>> barclays bashes its investment bank. 7000 jobs will get the ax. ceo antony jenkins tells us the bank still will be competitive on the global stage. day for europe's central banks. draghi and carney are not expected to deliver changes today but the pressure to act is growing. >> two bloomberg exclusives. we are live on everything from energy to emerging markets.

good morning, everybody. you are watching "the pulse." we are live from bloomberg european headquarters in london. >> also coming up is one of the deadliest jobs. why crab fishermen risk injury and death. first we will begin our top story today. that is barclays. the bank announced a strategy revamp. i asked the ceo antony jenkins in the last hour if the bank can still compete on a global stage. >> we absolutely believe that we will be competitive as we are today. in the market, with the clients we choose to serve. thatready have positions we are going to retain in the u.s. and u.k. and that is where our focus is going to be. we are confident we can continue to compete. we created barclays noncore, a set of assets we believe are no

longer strategic for the group. we are confident that we can reduce those assets over time from about one hundred 15 billion pounds of risk weighted assets to 50 billion in 2016. >> if you are shrinking it by that much, how do you think you can still compete? you are basically saying that the fixed income business and the downturn we have seen is not only cyclical but structural. basically you want out. >> the essence of this is about focus. that is true for the whole bank, not just the investment bank. we are focusing where we can compete successfully. the parts of the business we are going to be focused in our the much less capital-intensive businesses. is why we can free up the capital i have described, run the bank with less capital and deliver higher returns for our shareholders. we think the strategy is very compelling in the new world we

find ourselves in. >> you have lost some of the top bankers in the past couple weeks. is this what a death spiral looks like? >> no, what we see there is colleagues making decisions to go and do different things with their lives. in many ways, this is a generational shift. we have a deep bench and the actions we took to protect that bench where the right actions given that we knew we were going to go into this very significant transition. i am confident we have got the talent to do the job going forward. staying on barclays, let's get over to manus cranny. basically the investment bank is getting crushed. for want of better words, over 26% is going to go. what we have to ask ourselves, and this may come through in the strategy when jenkins talks to investors, of those 7000 at the ib, how many are in fixed

income? are you doing a ubs? are you pulling out of real key areas within fixed income? a great number of these could be client facing. they are also creating a bad bank. you spoke to antony jenkins about that. a great proportion of the bad assets, they are going to run that down. 90 billion of that is coming from the investment bank fixed income areas. there is execution risk in that. these are assets that barclays doesn't want. there is not a great deal of proclivity for risk in the other investment banking houses to take those assets off their hands. >> stock is up. just shy of 5% right now. you look at where it has been of late. that is not a big bounce.

that jenkins is doing almost the bare minimum here. he has had to cut aggressively but the targets he is talking about, this is what he has got to do. he is not going any further than that. >> i think you are right. this statement is very much a jenkins statement. this is an antony jenkins strategy, not the legacy of bob diamond. or of that legacy, for good for bad, whether the bank can carry forward -- you might reduce the investment bank. of riskl amount weighted assets is going to fall to 30%. they wille is that deliver a return on equity of about 12%. is going to cost about 3% in terms of return on equity for the shareholders. next year or the

year after. a lot of promises. i think there is execution risk in this. it is about trimming the investment bank. as fran put it, you trim a quarter of the bank, can you a truesay that you are global international investment bank any longer? that is not what jenkins wants to the anyway, is it? i suspect there is a guy that is watching the situation very carefully. >> i have had a number of conversations with the ceos. running down risk weighted assets is not easy. when i get into those rooms and look at these press releases, it is where are the risk weighted assets? what losses have you taken? how are you doing? everything else is moderately immaterial. >> manus, thank you so much.

i think that was a very interesting point. when i asked him, are you in it for the long run? it seems that investors say, we are going to give him time. in theaid, he has been job for two years and it is the first time he can implement a strategy with his team in charge. we will have to see. at least it is his. .e can take ownership >> let's see if he can deliver. paris difficult as ubs has proved. let's move onto decision day for the european central bank and the bank of england. we are joined by jonathan ferro and jennifer ryan. jon. start with you, the expectation is we get no change from draghi today. is pointingn data in the direction of further action at some point. >> there are several reasons we are not expecting anything to happen today. we get forecast next month.

what i will say is inflation, lowflation, call it what you want, not low enough. on the periphery, we have seen better data in the likes of spain and italy. i think the larger point to make is that on the governing council, is there any agreement on what tool they are going to use next? what are they going to do about bank lending? to use are going unconventional tools, which tools are they going to use? >> inflation not low enough for germany and the euro not high enough for germany. all the exporters are screaming in pain. near 1.39,me we get mario draghi tries to talk it down. it gets to the point where it is time to walk the walk. talking the talk has not worked for six weeks. he has used pretty aggressive language and it has done nothing. conference, he is

going to give it another go. will it be enough? again, we are waiting for new projections to come through. the 14th is when we will get those. anythingly won't get today. a very different problem. everybody is talking about rate hikes. thing everyone is talking about is the housing market. that is going to be the focus of today's decision. as you said, no change today. the bank is in a new regime. they have the monetary policy committee. now it is the financial policy committee. >> they are not one to hike rates to deal with the housing problem. they want to do macro credential policies and that would come in june. >> that is the next report from the financial policy committee. we are expecting an announcement about something. you have had economist today looking at the data saying it is

time for the bank of england to do something. >> we focus on the housing data because it is strong. the data from the rest of the economy is fairly strong as well. it is not like this is a single problem. the economy is gathering speed. most of the data point to the fact that slack in the economy is not the problem that it once was. is there a case for rates to go up? >> we are in for a guyto. phase two.ance every same token, what one is focusing on is slack in the labor market. those indicators haven't recovered to the point where somebody like mark carney is going to say this is the time to start thinking about tightening. >> how difficult is it going to be for mark carney to come into the markets -- to convince the markets that rates are not going up?

the rest of the economy is pretty strong. >> it is going to be a communication trick. we will see at the press conference. they are going to have to roll out what they are looking at with these labor market indicators. they have done it before. they have had a situation where the market didn't believe them, but they went out and sold their message and the market came back. >> i think the big risk here is that you have a bank of england that is saying, we don't want to use bank rates to address the housing market. there is almost a blind faith in macro credential talks. we look at the case of the new zealand economy. they implemented macro credential talks last year. highlimited the amount of loan-to-value mortgages. it worked to some extent. guess what it did six months later. they hiked. it doesn't put off the hike forever. this year we are talking about the fpc doing something.

it doesn't mean you're not going to get it. there is already disagreement on the amount of slack in the economy. we can see it. it is in the minutes. when they meet today, it might not be in the vote but in the beating itself, i would love to be a fly on the wall. another thing we have got to talk about is next month. what we get is a change in the composition of the mpc. i have talked to a lot of educated people about this. how do they vote? does anybody know? there is a lot of unknowns. things get very interesting for us. >> does that depend on the aggressiveness of the policies? what new zealand it, the governor was saying it was like having a peashooter to deal with a bazooka. aggressiveon how they are with the policy. >> there is one issue. there is a supply problem with

housing in the u.k. this is what everyone mentions. until you deal with that supply problem you are going to have this issue with house prices. >> why are they worried about putting up rates because of the housing market? there are a lot of people in this country with what is called a floating rate mortgage. rates came down to zero and then mortgage dropped to 200 or 300 pounds a month. since then, energy has gone up, food has gone up, disposable income has been eaten away. most people on a floating rate mortgage get decimated. >> you are assuming there is no way growth. if there was wage growth to counter that -- >> that is one point. it would have to be very aggressive wage growth. >> it is hard to see that coming through. there is a case for other things being equal, the economy may need that.

the output gap, whatever that is is smaller. the 2007 am saying is legacy is still there. >> i am not sure you want to be a fly on the wall. don't they burned a fly on the wall two weeks later? >> moving on. >> thank you so much. coming up -- >> we are going to stay on the boa. we will discuss that with the chief u.k. economist. >> how to survive on the high seas. a boat captain shows us what it takes to do one of the world's most dangerous jobs. ♪

>> welcome back to "the pulse." we are live from bloomberg tbn radio. the bank of england announces its rate decision later today. the decision will be the first since unemployment dropped to avoid mark carney's signature decision. this was guidance 2.0. we talked about unemployment. that's get a take on where we stand with the u.k. economy and the bank of england. rob would joins us now. nothing today, wait for the 14th. what is the bank going to say on the 14th?

>> i think it will raise its growth forecast a little bit. we had growth the first quarter a touch below its short term forecast. indicators point to much stronger than that. continuing to is remain strong. i think they will raise their growth forecast to reagan for inflation, pretty much unchanged. does it mean that it is going to be more difficult to find consensus on the fpc? >> i think so. voting for ther increase after the august inflation report. the economy is growing quickly now. inflation is a little below target but the economy is growing above trend. interest rates are at a record low. i think a rate hike of 25 basis points will start to seem reasonable. the first will see hike in q1 2015.

i do see a chance of it happening in q4 if growth remains this strong. quarter-point rise until the end of 2016. i think 2.5 by the end of 2016. >> is there a big concern that the market will jump on this and predict a rate hike far sooner than then? in someound is pressing more aggressive rate hikes. they are talking about mid 2015. with this inflation report, i think we will see that brought forth in the quarter again. it is not high in a long-term sense, just a bit higher than a very low point about 12 to 15 months ago. i don't think it is an enormous deal. don't think it is the be-all end-all here. >> what is the potential growth rate for the british economy right now?

>> 2.5%, i would say. >> we are going north of 3%. >> i think it is considerably low 3%. i think we are improving towards that level. i don't think it is 2.5% today. we are still emerging from the financial crisis. i think we will get up to 2.5% in another year or two. i think we need to slow the economy. >> what is your take on the housing crisis? we have been talking about macro credential tools. will they work? >> i think they are largely untested and that means the bank of england is going to move slowly with them. i don't think you start with them on full power. you start gradually introducing things to see when it works. they are not going to crush the housing market but they will try to take some heat out gradually. i don't think it will be a massive deal. they doargin, if

something aggressive with macro credential policy, i would expect the interest rate hike to be later. i don't expect an aggressive move. >> interest rates targeting what? for thethey want to do british economy? how do they actually work? once we start seeing both of them functioning, rate hikes are coming through, what will they be delivering with the rate hikes? >> i think the idea is to slow the economy's growth rate as you start to use up slack. approach a point where you think slack is roughly normal. maybe there isn't any left. >> the labor markets, this is a wage story. if that is what we are talking about here, can they do that this side of the election? >> i think they can. the bank of england is independent. if a rate hike is needed, it needs to hike rates.

it would send a bad signal if a rate hike was clearly needed and -- >> but it is going to be a marginal call. we are a year away. you are saying q1 next year. >> i am talking q1 next year in part because of the election. i think august would be too late. you onei am looking at with a risk of q4. >> thank you so much for all of that. we are back in just a couple of minutes. ♪

>> right, it is time now to look at your asset check. manus, what do you have for us? >> up she goes. janet yellen speaks. we can all breathe a sigh of relief. that woman is not moving newsere towards a tighter flow from the fed. one thing i did see in our stock reports, earnings for this quarter were supposed to rise by about 14%. not anymore. 8.3%. whatever you might see on that map, some of the earnings that came through, it is not going to be just as strong an earnings season as we all think. metro did deliver.

wholesale and delivery doing quite nicely. barclays on the move now up over 5.6%. bt adding more broadband customers. when it comes to issues of inspiration, motivation, there you go. i have a whole new career at of may. 1.3926. all you have to do is see euro-dollar track its way up to 1.40. somebody around the european central bank desk will ring a bell and say, this is going to kick into our earnings. this is going to begin to erode the recovery. at thell bit of recovery bottom of this map and the closing of the disparity, that could be eroded. and china, china is going to save us all. exports rise, good news all around. back to you. >> thank you very much indeed. we are going to take a break. ♪

>> welcome back to "the pulse" live from bloomberg's european headquarters here in london. i'm francine lacqua. >> i'm guy johnson. these are the top headlines. >> stock markets rose after fed chair janet yellen said the economy still requires stimulus. >> in light of the degree of slack that remains in labor markets and inflation below the 2% objective, a high degree of

monetary accommodation remains warranted. >> putin says his troops have pulled back from the border in ukraine. the u.s. says it sees no vidence of the move. >> and barclays will cut 7,000 jobs at its investment bank by 2016. the c.e.o. is trying to revive profits. in the last couple of hours, we spoke to the c.e.o. and asked him if the bank can still compete. if the investment bank can still compete on the global stage despite the job cuts. >> it is about focus. that is true about the whole bank, not just the investment bank. we are focusing where we can compete and compete successfully. the it is the much less

capital-intensive businesses which is why we can free up the capital in the way that i have described and run the bank with less capital and deliver high eturns for our shareholders. >> anthony jenkins talking to francine earlier on this morning. good morning. has he gone far enough? >> the market reaction is positive, and yes, it is a strong plan, especially looking at the cost issue in the investment bank and certainly he size of the run-off, less profitableable, weaker on the risk-adjusted basis. it is basically a quarter of the bank, almost half of the investment bank in asset terms. it is a sizable program for

sure. >> why should shareholders believe this time is the right one? >> by now, roughly we know all of the retirements that the p.r.a. is imposing on barclays an other u.k. banks as well. with this plan you can see a reasonably clear path to -- that others are meeting as well. let's not forget that barclays was on the weak side. stress pests, especially on the leverage ratio was lacking. that is a big driver behind all of those announcements and changes. >> u.b.s. was heavily rated when it made this announcement. barclays is up 4%, 5%. it is stillwell down on the year. am i sboing to see the same share price spike that u.b.s.

delivered? >> well, i would be surprised if it was to the same extent as u.b.s. clearly the investment banking and especially the asset-heavy low return, low margin type of investment banking with fixed income products, derivatives, etc. is not really in favor at the moment. with the new regulation and requirements, the returns you can make in risk-adjusted returns are just not exciting. yes, it is moving in that direction a bit. it is behind this plan that was announced. basically refocusing on those types, more bread and butter etc. ommercial banking, >> now it is about execution wlrks it comes to fruition. how much time do we give anthony

jenkins to pull this off? six months? >> we only have some headline figures so far. there will be more details in the presentation that starts at 10:00. most banks already have a pretty good implementation of those runoff plans. i would expect that barclays is able to do the same really. frankfurt a guy in carefully watching this. >> deutsche bank is under lots of pressure to do something similar. they have retrained so far from more drastic steps. it is so important and so core. deutsche bank, all investment banks basically have to change the way they do business,

especially on the secondary side compared to the old days. and deutsche bank will -- >> do you think it is harder for -- if you have an investment banker running the business? >> i don't think it is because he is an investment banker but i think it is harder. the core of deutsche bank is the fixed income investment bank. that is deutsche bank basically. >> but it was barclays three years ago. >> barclays has more legs to stand on i think. barclay card is a profit machine. they have diversified into africa a bit. deutsche bank, their domestic retail banking actually has never been all that profitable, really. they have tried to strength it in recent years but the big

driver of deutsche bank has always been the investment bank. >> did diamond sell the wrong ide of the business? >> all right. let's move it on. otto, thank you so uch for coming in. -- crab fishermen risk injury and death. discovery channel's hit reality ow "deadliest catch" chronicles the journey of some of these fishermen in alaska. we caught up with captain keith about what it takes to do one of the most dangerous jobs there s.

ry my name is captain keept coburn. fisherman. ou might see me on the show, " deadliest catch." there is something about being on the water, working with and against mother nature. the team work that goes into being on the boat gets your heart pumping. if i was going to make a list of e qualities i'm looking for, first of all it would be common sense. someone that is going to take the time to actually think something through opposed to just react. it may be the difference between having five fingers and three

fingers. you need a guy who is not going to blow his top, not lose his cool. behrens sea, most words we say get bleeped out. they have to be both mentally and physically tough. 've seen the biggest, burliest guys pull up immediately and a wiry scrauny guy work his way through the pain and discomfort. everybody can talk good story on the dock, but once it gets down to game time, all of the things that go into a job can break a guy really quickly. >> we shall never complain again about doing extra market hits. after seeing that. >> i have watched some of the programs.

yeah. those guys have it tough. >> also the way that you look at a crab now, for me, it is slightly different after seeing that prab program. >> yeah. >> there you go. coming up, we're going to talk phones. >> yeah, we're going to talk phones. a big company going forward. samsung and apple. we'll talk about that when we come back. phillips ive with the c.e.o. and talk about the reliance on russian oil.

>> it was certainly one of the biggest missed opportunities that i saw. there were very few people working on it. now we have hundreds of people working on it. we have made big advances. mobile is doubling along every metric we have. we're up to 430 million monthly users on mobile. so we have the largest mobile audiences in the world already. >> that was the yahoo! c.e.o. marissa mayer. she was speaking at the conference in new york. >> tech crunch.

the third largest smart phone company has released its latest phone. it picked paris for its global unveiling. >> chinese cell phone maker has launched a new device in paris. part of a campaign to win over western europe. it will compete with apple and galaxy from samsung. wordwide, huawei sold 14 million smart phones during the first three months of the year. china is its biggest market. u.s. sales are nonexistent after officials accused the company of

spying against american interests. in europe, they plan not only to sell hand sets but to hire local talent. we are the pioneer of the -- >> huawei is hoping customers in france and the rest of europe will soon start lighting up and falling over themselves for these new hand sets. >> let's go over to germany's iggest retailer. it still faces challenges in russia and with its consumer electronics unit. hans nichols joins us from berlin. the c.e.o. is speaking to analysts right now. >> well, the interesting thing we're going to be pressing the c.e.o. for is what is their plan

for their russian i.p.o. they delayed it in march. this is for the russian cash and carry business. a couple of things to look at, it is trading up because numbers are not nearly as bad as people were expecting them to be. on the general political situation in eastern europe and sales. they are so heavily weighted towards eastern europe. 20% of their business is in eastern europe. look at what's happening between the ruble and the dollar. 43 was the expectations. revenue is down 7.6%. they came in at about 14.3 billion. the high end of that was 14.4. overall these are remarkably good numbers given the condition metro is operating in here in germany. eastern europe, as we have been discussing, not nearly as bad as it could have been.

in morning, more people being assured that things won't go totally south in ukraine or what it says in the earnings report. they will grill the c.e.o. in a few minutes. >> let's talk about the consumer electronics division. >> so it is flat. it has been flat for a while. the two brands in germany are saturn and media mark. they are basically like best buy in the united states. you can get everything from curling irons to microwaves. products i have bought there. they let go of the c.e.o. there. he walked away. clashing with a major shareholder. the question is are these

structural problems or are they just cyclical ones? do they have a fundamental problem delivering products to consumers, getting consumers into their store or is it something much bigger than that and we're in a cyclical one and germans and europeans are not going to be upgrading their appliances any time soon. >> i think it is the magnetism that hans has. the microwave. >> it is the aura. >> we figured it out, hands. morrison's sales slump has dropped. >> the grocer slashed prices last week. has been hurt by discount stores winning over shoppers with cheaper low frills offerings. >> coming up, we'll talk energy

and emerging markets. ♪

>> good morning, everybody. welcome back.

you're watching "the pulse" live from bloomberg's headquarters in london. we're on the radio, streaming on your tablet. we're on your phone. bloomberg.com. what else could you possibly want? >> yeah, we're everywhere. time for our installment in the series the next space race. hoping to win the nasa competition to reshuffle humans back and forth to low earth orbit. we go inside the newest huttles. >> you have probably never heard of sierra, nevada. despite the fact that hay have launched something into or bit every two to three weeks. sierra nevada has been around for over 52 years and employees more than 3,000 people in 16 states. >> one of the things people see

when they come here is wonderful technology. >> nasa is hosting a competition, for private enterprise to build a spacecraft to shuttle humans back and forth to low-earth orbit, and that contract will be worth billions. sierra nevada's dream chaser design is the only one in the competition that is not a capsule. it is a lifting body. >> i'm ready to take a look at the dream chaser. your model is the only one that actually looks like the shuttle. >> the volume inside is as much usable volume as the space shuttle had. people can stay in space for several days if they need to. >> like a space s.u.v. >> so far there hasn't been a capsule for hupes that is big. woun would have to build 20 or

30 capsules. >> let's jump in the simulator. i see the runway right there. >> it doesn't fly like an airplane but it lands like an airplane. >> for us, we can land pretty much on any runway 1,000 feet or longer in the world. because we don't enter like a capsule, we pull a lot less gs on entry. you can land on the runway with a sensitive payload. scientists can get there within a minute because it is on the runway. >> you guys are against boeing and space x. what makes you think you can take them off? >> we think dream chaser is the best transportation system for what we do in space. it is almost like we're building the a pad and others are

building the apps for that ipad. >> how did i not get that gig? love this kind of stuff. >> let's get you some company news. deutsche telekom had to scale back ambitions. >> b.t. group beat estimates for the sixth consecutive quarter. they provided new web customers the promise of free rugby football. eni is set to confirm descalzi as the new c.e.o.. he was nominated by the italian

government which owns a 30% stake. >> it is decision day for the e.c.b. and the bank of englan. let's bring in jonathan ferro for a tour of what we can expect. it was perfect. >> can you pronounce mario draghi? i think i can. >> the market is at 1.3938 right now. what can we do to talk this down. i think if he is going to move, great element of surprise. perfect time to do it. >> you get 145 pretty quick. >> the exporters are not going to be happy about that one. we'll go through what the bank of england is doing.

it is central banks day and barclays day. >> we'll be talking to phillips c.e.o. very shortly. see you in a moment. ♪

>> barclays bashes its investment bank. 7,000 jobs at the division will go. c.e.o. anthony jenkins tells us the bank will still be competitive. >> the pressure to act is still growing. >> a showdown with samsung. huawei offers a in flagship phone. good morning to our viewers in

europe and good evening to those in asia and a warm welcome to those just waking up in the united states. i'm guy johnson. what have we got coming up for you? does europe need a new approach to power? we're going to ask the c.e.o. of enel. what do we need to do? we're going to find out in that exclusive interview. >> and the online revolution helping companies build value and viewership. but we begin with barclays. the u.k. lender nounsed a strategy revamp this morning including strategies to cut 7,000 jobs at its investment bank by 2016. we asked the c.e.o. if the bank can still compete on the global stage? >> we absolutely believe that we

will be competitive as we are today in the markets with the clients that we choose to serve. we already have the top five positions that we're going to retain in the u.s. and u.k. that is where our focus is going to be. we're very confident that we will continue to compete. we have a set of assets that we believe are no longer strategic for the group and we are confident that we can reduce those other time down to 50 billion of risk-weights assets in 2016. >> but if you're shrinking by that much, how do you think you still can compete? the downturn that we have seen structural. basically you want out? >> well, the essence of this is about focus. that is true for the whole bank. not just the investment bank. we are focusing on whether we can compete and compete

successfully. we can free up the capital in the way that i have described, run the bank are less capital and deliver higher returns for our shareholders. so we think this strategy is actually very compelling in the new world that we find ourselves in. >> you have lost some of the top bankers in the last couple of weeks. is this what a death spiral looks like? >> no, i think what we're seeing is respected colleagues make decisions to go and do different things with liar they'ves. -- their lives. we knew we were going to go into this significant transition in the investment bank, but i'm very confident that we have got the talent to do the job going forward. >> manus cranny is with us. manus, the investment bank is getting crushed.

he has just presented the strooge investors and girthing headlines. simpler ts to create a ank and more balanced. the language and the tone from jenkins, this is about rebalancing and we shaping the ank. john varly suggested to shrink the bank to 1/3. 2/3 of the assets will be in other parts of the business. re capital to africa and barclay. they did well in the first quarter of results. bear in mind that barclay has been dependent on the investment bank. this is about reweighting that dependence. where do you look for additional

return for shareholders. the object sieve to take 115 billion pounds of legacy assets, run them down. tough market to do that. if they don't want them, who the eck else wants them? this is a very important point. jenkins is one of the few c.e.o.s who gives you the costs for running the bank. >> manus, thank you so much. manus cranny with the very latest on barclays. >> right. t's give you a bloomberg excluesive. the philips c.e.o. is joining us now. looking to the emerging markets to help fuel growth innovation. we're joined by the president and c.e.o. he joins us from nigeria.

good morning to you, sir. thanks for the time you're giving us today. how big is the opportunity in africa? >> the opportunity in africa is very, very large, especially when as a company you bring innovation that is locally meaningful and relevant. philips is doing that by creating off-grid solutions. philips brings off-grid solar powered l.e.d. lights that instantly is bringing economic moment entomb a village. kids can play sports. kids can study in the evening. it is a huge opportunity. you have to have the right value proposition. >> you basically say that you want to double your african presence. just give us a flavor of what it

entails. is it labs? production facilities? sales teams? how many jobs will be created because of this? >> exactly. it is all of the above. i spoke just now about locally rell event innovation. -- relevant eni voigs. we have just set up an innovation center in nairobi and kenya. we are scaling up to provide locally relevant healthcare solution and energy efficient solutions. think about how we bring healthcare into the rural market, doing obstetric analysis showed us pregnant mothers can have timely support. it can reduce infant mortality. philips is bringing technology to bring solutions to africa in

healthcare and lighting. we are establishing local presence in over 20 countries that will include research and development, support, service and also manufacturing in a couple of these countries. >> can i change the subject? africa clearly is going to be very important to philips moving in from here. i'm interested to see how you see russia as a business as well. your picture is very nice and very prominent. are you still going? how important is russia and how worried are you about the situation that we have in front of us? >> well, first of all, russia is important to philips. we have a large presence there with over 1,000 employees and a large sales presence. more over, the opportunity in

russia is big. l.e.d. lighting is a big opportunity there. we are committed to russia. it is of course a difficult situation, but we are not in politics. we are in business, and i always believe you need to keep on talking to each other. this is why i am going the economic forum where we will be engageing with a lot of other russian companies as well as city mayors, people that run hospitals in order to bring technology into russia. >> i understand when you say you're not in politics, but you must be worried about foreign -- procedures. are you bring money back home more quickly than you used to just six months ago? >> no, not exactly. of course our business in russia is also down because of the economic consequences. us from sn't deter

participating in the russian economy. we are going establish a series of private clinics. i think this is important. there is a lot of people in russia that need good healthcare. in fact, i can the parallel to nigeria. there is unrest in nigeria, yet, i am here because i think as our s we need to share presence and commitment to the development of the local economy here. >> the e.c.b. meets today. 139.50. is trading at pretty strong. people are talking about it heading north of 140. do you need help? do you need assistance? would it be better if they took action? >> well, we seem to be in a

global currency conflict. many countries in the world are trying to lower their currency. this is strong competition from companies in japan and in other markets and the currency is affecting philips. first quarter we talked about that and said we had 180 basis points impact on our first quarter eeb that. -- i wanta. more over owe, it is stemming from the early recovery of the european economy. i think it is time for action. >> the c.e.o. of philips. sir, thank you for your time. we look forward to hearing from you very, very seen soon. >> speaking to us exclusively from nigeria. coming up, we continue the conversation on central banks

with mario draghi's road map and mark carney's tool books. ♪

>> good morning. welcome back. ou are watching "the pulse." no decision expected to be taken today to move things around. you have to wait for the 14th for that to happen. the british pound is trading

south of the 170 level. people having watching for the pound to break. it is going to be very interesting to see what happens when it does. still down significantly from when the financial crisis started. traction is beginning to be gained and as we start to get more grip, maybe the pound goes higher than it is. euro is trading at 1.3950. let's talk about the e.c.b. and what happens in brussels today. >> we have the rate decision later with consumer prices rising atless than half the goal. we'll speak with the chief european economist at bank of america merrill lynch. he seems to be speaking more often before an e.c.b. decision.

>> very interesting before the e.c.b. decision. one, the finance ministers, there are some official -- finance minister was quite interesting to see the french, the italian and spanish coming out saying more liquidity and others saying less, less. then we had no market news at this time. i don't know if you noticed. so maybe no decision. >> a balanced decision. does fact that these guys are all trying to get their word in tell us that it is very finely balanced and that things are close or that actually we're not going to get anything out because it is too ll to make a decision? > they will try. national concern and focus on the euro-zone. i think it is a very thin line

for the e.c.b., as you highlighted inflation is the target. it has been for a while. the april number was quite good. everything the e.c.b. was expecting materialized. highlighting the exchange rates. 1.39 now. that is a big move. they focused on on the trade-weights exchange rates. >> at the same time, mario draghi has surprised in the past. right? there are clear deflationary risks. today would make an ideal surprise move. > it does. the trade-weight is really flat. he did it in november and may. this time we had so surprise.

maybe -- maybe for once he will behave in a more orthodox manner. when he revises his forecast to make a move. one which is difficult for him when you compare with the b.o.e. or with the fed, the german -- is unlikely to be willing to move. slightly on rate is ticking up. >> what is less likely to be used if the decision was taken and further action was required? >> it is interesting. mario draghi may be thinking his forward guidance was not clear enough. on april 24, what he would do and how he would use his toolbox. you basically have three types of tools. interest rates, liquidity and then you have q.e.

and he was very specific in using that. interest rate is for monetary tightening. a higher exchange rate -- a rising rate globally. it hasn't happened. e have ticked one box. might be something to be able to make a diagnosis about before they are closer to the -- and we can move to the last one which is q.e. and there he was extremely specific in saying you need a big shock on g.d.p. and inflation before we see any q.e. >> do we have any indications that that would actually work? at the moment he is very good at talking the talk saying this is the last resort. how do we know it would do

anything on currencies? >> i don't think it would do anything for the -- for reasons hat you're highlighting. firms from u.s. are coming from the financial markets and from europe is banks. without the political concerns, there is no way this materializes. >> thank you so much for all of that. >> just a reminder, we'll break the bank decision at noon, london time and then we'll have draghi's news conference live and in full at 1:30. >> helping companies build value and viewership. we speak with the founder of the world's first digital video platform. ♪

>> welcome back. let's talk tech. when hbo wants to promote its shows to as many people as possible, it enlists the help of an israeli tech company. it has raised more than $100 million to date. elliott gotkine has more. elliott? >> thanks, francine. i'm joined now by one of its

co-founders. great to have you on. just explain to us exactly what you do. i think we have a vague idea, indication of what it is. tell us how it works. >> it is a cloud video technology and application provider. video is everywhere. it has always been at the center of news and entertainment, but now it is part of everything we do, part of learning experiences, working, shopping, healthcare, doctor/patient experiences. as a software company, we try to remove any challenges. it is the power of a video experience. sometimes perceived as a video operating system. you know any application related to video can run on our video system. we developed some of these like netflix-like environment or a youtube-like environment but in the end, it is all running on our video application system and

applications. >> what is the logic behind the acquisition and should we expect for acquisitions from kaltura? >> it was natural for us to expand into what we call the paid over the top experiences. we lack certain technology in a field and tvinci is leader on over the top television solutions. they have amazing social personalized applications across all devices. >> you have raised more than $10100 million so far. how much have you got left and what acquisitions are you looking for now? >> i'm not sure we're looking for acquisitions at this point in time. we have developed all of our software at this time. we are open to opportunities in the future. as part of this acquisition, we secured some additional funding

for support to have acquisition. all in all, there is quite a bit left. >> in 2006, a lot of people from that kind of era had their initial public offerings. is that something we should expect from kaltura? at altura has been growing fast pace. we have 400 employees. we have an open source project. hundreds of thousands of community members and developers. >> sooner or later? >> it is definitely something that is in the pipeline. i would not say that in the near future. we're mostly focused on growth. >> one of two women we have had in this slot over the next year or so. we'll try to get more for you in the future. now back to you. >> thank you very much indeed. looking forward to that. joining us from tel aviv. >> coming up, wee ask the c.e.o.

about a standoff with russia. ferraris of igi enel. ♪

>> welcome back to "the pulse" live from bloomberg's european headquarters here in london. i'm francine lacqua. >> i'm guy johnson. these are the top headlines. >> barclays is cutting 7,000 jobs at its investment bank. that is about a quarter of the total. the c.e.o. just said that the investment bank is an unacceptable drag on returns and he is trying to revive profit by reducing dependence on the division. >> we are very confident that we can continue to compete.

we're confident that we can significantly reduce the assets about 150 billion pounds of risk-weighted assets down to 50 billion in 2016. >> stock markets up around the world. fed chair janet yellen said the u.s. economy still requires stimulus. >> in light of the considerable degree of slack that remains in and inflation below the 2% objective, a high degree of monetary accommodation remains warranted. >> and one year after the e.c.b. chief said he could oppose a negative deposit rate, some wanted for time to gauge the

economy in europe. >> we have been hearing from vladimir putin this morning over the last few minutes. apparently he is monitoring via video link some russian military drills, checking the force readiness. doing so via video link. across the whole country. apparently these are nothing to do with what's happening in ukraine y forces are being removed from the border, but the u.s. says they are not. we'll figure it out eventually. >> let's see how the european markets are trading. >> your claim and counterclaim going on between russia and the u.s. equity markets. cheap money and no timeline to pay it back. janet yellen wouldn't be drawn on when those terms and easy street would end in the united states of america. to that end, europe has yet to

embark on that kind of maneuver in terms of supportingingities, you have good news flow in terms of reports coming from the likes of b.p. house prices are rising. germany industrial production dipped ever so slightly and expectedly and two out of 58 economists believe there will be a change in rates. u.s. equity futures slight slight tick higher. we wait for the jobless claims in the united states of america. it is thursday. 325,000 according to my notes. what could galvanize the european central bank? what could get them to move? might it be a more definite move or break of trend to the 140 level. en you break that 140 level, even though my own view is the market is incredibly long.

140 takes you into a new area which could be up to 145. the aussie dollar, things are bright and cheery in oz as china exports more and unemployment numbers are gide quite good. back to you. >> thank you so much. manus cranny on the foreign exchange markets. in just 25 minutes, "surveillance" with tom keene. we had a couple of interviews th c.e.o.s talking about how the euro is hurting them. >> it will be interesting to see the markets are in a strange state. indicate morrow will join us from jpmorgan morgsan. talking about the selloff. -- about talk to

parker frames. not too cool for school. we'll talk about the emotion behind the really the slaughter that you see out on those tech -- and then we'll speak to francine lacqua about barclays and about really these seismic announcements and then to top it off, "surveillance" just can't get better. we will speak to guy johnson of bloomberg news in london about european central banks. i think they have an somewhere n the middle of "surveillance" today. >> it is surprising. i'm surprised your glasses are not italian make. disappointment. we'll have to work on that. >> they are german. >> disappointing. we'll let you go. >> it is a busy day. there is a lot going on. we're going to do a conversation quickly, francine, on tesla. there is a real mystery about

tesla. >> a real mystery and a lot of hype. maybe that is part of the mystery. tom keene and "surveillance" in 25 minutes from now. now it is time for a bloomberg exclusive. -- does europe need a change of approach when it comes to energy? let's speak to the c.e.o. of enel. earlier this morning, it posted lower profits. what does draghi need to do to fix that? luigi ferraris joins us for an exclusive interview on this subject. let's talk a little bit about what's happening here in europe and move on and talk about the wider picture in a moment. we need a stronger economy. do you see that stronger economy coming any time soon here in europe? >> well, good morning, first of

all. yes, you're right. we see some positive sign in particular in the second part of the year in the real economy, but unfortunately we do not see yet the -- on the electricity consumption in particular in italy and spain where we have een a first quarter decline of 3.5% in italy and 1% in spain. very likely in the second part of the year, we should start seeing also some positive sign in the electricity consumption. > you also, of course, mr. ferraris mentioned the strength on earnings. what would you suggest to the bank today to maybe alleviate your pain a little bit? >> well, i think it is necessary to accelerate vems and to establish confidence by the final consumer. i think what we have seen these

days is it is possible the spread are going down. we need to see more liquidity going through the final entrepreneurs and consumer to establish confidence in the future and stable consumption. as for now, we still see the residential segment struggling and this of course means when it comes to our business, less con snudges the electricity. >> in terms of euro dollar, what are you basing your forecast on in terms of euro/dollar level? >> well, you know, when we look at that, we are assuming that 1.32 llar will go back to in the next 6-12 months. we think that today the euro is overvalued and this of course is not helping our results. in particular in the first results.

we had a negative impact due to poor exchange in south america and in the united states by converting all of these currencies into euros. we have probably -- will probably see over the next 12 months a little better value of the dollar which will be positive for our accounts. >> is europe overexposed to russian gas? >> well, of course europe is still depending on russian gas, but we see a lot of efforts in educing this dependence by leveraging the increase on the renewables side. this of course is achievable but necessarily we still need in the future to maintain a decent cover the base load

need of the normal consumption. there are margin to do more. a minimum dependence will continue to be there. >> we have south stream coming through. should we be looking at ways of reducing our exposure to russia? >> we need to gain more flexibility. in particular, just think about italy. e cannot take advantage of importing gas. by increasing the storage capacity. on the other end, why not by increasing the interconnection between different countries, among the different countries in order to -- on a more integrated basis the existing capacity

which is already sizable in particular in italy. >> when we talk about a new common energy policy, a more coordinated -- does it have to come from brussels or is it up to individual governments to do something about it? is it now a realization or is it too late? >> it is not late. it is never late. if you think just as an example, at the european level today spain is a -- because that is not having the connection with he rest of europe. if you think that italy is interconnected on a sizable base with france, the other countries like switzerland and there is a lot of capacity today not fully used in italy which could be exported to tore european countries -- to the other european countries.

to take advantage of the different levels and capacity of the different countries. for instance, if you think about spain, we have a sizable number of storage for gas capacity. i think this is something that we should pursue at the european level on a more integrated basis. >> luigi, why is that not happening? building grids across europe at a time when the european economy is struggling. isn't this the way we should be spending our money? isn't this how brussels should be spending its money? wouldn't it be better if we simply went out and delivered some of these big infrastructure projects? why is that not happening? >> because we still have, you know, a better -- there is a lack of coordination, having a common energy policy. there is still the tendency by the different countries on a

standalone basis. all the process has not been finalized. for instance in italy, we are well ahead if this respect. so if at a european level, the key players in the european arena should find an agreement in order the launch a program to build new infrastructure, to interconnect the different countries, that would go in the right direction with that flexibility and the -- europe could better le implement a common policy strategy reducing their dependence from the supply. this is something that has to be a political decision in the long run. >> all right. luigi ferraris, thank you for joining us there. >> coming up, showdown with samsung. huawei launches a new flagship

home. details coming up next. ♪

>> good morning. welcome back. huawei has picked paris for its global launch of its new smart phone. samsung struggles with falling

sales. what's going on? let's figure it out. nice to see you. let's start with this. >> the p 7 from huawei. a brand which probably still isn't very familiar to most people. a few years ago they didn't use their brand. they made phones for others. they actually still make phones for other people. they are now purring their own brand and -- pushing their own brand saying that huawei can compete. getting very premium specks. it looks like an i-phone 4. a very big screen. a five-inch careen. a decent processor. decent resolution. good specs for

a lower price. >> why would i buy that instead of one of the brands i recognize? >> this will undercut sam sung and the iphone. the problem is that i think we still associate chinese makers, we know phones are made in china even when they have apple's name on them. chinese branded phones, we still associate them with the mid range and that's where most people expect them to compete. google owns the mid range. if you're comparing this to a top class $700 phone, this one is equivalent to $500. if you compare it to the next us 5 from google, then that is going to undercut this to the tune of $100. the only sacrifice you'll make by going to the google phone is a bit more plastic and less

glass. >> this is a joke. where is the app from the chinese government? >> this is a problem with the branding. i don't know how much people are influenced by the fact that the only time we hear about huawei is they worry that it has back door service to the chinese government. people are aware of the irony in that. i think a lot of people ultimately regard them, the privacy as being compromised anyway. when the huawei brand comes up, it is usually in the negative context but they are slick in trying to tell their story. any company that operates in china has to abide by some pretty shady rules. >> they basically decided to launch the phone in paris. how significant is that? how long is it going to take? four, five months to see whether they are successful in europe?

if they are successful, does that mean a lot of other chinese manufacturers will try penetrate the international market? >> maybe. i would think they would have tried to launch in new york. that would have had a message. the fact is this is a phone really only for european market now. no u.s. price, no u.s. plans. it is going to be quite limited. i'm not saying europe is not important, but it is not going to be the global domination for chinese-branded phones. >> tell us about the life cycle of the smart phone? the fact that this is very comparable, the fact that this is effectively a product that we have all seen coming but now it is here. >> it is smidge a bit sad. as much as i love the people are phones, they do offer more, the fact is the trend is towards the mid range. the $400 phone. that is where arm sees the

biggest growth. that is becoming a sensible choice. all of these phones are getting so similar, you may as well make the sensible choice and forego some of the really premium features. i hope while we can learn from this, it may be a rival to google. > interesting. we're back in just a couple of minutes. ♪

>> welcome back. you are watching "the pulse."

let's talk about the currency markets. yellen yesterday, yeah, nice and dovish. what kind of impact is that having on the rest of the world? it continues to have an upward push on currencies. the pound is trading just north of the 169 level. what can stop the pound? we're waiting for the 149. the bank of england will be releasing their inflation report on that day. we can talk about the bank of england today if we want. today is not the main event. the pound, how much higher does it go? >> if you look at what we're watching for the rest of the day and the pound is part of that story. we're joined by jonathan ferro and hans nichols in berlin. we're watching the e.c.b.. >> the e.c.b. is really the one 1.4943. the euro up

getting stronger and stronger. draghi cannot talk this down. is he going to do something? then you have yields coming low. what i thought was really interesting, a very subtle line in one of his recent speeches. he said yes, the euro strength can be a problem, but if it is a symptom of flows coming from the euro-zone and pushing down yields, it has a stimulus effect. it didn't sound like a man that was overly concerned about the euro. we want to listen to what he has to say. >> we have had two c.e.o.s and one c.f.o. on this morning from european companies. it is hurting. >> all the finance ministers over the peripheral countries are saying that. >> really, the bottom line is a worsening inflation outlook. is he seeing any of that right now? probably not. >> hans, let's go to you. let's go to capitol hill.

let's talk comcast. >> time warner, comcast are going to be doing a test run, a dry run on regulators on why they should be allowed to merge. it seems to me there was a center of gravity with regulators. they will be approving or disapproving of all of these m&a deals. it is not just comcast, time warner. it is sprint, t mobile. they will hie off a certain amount of cable subscribers and they should still be allowed to merge and cover 1/3 of u.s. geography. cable wars are just about to get really interesting. guy? >> thank you so much. that's it for "the pulse" performs keep it here on bloomberg tv. "surveillance" is up next live from new york with tom keene. >> this is the last time you'll see fran and i together for quite sometime. >> just for a couple of months. >> i'm off for a little while. she is off for a little while

longer. we're looking forward to get back shortly. you can contact us on twitter. i'ma at guy johnson tv. >> i'm at flacqua. we're back tomorrow. ♪

>> putin blinks and suggests russian troops will retreat from the ukraine border. there is an air of conciliation 17 days before the ukraine election.

investment banking will be slashed at barclays, 7000 bankers will go. at tesla, they disappoint. is it a car company or whatever? good morning, everyone, this is "bloomberg surveillance." it is thursday, may 8. joining me is scarlet fu and adam johnson. it's a busy morning. it's a mixed morning brief. the chinese exports and imports unexpectedly rose which is good and they are selling more abroad. in europe, german industrial output unexpectedly declined. next picture -- england rate decision comes at 7:00 and the ecb rate comes out at 7:45 a.m.. 8:30 a.m.ght that the press conference is what the pros are looking at? sayss, what mr.draghi ab