of money but they only make 50 of these suits. your suits are significantly cheaper. >> all we ever try to do is make bespoke tailoring accessible to the world. we want to make it accessible in every way. we are local to you. we are at a price that customers can afford. we want to make everything to

fit our customers' bodies exactly. >> do you think this is really going to take off? i have friends in the newsroom who have had fitted suits for the last 10 years. just wondering, how that changes. does it become cheaper because of the machines that you will use? >> i think technology brings a lot of efficiency. it is not necessarily just the machines that make the suits. all of our suits are hand cut by a master. it is all of the things in between, the way that you can efficiently service your customers and see them locally and be very efficient. that is the thing that makes it possible to pass the value back to customers. >> are you seeing more of an increase? has it remained pretty much the same? what kind of people come into your shop? >> we get all sorts. people working on investment and that kind of thing but equally, we have just normal people wanting to have a suit for their wedding or an

event. the message that you can actually have something tailored , you should have something tailored is something that we want to spread. >> what is the question that you get most frequently asked? what we are most frequently asked is, what is right for me? >> depending on your shape and stature. >> we think of it in the three f's --fit, fabric and fashion. every one of those is important. the fit is the most important. the fabric is the second most important. we believe the fashion touches at the end with at the cherry on top. -- we have a about lot of professional viewers, a lot of bankers or ceo's. how many suits does a man need? >> this will range. if you wear a suit every day, we

recommend that you should have five suits. four of those suits are what you rotate in the week. one of the suit is that special one that you bring out when you want to impress in a meeting. something in that way. >> all dark colors? the standard is two grays, two navies and whatever you love for your meeting suit. having said that, everyone is different. fabrics work differently on different skin tones. outly, if you want to find what is right for you, i think our styleh -- one of advisers. go through the fabric and fit that will be right for you. >> thank you so much for joining us today. next, levels of air pollution have been linked to millions of deaths each year.

hydrogen fuel technology may provide solutions. details ahead. ♪

>> welcome back to "the pulse" live on bloomberg television and

radio, also streaming on your tablet, your phone and bloomberg.com. has theydrogen tech potential to/air pollution. vehicles powered by electric fuel produced zero harmful emissions and are more efficient. all, explain to me how it works. >> the difference between transport which is powered by an internal combustion engine using a fuel, it is combustion. fuel cell technology works on an electrochemical process. it means that there is no combustion. there are no omissions. by using hydrogen and oxygen from the air, you are creating a completely zero emission power. it is electric current coming from the fuel cell. >> is it more expensive? >> it is at the moment.

that is because we are not producing at the same volumes. it will be the same as we have seen with mobile handsets and all the other electronic devices. expensive to begin with but as you get to the volume, plus come down. cheaper will be a lot -- >> we are already moving very quickly to being able to get competitive with conventional technologies. that has been the challenge. fuel cell technology has been around as a concept for well over a hundred years. >> this has to be commercially viable now right? a reales this become alternative? >> we are on the cusp of that right now. we are about to see what will become the first commercial consumer products. >> do you still need subsidies from the government? >> there are plenty of barriers. a lot of those barriers are

around the infrastructure side rather than the technology side. you have got to have access to hydrogen. you need to be able to create it from a green source. that means tying it up with wind or solar in order to be able to obtain a completely carbon-neutral footprint. >> you also bought props. we love props on the program. tell me what those are. >> we have been talking about fuel-cell technology. that is it. the challenge has been to get it scalable. you can put this in your pocket and carry it with you and that provides power on the go. >> for people on the radio, this is a little bit bigger than an old nokia phone. this basically enables people without access to current electricity to plug in. and be able to charge whatever they want. >> if you don't have great access -- here in europe there are plenty of opportunities to plug in. that gives you your recharge whether it is an ipad or

whatever the device might be. there are plenty of parks in the world, africa, asia, where that is not an option. we are looking at a marketplace ,hat drives the opportunity where fixed telecoms doesn't work, everything is mobile. we are supplying power for people on the move. >> i like that. how much does it cost? >> it is going to vary depending on the particular model. we are looking for example at an arrangement in the u.s., $199. that is more the recreational market for people that are away over the weekend. rechargeou're able to the gps, iphone, whatever you might happen to have. it gives you the opportunity to get that into play. in africa, it will depend on whether it is sold or leased. the only part that comes with it is the recharge from the hydrogen.

this also shows is is completely safe. >> i hope so. it is right here on the desk. thank you so much. coming up, for those listening on bloomberg radio, the first word. or our viewers, a second hour of "the pulse." ♪

>> potential for peace, ukraine's president agrees to a plan to resolve the political crisis. he could sign it within minutes. >> the bank will reportedly get the investment banking unit and slash 30,000 jobs in the process. >> and the power of whatsapp, facebook's $19 billion buy could make a big dent on the mobile telecom carrier's bottom line. >> hello, good morning to our viewers in europe. good evening to those in asia, and welcome to those just waking up in the united states. i'm mark barton.

>> and i'm francine lacqua. this is "the pulse" live from europe's european headquarters in london. >> also coming up this hour, sky-high fashion, drones hit the scatwalk in milan. the company's chief executive tells us why. >> plus, survival on the slopes, we'll show you the kilt that could be the difference between life and death in case of an avalanche. >> first up, let's quickly check on the markets, two hours into the friday trading session for european markets. stocks trading higher. the stoxx 600 just below a six-year high, up about a quarter of 1% today. >> one stock we're watching has gained 10%. it's a carmaker, or a car part maker over in france, also watch out for euro dollar. janet yellen arrives in sydney for talks on the g-20 with the other g-20 ministers and central bank governors. that's in sydney over the weekend. >> right, let's begin with the situation in ukraine. president yanukovych's administration says a plan has

been reached to resolve the political crisis that's caused chaos in the country for weeks. according to the administration, the accord is scheduled to be signed right now. our europe editor, david tweed, has been following this story from berlin. david, give us the latest. >> well, there aren't many signs out there that that accord will be signed right now, certainly haven't seen anything about that, and the reason, because of that probably is because the opposition is arguing that the accord doesn't go far enough. now, we've seen reports about the contours of this accord that was agreed after talks with e.u. negotiators, including the polish foreign minister, the german foreign minister, even an envoy from russia, as well as president yanukovych last night, and then looking at constitutional changes that would bring the constitution back to its 2004 form, and that would involve scaling back the powers of the president in favor of a prime minister. that wouldn't actually be voted

on until september, and the other item, which is probably not going to be accepted by the opposition is the fact that the agreement caused the presidential elections, but not until december. we know they actually want snap elections as soon as possible, mark. >> yeah, david, i'm actually going to pick it up from here. i guess the problem is a lot of opposition leaders will never agree to anything as long as president yanukovych is still in power. that's something that we heard about. now, talk to me a little bit about s&p, because they came out with a fresh downgrade for the country. they also say that if this continues, ukraine is at risk of default. >> that's right. we've had a bit of news out about bond sales. there's been the scrapping of a $2 billion ukraine bond sale. that's according to the irish stock exchange. we've seen the ukrainian currency down another 3.5%. that's obviously going to be an issue. the s&p report is interesting, because it looks through the

currency situation at what might happen in the case of a bailout that would come maybe from the united states, from the e.u., and the i.m.f. they say that bailout or that money could potentially be likely conditional. all sorts of conditions would be attached to it. the question is any government that could replace the ads in power at the moment, who would be the leader of that government, and would that government be able to have the power to actually push through the likely conditions that would be asked for in exchange for money. >> david, thanks. david tweed in berlin. >> r.b.s. is planning to cut 30,000 jobs as it shuts down its riskier investment banking business. that's according to reports from the if the f.t.." what exactly does the report say? >> well, francine, i think the bottom line is this, r.b.s. is planning to withdraw from some

of its investment banking activities. that really is the bottom line. the spokeswoman has declined to comment on the report, so this is not confirmed yet, but potentially huge, deep cuts in r.b.s. to be overseen by the c.e.o. you've got to say it's not a big surprise. perhaps the numbers are to some people, but a move to scale back has been flagged. listen to ross speaking just last week. >> delighted you're able to come and spend time with us. can i just tell you my as operation is not to run the world's largest bank. it is not my aspiration. my aspiration is to run the best bank in the u.k. >> not a man there flagging an expansion or a hiring spree. >> and john, r.b.s. certainly not the latest, certainly not the last lender or the first lender, should i say, that could cut part of its investment banking, investment banking unit. how big of a trend is this right now for the industry? >> it seems to be pretty wide. if you look at barclays,

they've scaled back to some extent. swiss banks, they're retreating to other businesses, but various reasons. some have got to raise more capital. but for r.b.s. in particular, this seems to be much more socially palatable. government-owned is focused on being a much more simpler bank and business lendings, and that's probably not the main reason, but at least one of the reasons why they're doing it. >> so john, where does this leave the government, the biggest stakeholder in r.b.s.? >> the politics of this are absolutely fascinating. you've got the biggest bank bailout in the country's history and 80% stake that the government has not been able to shift. you've got a break-even price of 407 pence. right now we're trading at 360. they are way off. there's so much unis not around this bank right now, and the fact of the matter is mr. osborne and mr. cameron face an election next year. they will want to show some progress and get in this bank off the books. but guess what we're expecting next week.

we're expecting this bank to post a loss. we also know they'll get their releasing, rather, that strategic review in full next week, and that one is going to come coming through pretty carefully. >> jonathan there with the very latest on r.b.s. >> moving on into corporate news. gucci hosting its slower sales growth in four years and dragging shares of its parent lower this morning in this friday session. our markets editor, manus cranny, joins us with more on the luxury goods maker's report. what does it say? >> it's a divergent story. you've got three big luxury brands in the stable of carrying gucci. essentially gucci delivering worse than we had estimated in the market by a long, long way, mark. that's the issue. fwuchee, the brand is going through a transition. they're revamping the stores, changing the pricing. they're changing the product range, and they're trying to introduce that glorious phrase, premiumization.

it's already a premium product, but they're trying to take the entry point higher. that's taking longer than the market had anticipated. there's less foot fault from the chinese tourists. u.s. and japan are bolstering the numbers, but you're going to leave on other brands, which had a very, very strong quarter. a anus, the brand is still transition story. where is that story right now? >> it's trying to get the balance right between what and you i talked about, which is taking away the stamp of gucci, the g.g., thanksgiving off the product and trying to get that balance correct between going from monogrammed product as the image you're looking at through to a new nonmonogrammed look. it's trying to get the balance right between logos and nonlogos. but for the new luxury customers in chain ark the logo is essential. so it's trying to get the balance right. i think it's just taking a little bit longer than the markets had originally

anticipated. >> manus, thank you so much. manus cranny with the very latest on kering, the company formerly known as p.p.r. >> vodafone completing the biggest sale well disposal of s 45% stake in verizon wireless. bloomberg deals reports that matt campbell joins us with more. hi, matt. where does this leave verizon in the u.s. market? >> well, we now have verizon in full control of its main operating assets, the verizon wireless business, which is, of course, the leading american mobile carrier. the leading carrier in really what is still the world's most important mobile market, certainly at the higher end. that doesn't mean it's going to be smooth sailing necessarily. we have, for example, t mobile in the u.s., led by a very aggressive c.e.o., cutting prices aggressively, offering ll kinds of promotions, making quite transparent attempts to poach guys from at&t and

verizon. we also have sprint, traditionally really an also-ran, almost not even worth worrying about for verizon and at&t, which is now owned by soft bank, a very aggressive japanese company. so verizon has more flexibility in this core business, but it's going to need it if it's going to invest in networks, potentially cut prices, and find a way to get in front of more consumers, particularly high-spending consumers. those are the ones that really matter, and not be really undermined by this competition. >> matt, what about other deals? >> well, in europe, we could see all sorts of things, though in the u.s., the one that everyone is focused on is the possibility of a combination between sprint and t mobile. the c.e.o. of softbank is a very, very ambitious guy who has said he wants sprint, which he owns, to be the number one american carrier. that means a merger with t mobile. but there's a big obstacle to that, which is washington. the u.s. regulators just don't want to see these four national carriers go down to three. we have, for example, four in

the u.k. there are four in france. they think four is the right number for the united states, at least right now. the counter argument is that actually with a stronger third player, you could have a more effective challenge to at&t and verizon, which are the largest players by far. >> and where does this leave vodafone as a stand-alone company, a company that from today is inherently half the size it was yesterday? >> well, vodafone has emerged butterfly-like from this transformation of unloading its american business. it's now rooted really in europe, of course, with important operations in africa and in south asia. but vodafone has some real questions about its future. in the u.k., it is not the number one carrier, not by a long way. it has to decide what to do in spain, where, of course, there have been rumors that it could acquire ono, a fixed-line company. this seems to be the future. they want the fixed line packages to be able to sell alongside mobile. >> thank you so much. matt campbell there, our

dealers report. whatsapp is worth $19 billion to facebook. that's a lot of money, but less than half the amount that phone carriers may lose in the coming years. our international correspondent , hans nichols, has been following this mega deal. hans? >> there's always been another side to this whatsapp story, and that is who is losing money for everyone switching to whatsapp, and that could be the phone companies. there's one report out there, an analysis from a consulting firm, we're not quite certain how they arrived at the number, but they put it at $32 billion in lost mobile tech revenues from the phone companies in 2013. francine, that will grow to $54 billion by 2016. now, you look at the u.s. alone, mobile revenues will peak at around $21 billion. countries like mexico, right, this is one of the reasons why zummerberg was so interested in whatsapp, countries in the emerging markets, mexico, 90%

of messages are now sent over what's app as opposed to where it was all text messages. this is lost revenue for the phone companies. >> hans, what can the mobile phone companies actually do about this? >> well, this is give away text messages or charge more consumers for data. and then the question becomes engineering, right? how much data does whatsapp use in terms of its engineering, in terms of its software when people are sending video, voice, all kinds of messages. it's really the engineers versus the mobile phone companies. mark, francine? >> hans, thanks. hans nichols, our international correspondent in berlin. >> here to look at what else is on our radar. france's second biggest car parts maker says second-half earnings jumped 16%. the company says demand for cars has increased in china and north america, and the european vehicle markets have also

increased. >> finance ministers meet in sydney, committed to developing new measures to bolster global growth. the world economy has stabilized. >> we're getting back to normal. u.s. and china, and i hope japan, are arguable on a sustainable growth path, slowing down a bit, consolidating and moving forward. europe is not as vulnerable as it was. i still expect it to stagnate, but it will get through the bank quality review and be all right, and that's a huge share of the world economy when you add all that up. then as i said, you take out the spare ribs of many of the major emerging markets, even extending to sub saharan africa are on a reasonable path. >> and former u.s. national security advisor says the unrest in ukraine relates to a bolder issue with russia. he made the comments in an interview with charlie rose. >> the issue goes beyond ukraine. it goes to the heart of the

issue, what will russia become over the next decade or so. right now, putin is embanking russia on some sort of nostalgic, i think irrational, in fact, imperial restoration. he wants to nion create would really be a restoration of the soviet union, minus some european portions, and, of course, the russian empire. >> well, you can catch the full enterprise with president jimmy carter's former national security advisor on charlie rose at 10:00 p.m. u.k. time. autopsy still ahead -- live in kiev. could a potential deal restore peace after months of unrest? >> later this hour, game over for russia. we'll see whether the international attention will prove to be a boon or bust for president putin's economy. ♪

>> welcome back. let's check in now on the currency markets. jonathan is at the touch screen with more. john? >> i've got one trace for you, and i'll keep it short and sweet. one pound now buys you 1.6671. this is what happens when u.k. retail sales come below expectations, absolutely nothing. it comes right back up. 1.5%, that was the decline for the month of january. expectations was minus 1.1%. look at some of the analyst comments. basically they're saying it's

the weather. sounds familiar, right? also, you're coming off the back of a pretty strong number in december. what's keeping us at these levels approaching 1.67? martin will, talking about the possibility of a rate rise before spring next year. that's one man's view, but it matters. >> it matters. i'm not sure -- we take it at its face, but you're absolutely right, john, it does matter. let's check on the pound. >> let's get to the ukraine. joining us by phone from kiev for more perspective is alexander, the head of research at investment capital ukraine. alexander, good morning. thank you for joining us today. >> good morning. >> we're still awaiting this accord. we're awaiting details on it, if it's going to be signed at all. if this accord is signed, do you think it will end the bloodshed? >> you know, we need to find out what kind of details are on the accord. so far, no details, and i will

ll you if the details emerge that yanukovych would stay in power and would handle the power, i think the risk that the violence would continue, because in my view, the longer yanukovych stay in power, he would master this, because he oved that talk is very cheap and this is very authority in ukraine so far in the years since early 1990's. >> alexander, there's very little chance that we are actually going to get agreement, sent there? as you said, if he stays in power, president yanukovych, it's very unlikely the opposition parties will actually sign it, and this agreement we find out, because it was leaked by president yanukovych's office. the opposition haven't even said they're looking at an agreement. >> well, the risk that such a

cene like this and the people, and, you know, this is a very important scene you should understand is that ukraine and politicians, even politicians in a position, they, you know, a little bit apart from the people, and i will tell you that people are grown, the politicians themselves. so people are well ahead of politicians, even opposition politicians, and for the opposition to sell this idea on the agreement, they need to proceed. the people say this deal is workable, and workable in a peaceful way, and as i said, any dayan covek stay in power is a kind of blank check for him and his people who support him and those people in kremlin

who support him, it's a kind of blank check. >> alexander, very quickly, standard & poor's today has downgraded ukraine's credit rating. it says a default is likely. can the ukrainian economy withstand defaulting on its debt, and how will external investors perceive the nation if that eventuality is to happen? >> i think they cannot withstand default unless they strikes a deal with i.m.f., and i think i.m.f. deal is likely only when new government is in place, not yanukovych government. i think when investors hear i am here to support the economy, i think the crisis on the euro bond market and others would jump up. >> alexander, thanks for chatting to us. good to talk to you.

speaking to us on the phone from kiev. still to come -- we speak with a man who survived an avalanche. we'll show you the technology that saved her life. ♪

>> let's take a look at some companies on the move today. markets editor manus cranny joins us at the touch screen. >> mark, thanks. you spoke about vodafone in terms of the deal and the

ramifications, but brokers are saying when vodafone closes the deal after divesting their holding in verizon wireless, u.b.s. says this stock is undervalued, this stock could be under praise. this stock is where investors should reinvest the proceeds back into vodafone next week. let's move it along. when it comes to wind screen, wipers, headlights and ignition and starters, what a stunning day, up 12.8%. the european auto industry, these guys produce all the parts, transmission mechanisms, six years of contraction. that's on the turn. when it comes to noninvasive surgical instruments, knives, very specialized knives, that's what this company does, elekta. we were down 12% off the bottom, because it flagged up, look, we're cutting our outlook for the overall year. back to you. >> thank you, manus. >> coming up, a new take on high fashion, fendee is taking its latest show to new heights. we spoke to the italian fashion

house's chief executive about why it's embracing tech. ♪

>> welcome back to "the pulse," live from bloomberg's european headquarters here in london. i'm francine lacqua. >> and i'm mark barton, right. >> these are the bloomberg top headlines. ukraine's president has agreed to a plan to resolve the political crisis that's caused chaos in the country. the administration says an accord will be signed in about half an hour, but france's foreign minister says it's premature to say an agreement has been reached. earlier this morning, the rating agency standard & poor's said ukraine is at risk of default as the political crisis

deepens. >> r.b.s. planning to retreat from its investment banking business and cut 30,000 jobs, according to the "financial times." it says the biggest government-owned lender will announce the restructuring next week. a spokeswoman for the bank declined to comment. >> and the italian prime minister designate says the italian premiership as early as today. that's according to an official in his democratic party. once sworn in, renzi will be the youngest prime minister since world war ii. >> right, our italian bureau chief is here to talk about the developments in italy. dan, good morning to you. could we have a new prime minister today or not? >> it's very possible. we have reported that mr. renzi perhaps will formally accept the premiership today and announce his cabinet. the original game plan was for him to meet the italian

president tomorrow and unveil everything. he's obviously been trying to move very quickly, get everything up and running so he can present his team and program in the italian parliament on monday for a confidence vote. >> do we have any indication, dan, of who he will choose to be his main ally so the cabinet ministers, it will be crucial not only for the positions of finance minister, but also industries, reforms, economy? >> yes, very much so. the italian papers were reporting this morning there was a late evening meeting with the deputy premier in the previous government and obviously his support is very crucial. that will be something to watch, what will his role be in this government? as you said, also the finance minister. the latest is focusing on the chief economist. obviously he has some

international experience, and mr. renzi, you know, probably being forced to make that role more of a nonpolitical and get someone with some international experience. >> dan, give us a sense of what it's like on the ground, renzi would be the fourth prime minister in two years. is there real hope this time will be different? >> i think there is some hope. he obvious logical have to deal th that criticism that he is unelected and that once again italy is installing someone who hasn't been chosen by the people. his response probably will be that he has waged a campaign, a popular campaign in the last year to become the head of italy's biggest political party. so, in a way, he does have quite a bit of grass roots support.

and he has put together a very ambitious reform program, which essentially is trying to do one key piece a month, such as the electoral reform, and he can pull a couple of those off, then i think the popular support will increase. >> good to chat with you, our italian bureau chief. >> now to the g-20, because the g-20 finance ministers are meeting in sydney. they'll commit to developing new measures to bolster global growth. will they really commit or try to commit? >> yeah, they'll try to commit. there's two takeways here. we have a lot of noise about monetary policy and the federal reserve and what it all meant for emerging markets. compare and contrast two years ago to q.e., too much of it, currency is too strong, insert the official right there. two years later, insert whoever you like, stop tapering, currency is too weak. the inconsistency of the message is one point, but i

won't waste any time going through that. but we have a mandate, the u.s. economy is not an emerging market, and right now we don't see it feeding back into the u.s. economy. one of the takeways from this statement or at least the draft of it is that they're back in monetary stimulus. >> and i liked george osborne's comments, put your own houses in order. e summed it up nicely. >> one of the other lines in this that we commit to developing new measures to significantly raise global growth. i loved paul allen's line that he said when is the last time the g-20 achieved anything. >> i disagree. >> i can't y? >> because gordon brown, when he was in charge of the g-20 three years ago, put in very good places for regulation, so the g-20 is basically a forum where people talk. i'm the u.s., i listen to you, you're an emerging market, and it's an exchange of ideas. it's not about putting pen and

paper, getting something done. >> that was one example of the height of the financial crisis, where a g-20 actually came out solid. yeah, but you don't know. it's private discussions, and it's about the exchange of point of view, and if you don't do it, there's no real forum that allows emerging markets to at least have their voice be head to head with the big boys. taup take a listen. >> we've run out of room on the monetary policy side, or almost that we run out of room on the fiscal policy side, meaning everything is trying to reduce their deficits and reduce their debt. so what we have left is structural change. >> so the takeway is the government needs to do more. the problem has been that you've had a federal reserve that's been out there doing a lot of stimulus, being very act daverb. but you have agot the u.s. government that hasn't done a lot. so it's all well and good than

to go around preaching to economies to do more. it's the fed that's been stimulating the u.s. economy right now. i think there's so much talk about the issue around emerging markets, and it's interesting whether it will feed back back into the u.s. economy. talk about china, what will happen there, but you've seen some broad-based tightening, central banks across the markets putting up interest rates. what does that mean for growth? it remains to be seefpble >> it's their choice to be pegged to the dollar, which is also a fair point that a lot of chief economists put on the show. this is a kind of international parliament for the world's superpowers. >> more relevant than the g-7, many say. >> yeah, because it has the emerging markets in there. >> right. mansuccess here, a peek at what's happening at the touch screen. what have you got? >> mark, we've got equity markets indifferent at the moment, overall, you're looking at markets up about a quarter of a percent. it takes me back to a point that you made this process, borrowing rates at a decade low

down here in spain has the impetus for structural change, is that going to drive the other peripheral countries to actually get their act together in the same way as spain and ireland have actually affected structural changes? it's clothing and food that came under pressure, but despite that, you saw the equity market in the united kingdom up for the skt straight day in a row. you're looking at a fairly strong innings there. u.s. equity futures indicate a little bit higher. for those on radio, you want a price check, we're up .2%. s&p 500 at 1840 on the future. you will get a couple of voices today, the st. louis and dallas reserve members will speak. currencies have had a pretty tortured week. the worst weekly loss in almost six months. let's just give you a quick view on what's happening with cable. it just doesn't know which way it really wants to go today.

1.6671, and back to you. >> in just 20 minutes, "surveillance" with tom keene, he joins us from new york with a preview. what are we looking at today? >> we'll look at kiev and ukraine. as you know, u.b.s. moments ago out with a report on a collapsing ukrainian currency, just part of the financial debate. you know the s&p rate cut that we saw overnight. but extremely fluid events, and we'll look at ukraine through all of "bloomberg surveillance" this morning. we'll look at coffee. i need coffee on a friday. of l talk to the leadership -- am i pronouncing it right? lavassa, we will talk to the leadership of lavassa about their efforts in america, which always needs a good cup of coffee. and then we've got a special treat this morning, fran cry. help me here, please. i've yet to get over lady sybil

dying from "downton abbey," the lady, the countess of the castle will join us in america. what should i say, francine? >> your countess. i don't know. i'm the wrong person to ask. push it off to mark barton. he's the briton here. >> i'm the only person in england who hasn't watched an episode. but now that tom has told me lady sybil has died, he's completely ruined it for me. who is she? >> exactly. that's why you have to watch. we have a brit not watching "downton abbey," i'm ashamed. >> i've been in therapy for two years over lady sybil dying. there are 50 to 80 bedrooms at high clare castle. folks, it's in hampshire, so it's like fiction nonfiction, and i know that, mark barton, you're going to need to pay attention. i'm going to need a lot of mark barton help to get through our interview with the countess and her castle. >> at least you said hampshire and yorkshire, because many

people hampshire, but well done. gow that right. it is yorkshire, and it is hampshire. >> tom loves lady sybil so much, he's going to get the names right. >> i've got to practice the mark barton accent 101. that will help me out. but seriously, a lot going on. yes, we're going to look at "downton abbey," but look at these unfolding events in the ukraine. we'll do a little bit in washington as well. >> great. tom, thank you so much. tom keene with "surveillance" in 20 minutes from now. >> fendi showed off this year's autumn collection at the milan fashion show. the most memorable thing about it wasn't the models or even the clothes. it was the drones hovering in the sky. angus bennett reports. >> this is fendi going high-tech. can't see the gadgets? don't worry. the whole show was shot on drones. italian fashion house fendi teamed up with a french company to stream this season's show

live online. > fendi, as long as history, has been an innovator. >> a noble commitment, but as with all new tech, there can be teething problems. this is what people actually saw when they tuned in to the show. still, it didn't take the sheen off the glamour of the event. >> i've never seen anything quite like it before. it feels like fashion going into the future with all of this stuff, but i think it's great t. gets dfrpblt camera angles of the clothes and it gives people like a real feeling of being there. >> it goes to show, there's one thing tech isn't replacing, the models. angus bennett, bloomberg. >> now, still to come -- a boost to business or an unwanted inspection? we're debating the olympics' impact on russia's reputation. that's coming up next. ♪

>> welcome back to "the pulse," live from london on bloomberg tv. now it's time for today's olympic hot shots, and canadian women's hockey now has its gold. the team beat the u.s. in overtime to give canada a fourth consecutive olympic women's ice hockey title. >> the women's ski half pipe event in sochi, the 20-year-old american had a top score of 89 points, her first olympic gold

in the sport. >> and russian teenager upset the defending champion to win a surprise gold medal in women's figure skating. the 17-year-old had previously only finished ninth in the 2013 world championships. meanwhile, kim hughes, one of south korea's biggest celebrities, announced that she's retiring from the sport. >> and this is at the medals table stands. you can see norway in the lead with 10 gold and 21 medals the u.s.a. has a bigger number of total medals, 25. however, less gold, only eight. the 't forget team g.b., best on the olympics. >> shame. maybe next time. as the 2014 wrnlt olympics draw to a close, let's step back and discuss how the games have impacted russia's reputation. >> yeah, joining us to discuss

all these matters is the chief economist at m.m.i. indicators. because of events in ukraine, phillip, one might have missed what's been happening to the ruebel and to russian assets. the ruble this week has plunged, both against the euro and dollar. this year it's down by almost double-digit figures. is that ukraine linked or the general feeling that swamped merging markets in 2014? >> it's the general theme that hit most emerging market currency this is year. ukraine has also had a big impact. they're down about 1.5%, so that's had a very big impact. also, the general feeling that russia, that the growth outlook for 2014 is particularly poor. >> i guess the problem with the ukraine is this is just the citizens saying we just want to rule the bloc, and what sochi

has shown is that there's no real rule of law in russia as well. is there a danger that this civil unrest would actually spill over to russia orer or at least to some of the other countries? >> potentially, yes, i think the events that have happened this week show there's great tension there. vureb biding its time. but after the sochi olympics come a close and the focus is less on there and than on russia's reputation, we might see russia taking more of a -- well, let's put it, a negative set in terms of ukraine. >> do you think meddling in ukraine is hurting russia's image as an investment destination, fill snip >> yes, potentially. i mean, it's not the fact they're meddling in the ukraine, they have a lot of liabilities in ukraine around. they have around $30 million worth of debt in ukraine, so anything that hurts ukraine is likely to hurt russia. >> what do you make of the

sochi olympic games so far? they started off pretty disastrous. they're actually pretty smooth. >> yeah, i think all olympic games have a few teething problems at the start, but yeah, they seem to be going pretty well. >> it won't change your perception that we have russia either way? >> i don't think it will really have a great impact on russia. i think what's important is what sort of impact it will have on the economy. does it help the russian economy at all? the games cost around $50 billion, the most expensive ever. we take some business and survey evidence, m&a indicators every month in russia, and we saw quite an up tick in business sentiment in january, and that's likely to be partly seasonal at the start of the year, but also partly the sochi games, the boost is there, and we saw the same impact coming through from the consumer survey as well, which had a boost to consumer sentiment. sochi providing a short-term impact, but just like the snow in sochi, it's starting to melt away. >> and the economy rose by 1.3% last year. it will be 2% this year, the average in putin's early days

was 7%. i mean, it's a putin boom turned into a stagflationary environment, because as you say, that's little growth, and inflation is the 5% target. >> yeah, very much. i'd call it a stagflation lite, if you like. 1.3% growth last year, the lowest since 2009. latest data for january, i mean, our business survey, yes, that popped up a little bit, but other data on investment was very weak, a 7% fall on the year in january, we've had retail sales coming down lower. inflation remains still very high, although it did come down in january, so that was a little bit of a positive. it's not shaping up to look like a good year. >> and how much did the russian authorities let the ruble decline? they seem happy at the moment, but at what point do they say oo much?

>> on the one hand, the fixed line in the ruble is quite a good thing for russian business. t will help the export sector. one of the questions we ask every month is how is the ruble affecting you. is it helping or hurting your business? it's been helping businesses in russia over the last couple of months. they've seen a benefit from it, but yet it does have another negative effect, which is it will push up inflation, and that won't help. >> phillip, thank you so much. >> coming up, a meeting at the white house isn't making china very happy. president obama welcomes the dalai lama in washington today. we'll discuss this and what you need to watch for the rest of the trading day. ♪

>> the issue of safety has become more important in skiing and snow boarding in recent years. here's a kit you shouldn't leave without. >> if we say that you can leave under an avalanche in 15 minutes. if it's really heavy snow, you can be completely broken and hen you're dead already. >> everything cracked around me. and i understood i was on top of a huge lift, and it just fall and fall and fall, and i

was in a huge avalanche. it's so much power. sometimes an avalanche of powder, you just sweep over. most of the time, but a different time of the year in spring, i would say after midday, it's really dangerous. you have to be there and ride in the environment to know at the beginning, it was really big and really heavy. now it's really small. you don't really need to swim. ou've out of the evidence. >> hans nichols just back from a series of stories on the business of skiing. hans, just tell us about what

we just saw there. >> well, what it is, it's called an a.b.s. you wear it all day. you barely know you have it on, and in europe in general, we can go off peak, the risk for avalanche is greater. this is the biggest difference i've seen in seeing in north america and europe. europe, more helmets. and b, everyone seems to have these a.b.s.'s on. they want to be prepared. wet snow, warm conditions, avalanche weather. >> yeah, what else are we watching, hans, today? >> also there's a snow aspect because it is tibet. his holiness, the daalee lambee, president barack obama is sitting down with him at the white house today. it is a clear poke in the eye to the chinese. every time obama meets with the chinese, the chinese -- meets with the dalai lama, the chinese get very upset. diplomacy at a very risky high level. guys? >> thanks, hans. just getting breaking news on ukraine. >> yeah, president yanukovych is saying that we should return, or they should return

to the 2004 constitution. he's been urging that. this is comments that are from his website, being taken by interfax. we'll be all over the ukraine situation with tom keene and "surveillance" next. ♪

>> this is "bloomberg surveillance." from kiev, it independence square with the headlines coming out right now across the bloomberg terminal. there is political chaos in kiev this morning. a truce has been reached.

is ukraine reels from uncountable kills. yesterday, ukrainian debt was slashed to triple c. the heated debate over the minimum wage in the united states has become a maximum washington headache. and can 99 cents per year, can it justify mark zuckerberg's $19 billion acquisition? good morning, everyone. this is "bloomberg surveillance." we're live from our world headquarters in new york. this busy friday, february 21, i'm tom keene. joining me, adam johnson and alix steel. scarlet fu rumored to return next week. let's get right to the morning briefs. the corporate news flow and, of course, the political news flow just amazing. >> and economic news flow as well. we start in the u.k. retail sales falling foreign forecast in january, led by a drop in food and clothing stores. u.k. also posting a smaller than forecast budget surplus. taxes from income and company profits actually fell. here in the u.s., 10:00 a.m.,