>> sarkozy under fire. we are live in paris as the former french president is charged with influence peddling. just short of 17,000. will the dow jones passed that threshold today for the first time ever? and thumbs-up for a telecoms tie up. the eu is set to approve' vodafones bid for ono. welcome to "the pulse," live from bloomberg's european headquarters in london. i am mark arden. also coming up today, virgin

atlantic he high-fashion makeover. you see if it's new uniforms are a sign of a bigger revamp and we look at why two letters are all you need for an app to go viral. let's get to our top story. nicolas sarkozy has been charged with influence peddling after 15 rounds of questioning by police. good morning. what are the details of the charge? is interesting is this is the first time in recent history is that a french president is being held into custody, like we saw last night. questioneds, he was by the anticorruption judges in the suburbs of paris before being officially charged with influence peddling. sarkozy isolas

accused of is allegedly influencing a judge, seeking information from this judge in exchange for promising the judge a prominent position as a government advisor in monaco. so the information that nicolas sarkozy was looking for is related to another case on alleged illegal financing of his presidential campaign back in 2007. and the investigators are looking into whether nicolas sarkozy received illegal leaderng from the former gadhafi. his agendas and, according to a newspaper, it is the phone tapping as part of the probe that led to the current investigation. the former french president denies any wrongdoing, but both his lawyer and the judge have

also been placed under formal investigation. so who is left? said there wasr no active corruption. >> what are the consequences for french politics? >> it is a big blow for the conservatives and for nicolas sarkozy, who was widely expected to make his return to politics in the next few months, maybe this fall. the right wing party has been damaged by political infighting. there is no clear leader at the moment. so nicolas sarkozy still remains the favorite among the conservatives in france to run against president hollande in the next presidential election in 2017. some of his supporters even said yesterday that they were accusing the socialist party of

influencing the investigators in order to avoid his comeback. but the prime minister said this morning that the case was serious about but the justice remains independent. politics inozy and 2012 after he lost against hollande. in the last few months, he has been traveling around france and even meeting with chancellor merkel, an indication he was planning a comeback. more highs for the u.s. stock market. both the dow jones and the s&p closed at a record yesterday. a bullish start to the second half of 2014. manus cranny is with us. can it be sustained? >> one mind here is that only a truly convertible would jump in wouldruly convicted bull jump into this rally. if you believe in the dow.

, which is the dow industrial roaring ahead with transport, it is a bullish dynamic. i read another technical report, lagging industrials and utilities, the careful. quoted the b. n i.s. they said that all financial booms sprinkle fantasy dust of the illusionary riches. is that where we are? the market is going to debate. there are greater minds than i at play here. i will give you some beautiful bloomberg facts. it is the highest valuation in four years. do you believe the growth will transfer into profits and earnings? a simple proposition. do you believe the u.s. will continue to roar higher and transfer into profitability? >> profits will rise in the current quarter when earnings

are released. >> there you go. we have not had a drawdown in this market more than 10% in two years. and this is a 64-month rally. drop, we have not had that. >> so it is a roaring success. >> i spoke to one of my guests earlier and he says you can look at all sorts of metrics. volatility is something you have been looking at. you have had to work with it in the past as well. what is it telling us? >> it is telling us that, in this period of low volatility, the vix, by options against that 10% retracement in the market or perhaps not. every time the market has been below 15% level, going back to 1990, so low volatility does not necessarily correspond to bearish.

that is according to oppenheimer. guest say it reminds him of the 1996 pre-asia crisis. the internet bubble, we are in a danger zone. , 2006, 2007.cent the end of the day, why i am a believer in volatility and some people would argue against this, you can write options and take advantage of this lowball ability period and make money. in other words, i write an insurance policy for you, you give me some dollars, i go, thank you very much. i am a believer in protection. perfection allows you that grace of favor when and if a moment of retracement comes. can only25 years, we be assured of a very few things

in this world. nothing last forever. >> telecoms falling today with news that orange is not proceeding in a consolidation deal with in its own market. here with more is caroline hyde. details, bute orange is down. iliad is trading lower. bouygues is trading lower this morning. why? orange said it could not pursue an operation for consolidation. much speculation has been within the french telecoms industry as the politicians tried to drive forward mergers. they do not want four players anymore. so says the industry minister. he wants three. there are four. sfr, orange, iliad, bouygues. who is to merge with who? speculation that orange could be

buying bouygues telecom. today, they said they could not pursue the operation that would lead to consolidation. so who might be next in the cards? telecom has not been wanted to be bought by iliad because iliad is not offering enough money yet, but all the shares are falling this morning. >> there is still cross-border consolidation happening within the telecom sector here in europe. >> you are right. today, we are expecting a thumbs-up to come from the eu in terms of allowing the 7.2 vodafoneuro bid for for ono. we understand there will be no problems in a regulatory issue for these two combine. the eu has been pushing for a drawing down of market barriers in the telecom space.

the head of the digital agenda has been saying, look, we want a single telecoms market. we do not want roaming charges. tuesday, they slashed roaming charges by half. when you and i go to france, spain, italy, our roaming charges should be half the price if we are accessing data. it should be 20% off if we are making calls. that is a problem for telecoms companies because it is eating into their revenue stream. how do these companies pump money into investment? we want to access our videos and get a hold of our e-mails on our mobile phones. they need to build a better network. when revenuesest are going down? this is why companies such as vodafone and deutsche telekom are saying, let us consolidate. let us join forces. look at the deal with ono and vodafone. they're saving could cut 2 billion euros in costs. they could increase sales by one billion euros.

that is what is attracting vodafone to buy ono. they spent on kabul deutsche land last year. this is why they could be eyeing in italy to of wind try to build up their market share. we are expecting more consolidation to come, just not happening in france right now. back to you. >> here is what else is on our radar today. hasrgan chief jimmy diamond throat cancer and will get treatment shortly. he told employees and shareholders in a memo that his condition is curable. he also said he will continue running the firm as normal during his radiation and chemotherapy. being investigated by u.k. agulators after a study shows psychological experiment influenced what users saw in their news feeds. facebook says it has taken appropriate protections for

people's information. in the u.s. is said to be more than 4000 lockheed martin missiles to iraq. the administration wants to sell the missiles to help iraq's government fight against islamic insurgents. coming up, we will bring our focus back to vodafone's acquisition binge. it'sll dig into how shopping spree could impact consumers and the competition. ♪

>> let's bring back our focus to vodafone. the you expected to approve its 7.2 billion euro bid for spain's ono today. joining us is the principal analyst at ovo. it will be passed unconditionally, isn't it? no concessions? >> in this case, i have no doubt read it will be passed. >> there have been other issues in other countries. why is this so straightforward when it was not so straightforward in other scenarios? >> good point. the reason why germany is such an issue and ireland is such an issue, and back then, france was when we were part

of a consolidation deal is because in the case of spain, we are talking about a mobile operator acquiring assets. that does not introduce too much. the concentration in the market space. in the case of germany and ireland and france, the issue is, when you consolidate from 4 , that could reduce competition. in this case, no. >> what happens next with vodafone? some are saying there are network gaps. fastweb.nd, thethere more deals in offing from vodafone? >> there are potentially more deals for vodafone. vodafone has set a clear strategic view which reflects what consumers and enterprise buyers are doing.

if you look at the way enterprise buyers are buying telecom services, we do surveys from the buyers and the vast majority of them, in the next two years, they want to buy telecom and i.t. services am a single supplier. -- from a single supplier. they are now able to offer to enterprise customers services not only in the mobile space, but also in i.t. what is happening in other markets where vodafone is not able to do that? obviously, they are look at acquiring assets in italy or in the u.k. it is a possibility. at the moment, their position in italy is not bad. a few years ago, their acquired

.ssets maybe the u.k. is a different story. the u.k. market, we see a lot of back into theg mobile market. point, theresome will be a trigger in the u.k. market for vodafone to do something. as to the italian situation, you mentioned wind. i do not know to what extent this has been confirmed, but in italy, the speculation is between wind and the smaller player. i do not think vodafone will make a huge acquisition there. well-placed to satisfy those enterprise customers? as you said, it has money to spend. it is spending 90 million pounds on improving its networks.

hadhe same time, it has seven quarters of shrinking service sales. is it going to be one of the winners as we look at your crystal ball over the next five years? >> whether vodafone is going to be the winner or one of the winners, i think it is very well placed within a bunch of companies that are losing out. topline,alking about service levels. unfortunately, the story in europe still is that the topline is going down. but it is not really because of offeringing or lack of of mobile operators rates. what is driving down the topline is regulation. and yes, competition is driving

down the prices. if you think about it, operators are not even able to adjust their prices to inflation these days, which is something that most companies do. when you talk about the consumer space specifically, i think vodafone has had quite a few gaps in their portfolio in a number of markets and i think they are addressing that. when we see vodafone acquiring ono, it is not only because they want to offer fixed mobile, it is fixed mobile and tv. incumbents are bundling to the fixed line services. they are putting in tv content. was.is where vodafone there was a huge gap. in fact, they are a really strong player in enterprise services but i would not judge them as an equally strong player in some markets.

as we see incumbents protecting their fixed line revenues with tv services in spain as well, we see vodafone getting into these spaces. the way we see the future in many markets is that us, as customers and users, we ourntially buy all of telecom and entertainment services from a single provider. is vodafone ready for that today? no. but it wants to be. >> thank you. who is going to win the world cup? >> i hope a european team. >> you are going for germany. i am going for holland. we will see. principal analyst at ovium . it is time for today's pulse number. 2.5 million pounds. that is how much tracey evin's

piece went for at auction. it documents her relationship, displaying her unmade bed strewn with cigarette butts, discarded condoms, and empty booze bottles. we are back in two minutes. do not touch the bed. ♪

>> it is time for today's

hotshots. this juggler in brazil is taking his craft to extremes. check him out juggling on top of a wooden box in the middle of a easy street. this performer has a separate full-time job and simply loves to share his love of juggling and apparently also dodging traffic. we start off in germany for the red bull rising high competition. buildersd course demonstrated their street style skills. let's see how the markets are trading. manus is here with the latest. >> it is the strongest day in almost two months and european equity markets yesterday. so the momentum is building. i want to take you on a little bit of a time trip. this goes back to the american'' last night. can they maintain that? will the dow jones break 17,000? will nasdaq continue?

will dow transport catch up with the industrials? those are all questions as janet yellen goes to speak at the imf. not fail. they took it gallantly and they took us ahead in terms of six-year highs. here we are in europe and the momentum is still there. iliad driving the market back there. this is built on valuations, the strongest valuations in four years. can the u.s. march ahead? central bankpean deliver quantitative easing? notes from the french talking about the value of the euro, saying it is overvalued. the ecb probably needs to do more. the tone will be set by the adp. that is the current razor to payrolls. >> we are going to look at why to letters rrs -- two letters

are all you need to go viral. i have already sent a yo to my buddy in tel aviv. ♪

>> welcome back to the polls. i am mark barton. here are the top stories. french president is being charged with influence headline. have a political comeback. denies the allegation. the foreign ministers from the ukraine, russia, france are owing to meet. it comes after the russian president ended the cease-fire

with russia. he has vowed to retake territory from separatists in the east. dimon has throat cancer. employees that his condition is curable and will continue to run the firm as normal during his radiation and chemotherapy. ryan chilcote is here with more on the story. tell us more about this. >> it has artie sparked concerns amongst investors about a succession plan at jpmorgan. as far as jamie dimon is concerned and the board is concerned, the public discussion --a secession plan is succession plan is unnecessary. he plans to work through the treatment for two months.

like we saw with warren buffett, several years back, he is an iconic figure and people ask questions. when they think of jamie dimon, they think of jpmorgan and there are investors who say that they should use the two months to indicate to investors who is taking leadership at the company. jamie dimon has been in this before with the london whale incident when he was accused of not handling or mishandling -- or not providing correct oversight and risk control. at the investor reaction, the shares went down less than .5% and no one is overwhelmingly concerned. these are questions you ask when you have iconic leaders. a sense of jpmorgan under jamie dimon and how it has performed. been the

longest-serving ceo of a big u.s. bank. the shares in that time during his tenure are up. to me, that does not sound like a lot until you think about the banking sector and what it has been through. jpmorgan has outperformed all the other big u.s. banks and that is already saying something. he posted his first quarterly last year and it was a tale of two halves. that was a big deal. there was the loss of $6 billion and then there was the $13 billion settlement with the u.s. government for failing to appropriately described and the quality of mortgages sold to investors. there is no one out there that does not think that jpmorgan has challenges and that is a reason why there is a little bit of concern about what is next with leadership at the company.

>> thanks. it is called a sharing economy and many see it as a resolution. it is being aided by technology startups. one key player is expanding in france. announced a new funding route. our correspondent, caroline hyde, has more. they have raised money. >> 10 times the amount of two years ago. $10 million helped them expand into 11 new countries. they were in france where they were founded. he moved into russia, germany, italy, spain, you name it. investors have another round. this is 10 times that amount. $100 million. the targets are bigger. it is getting into latin america, asia. it is looking outside of europe

and into countries that have a plethora of smartphones. you can share cars and have a need to reduce costs. this is a fascinating company, set up in 2006 i a french man. a french man and it is sharing economy. he had to get a lift with his sister because he could not get on a train. he noticed that all of the cars seemed to be relatively empty. why not fill them up and cut your cost? lacar. up blaba you can socially network and see who is driving the same way. you can ensure that this is the person you want to that -- sit with. there you go. >> give us an idea or a sense of

how much cheaper it is to car share using blablacar. >> a lot cheaper. i spoke to the founder yesterday and he gave us a sense of it. aroundengers would pay 15 pounds to go from london to manchester and that means that the driver will save 45 pounds. it is this and all this money-saving angle that has been driving the extension of lovelock are -- blablacar. we are transporting one million passengers a month. to.pt, we did not have it was less expensive to start with. >> you can get a sense that it was a cool office. money has been used in the office space. it was really great to meet the

chief executive. very animated about how he is going to expand the business into other continents. 8 million have signed up for the car. -- blablacar. had any negative feedback or has anyone ever not enjoyed the line -- ride? thatmetimes, the women say the guy who was driving me like to meet a little too much.\ -- too much. >> stupid. pointless. addictive. these are the adjectives used to describe the phenomenon of the app that lets you send the word "yo" to your contacts. elliott, yo. my soul friend. >> you really have to work on

your yiddish. it is oy. it does not work so well for verbal communication. there you go. one of my colleagues just sent me one. it would make for interesting conversation. it is a viral phenomenon. 8 took a hours to build -- ouhours to build. i am going to send you one back. it sends them a yo. three letters to point to the cofounder. he was the founder and ceo of a company. i asked him why. >> sometimes, you do not need anything else than yo. a simple yo is the message. it is an efficient way to say

stuff. i am thinking about you to my wife or, come to the office. >> you are saying, i am thinking of you or i love you? >> i am thinking about you. send and wait and see if she writes back. if there tap it to see is one on my screen. it is yo. persona of yours, you are a hopeless romantic. and she her a little yo will be happy. >> i think about this a lot. than $1 has raised more million. >> he told me that he closed around $1.2 million this week. he says that they could have raised more. they want to be responsible and ensure themselves.

they do not want to be diluted. they also do not want to lose the shirt off their back. the key thing is to turn this from a novelty into a viable business. >> the big challenge is to take it from the funny sector and bring value. there is a lot of value. you can really enjoy it. it is a big challenge. people?yo inspire there is the world cup going got right out. it every time there is a get a yo back. > it took them eight hours to build this>.

you -- inm in dollars -- 1.2m dollars -- $1.2 million. >> ok. news.or world cup belgium has secure their spot in the quarterfinals by overcoming a record 16 saves by the american goalie. goals were in extra time. the tournament. each cup is printed with specific dates and locations of each match. atlantic'svirgin brand may punch above their weight. it will take more than that to get back on track.

you will hear from richard branson.

time, other airlines start to emulate what we do. we have to revamp. >> that was richard branson speaking to us about the virgin atlantic just rolled out. they are not just revamping the

uniforms. they are revamping the 747 jumbo jet. here is the chief executive's take on that issue. coming off ofe we can extend those. it is not an urgent problem. we need to think about those and some options. >> let's take a closer look with the investment director. hello. thank you for joining us. richard branson was saying that we are a trendsetter when it comes to outfits of our crew. -- they a trend center trendsetter in other areas or behind the times? >> they have been spending heavily on refreshing the brand and the product in recent times. they have been spending money on new uniforms and onboard

refreshment. and, that sort of thing. they have been making big efforts. does not particularly give virgin atlantic and edge, i don't think. this is a cost of doing business and the competition is making strides. >> what would live -- what would give them the edge? what would give them the edge against the competition? >> they are a transatlantic as ms. and it will make some difference. there have a 49% stake last year and the airlines have not combined their transatlantic businesses in the way that british airways and american businesses did. theytook place in 2010 and have been reaping benefits ever since. version is doing the right thing and it is several years behind the competition. high is suffering from the costs of operating from london

heathrow. they were talking about the first year anniversary last month. that theas saying runway space -- the lack of runway space in the united kingdom is a real bug there. the economy and the economy's reputation. how is version coping with that issue right now? >> there is hope here. the runway issue, by the way, anyone who would in their hope on business revival with a third runway being built, that is a prospect, to say the least. i do not think that virgin should put their hopes on that. it is a costly airport. it is about to clamp down. traditionally, heathrow has charged 20 pounds per passenger. the civil aviation authority says that has to stop and they want to see those charges

increase no faster than inflation and below the rate of inflation for the next five years. doing well with a short order feeder operation. that has an acceptable cost. is the version of equivalent working or not? >> reports persist. unconfirmed reports. the load factor and the number of seats filled on virgin's little.ly new launch is it is disappointingly low. perhaps as low as 30%. way below the level one imagines they can turn a profit on. to make up for the loss that they got from british midland in 2012 from british airways. skeptical.unds to be >> that have survived 35 years landscape.itive

will it survive another 30? >> british airways is a dominant player on the transatlantic market. u.s. market. you would think that there is a space for a second strong competitor. version is a stronger competitor than they used to be and has a lot of ground to make up. they'll have to improve financial performance if they want to be around 30 years from now. >> thank you for joining us today, douglas mcneill. to cars, daytona is the world center of racing. on onees it take to race of the most iconic racetrack? ♪ >> richard petty, jeff gordon, juniorohnson, junior --

earnhardt jr. >> i am riding shotgun. anwe're going 170 miles hour. .> it is loud it is next to the track. how loud is the car? what's to be honest with you, you may hear a lot of noise. when you are out on the track, you are so focused and screaming that you forget about the noise. >> the noise will be replaced with -- >> adrenaline. >> bone chilling fear? >> black, not silver? >> i am sweating in here.

i am so scared right now. this is no joke. my ride was five minutes. i flew around the corners and reached a top speed of 180. >> three turns around the track and i am converted. i am a nascar fan. >> well done. still to come, we have a special interview for you. we will be joined by fate to talk about the surge in property prices later on the pulse. stay with us.

>> bloomberg has just released a report and concludes the region will need $3.6 trillion to power itself by 2030. let's go to hong kong. justin is from the bloomberg energy team. thank you for joining us. tell us more about the number. where is the money going? >> sure. let's give some context to the $3.6 trillion number. that is 40% of the global total needed. 7.7 trillion. going intoof that is

renewable energy. to give you a sense of how much capacity is needed, 1.7 terraw atts. installed int is the united states. theasia-pacific region is largest region for new energy in the world. it is larger than the america's and europe combined. >> 55% of that, which equates to $2 trillion will go to china. what is driving investments? >> something china needs is a lot of energy. not ave a lot of coal and lot of nuclear. a little bit of hydro. is that moreaying than half of that will be renewable energy and china has watts and a lot

of it needs to be low-carbon emission technology. china is facing a lot of air hasution issues and extensive natural gas imports. it needs to find a more viable solution and much of that comes from solar and wind. also, from a bit of gas and nuclear. >> thank you for joining us. energy finance is analyst. the first word is up next for our viewers. here is what we have for you. an exclusive interview with the former member at the monastery policy committee. thewill discuss with me -- monetary policy committee. she will discuss twith me rates. rose in june.

what about vodafone's acquisitions? m&a.l speak to the head of busy hour. stay with us.

>> sarkozy is under fire. we are live in paris. the dow jones surpassed the threshold today? the eu is set to approved vodafone's bid. ♪ >> good morning to our viewers in europe and to those in asia. welcome to those waking up. this is live from bloomberg's

european headquarters. version gets a, fashion makeover and we will see if the new uniforms are a sign of a rebound. blablacar.on can the ridesharing application go the distance. being charged with influence peddling. for more, we are joined in parallel -- paris. what are the details? >> influence peddling is the charge that the former french the 15nt is facing after hours of custody. everwas the first time that a french president was being held in custody. ofkozy is accused

influencing and seeking information in exchange for a promise to get a frisky disposition as the government advisor and monaco. sarkozy it was allegedly seeking information that was related to another case. campaignpresidential was from the former libyan leader. and,obile phone was tapped according to a newspaper, it is the phone tapping that led to the current investigation. sarkozy is denying any wrongdoing and his lawyer and judge have been under formal investigation. this morning, we heard from the .awyer of the lawyer of sarkozy he said there was no corruption.

in custody wasas to apply psychological pressure. forhat are the consequences french politics from all of this. -- all of this? >> the consequences could be big for the conservative party. the right wing party has been damaged by political infighting. no, at the moment, there is clear leader in france on the conservative side. sarkozy remains a favorite among conservatives and is widely expected to make his comeback in the next few months. some of his supporters have accused the socialist party of possibly influencing the investigation in order to prevent his return. is denyingpresident'

all these accusations. we will see if this case goes to trial. if it does, it is a different story. the judiciary is slow and his chances of running for president in 2017 will become very slim. >> thank you. caroline connan in paris. closed.ow and the s&p that signals a bullish start to the second half of 2014. manus cranny is with us. 10 the rally be sustained? >> i think it will be down to the option traders. markets are dealing with a psychological breach point. of thatwithin a couple level and we were on a rally that only a bull could love. bigl caps, big cats, the

bang theory. you will question me about a detailed analysis. they are up. all making record highs. >> positive signs. >> theoretically. i have statistics. the strongest valuations in four years. more importantly, the market has not self-corrected and has not shaken out. it has come down over 10% in the last two years. very long. >> the longer it goes, the longer investors will ask, it is about to happen? >> or, you get out of the game. i have looked at the market in the last six months. it is like macbeth. cannot turn back. once you have no choice. >> are you the contrarian? what i am. 2009. are like

hen the shoe shiner -- >> when the taxi driver by this stock. >> he has just given mthe sell signal. it is the longest rally and 85 years and the highest valuation in four years. andtocks rose yesterday that signals a bullish sign. >> it does. he countersigned to that is in your this morning. -- in here. i want to show you volatility. it is crumbling, falling and stocks are ratcheting higher. i know you hate that word. rising. i know you like clear and simplicity. what does it mean in the market? no. thereing to oppenheimer,

is volatility that gives you protection. >> volatility is cheap. is very cheap. what you has to ask yourself, apart from my contrarian volatility was cheap in 1996-1997 during the asian crisis and during the cap level -- tech bubble. complacency seems to be the note of caution coming from this. i am not a proponent for the bull. i'm saying that there are pluses ansd minuses. you need profits. >> the contrarian signal. i am on the phone later. that's true. french telecom stocks are falling.

proceeding with a consolidation deal in their home market. here with more is caroline high. good morning. there is little detail in the statement. >> there is. you are trying to read the tea leaves. i am pretty sure that orange is going to do it. that comes after the cfo came out a few minutes ago and said that they are still open to bits. -- bid. this is surrounding speculation about consolidation and deals being done in france because the politicians are so pro- it. remember, the four players are orange and iliad. really want to see consolidation. orange is coming out and saying

that they cannot pursue an operation. they did not tell us who is buying a who the players were. given that they have come out and said that they are still there were bids regulatory problems and too much of a hit on competition. by iliad would be more realistic. they are not quite pumping enough cash for their liking. maybe they are the main player in the future. >> there is consolidation happening in europe and we are expecting the eu to agree to the bid for no later. later.hno bit forpect to see a the cable company. this is such a trend.

telecom and cable companies are coming together. toy say, i do not just want be on your mobile. i want to be in your television and at home, as well. you have cable companies by sfr and moving into mobile the stock you have mobile moving into cable. you have liberty global. virgin media in the u.k.. -- in the u.k. you have lots of moving together. cable and telecom coming together. much datats to eat as as they can. through the internet or on the mobile through the internet. we need more data. we are seeing so much consolidation and the yuan allowing vodafone to get into spain because the telecom companies in europe have a real problem. they have to increase investment . the have to update the networks to allow us to download this

data. at the same time, the revenues are falling, particularly when you have the you reducing data roaming charges in europe. what do you get the money from? they save money. they will save money by buying ono and i think there is more consolidation to come. >> thank you. here's what else is on our radar today. the jpmorgan chief has throat cancer and will begin treatment shortly. he told employees and shareholders that is condition is curable and he said that he will continue running the fi rm during radiation and chemotherapy. facebook is being investigated by u.k. regulators after a study says that a psychological excrement influenced -- psychological experiment influenced what they see.

4000 lockheed martin missiles to iraq. the state department told administrators that the administration wants to sell the missiles to help fight against islamic insurance -- insurgents. megamergers. a comeback. how long will the frenzy last? we will discuss. that is next on the pulse.

>> let's check in with currency markets. the dow has risen to its highest level since 2008. we have a construction report out that beat estimates and extends the rally. pmi be estimates, as well. -- beat estimates, as well. u.s. data tomorrow. he said that it will be disappointing and it could push it to 1.72. those are the words. it is pushing sterling higher today and stronger-than-expected. it is u.k. instruction as the number. let's return to the acquisition

binge. the recent bid into the purchase of ono was in march and the eu is expected to improve that takeover. there is a boom. mining me now is the head of &a. what a quarter and a year. plus absolutely. the highest since 2007. we have seen a bit of everything. hostile deals. amazing valuations. an amazing year. it is all about market confidence and, at the start of the year, most of the economy reported would figures and the u.k. is the fastest-growing g-seven. g7. we predict that it will

continue. another level.to it was the equivalent of bloomberg data on volume terms and the most since 2007. is it right to compare the two times? >> a lot has changed since 2007 and now and what is driving the heart of this today is cash with incorporates. estimates, the largest non-financial companies have 2 trillion in cash. that is driving behavior and i like to think of it as a bit of a carry and stick. -- carrot and stick. what is interesting is 25% of the companies are sitting on 80% of the cash and that with the recovery in the hands of the few. >> interesting. cash companies have a lot of it and cash offers make up one third of the announced.

it was two thirds and 50% in the five years through 2013. more stock is being used and there is lots of cash out there. what does that tell us? more stock is being used in deals. >> absolutely. >> and makes a lot of sense. that is part of the reason. companies are using that. also, not all companies have cash. 25% have 80% of the cash. >> what sort of deals can we expect. i looked over the last months and every sector has benefited and some more than others. >> one of the big differences that it2007 and now is is across every sector. we have to watch the telecom, media, and take elegy. it is driving deals in europe and across the atlantic.

technology companies are sitting on $1 trillion in cash and health care is a surprising one because every year, they go through this massive surge and this year, it is not just a classic. >> creative deal. >> very creative. >> will we see more evidence? asset swap things? -- swapping? >> other sectors think more creatively. ande is an interesting deal it points to something. there is an ad company. taylor, the ad company. the blurring of the boundaries of the technology retailer. create stock deals

and cash. >> tax inversion are words that others have discovered in the last quarter. the deal fell apart for now. will there be more tax inversion deals? >> there is a strong incentive for u.s. companies to look for tax inversion. it is overseas. tax inversion gets you synergy and that is a huge driver. it is a strong motivation. many things can happen. there is a lobby going on to strike a deal. >> we shall see. maybe it will happen after the elections. thank you for giving us a nice m&a.iew of mnj -- cars.xt, blabala

details next.

>> time for the new energy. ablacar is one of the new startups creating the sharing economy revolution. it is helping the environment. here is caroline hyde.

tell us about it. >> they have great offices. i spoke to the founder in 2006. i cannot not get a train ticket he shared a list with his we canand realized that make it more efficient and environmentally friendly. i spoke to him about how it is reducing emissions. social activity that helps reduce co2 emissions. we are always amazed and we make it easier to do it everywhere. >> 8 million users already and they have raised $10 million in 2012 and pushed into 11 more countries. they earn germany, russia, the

ukraine. they have times that by 10. into asia andng latin america. >> what are they going to do with that money. >> go further abroad and cutting costs for people. i spoke to them about how much they managed to say. i said, you get a car and it costs you 15 pounds. andaid 10 million per month they will have to dig a tunnel. they are raising money from investors and starting the sharing economy revolution. didn't austerity help to a large degree? did it help that we had to clamp down on the spending. push into other countries. this is growth and a fascinating

block of offices. at the moment, any family car. you can do a by your mobile. as long as there are roads and smartphones, they will go. >> where did the name come from? >> i did not ask. i will have to. it is interesting. why would you not go? >> they are cautious about the united states. they feel that diesel is so cheap over there that they do not need to share in that way. in asia, latin america, europe, you want to be able to share. it is social networking. >> there you go. >> up next, dressed to impress. an ongoingntic has recovery plan and is style over. find out.

[captioning made possible by loomberg television] >> welcome back. this is "the pulse" live from london. here are the top headlines today. former french president being charged with influence peddling. he had expected to attempt to make a political comeback in time for the next election in 2017. he does deny these allegations. foreign ministers from ukraine, russia, germany and france plan to meet in berlin today after the president ended ukraine's ceasefire with russia.

he has also vowed to retake territory from separatists in the east. and jp morgan chief has throat cancer and will begin treatment shortly. he told employees and shareholders in a memo that his condition is curable. he also said he will continue running the firm as normal during his eight weeks of radiation and chemotherapy. and ryan's got more. this diagnosis, is it raising any questions about his secession plans or not? >> it is. as far as he's concerned, the board is concerned, which he says supports him fully there's no need for any discussion of secession because he's not going anywhere, it's very curable. and for the next two months he is going to continue to run the country so it is business as usual. but like we had when warren buffet had cancer and decided to continue to run the company and he's an iconic ceo, people think of jamie diamond they think of jp morgan, he's going to get it just like in 2012

when he was in trouble for the mishandling of those mortgage scurebts, people then asked what was the secession plan? so we've got that now. and what some are telling us is, look, they should -- the bank should use this period to at least highlight who else is leading though he is going to be there obviously some people are going to take on some more responsibilities. so we just get a sense of who those people are. but if you look at the share price reaction yesterday, shares are down 5 cents, less than 1%, investors not concerned. >> give us a sense of how jp morgan has fared under his tenure. his tenure began in december 2006. >> he's been there about 8-1/2 years. share price in that time has gone up 45%. >> which got me thinking because he's beaten not only 500. but the 500 s and p

>> it doesn't sound that great but when you think about what happened in the banking sector, what really jamie dimen's big claim to fame is he posted his first quarterly lost just last year. most banks had big problems almost immediately during the financial crisis. having said that, the last couple of years -- >> he's had to deal with some fines. >> london alone incident which was a big thing about risk control and oversight that cost the bank 6 billion and last year their settlement with the u.s. government cost them 13 billion. there are a lot of issues still to deal with and that's why people are paying attention to the issue. >> since the start of his tenure, the stock 600 bank indefment, 60% lower. >> puts it in perspective. >> buy american i guess is the

story. >> let's get to the u.s. it is surveillance with our very own tom from new york with a preview. what are we looking at today? >> to be very interesting we'll continue the discussion on the illness that has faced jamie. i was in one of new york's finest restaurants. there was no other topic of conversation. people here of course transfixed on jp morgan and company and on the future for mr. dime on we'll address that. william coheaven has been a great supporteder of surveillance and we'll talk to him on the effect of the banking as ryan just spoke about. and we have a very special interview. charles peabody will join us. his simple perspective on the treatment of cancer. we'll look at the equity markets, the dow near 17,000. adam will join us from morgan stanley. the look here past the 4th of july holiday and into earnings

season really looking forward to catching up with adam. we've got a lot of other guests as we go to the jobs report. the jobs report is tomorrow not friday. thursday jobs report. >> i wanted to say sorry and i mean it. i'm sorry that the u.s. didn't make it past belingm yesterday. i know they were knocked out of the world cup 2-1. i gather your goal keeper had an amazing game, 16 saves which was a record. but my commizz rations. >> yes. we went further than the united kingdom did. i believe we went further in the tournament. no one knows why this is. but it was a great time. i actually spent it watching with my colleague adam johnson. we had a lot of fun watching it. >> you went further than england did, and never ask me why we didn't go so far because we've been chatting in about 24 hours. it's a long long debate. well done to the u.s. for doing so well. we'll see you in about 20 or so

minutes. thanks for being with us. let's move it on and talk about how the european markets are trading. >> european eek tisses are trying to put another -- equities are trying to put in a good day. they must all be building. there's scaffolding upon scaffolding. construction is thumping away in the united kingdom. but where the ignition ow of hope, valuations are strong. this is where the records were almost set 17,000. whether utilities catch up or transports not fall over. everything a perfect alignment. or is it? one has got to question the validity or the robustness of some. and we get a bit of a current rate when we get the equity marketeds in umplete i want to

show the starting. i talked about some of the u.k. data. and we have indeed had the construction data. yesterday's manufacturing, today it's construction. i'm getting ready to go shopping. to new york because that's 171 62. u've got to say to yourself, 1.7162. is it going to flow from the u.k. into dollars? contrary to that the euro rather anemic. down an 8th. >> the company celebrating with a high fashion makeover, richard branson unveiled new fashion crew uniforms. i should call them high fashion. joining us for more. we've got a comment on the uniforms first. surely. >> absolutely.

well, the men were in a three piece burgundy suit. >> there is debbie harry. >> she was wearing the jacket that the stewardeseses are going to be wearing. i definitely liked it. i like the color is a bit different. it has sort of a military collar. a big ruffle in the shirt in the blouse. they look very comfortable. and the shoes. they are hour glass shoes so they will be more comfortable to walk in. ana was telling me, stewardesses walk up to 7 miles on a trance atlantic flight. >> i love that's a good step. other new uniforms, are they a sign of bigger greater things, a bigger revamp? >> they're so such an important -- it's a small thing but such an important thing in terms of the overall brand of virgin atlantic. the last thing that the ceo wants is for virgin just to be any other airline.

they really need to stay dis tinkive so later this year they're going to get a dream liner. i think they'll be about half of their fleet by 2018. that will be another big brand launch. that's more important because for the customer the experience like your entertainment system, your food, inflight experience that's what the customer cares about. >> the ceo has been with them 18 months. they're not profitable yet. that's his goal. but not quite there yet. >> not yet but last year they had their losses so that's a big step in the right direction. they've really betted in delta. one of his first jobs is get that joint venture settled in. so that seems to be working for them. so it's going to be interesting to see how the summer plays out. as of today norweigian air starts low-cost flights from gatwick to the united states. that's a low-cost competitor.

it's a fairly small operation they have. but ba is also ramping up their plans for transatlantic flights and operations. so virgin's in the middle here and you have to wonder is the demand there to keep yields at the level. >> i read today it was the famous freddie laker who pioneered low cost flights who advised branson to put himself at the center of virgin's marketing. any signs of branson slowing down? >> he was there yesterday. he dove right into it. i would say he's very much -- he is happy to be in front of the camera, quick to take an interview, very quick to respond to any questions thrown at him. and he was also down with the staff celebrating their 30th anniversary. and i think all the staff feel he is very much involved and very keen on the brand. >> we know what vivian was paid

for doing this job. that's the key. >> we'll grill him. >> thanks. see you later. up next, an exclusive. live with the former member kate barker to talk about the u.k.'s surging property prices. stay with us for that.

>> time for a bloomberg

exclusive. the trading in the first half was strong, customer demand is firm. we got a chance to speak to the ceo. he weighed in on the health of the morning market. >> confidence -- mortgage market. >> confidence remains good and the mortgages continue to be available for those people looking to enter into the new housing markets. and there are good products but the lenders are very disciplined. >> let's stick with u.k. housing and bring in kate for an exclusive conversation, former monetary policy committee of the bank. currently a senior adviser at credit swist. thanks for joining us on the pulse. is the housing market in a bubble or not? >> i don't think it is. if you define a bubble as being a time when people are buying because they can only really make that purchase work if prices go up there may be a little bit of that. but i don't think it's more generally wisespread. and if you think people buying

when they can't afford to sustain their mortgages but buying now because they're afraid of prices going up i don't think we've reached that state yet. >> are we close to that stage? >> i'm not sure we are. you would expect. we've been through periods where house building has been very low, talking about picking up and that's true. but even when it picks up it will be a long way from where it was prior to the crisis. as soon as mortgages start to ease you're bound to get prices rising sharply. ink what the policy was about last week was saying, look, we're not really worried yet but we are prepared to act. and what i think will be really helpful about that is if i was thinking of buying a house it would make me feel a little more relaxed, that prices aren't going to run away from me. >> did they get the balance right? some said after the recommendations were announced last week they could have been a bit firmer, a bit stricter. do you think the balance was right? the focus was loan to income and stress testing that assumes

an immediate 3% rise. was that about right in balance terms? >> i think it was really good set of measures. the first thing of course is the mortgage market has slowed down since the introduction of the mortgage market review which makes it pretty hard to lend in a very risky fashion. and what they're really worried about is people taking on mortgages today who won't be able to afford them when rates rise. that's why the stress test is so important. so i think it hit what they wanted to do which is expectations and the buildup of vulnerable borrowers because the bank doesn't care really what the level of house hold price is, it cares about the level of debt to income rasheyofment >> you talked about supply. in 2004 when you were a member of the mpc you released this report on housing supply and you said weak supply contributes to macro instability and hinders labor market stability constraining

economic growth. is enough being done to combat weak supply a decade on from this release? >> well, it's been very difficult at the housing supply because of the financial crisis so it's proving very hard to get it back up. i'm very supportive of the changes introduced by labor and more recently by the coalition on planning. they are certainly starting to take effect i think a lot of the home builders would say it's easier and more certain what planning commissions are going to get. but the real problem is during the crisis lots of small and medium sized builders just went out of business altogether because they couldn't get the financial they went bust. very hard to get those companies back just like that because to come back into that industry you have to own a piece of land. it's not easy to do that starting from scratch. so i think it will take several years to get supply back up. but i think what the government is doing is very sensible. >> let's talk about mark carney celebrating the one-year anniversary. you were on for nine years. you told me you were there for

over 100 decisions, which is quite astonishing. how has he done? people have called him one mp called him an unreliable boyfriend, a flip flopper especially because of his varying stance many have perceived on the direction of interest rates in the last month or so. how has he done? >> one of the things i learned -- when i started on the committee, it was practical what we were going to say in the future. and then the data comes in slightly differently than what you expect and then you regret that. that's the big danger of forward guidance. and if you can be really clear about the conditions in which you might start to raise rates. it's very difficult. what happened is productivity growth is much week esh so unemployment improved before growth picked up. but i think the idea of forward guidance of giving the markets more sense of what has to happen before you raise rates is a good one. but we've now got both mark

carney and charlie have talked about where rates might be for years in the future. but when you don't know what's going to happen to productivity growth, when you don't know what's going to happen to the spread of mortgage rates, when rates start to go up and don't quite know how the regulation banks are going to run, i don't know how you can say anything. >> so it's wrong saying they'll stay below their long term average when they start to rise. >> i don't think that's necessarily wrong because i would agree with that. some of the things we've had are precise numbers. i think they should have stuck to ranges. >> when will rates start to rise? that's the $50 billion question. the idea was in may and the inflation report that it would be sometime next year second quarter. now expectations have been pushed forward. >> growth has been very strong. i think the one thing that people often talk about rate rises is we're in the world i was in most of the time i was

in the committee where you look two years ahead you put rates up a bit but rates are a long way below normal level even if a normal level is lower. and if you want to be gradual then that means you have to start quite a long time before you think an inflationary problem might start to emerge. that's i think why the bank is thinking about raising rates sooner rather than later. >> do you think this year? >> it could be this year it might be early next year. i kind of feel that they might want to get the first rate rise in before the election. they certainly don't want to be raising rates in may when they meet within two days of the election. >> you mentioned inflation. you must raise rates in case inflation moves away from where you want it to be. but inflation right now isn't an issue. cpi is at 1.5%. do you expect it to become an issue? >> i certainly don't expect it to become an issue on the time line the bank normally looks. but we're such a long way away,

when we do get inflation ticking up we've got rates rather close to whatever normal is, so than we are today. that means we've got to start pushing rates up, finding how the economy reacts to that we have had a year of really very strong growth and all the p.m.i.'s say so. >> manufacturing. >> yeah. >> is this a balance recovery now, can we go as far as saying that? it's certainly a broadening recovery. >> i'm never sure what the balanced recovery is. one way in which it isn't is trade. our trade remains weak. but i've never understood what you could do with that with monetary policy. it's really about supply conditions. >> thanks for telling us about your thoughts on the u.k. economy. please come back. of course the senior adviser at credit swees and bank of england policy member. stay with us, this is "the pulse."

>> let's get a check at the currency market. the pound has risen against the dollar and against the euro. we had a report showing construction growth here in the u.k. accelerated to the highest level in june or accelerated in june adding to further signs of strength in this economy. and this support it is case investors say for the bank of england to consider raising rates after mark carney, the

governor said trying to normal lies them, the time, is his words, edging closer. 171. now for a look at what we're watching for the rest of the day, ryan, you are watching iraq today. >> weapons sales interesting we learned the obama administration wants to sell 4,000 hellfire missiles to them to fight the insurgents. almost always from helicopters. meaning hell copter launched fire and forget. the whole idea is that they are sort of strategically guided missiles and they're banging these out in this factory in alabama made by lockheed martin, the largest contractor in the united states. but the iraqis are complaining that the u.s. is not fast enough with these weapons deliverice. >> and meanwhile the russians are getting in there and selling hardware. >> interesting because if military helps another country

you're supposed to buy their weapons. that's the rule of thumb and yet the russians have squeezed in now selling the iraqis fighter jets. they delivered one batch today just after a couple of days ago delivering five of these planes. a little different story. these are used planes. interestingly planes the russians used against the georgiaens during their war against 2008. it nets them a half billion bucks and gets them a little influence in the region at a time when they could use a helpful distraction from places like ukraine. and the funny thing is again the iraqis say we have a deal to buy from the united states but they're not coming fast enough. we would have preferred those. >> but the u.s. says it's keeping to the delivery time. >> it's not entirely clear that the u.s. is unhappy that this is taking longer and the russians are out here because they don't know where these weapons end up at the end of the day. >> that's it for "the pulse."

surveillance is next. live with tom keen in new york. stay with us.

it is an unloved bull market. the dow near 17,000. we speak to a leading technical analysts. there is fierce fighting in eastern ukraine. russia considers "all a mailable

means -- all available means." tears -- tells shareholders he is fighting cancer. >> it is wednesday, july 2. me,keene, and joining scarlet fu and adam johnson. adam is hung over from yesterday's football game. >> that was a painful experience. the fact thatbout we had a clear opportunity to win that thing and could not put it in the net. with about two minutes to go. >> even in overtime we started to make a comeback, a little bit of a comeback. >> speaking of rose, we are going to europe. starting with london. home prices jumping the most in 27 years in the second quarter. may,d a big increase in 18.6% increase. in