>> making putin pay. the u.s. wants moscow not to use aid trucks to send in troops. contract -- the ukraine conflict could hurt business. welcome to "the pulse," everybody. ,lso coming up on the program

we take a ride with an armored truck company that provides protection to the legal pot u.s. industry. first, let's get back to geopolitics. a russian convoy is on its way to ukraine. an vehicle is part of international humanitarian effort, not a military mission. what is the story? >> we have 280 trucks from moscow to the city of the house in the southeast of ukraine that has been without electricity and water for 10 days. 10,000 kilometer journey. theyou've got the issue of russian-ukrainian border. the aid convoy is supposed to be a part of an international military and aid effort that

will be run by -- international humanitarian aid effort that -- there arey still some practical details that need to be worked out. concern in the european union, in the united ev that and in ki russia is using this convoy or what this condo does was a gets ato ukraine as a compress -- pretext. moscow says this is all about helping people. market positive or a serious market negative. of all that,st

ukrainian parliament is voting on whether to allow russian gas to continue to be transited across ukraine. are we really talking about a situation where we could see the taps turned off? that is not what is at stake here. >> the ukrainian parliament is actually discussing sanctions that it would introduce or impose against russia. you see the eu imposed sanctions, the use -- the u.s. 90 ukraine has its turn. they talk about limiting the transit of russian gas. it is no small matter. the whole story begins on friday last week when the ukrainian prime minister threatened to ban the transit of russian gas to the european union. that caused to the price of natural gas in western europe to

jump and people to really get quite concerned. then we got equivocation that, in fact, that is not really what would happen. there would not be a banning of the resource itself. but the ukrainians are saying they would simply not allow the russians to be in charge of the transit. so you can have western european companies, if you will, be the counterpart to the russians at the russian-ukrainian border as opposed to on the western side. buts kind of semantics, this does presumably have some impact on business in the sense that that would suggest the european countries would be taking on payment for that gas on the eastern border of ukraine as opposed to on the other side. it would be a different price because there is a transit fee. we were talking to the head of the ukrainian energy company and he said it would not lead to an increase in the price of natural gas. so it feels a little bit like we had a threat, perhaps somewhat

of an empty threat, and we got a clarification that this isn't really a danger. whether they vote or don't vote to block transit by gazprom, there could be broader significance in applying sanctions. >> i think that is exactly right. russian companies are very active in ukraine. you get huge sanctions against russian companies, that has massive consequences. the two largest telecom companies in ukraine are both russian. if you were to disallow them from working in ukraine, people in ukraine would not be able to make phone calls. both of those companies are listed on international markets. >> let's turn to a company that is feeling the heat, henkel. it is warning that your

political tensions will have an impact on its bottom line. alex, how does russia affect henkel? they are giving this warning but they are suggesting they will manage to cope with it. >> i have just been on the analyst call and the ceo is trying to put out don't panic measures. a billion revenues loss last year. they have about 2500 employees there. it is a big chunk of business. this is a company that has been trying to counter some of those markets. of, by have a target 2016, having 20 billion euros in revenue total and half of that should come from emerging markets. they have been looking at m&a in

russia but it is not easier. but it is a great market they are considering. >> why are they making reference to the middle east? is this in regard specifically to iraq or north africa? where are they concerned about there? or was that a more over general background concern? >> i think it is the latter consideration. the way they were talking about russia-ukraine, they say that their russian business has not been affected yet. but the broader implication is confidence in europe that carries over to the top and bottom line. that is probably the same when you look at the middle east. 150yria, they have employees there in a joint venture so that is not a big part of their business. but the effect on the surrounding countries, i think that is what they are talking about. >> thank you for joining us today.

shares in labrokes arising today. the bookmaker also says it is confident full-year results will be in line with expectations. the political crisis in iraq is escalating. prime minister al-maliki a has rejected a transition of power to his successor. he has also increased troops in baghdad. the refusal threatens to extend a three-month stalemate and that helped militants seize part of the country. authorities are conducting a comprehensive investigation into robin williams's death. the actor had been battling severe depression. we will take a short break. coming up, a critical vote in ukraine.

lawmakers decide on imposing sanctions to stop the flow of oil and gas from russia. we are minutes away from prudential's latest report.

>> lawmakers in kia vote today today on banning

-- on imposing sanctions on russia. are we going to see the ukrainian government voting to lock of the transit of russian gas across its territory? you don't think that is going to happen. >> it is a more competent good story. the problem is that ukraine does not have a legal framework to impose actions whatsoever. the bill signed by the government and will be voted on today is instituting the notion of sanctions and to the legal framework. it will allow them to target individuals and companies and then all forms of transports from selected countries. transport,nclude air gas transport, and all kinds of transport. that is in response to the russian ban of flyover by

russiann planes over airspace. ukraine has no particular interest in stopping all transports of guest to the european union. union.as to the european it earns money from the transport. the last thing they want is to give the european union to think about that. >> we should think about this as a's dazed process -- a staged process. this will be a broad structure on which to hang sanctions. there is not actually going to be something that will specifically target stopping transit of gas. >> it is possible that ukraine will sanction some companies that have their seat in russia or 50% russian capital.

the second will be that this will raise questions about subcontracts that european transit ofave with gas in the country. this is probably something that will come up by the end of the day. >> let's talk about the convoy that is on its way to you soon ukraine. a humanitarian convoy. we heard from parts of the red cross that there are still details to be i and out before this mission can be launched. >> what do you think is holding this up? >> the situation got heated over the weekend saying there was already one convoy on its way to ukraine in the evening and could not be stopped with a joint diplomatic effort, including the red cross. the idea on the ukrainian side was there was no particular position to russia sending humanitarian aid as such if it

is to be checked and distributed by the international red cross. initiated.lcomed as international red cross agreed to distribute this aid. now the question is a publication. is this really going to be humanitarian aid or will it be an excuse for russia to send a humanitarian convoy and then take cover saying everything was agreed. >> what you think it will turn it to be? >> i think it will be a mixture of the two. there is an added risk that there are russian civilian humanitarian aid workers on the ground in ukraine that present risks. all it takes is one injured or casualty among the russian humanitarian aid workers and russia will claim its response ability to send military escorts with them. that is exactly the situation we are try to avoid in the first place. >> that would be a lot of

military-looking vehicles and personnel. will it have a smooth path through ukraine? that will probably take until late in the night or early tomorrow morning to reach the ukrainian border. if they are only going to do as agreed, it should not be any problem for them. it is rebel-controlled territory mostly. if everything goes as agreed and the icrc is on the ground, ukrainian unit would lead the convoy into the city itself. >> i guess people for the icrc, one of the key questions will be where a ghost -- where it goes after it completes the initial goal of the convoy. when will russians leave ukrainian territory?

do you believe that is one of the areas that has come up as a sticking point? >> if this is an operation in which the trucks led by the drivers and offload humanitarian aid and then leave, this is probably not a major problem. the questions always are whether there will be any left on the ground that can then be used as a base for a russian presence on the ground. the question is implementation. >> thank you for joining us today. we have breaking news this morning. prudential just reporting numbers. good morning. what do you see so far from prudential? >> they are reporting profits for the first time in a month. the company split into it asia, u.s., europe head and asset andgement business -- u.k.

asset management business. the u.k. life business profit up of high temperature and. -- profit up by 10%. >> the fear going into these numbers was asia. that was going to be one of the sticking points. the u.k. business under pressure because of new rules. anything on asia so far? >> not yet. the operating profit is double digits. i will dig deeper but asia is the golden goose. half of its revenue comes from asia. theheart of prospects for company. he said to us in march, the ceo,

the pie grows faster than our ability to eat it. he also mooted the idea of spinning off the asian division. cashompany has enough within asia to fund itself. the new asia is africa. the company wants to push into markets like nigeria and kenya. that is for its second leg of growth after asia. he says the country store, the city-bi-city story. he says africa is like asia in the 1990's. we rose asia in the wave of urbanization. in africa, the same forces are at play. from what i can see, it looks like asia has done ok but i will dig a little bit deeper. coming back to the u.k. george osborne said retirees do not have to buy a new annuities anymore.

annuities are down by 43% because of the george osborne announcement. prudential.s of have other options they have balkan annuities at companies. the ceo, hee to said we are growing in the u.s., in europe. we can easily combat the decline. sales of u.k. annuities fell by 40% in the second quarter. ad prudential fell by 43% in the first half. but they have other businesses to combat the decline in an annuity sales. costs, rise in operating it looks ok. >> it looks like the stock is responding affirmatively. let's get to some other company news stories.

shares of tata motors rose. sales of jaguar and land rover in china jumped. barclays ceo anthony jenkins singled -- signaled last year. apple suppliers have reportedly started manufacturing new ipads. mass production of a full-sized ipad is underway and a new version of the ipad mini is beginning to be produced. the new products may be available by the end of the year shopping season. we check out the

company securing the cannabis industry. ♪

>> welcome back. let's check in on the markets. big day of gains yesterday for european equity markets. today, we are inching lower. the dax down by 4/10 of 1%. the ftse 100 inching a little bit lower. wouldeople in the market have questioned that statement. today, we have a live it more color. ukraine discussing preventing russian gas from moving through the country. russia attempting to send him and sharing a -- sending humanitarian aid into the country. one of the big movers we are watching today is labrokes, the bookies. the ceo has a strong message.

we are going to get back to growth. the only thing we intend not to grow is our costs. it has lost a quarter of its value. the challenge is to go to digital, from the high street to online. really hurting labrokes in the last year or so. italian inflation comes out. zero inflation, negative growth, recession concern there. >> a newer ipad, details still ahead. take a short break.

>> welcome back. here are the top headlines. nouri al-maliki has rejected a transition to a new government. he increased to the presence of troops and militias in baghdad. russia has reportedly sent 280 trucks firm -- from market -- from moscow with humanitarian aid to ukraine.

united states one russia not to use it as a pretext for military action. todayian lawmakers vote on new measures to punish russia for its support of rebels in the eastern part of the country. lawmakers could impose sanctions. would block the flow of russian gas through ukraine to europe. are risingabrokes after the company ceo promised growth in the future. as is bet on digital slowly starts to pay off. optimism for the future for investors. >> yes. right now, it is not so pretty. operational profit fell 34% in the first half of the year. this is after a run-up of profit warnings ahead of these numbers. but they do keep their dividend and everyone is embracing the profitability numbers. shares are ashley rising.

we knew -- shares are actually rising. call it match ready in terms of the world cup. they put financial performance on hold, get financially fit and that is what they have been doing. we are seeing a little bit of optimism in the share prices. they have had to reinvigorate the company. they closed some 50 shops in 2014. it is not about being on the high street anymore. it is about being on the mobile, the tablet, the computer. they have been silly to the digital party. they admitted day feet at -- they admitted diffie and said we admitted-tech -- they

defeat and said we need play tech's help. 28% were active during the world cup. half of those now active customers are using the mobile and computer. it does seem to at last be galvanizing and luring us all on with their novelties. >> it was always going to be tough, these operational changes. and then at the same time having to deal with results that did not go their way. they talk about customer friendly results. away from that side of things, we talked about the operational changes in the website. regulation is a big part of the business at the moment. themselves they get on track in terms of having their digital presence. they have their new games on mobile send updated apps.

then comes long december, 15% tax on online gaming. but this is a regulatory minefield when it comes to gambling. -- the u.k. has been transparent about the rules they want in place. countriesout other wanting to change the rules as people go along planograms. wants to protect the gamer out there, making sure that the abb code is being taken on board. it is about code of conduct, being responsible, trying to protect the 8 million people who generally gamble on a regular basis. you basically know how much you are set to lose. you have these high-tech machines. you just have fewer machines in these particular shop. if you are going to be spending 15 -- 50 pounds or more, you have to do it over the counter so you are aware of how much

money you're giving. maybe you give them in the limited amount of time to start. it is a difficult world in terms of radiation. the u.k. is front and center about transparency and put the rules back in place. maybe there is a little bit of a golden goose in the end. --liam l and labrokes william hill and labrokes are very aware of the changing landscape. >> let's talk about technology. apple could have new versions of the ipod manufactured and have them ready by the holiday season. tim, what are you hearing about the products that apple has lined up? taipei.afternoon from you are right.

there are a couple more ipads on the way to have gone into manufacturing. that means the suppliers you will be assembling them are ready to bring them out. that points to new ipads by the end of this quarter or early next quarter. what we can tell you is there is a new version of the 9.7. that is the most familiar form factor they brought out after a quite a few years. there is also the 7.9, the ipad mini looking to be bought out by the end of this year. we have reported before that the new iphones are on their way. date we areis the expecting to see new iphones coming out with a larger screen that, screen sizes hopefully will market that target.

a lot of consumers are enjoying the larger screen size. apple is finally coming to that party with their largest screen size in september. so to iphones and to ipads by the end of the year. >> september 9 could be a crucial date for all of this. honhei is a q1. up 4.8%.e only almost no change at all. the first half of the year for companies like them, a supply chains, are always slow. we see them push for companies like apple. but they had basically no growth in the first half of the year. they need some sort of kick in the second half of the year to get some kind of growth.

they need to see some of these new tonics, line. they need to put it out to the market and they themselves can get some sales at the end of the year. sales would lead to profit at the end of the year. >> let's get some more company news for you now. plans to focus its business model around a new subscription service. the -- ailable to discharge you generate more sales from digital downloads. unsolicitedeived an takeover bid. the fight to keep the deal would make it the world's most familiar hidden company.

buzzfeed has raised $50 million in financing. them at about a hundred $50 million. he is an investor. colorado's cannabis industry is expected to do more than $100 million in business before the end of the year. and it is all in cash without access to banks. owners of legal pot shops have to figure out what to do with all that money. that is where armored truck company and ps international comes along. we rode with them for a day. >> i am not a brilliant businessman. i just have enough common sense to see that there is a need and we jumped on it.

we provide security solutions to the cannabis industry. ♪ >> come on in. there is more dispensaries in denver than there are starbucks. >> we are trimming it all up. >> because the federally insured banks are prohibited from banking marijuana money, we have clients that are making $200,000 to $300 and -- to $3000 a month in cash and they don't know what to do with it. they do not have security training. they might put it in a shoebox or a pillowcase in their closet. itthey use us to transport

in our armored vehicles and we have storage in our facility because the banks won't take it. >> i have been in the industry about 15 years. my background is law enforcement and the marine corps. dynamic.unusual for anytrain to look chokepoints or ambush sites or anything that is going to stop our trucks. >> most of the banks want a degree of separation. they don't want a dispensary walking in with $200,000 in cash

that smells like marijuana. we have a service that washes the money. -- theves them hermana marijuana molecules so it does not smell like marijuana and then we deliver it to the banks. now 23 green states. our intention is to be in every one of them. the potential for growth in this space is unlimited for us. difference between laundry and washing your money. theng up, with all geopolitical tension, what is the safe bet to invest your company -- your money?

>> welcome back. conflicts in ukraine and the middle east have escalated. will that have lasting impacts on the financial markets? memoriesare market's these days with geopolitical events like these? >> very short. index, itk at the vix is already fully back. if you look at the coal ratio in the u.s., that is already calming down.

it seems to me that we are already in the calming down phase after the shock. it lost about two weeks maximum. and now i think there is a chance that we see stock markets recover as we get into august which is a bit weird. normally, august is a slow month. >> it is a difficult to ensure. trying to untangle what to the geopolitical events are doing to markets from the broader picture is always difficult. it has been a week picture for european equities. you think things are going to turn around. this is not the start of some longer correction? >> never say never. it is difficult to predict geopolitical events but it does seem to me that the trend is calming. speaking, while it is a human tragedy, you look at israel and gaza from a market point of view, there does not seem to be destruction from

there either. we talk about geopolitical tensions. normally, when you talk about the middle east or russia, you talk about oil. but crude oil prices have done the reverse. they have slumped for the month of july. it tells you that the geopolitical risk premium price into oil is probably zero. if they could be below 0, 8 would be below zero. if you look at other markets aside from equities, we don't see a lot of hurry or worry. >> is it because the markets are too confident about sources of supply should disruptions come along? >> i think that is it. . think they are hoping iraq is the largest oil producer in opec today. they are expecting to see no disruption which seems to me a little complacent. we have not mentioned syria or libya or even nigeria.

i would expect the risk premium to be built back into crude oil moving forward. >> how do you look at european equities versus u.s. equities at this point? are big links between the german economy in the russian economy and the ukrainian it, and he, not least of which when you look at the gas relationship. is the selling of german assets, is that wanted to you? >> i do find it a bit overdone. the sanctions today are not really publishing. yet we hear about reprisal sanctions. russia is much more focused on food. germany does not export a lot of food to russia. i think that is the big issue. i think people are worried about escalation. for me, that is the opportunity. there are certain areas, terminate particular, within

european equities that are very attractive right now. has ad look amateur that russian operation and has been massacred over the month of july. but the underlying business is doing well. again, as for the german wellmy, it is doing rather . >> some of the countries along the eastern side of europe, poland for example,. that has perhaps come under pressure. what about the u.s. economy >> does it still showed good momentum. >> i think it is fine. if you look at the isn surveys, both manufacturing and non-any faction, they are bullish to multiyear highs. happy new call that bad? you look underneath and you

look at things like where are the new jobs coming from, they are coming from places like mcdonald's. these are not high paid jobs. -- i will bee .ooking underemployment, if we take people whopeople and are not looking for work any longer, it is still up 19.5%. next, the latest tool for treating autism. why this little guy can double as a second friend.

-- >> welcome>> back. robots have been imagined as human companions for over a century. fiction isf science now a medical prototype. robotmay look like a toy but it is actually the latest tool in autism therapy. it is designed to engage and monitor artistic children like 11-year-old marco.

his social skills are limited by the disorder, causing him and others with the disorder to interact with their surroundings differently. the difficulty in treating children with autism is gaining their attention. >> autistic children explore even when we don't notice. not that long of a, the robot was something simple he would move. now the robot moves toward him. so it is a curious -- a curiosity that one his attention. ed by italy's international research, it will provide valuable data to therapists. >> the robot keeps and records information and metrics. how many times the child locks eyes with a robot and how long a child laughs. can easily be accessed by

the therapist through a computerized system inside the robot to create a more personalized treatment for each child and keep track of its progress. founder ofe of the the autism center says that one of the challenges is that every child responds differently. >> every artistic child has a your unique -- has a unique reaction. one might marvel at the reaction of each child in the presence of a new toy. every child has their own way of registering sensation. theesearchers hope by 2015, robot will be more than child's play and instead a medical instrument. pulse is time for today's number.

that is 7000. that is how many putin t-shirts were sold in red square. they feature pictures of the russian president. among the crowd was the american actor mickey rourke. he says he met putin a few times and was proud to wear the t-shirt. i wonder how much they will be going for on ebay shortly. a second hour of "the pulse" is coming up. reducing europe's russian oil addiction. we will be talking with michael bradshaw about that. he says any reduction on the reliance will not come in the next decade. we will talk about the latest rejection by the prime minister of his nominated successor. where that leaves the u.s. and

its allies. and then the buzz around buzzfeed. whether wek about are seeing sensible valuations in the technology industry. back with all of those topics when we return.

>> making putin pay. lawmakers vote on sanctions. the german consumer giant warns that the ukraine conflict will harm business. prudential pushes back. profit rises as it shrugs off concerns in asia. a warm welcome back to the program. good morning to our viewers in europe. welcome to those just waking up in the united states. i'm an edwards. -- anna edwards.

we check out the company securing the cannabis industry's cash. the buzz builds for buzz feed. let's start with breaking news. the german indicators just crossing right now. at 8.6.ome in was for 17.0. this was worse than what economists had been expecting. it is a lot worse than the previous month come as well. -- month, as well. this is an investor and analyst expectation. it can be quite volatile, in particular at times of geopolitical tension when analysts and investors are aware of geopolitical tension taking place around the world.

that fully describes the situation right now. the euro is extending its losses. zew says it likely clouded german sentiment. the polish currency is also extending losses after the zew misses estimates. for now, let's get straight to our top story. a russian convoy is on its way to ukraine. of an international humanitarian effort, not a military operation. what is the story behind this convoy? >> 280 trucks headed from moscow lutansk.- to crossy will have

the border. that is where things get tricky. these trucks would be part of an international aid effort led by the red cross. the international committee for the red cross says it needs to work out practical details. lots of phone calls. there is a great deal of concern in the last and in -- west and in the ukraine that this convoy could be used as a pretext for some kind of incursion after it arrives. it really does come down to some of these details about what is included in this convoy. who are the people in the convoy, how long do they stay for, what is the role when they get to the ukraine? it is those details that mark the difference between genuine humanitarian assistance and

something a little more longer-term and more military in nature. from as more binary markets perspective as well. if this is indeed a convoy with assistance that is going to be part of an international effort and shows signs of diplomacy and russia cooperating with ukraine, the united states, and the european union, this could be a real coup and a real element of de-escalation for the kremlin. this is fraught with problems throughout. decidesf those parties that the russians are not acting in good faith with this aid shipment, then what is in the the russians what say it is or not what is needed or this is a pretext or cover for some kind of military work luhansk. skip --

under firethis comes from the ukrainian separatists or the ukrainian government. you would imagine there would be returned fire. ukrainians say the russians have 45,000 people over the border. things would get ugly very quickly. it really does come down to what happens with this one convoy initially. not goingns say it is to be accompanied by russian military. it has no military component to it whatsoever. it is being run by the russian emergency ministry. the headd to be run by of the russian defense ministry. humanitarianre problem in ukraine. when the convoy

gets to the border, if the , what do then russians do next? let's go to a company that is feeling the heat from the conflict in the ukraine. isman consumer giant henkel warning that the conflict will have an impact on the bottom line. building.ow, it is , ukraineou a context is the fourth biggest market for henkel. they have eight major production sites and 2500 employees. they are starting to see a significant slowdown in russia. is thatest russian risk

the economy begins to slow. we so the gdp comers -- numbers come in yesterday beating analyst estimates. but they are still quite a low level. contagion, as russia begins to go down, so the overall propensity in the near russia panel. henkel says it would be naïve to would notat russia approach concession. the actual growth and organic sales miss. there are three big parts of the business. adhesives, laundry, and beauty. beauty and cosmetics is where we saw the biggest miss. they are spending more and more money on marketing. there who hasout

5 billion euros to sell -- to spend, excuse me. they have been doing that on hair care products. the margin in the business, for the first half of the year, 16%. that is ahead of target. that leaves them a little bit of room to breathe. that is why they are saying they will stick for now to their full-year target. back to you. >> thank you very much. other company news, prudential has reported results. insurer.s biggest mark barton is here with us now. tell us the story behind this. so much fun with constant exchange rates versus actual exchange rates. because a lot of the business is in asia. constant exchange rates gives

you a better underlying feel. >> in the real world. >> in the real world, it is bang in line with estimates. the constant exchange rates, you -- at actualumbers profit -- exchange rates, it is up by 7%. but asia, at actual exchange rates, 2%. the u.s. is up 18%. u.k. life is up by 10%. all divisions are showing gains. they want to sell you the constant exchange rate story. it is still a good story. >> let's talk more about the

u.k. march allannounced in to do with annuities and pensions. >> if you are a retiree, george osborne, hey, you can buy an annuity, pension provider by prudential -- today, prudential has risen above the share level of march 18. that is significant. what are they doing? they are providing bulk annuities to companies. that is upsetting the decline in individual annuity. annuity sales fell, but that is being offset by bulk annuities. they are also big in the u.s. and in europe. the pension providers are managing to offset. >> despite the problems with

currencies in asia or the headwinds that i created, there created, they are still managing. the ceo said to us in march that the pie grows faster than our ability to eat it. cash toany has enough fund itself, the asian division. africa is the new asia, he said. asia in a wave of urbanization and the same thing is happening in africa right now. asia is the golden goose. the company is throwing off cash. the dividend has risen 15%. and wants in december to generate at least $10 billion in cash in the next four years. .hey are throwing off cash

everyone is happy. >> mark, thank you very much. you are very happy with your mastery of actual versus current. is there a remedy to the pipeline? why you should not hold your breath. stay with us on "the pulse." ♪

>> welcome back to "the pulse."

live from london. let's check in on the currency markets for you now. euro-dollar. you can see that we thought the european currency -- saw the european currency weakening as a result of that zew but came across our screen. investor and analyst expectations measured by the zew indicator. you will have to look at the mess in europe for why investors and analysts might be nervous. investor and analyst expectations dropped to 8.6 in august. that was well below estimates and the july number. things deteriorating on that expectation index this morning. that is wayne on the euro-dollar -- weighing on the euro-dollar.

ukrainian lawmakers vote today on whether it should hit back to russia -- at russia by blocking the supply of natural gas to europe. professor, thank you very much for talking to us. when do you see this vote pass or not? think any cut off in supply would be very unlikely? >> i think it would be quite counterproductive for everyone. this is a critical transit corridor. at the moment, the gas is flowing through ukraine to europe to its customers. unlike previous gas crises, it is the middle of the summer, the market is low, storage is high. it may be that the ukrainian government is reckoning that the immediate impact on the european consumers would be fairly

minimal and that mice force russia's hand. force russia'sht hand. but it is a dangerous game to be playing. >> the result of all of this could be that gas continues to flow across ukraine, but european companies that usually take delivery at the western side of ukraine will now have to take delivery at the eastern side of ukraine and pay themselves for the transit across ukraine. how this isund as going to play out? does that change anything? >> it depends on how gas prom reacts in that situation. the question will be, how will they respond? there may be a compromise solution. it also depends on the pricing of the gas. situation of gas transiting through ukraine to

europe, the gas is still flowing. whatave to wait and see the reaction in moscow might be. what the price consequences of that would be. inin the broader picture terms of the europe energy are the on russia, what great minds such as yours thinking about how hard europe tries to reduce its reliance on russia as a supplier of energy assets? what kind of timescales are you have to have? how long of horizons to you have to have? i think this is a long-term prospect. acceptmoment, we have to that it is very difficult to replace a third of our natural gas imports into the european market, especially given conditions in global gas markets

. energy supply is very high because of the situation in demand ingrowing asia. it takes time and years to build new infrastructure. we have made improvement in 2009 , as far as improving connection between european markets. improve theelp resilience of natural gas in europe. we have to look at the broader question. one response of the european byon is to reduce gas demand improving energy efficiency. the question of how much gas moving forward is part of the equation, that depends on what happens elsewhere in the power generation sector, but also in terms of what happens with household demand for natural gas.

it is not just about power generation for the european union. we are looking at the idea that we would have substantial amounts coming from north america based on shale gas. it remains to be seen whether that we'll -- will materialize. we are looking at into the next decade. >> should europe be spending more money on -- i take your point on energy efficiency -- trying to get access to the globally more movable product? should europe be investing in that? what is stopping us receiving more from the rest of the world? >> there is a problem of capacity. through the interconnector's, we can move natural gas into the european market, but most of our energy is on the line at the moment.

in spain, the problem is that the spanish market is not connected into the european system. they are re-exporting elsewhere. lithuania is in the process of lng.ssioning a foloating >> thank you very much for joining us. professor michael bratcher joining us from warwick business school. --ll to come, pop protection p ot protection. it is coming up next on "the pulse." we will have more when we come back. ♪

>> welcome back. thees arising after company's ceo promised growth in the future. this is on digital playoff -- payoff. optimism for the future. >> at last come the digital play -- atto be bearing fruit

last, the digital play seems to be bearing fruit for ladbrokes. they said, let us get inrationally and play -- play and then we will continue. they are shutting stores on high street. is getting away from the shops to the online space. your computer, your tablet, your smart phone. revenue was not quite there yet, in terms of the area, but they are adding customers. the world cup really did help them in this respect. upy are up 48% in sign thanks to the world cup. half of those are mobile. it seems to be all about mobile. new stats, new apps. it does include bringing in the

new gamblers. they are starting to get in gear. it has taken so long. initially, this was all about sporting bet. that did not happen. they said, we will do it alone. then they decided to go with play tech. play tech is no fully integrated. -- play seem to have tech is now fully integrated. gottenw seem to have stable. they have the products, the people, and the brand. >> thank you very much. here is today's hotshots. whenincredible close-ups this sharks confused it for a tasty treat. the camera managed to withstand several shark attacks. national geographic's shark week series.

we will be back after a short break. ♪

>> welcome back to "the pulse." live from london. i'm an edwards. -- anna edwards. iraq's prime minister has rejected a transition to a new government. he increased the president of troops and militia in baghdad. russia has sent 280 trucks from moscow to deliver humanitarian aid to south east ukraine. that is according to a russian news agency. the report said the trucks are

located with food, medicine, and drinking water. the united states warned russia to not use the aid mission as a pretext for military action. ukrainian lawmakers vote on new forures to punish russia its actions in the eastern part of the country. one measure would block the flow of russian oil and gas through ukraine to europe. now let's check in on how the markets are doing this tuesday morning. jonathan ferro is here. >> let's whip through these markets for you. 0.33%. german investor confidence takes an absolute drop. that is an eighth consecutive monthly drop for germany. zew, exactly what you were expecting, geopolitical tension likely clouded sentiment. , a contraction on

thursday. -0.1%. i notice a fraction, but this is supposed to be the engine of europe. this is a fraction, but this is supposed to be the engine of europe. european, you look at equity markets. we are at session lows. the concern was russia. the talk yesterday, a lot of happy talk. the tensions of somehow eased. then you look at the facts. russia looking to send humanitarian aid into the country. ukraine is thinking about gasenting -- preventing traveling through the country to europe. >> let's see what tom keene mix of it all. "surveillance -- makes of it

all. "surveillance" comes up next. marketl be talking about corrections. i have a number for you. 8 today.ame in at just the 17 it was expected. it is well below the 27 we saw last month. tell us more. are we expecting to see a correction? >> it is well done, anna. a lot of strategists are subjecting -- suggesting that the knock on effect will affect the u.s. we will talk about the non-kill back in stocks. pressure the corporate offices are facing on using cash. maybe the kinder morgan deal is a bit of an obscure deal, but it gets your attention with $44

million. we will talk about the use of cash in 2015. we will talk to phil mattingly in washington about the congressional reaction to a united states-iraq policy, which by any estimation is completely adrift. we will touch on that as well. a nice mix between geopolitics and what is going on in the markets. >> thanks, tom. we will pick up where you left off on iraq. let's get back to the escalating political crisis in iraq. the prime minister has rejected a new government. here is more. thank you very much. how significant is it that al- maliki has rejected the newintment of a potential prime minister? how significant is this for you? will this dictate will things go things will go?

stability is key to the entire country and to the sovereignty of iraq over the medium-term. there is nothing more important today than the creation of a new government in iraq, so that iraq can stabilize the security situation as a unified country and prevent the international community -- and so that the international community can support iraq as an independent state. rejected thes choice for the next prime minister, even though this man comes from his own party. there has been a bit of a revolt against mr. maliki and he is calling it unconstitutional. >> the key question for you as we look into the weeks ahead is to what extent the infrastructure of iraq manages to remain in place, the

institutions remain in place, so that they can effectively deal with the outside world. is that the key thing? >> absolutely. step number one is the creation of a new government. the otherem that candidate has the report -- 's party andaliki implicitly iran. bep number three has got to the stability of the iraqi army. they need to be reinforced further. does this mean for u.s. airstrikes and further western involvement? to u.s. has gone some way tying the promise of further assistance to progress being made in forming a new government. where are we on that? >> they will look to see the progress before supporting the iraq he army further. further.army

get a lot more support if there is a pluralist representative government in place. it will also mean that any disruption of peace would be quite unfortunate over the short term, in terms of the preservation of stability and having some hope for the sovereignty of iraq as a state. >> are we going to see further airstrikes coming from the u.s. do you think? >> very likely they will is,tinue to try to contain is which has appeared to have quieted down on the southwestern borders of kurdistan. there are fears they might be preparing for another side of the battle and curtis dan. rdistan. international community can work with iraq if there is a government to work with.

>> what is the role of the kurds in this in shaping the new government are shaping the new iraq? some have suggested that an istan comingkurd sooner rather than later might be something the u.s. is pushing for. >> i don't think this is the pushing anyone to be for a more autonomous kurdish province. directly ining aid the form of arms from the u.s. and soon other governments i would think. for it to call for a referendum today in the midst of all the instability would be a mistake, and the kurdistan international community. the kurds have played a role. the president has nominated the inme minister designate moving the political process forward. that is significant. now they have to defend their

turf and see through the process. >> where does this leave the islamic state? where will a new government in iraq leave these insurgents? >> the hope is that the new government is reinforced and capable of fighting back and the leftis that isis will be with a challenge. today, it is practically unchallenged. it is practically unchallenged. >> it is the kurds to have a very long border with these insurgents. >> yes, they have a very long border. these insurgents have shown over the past 10 days that they can get through the border and they erbil.eaten iraq absolutely urgent for to form a sovereign state so that baghdad and kurdistan can act together and receive the international support that is available to them and counteracting isis. >> thank you so much.

let's get some company news. have recordeders they started manufacturing new ipads. according to people familiar with the plans, mass production of a full-size ipad is already underway. a new version of the ipad mini is beginning to be produced. storyl have more on that as the day develops. a barclays trading team is leaving this year to start an investment firm. they will take 60 employees with them. the firm has not been named and will view out the rhythms to trade equities and liquid securities globally. barclays ceo said the bank would exit and interact with clients. with a threefold jump in profits. india's largest automaker

jumped. cannabis, the industry in the u.s. and colorado may do over $100 million in business this year and it is all in cash. owners of legal dispensaries don't have access to banks and have to figure out what to do with all the money. that is where armored truck company mps international comes in. ♪ ♪

♪

♪ you are. a bit too early in the day for that kind of industry. -- imagery. a $50 million investment propels thefeed into the land of media giants. we are talking tech next. ♪

>> welcome back to "the pulse."

live from london. ukrainian lawmakers vote today on new measures to punish russia for its support of rebels in the eastern part of the country. one measure would block the flow of russian oil and gas through ukraine to europe. for more perspective on the story, ryan chilcote spoke to the chief executive of the state owned oil and gas company. he asked about the likelihood of a ban and what it would mean for european energy prices. >> [indiscernible] our understanding of the intent imposedthe ban could be on certain companies which the ukrainian government [indiscernible] companies, other european companies, or any other company, will be able to transport you gas -- gas through ukraine. >> what does that mean for

consumers in the european union? through the confusion here. we are only talking about one company. are you going to ban gazprom from transiting gas through ukraine? >> theoretically, that is also possible. however, any european company can have its own [indiscernible] >> one interpretation i read yesterday seemed to suggest that what you are talking about is that in place of ukraine transiting that gas from the russian border to the european union border on the west side of your country, there would be new counterparties, european counterparties that would take the gas. effectively, the europeans would take the gas from your border with russia. what does that mean in terms of

price? does that mean european companies and european gas prices go up? we don't believe this should drive prices higher. it will depend on what the agreement could be between the european companies on the russian suppliers. transitost of [indiscernible] come on the program, the buzz builds for buzz feed. we will see of it is worth the $850 million valuation. ♪

>> welcome back. let's talk tech. news and entertainment site million.has raised $60 that pushes the valuation to about $850 million, topping global news giants like "the washington post" and "the l.a. times." eileen, thank you for joining us. give us the buzz around buzzfeed. "thes it worth more than washington post" and "the l.a. times"? >> a number of reasons. there were lots of rumors that

disney was close to paying upwards of $1 billion last year. legitimately because of how much attention it gets from its audience. it has 150 million unique visitors every month. it does roughly about 120 million people in revenues. drives it is the demographic between 18-25-year-olds. and how much time they are spending on the site. you make a comparison to traditional media companies. "the new york times" is valued at about half of that business. in addition to being news or coverture content, people are valuing it like a technology company. >> that seems to be the secret. no matter what business you are in, if you get yourself a year as a technology business, you get those high valuations. [laughter] it relies on social media

networks to get in front of people, to get in front of people. facebook and others. is that a strength to the business model or a hindrance? >> i think is a little bit of both -- it is a little bit of both. a reliance on the platforms is a potential liability. but they are doing better thoset leveraging networks. they have the technology, they have the know-how to make use of these channels more than anyone else and before anyone else even thinks of it. whether it is pictures driving more traffic than twitter or other syndication. so specialit that is about the technology behind this business that means they are so able to create content that is been clicked on and watched or read? that seems to be the secret. they actually used the data to inform the editorial process. >> i think that is right.

it is similar to "moneyball." people took analytics into sports. this is what they are doing with content and media. they built all the technology from the ground up. things that render for them and show what they will look like on a mobile phone, they know what the content looks like on any number of devices. they're constantly tracking what their users are looking at, reading, and they are dynamically restructuring. they are able to take everything from the content all the way up to analytics and what they do with the content and make the most of it. >> how significant is it that they create sponsored stories that brands like? if you are looking for new revenue streams, is that significant? >> i think it is very significant. it is the attention economy. people were getting tired of the traditional advertising format. they didn't like the in-your-face, bold advertising

taking away from the experience on the site. advertisers like to be blended in with the experience and have some kind of relevance to what people are reading about. andfeed has channels advertisers are going to particular channels. criticize they are making advertisements look too much like articles. but i don't think it is turning anyone away. >> interesting. what about valuations? is this a technology business or in his business? was talkingellen about concerns around tech fell you a. is it a concern to you? >> it is not a concern to me personally. --ht after that statement tech valuations. is that a concern to you? >> it is not a concern to me personally. right after that statement, tech fell you asians are 10 times more than revenue. it does not seem -- tech valuations are 10 times more

valuable than revenue. it does not seem bad. >> thank you very much. let's get a quick check on currency markets before we go. this is where the euro is currently trading against the dollar. we saw the euro moving lower as we got that zew coming out of germany. that is an expectation indicator from analysts and germany. that came in at a reading of8. that was below the estimate of 17. it was also well below last month's number of 27.1. that number deteriorating. you just have to look at a map of europe to see how close germany is to ukraine and you get a sense why investors in that part of the world might be feeling particularly nervous about the geopolitical tensions right now. we will leave it there for you. "the pulse." is coming to an end. "surveillance" takes over next. with tom keene and the team. you can follow me on twitter.

i will see you again tomorrow. ♪

>> this is "bloomberg surveillance." init is a political showdown baghdad. the president commits to a new shiite leader for iraq. 280 trucks move from russia to

eastern ukraine to provide food and medicine. are they a trojan horse? america, wage inequality is ever greater. we speak to the mayor of boston. good morning, everyone. this is "bloomberg surveillance." live from new york. i'm tom keene. joining me, back from 35,000 feet, adam johnson. olivia sterns is with us. scarlet fu is off today. what did you do? f-16.ent up in an it was out of control. unbelievable. >> did you have oxygen? you do look like tom cruise. >> yeah. >> i will admit, there was one point in the middle of doing multiple loops, we did for loops , i said, can we go steady here for a second? he said, yeah, me too.