>> driving hard in china. we're going to talk to land rover about its first factory in the country as beijing delivers its weakest economic data since 2009. >> the apple c.e.o. tim cook is expecting record holiday sales avenue they sold more than 39 million iphones this quarter. >> tragedy for total. the c.e.o. died in a plane crash in moscow. good morning, everybody.

welcome. you're watching "the pulse" live from bloomberg's european headquarters. we're here in london. i'm guy johnson. >> i'm francine lacqua. this is our top story. g.d.p. came in ahead of economist estimates and dashed some hopes for large scale stimulus in world's second largest economy. >> bloomberg economist tom joins us from beijing with details. first of all, are we being overly aggressive when we said there was a surprise on the upslope? this is still the weakest data we have seen since 2009. >> i think that is a good way of looking atice, guy. 7.3% growth in the third quarter was slightly better than 7.2% expectations but only really marginally better. if you dig into the details of what is behind that number, what you see is continued weakness in the domestic economy. real estate has to have been the biggest headache for china's

leaders, continued contraction in sales and property. that is being offset by the u.s. consumer, a little bit -- little forms of exports a little stronger in the third quarter. the story here really, weakness at home being offset by a little bit of strength in terms of overseas sales. >> what does i mean for momentum going into the fourth quarter? >> so there were some pretty encouraging numbers on what was going on in the economy in september. we saw industrial growth popping up to 8%. up from 6.9% in august. electricity production, which lots of people use as a proxy for overall growth in china, came back into positive territory after a surprise contraction in august. so if you're looking at the monthly data, there were some fairly encouraging signs that there was a little bit of growth momentum for china heading into

the final month of the year. >> finally, where does it leave those that think we need to get further stimulus from the authority? we have a situation where we're watching the housing sector carefully. there was concern around the banking story. where are we in that process? what are you hearing? >> what we have seen in the third quarter is really the chinese government rolling out a series of targeted measures to support the real estate sector and provide funds for the banks to lend. my expectation, and i think the expectation of many china economists is that that is what we're going to see pushing into the fourth quarter. the economy is weak but it is not so weak that we need a major stimulus. it is not so weak that we need a cut in interest rates. employment a key metric for the chinese government, remains relatively robust and that also

argues the targeted measures rather than another major stimulus push. >> thank you so much for that. staying on china. >> yeah, jaguar, land rover, just opened its first manufacturing plant in the country. joining us now with further perspective on china's g.d.p. stories, chris bryant, the president of jaguar land rover's joint venture. good morning to you, chris. congratulations on this happening. one of the british newspapers described this as a pivotal moment for your company this morning. is that slightly overstiming it or is that a fair reflection of reality? >> i think that is an absolutely fair reflection of reality. if you look at jab war land rover, today is a great day forous. this is the first ever roduction plant to be launched

for jaguar land rover. to show the world this was fantastic today today. >> are you a little bit disappointed when that it couldn't happen sooner? some of your rivals have been in china longer than you. you just started the joint venture. >> no, we're not disappointed about the timing. we just established it late in 2011. we just launched it in under two years. a fantastic achievement by all of the team. >> the headlines are for -- the data today. talking about the fact that china's economy is growing at a rate we saw back in 2009. not exactly great growth by historical standards. can you give us a sense of the demands that you're seeing and

what your expectations are and where you see the economy going? >> yes, there is lots obviously. new stories about the economy in china. for jaguar land rover, this is a hugely successful market for us. we're seeing continued growth. it has been a ground breaking product for us and last year sold over 30,000 cars. >> how many can that increase if you look at, you know, the number of cars you may sell in ina over the next one to two years. are we talking 30% extra? 50% more? >> we have spoke within everybody here today. what we're focused on is the quality and delivering world class quality. we don't want to get in the position where we're just chasing volume and trying

chasements. our focus is world class quality and the commerce really aspire to buy the car. if we can do that, we'll be hugely successful in china. >> we talk about pricing. when you look at the german operators and what they did. we saw around a 15% price decrease as a result of the impact of paris coming ufe a little bit. is that what we're doing to see? are you going to be able to be a little bit more sensitive on the price and also if you can give us your thoughts on whether or not the trend of having very big price gaps between what you sell in china and the rest of the world, they are not that sustainable. >> yes, today really is about the launch of the facility. we have shown -- coming off the -- today. you have going to have to wait just a little bit longer to understand what we're doing with the pricing of the vehicle and we will talk about that in the

next month or so. -- ifference in vehicle could you repeat? >> carry on. you were about to talk about paris. give us the sense of the impact that is going to have. >> yes. yeah. so with regards to the -- and the cost to have vehicles, that is why we're standing here launching our first -- over time we will launch more from the joint venture. we have announced by 2016, we will have three cars being manufactured here. two land rovers and one jaguar. at the same time we're building a world class aluminum facility. the future is really exciting for us right now >> if we speak to you in five to six years, how many new factories will you have in china?

>> wow, who knows? today is about our first car really. for us, it is about celebration of our first facility. we have installed capacity here for 130,000 cars. as we move forward, we'll listen to our commerce. who knows. china never ceases to amaze in terms of the speed that it can move. >> what about carpetry amazing. what about birmingham. what happen up in the west of the u.k. as well in term of how the workers feel there. the unions are broadly onboard with this at the moment but does this in any way detract from manufacturing cape nblet the u.k.? ?- capability in the u.k. >> this in no way is damaging to

jaguar land rover in the u.k.. the car that we're launching been running at maximum capacity. this gives us a chance to continue to grow. in no way is this the threat to the england facilities. >> congratulations. thank you for taking the time to talk with us today. chris bryant from jaguar land rover. >> let's go to some somber news. total's c.e.o. has passed away when the company's private plane struck a snowplow at a runway in moscow. >> there is an investigation going on and the russian committee are investigating this

accident saying that the driver of the snowplow may have been drunk. there is also an investigation about the bad road conditions and what role this played into the accident. course de margerie was a very charismatic character. very respected among the industry. people are saying he was a larger than life character. we had reaction from president hollande saying we have lost a great leader to have french industry, an ambassador over the freafrpbl technology abroad. he was often making jokes with other c.e.o.s in his field. also being very friendly. with journalists. he was nicknamed the man with the big mustache. i met him a dozen times but the last time was just a couple of weeks ago at the paris car show when he was actually making a

joke about the fact that i did not interview him because he was talking about the future of electric cars which i thought was quite a surprising subject for someone who is the c.e.o. to have fourth biggest oil company in the world. >> he was always somebody interesting to talk to, i have to say. let's talk about his drive, though. he was a man that literally went to the four corner of the world when it came to making sure that his company was front and center in the oil industry and he was certainly a frequent visitor to russia. >> he was. he was a very frequent visit even visitor to russia. in fact, co-rg the a statement removed from the russian government website, me may have been on the list of attendees meeting with prime minister medvedev in moscow. they may have been the reason for his visit to russia. he was traveling very frequently. he was one of the rare international c.e.o.s to attend

the spurg international forum. -- st. petersburg forum. total has a lot of interest in russia. they own 15% of russia's largest independent gas piecer. a few weeks ago, he was saying despite the sanctions, the group will continue to work on the project, this massive project to tap natural gas reserves in siberia. in july, he said that europe could not live without russian gas. >> thank you so much for all of that. we'll be back in just a few minutes.

>> we are all involved in this country with -- and when that is with limitations, it is allowed. >> that was e.u. commissioner talking yesterday about spying within limits is allowed. we'll talk more about that a little bit later. you're going to hear my conversation with her yesterday evening about online privacy. what's happening with u.s. tech companies here in europe. but tech a big theme running

through the day post apple. >> let's keep talking about technology companies. arm expects sales to grow. arm are pretty bullish about their outlook all to do with the sales of iphones. >> this is a company that designs chips for chip makers. the chip makers then put their own chip with this technology in their computers, especially smart phones. they have 95% of the smart phone market. ne way they make money is from royals from the chip makers companies use their technology. growth of the revenues is actually slowing. it is 9% for this quarter. opposed to 13% a year ago and 15%, which is where the company says they really should be and where they are expected to be in the second half of the year. the good news for investors was

they think it is going to accelerate and the reason for that is, you know, basically smart phones in the first half of the year did very poorly, particularly in the developed world because everybody already had one in the emerging markets. they got -- that's where you didn't have the acceleration but they went for the cheaper ones. now you have 4 g rolled out across the world. so the idea is they expect people now are going to get the smart phone that is going to drive their sales and royalties is of course the iphone 6 part of that story. >> their licenses translate into royalties. one of the best licensing numbers they ever produced quarter-on-quarter. hat is future revenue. >> the fact that we just spent a minute talking all about smart

phones. a lot of the licensing growth happens to be outside the mobile space in the internet and things . >> in term t'wolves future revenue -- terms of the future revenue you get. obviously there is a big demrealings the fourth quarter. everybody is going to go to the store for this iphone. all of the phone makers targeting christmas sales. chinese new years sales as well. this is a good sign even going into next year. >> talk to us a little bit about apple. we have been talking about apple with regards to arm.

at the same time, they launched apple pay. does that feed back into arm? >> apple pay, that is a good question. i would have thought it does. if you think about it, tim cook has lined up for quite an interesting christmas. everybody wants to get an iphone 6. the expectation was they would sell 38 million of them last quarter and they sold 39 million. in addition to that, they expect to do between 63 1/2 to 66.5 billion in sales in this coming quarter which tops analyst stims. a lot of that, the iphone 6 and 6 plus because they were only for sale for eight days during the last sales period. apple pay, this could take off. if you get your iphone and get apple pay at the same time, you make your first christmas purchases. this can only propel and there is a lot of people talking about this, the smart phone space further down the road.

i pulled up i think it was mcdonald's in the states. this was -- i was there about a month ago. they were advertising apple pay. i could pay -- obviously i couldn't yet but they said go ahead ready, you can pay with apple pay. i was like what does that mean? this is going to become kind of usual for people. the fact that it comes around christmas, you a, you get the sale of the iphone and b, you introduce people to apple pay. > it is a new way of paying. >> what did you get? >> fries. >> milk shake. >> thank you so much for all of that. talking arm holdings, apple and mcdonald's. >> trying the fit it all in. >> it is early. >> let's take you to what's happening in pretoria. as you can see, the judge reading out the sentencing.

we have had various comments from her over the last sort of half-hour. we'll continue to monitor events when get the sentencing, we will clearly break and bring it to you and take you to pretoria and show you what's happening there. >> did not suffer from the disability and or that ability of the accused in the present case. e slow benefits of the disability. ♪

>> 25 minutes past the hour. welcome back. you're watching "the pulse." what is going on in the markets this morning? >> thanks. we opened a little bit lower this morning. we have higher now. ftse 100 up 1/3 of 1%. up 1%. in frankfurt chinese g.d.p. do i look at that as beat? better than the 7.2% median estimate or do i look at that as actually the worst quarter of growth in china since 2009? what are the analysts saying? they are suggesting the easing efforts have succeeded in china to stable i'd growth and lift g.d.p. growth in the fourth quarter we might need a little bit more stimulus from the chinese authorities. big move in italian 10 year

yesterday. up by 10 basis points. yields a little bit lower. we're a little bit light on the data side of things both here and europe and in the u.s. sterling one pound buying you 1.6156. tomorrow we get bank of england minuteses. since the last meeting, unemployment has slipped to the 6% mark. inflation has slipped to 1.2%. i think that is going to be very, very difficult to way up. the labor market side of things and the inflation side of hings. tomorrow, the next 24 hours, they are pretty big. >> thank you so much. let's bring you live pictures from south africa. oscar pistorius will soon use

his sentence. the judge said the prison can deal with his special needs and said the sentencing request from the defense is not appropriate. >> he discharged a firearm thinking that the person --

>> welcome back to "the pulse" live from bloomberg's european headquarters here in london. i'm francine lacqua. >> i'm guy johnson. these are the bloomberg top headlines. >> oscar pistorius will soon learn his sentence at the high court in pretoria. the judge says that prison can deal with his special needs and she said the sentencing request from the defense is not appropriate. that may mean house arrest is off the table. > export demands grew.

>> apple earnings beat analyst estimates for the quarter. sales came in at over $42 billion as the customer sold more than 39 million iphones in a three-month period. sales of the ipad disappointed falling 10%. >> ok. let's keep talking tech. if you have ever tried the trace your family history on the web, it can be a tough task. today you'll be able to do it using your d.n.a. elliott gotkine has more. explain. what is going on here? >> thanks, guy. rather than explaining myself, i have the c.e.o. and founder of my heritage to tell us all about it. we're announcing right now this second live on television.

tell me more about it. what is going on there? >> it is a very exciting strategic collaboration with product innovation with my heritage, discovering family history, preserving it and sharing it. together, the combination of d.n.a. and documented ancestry is extremely powerful. you can say it is the next evolution in family history. >> you can tell people if you know, you're related to somebody or a particular person but they can't tell them specifically how they are related and that's where your technology comes in. >> d.n.a. can reveal many things. among them your ethnic origin or geographical origins and find unknown relatives of yours. d.n.a. cannot tell you precisely how you are related. this is where it comes in with your family trees and historical records and we have technology for making discoveries.

together the user has the best chances of learning more about their family history. >> what is the latest tie-up that you have made? i know you did with a deal backed by the mormon church and recently with university libraries. is that right? >> we have recently launched a new product, my heritage library edition. it is specialized for educational facilities. now we can make available to tens of thousands of libraries across the world, all the power of my heritage for free for the patrons of those institutions. >> should we expect further deals like this? >> there are many, many exciting deals in the pipeline. regarding family search, the mormon church said they are planning to immediately make available our library edition in their more than 4,700 physical centers of family history around the world. this gives us tremendous exposure. >> i think shortly is when

you're due to launch an updated version of your software. anyone can come in and log in and automatically your family tree will be given to them. we are focused on re-inventing the way families explore their family history. we want to give them an easy, instant and meaningful experience. indeed, like you said, we are working on this new experience. it is about to launch. users will be able to come in for free. just give us a bit of information and lo and behold, we will unfold richness of information about their family history, photographs, people they are related to they never knew about. this gives them a friendly welcome into this amazing world of a family history. oscar pistorius was just sentenced to five years in prison. we'll come back to that. >> growth is very strong and we

e focused on building a great business and we are so proud of touching the lives of millions of people in such a positive way. >> you also said last time that you were not ruling out of the offering or the sale to business. of we closer to that kind eventuality? >> we'll talk about it in our next interrue. >> the first start-up founder to join us in this slot. nice to have him back here. francine, guy, back to you. >> we want to come back to that breaking news we had in the last minutes. oscar pistorius sentenced to five years in prison. she said a noncustodial sentence would send the wrong message but a long sentence was

inappropriate. >> it is going to be interesting to see how the south african people react to this. i think she is very aware of how this is going to be perceived in the wired context of what's happening in in -- wider con test of what's happening in south arca. -- south after ca. -- africa. i don't see any details whether or not that is with parole or without. whether that is an option. the headlines at the moment, oscar pistorius sentenced to five years in prison. judge said very clearly that the prison service in south africa is capable of coping with his disability. i think it became clear that a noncustodial sentence was the wrong message and said the prison was capable of coping

with his disability. >> she had a wide range of options really at her hands. defense lawyers actually suggested that three years was the way to go and the prison couldn't deal and cope with his special needs. at the same time the prosecutors demand 10 years in prison. it seems like a compromise. oscar pistorius sentenced to five years in prison. we'll be back in just a couple of minutes. ♪

>> so healthcare workers in the u.s. who are putting their lives on the line to fight ebola now have a place to train at home before going to west africa. the c.d.c. set up a mock treatment facility in alabama nd we got a look inside. >> about an hour and a half west of atlanta, the centers for disease control set up a mock e.t.u. an ebola treatment unit. fake patience in a fake hospital. >> this is an actual ebola treatment unit. there is somebody watching you and there is a mirror so you can

watch yourself. >> exactly. you never go into the center by yourself. >> but this is not the c.d.c.'s protocol. this was designed by doctors without borders. a group of volunteers basically running the international effort to contain ebola. americans are training before they go to west africa. >> one of the focus points here is to show that the white part is the clean part. that is something -- right now, we're all clean, but this is something to remember when you're taking it off. >> you're only touching white. >> exactly. >> suiting up is only a small part of the training. doctors without borders has learned to keep their own volunteers safe, they don't just need a suit. they need a routine with military redundancy. they need architecture. >> you are entering the high risk zone. the arrows are here.

it is a physical reminder that it is one-way flow of traffic from here on out. >> always moving in the same direction. less danger to more danger. >> from clean, you move into suspected. this is an area where patients are waiting for test results. they all have symptoms but only some of them have ebola. > two hours down the road. one might have died in the ambulance. the other one -- >> you have been in one of these units in west africa. this is a very high-stress area. >> the healthcare worker in 95-degree heat, you can't spend more than an hour in the suit, but you're not done. the hardest part of moving through an e.t.u. is getting out. >> we're going use this technique. trying as distributely as

possible not to slash anything. just nice and slow. >> the principle here is you start with the dirtiest thing and end with the cleens thing. >> removing the suit is more difficult than putting it on. it is time when the risk of contagion is highest. >> that part right there, putting your gloved hand inside and actually touching the scrubs is terrifying. >> yanl change to three -- i can't imagine doing that three times a day. >> it is really a mind-set that requires confidence in your teammates and clear communication. >> the detail required, the attention to detail absolutely amaze. i think that piece really

brought that home. the u.k. has introduced enhanced ebola screening at heathrow, gatwick and the eurostar terminals as well. how is that affecting passenger numbers at those venues? we don't quite know yet. but let's try to get a sense of what is going on. we're joined by the c.e.o. of your star international. good morning to you. you're in a situation where you still have yet to put these into place. correct? where are we? what's happening? what is going to happen next? >> we are discussing with the authorities how it is going to work because the objective for everyone is not to disrupt the operation. we have to find a way to make it easy. we will start this screening in the next few days and by the end of the week, weekend, something like that. >> could you give us more of the details? this would be for people taking the your star to enter the u.k..

you would go through passport control and then a series of questions would be asked if there is thought that you came from one of the infected countries? >> that's right. it could be brussels -- when they check the passport. if you have come from one of the infected countries in the past, i don't know, 20 days, in a way you would have more questions and have a screening test to check if everything is all right. >> how are you inform about this and how says it to work with the government? >> well, first it was -- just a declaration. an announcement. then we were taken by surprise. i think what has been good is everyone took the time to then sit down and find an operation to make it work. it was useful for the authorities. for us, without disrupting the

vast majority of our passengers. >> but the mood is what? one of nervousness? you're still a transport hub. because you have been identified as one of the screening points, is there a bit of nervousness among your star staff or the people that work there? >> i think everyone is trying to get information. we're trying to get information on the topic and how it is going to work. they get the message. i think people are confident. >> let's switch gears. air france, massive strikes. easyjet, loving it. great numbers from them. the local carriers really benefiting. what about you guys? sorry. didn't mean to shock you. >> we saw -- in the business market. we already enjoy market shares

in our markets. it was not such a boost. >> i'm going to get you a glass of water. fran will ask you a question. >> it was a surprise. one of the tough questions from guy johnson. you never know when guy johnson will surprise you. we have been talking a lot about transport and strikes. yesterday the first dive strikes, today is the second day of strikes with a lot of long haul flights being cansed. we have -- being canceled. flights at heathrow. it is a lot of disruption. do you have the glass of water? >> thank you. >> because of all of this destruction, do you have an impact for the bookings? are you seeing more people want to travel by train? >> it is good for us.

people like to take the train. it is a good alternate. because we have such capacity, our trains are so big, we can accept even last minute quite a lot of people on our trains. people understand that. if they elect to go to paris, they know they can -- >> can we talk about the winter season? you talk about the capacity you have on your trains and the ability to take more people. out of curiosity, what is the load factor on a traditional train that you run? >> our trains are very large. hey have 750 seats each. >> the local carriers are putting a lot of capacity on the winter. you're seeing the order coming through from ryanair and more still to come. they are pushing pretty hard.

when you look at your projections, you sound optimistic but it looks tougher. capacity is going to be one of the big stories in the sector for europe in the next few quarters. what are you projecting? >> it is extremely competitive. even worse than before. we want to grow. we want to go to new destinations. people are actually happy to take the train further away than just london or paris. next year, for instance, we are launching a new service. we will go to marseille in the south of france. the year after, to holland. >> how much will that add to your revenue? how much can you grow by? >> at first it will be small because we are just starting. there is a good market.

there is 20 million people flying. between the u.k. and not just london but around london to the -- and we are trying to capture a market share from the airline on those markets. we're trying to be -- >> london-nice is a pretty busy route. >> it is definitely a place where we want to invest. they just announced six months ago they would invest 50 million in the station. and we know by 2016, all of our area will be refurbished and made bigger. i think they really wanted to be much better. >> the managing director, john lewis just a couple of months ago saying -- i have to say when you arrive there, it is

shocking. why was this not dealt with before? > well, a bit excessive. the words used by this gentleman. the station was refurbished 25 years ago. they are starting a new program to reinvest in it. it is the best station in europe. >> it is also very new. >> you compare it with our -- but we're -- everyone is investing a lot of money now. it takes time. >> the labor party in the u.k., the transport union here in the u.k., not particularly comfortable that the british government is selling a stake in your business. are you comfortable with it? >> yeah. >> yeah, don't worry about it? >> because the main -- we have a

clear strategy. we're not going to change it. so really the u.k. government wants to exist, find someone new. >> if the french don't buy, if you have other people you would rather buy? invested in the business? >> they would be, you know, i ple -- from what understand, there were some interested in investing. as a business, it is not going to change our strategy in what we're going to. >> if it is a sovereign wealth fund, wouldn't there be more political pressure from the french? >> i leave it to up to --

>> i don't think he is going to answer our question. >> you don't think? >> understandably. >> thank you so much for joining us. we'll get him back to quiz him more on who is going to buy -- >> we need no take a break. we're back in a couple of minutes. ♪

>> welcome back. new energy headlines.

the u.s. has add megawatt capacity in the last quarter. there are currently five products in development across the 1 states. >> china's determination to build electric cars will likely cause the demand for aluminum to skyrocket. it is expected to grow about 30% a year for the next decade. this increase is expected to be much more if electric car industry is to take off. >> and staying with china. the country's wind power industry, spending 6 billion a year. this will open up opportunity for outside service companies to perform work on the turbines. hopefully we'll stay on the ground. >> we're looking forward to cars staying on the ground. >> for our viewers, a second hour of "the pulse" is coming up

next. >> we'll be talking about apple and connected cities. all of that in the next hour. ♪

>> driving hard in china. jaguar-landover opens in the after 10%d says it is of the market. as beijing delivers the week's economic anderson's 2009. expectingtim cook record holiday sales. >> tragedy. the ceo dies in a plane crash in moscow. good morning to our viewers in europe, good evening those in

asia, and a very warm welcome to those just waking up in the u.s. johnson. >> i'm francine lacqua, this is "the pulse." live from london. the techtalk about landscape. growthp designer expects to accelerate. .e spoke with arm's ceo >> we look at progress costs -- progress across the whole business. we are seeing new innovations at the high end of mobile. we are seeing further adoption of technology and enterprise. we saw hewlett-packard launched service based around arm silicon. it is a broad penetration we are looking at. ryan chilcote joins us with the latest. arm says growth will rebound due

to smartphones, especially the iphone. >> a turnaround for chipmakers. everyone was concerned and we are getting light at the end of the tunnel. thee guys designed chips chipmakers put into computers and smartphones. the way they make their money is from revenue that they get, the royalties they get from chipmakers when they use the technology. this last quarter, the growth was only 9%. that is short of 13% they saw a year ago and 15% the cfo promised for the second half of the year. why are investors happy? based at revenue growth is going to pick up in the fourth quarter. goldman sachs put out a note saying if it is going to come up in the fourth quarter and is likely to further accelerate the beginning of next year. then --ne sales have the growth has been slowing. particularly in the developed

part of the world. everybody has artie got a smart phone. they are relying on the emerging market for the little growth they've had. they've been dying on the cheaper end of the spectrum. going out, people and faster speeds. people are going out and buying so they can get a faster speed. >> they make money off of licensing. whatever it is from every chip that is sold. but when you license the , you have to pay a fee as well. the number of licenses that are in the pipe, that is pointing at a positive story. >> it as a forward indicator and it is good for arm. a lot of the licensing is happening outside the mobile space. helpful for the diverse vacation of their revenue space.

it takes them into the internet of things. that is good for them. much.nk you so ryan chilcote with the latest on arm, apple, and licensing. >> let's say on tech. espionage. we caught up with neely cruz about the story that has captivated everyone, spying. >> we are all involved with spying. within limitations, it is allowed. talked to her about a number of things. , theaid is just too hard year. politicians need to get to grips with having more digital -- >> she's very focused on entrepreneurs in the digital space. >> she feels like there's so

muchork to go. aware of the fact that technology, big technology companies, has had a date role of about last few months -- have role of the last few months. with the right to be forgotten and google, i get a sense that she feels she could do more. she's still figuring out what's going to happen. we'll see what happens with neelie kroes. out a bigplaying chunk of the interview later on. you can follow the full interview on the website, bloomberg.com. might be bad news for china investors. gdp came in ahead of economists hopes fornd dashed stimulants in the world's second-largest economy. economists china joins us from beijing with details. what fueled the surprise on the upside?

you dig into the details, it is really a story about driving theports better-than-expected third-quarter data. the u.s. economy is doing a little bit better. that is driving a little bit in chinand for made goods from consumers in the u.s. if you look at what is happening and china, the story is more depressing. real estate is the main driver of china's domestic demand. what we are seeing now is a contraction and sales. that is pushing developers to go more slowly on new projects. we are seeing the area of new real estate under construction contracting. third-quarter gdp data a little bit better than expectations. if you dig into the details, some wording finds in terms of what is happening in the domestic economy. >> what is the read across

policy? where are we going to see beijing moving on this? what does it tells about what is happening next in terms of how much stimulus or no stimulus? >> coming into today's date at release, there was a lot of expectations that weakness in the economy would push the government to do more to stimulate growth. a lot of analysts were talking about interest rate cuts heading into the beginning of 2015. i think what the third-quarter data does is moves the pendulum a little bit away from that measure stimulus and towards expectations of more targeted easing, targeted support for the real estate sector. a little bit of additional liquidity for the banks when on lending. carry probably not a major move like a rate cut. >> thank you for all of that, beijing. in

>> somber news. total's ceo has passed away. christophe de margerie died along with three crew members when the company's private jet struck a snow in moscow. the driver of the snowplow was drunk. caroline connan joins us from paris. what else do we know about the accident? >> we don't know much more. there's an investigation. the committee investigating in russia is saying that the driver beene snowplow may have drunk. there's also possibly a reason because of the weather. it was a foggy night. which is why you had the snowplow driving at moscow international airport. there's a lot of reaction about the death of the title ceo. he was very respected among the oil industry.

you have the bpce of bob dudley saying he lost a great friend. similar reaction from the shell ceo, saying he was a greater than life character. french president hollande saying friends has lost eight leader of frenchindustry -- president a lot saying friends has lost a leader of french industry. >> what does this mean for total's history? be meeting asill soon as possible. this is unexpected. there's been talk about the succession of christophe de already because he was 63 years old. he said he was in favor of a successor being from inside the company rather than an outsider. he himself did his whole career at the town for the past -- at the past 40 years. he went up the ladder from

finance all the way to ceo in 2007. there are a few names on the table. the upstream president of total. he's already 62 years old, maybe two old. the refining chemicals chief is another name. newhe head of total's energy division. the board will be meeting as soon as possible. it'll be a tough transition after this tragedy. talk about why he was there. this was a guy that really was a globetrotter. you bumped into him and the four corners of the world. he was always out there looking for new opportunity. he spent a lot of time in russia as well. >> he did. russianomy minister of ulyukaev has confirmed he

was attending a meeting about foreign investment in russia. that is why he was in russia before the tragic accident. novatec,s 18% or russia's largest gas producer. christophe de margerie has been negotiating a deal with the siberia.mpany in saying that despite sanctions, totally keep working on the project -- total would keep foring on the project natural gas in siberia. christophe de margerie thought that europe could not live without russian gas. a reaction from vladimir putin himself, saying he was shocked

by the death of christophe de margerie and that russia had lost a true friend. indeed. you very much sad news from caroline connan. we will take a break and be back in couple minutes. ♪

>> welcome back. you are watching "the pulse or cut we are live from bloomberg's european headquarters in london. let's talk about what's happening in the u k not great news for george osborne. the pound is spiking, 1.6176. in the data on the deficit is not the story that a chancellor would want to hear. in terms of the deficit -- let's make sure we do not mix up debt and deficit. the deficit is 11 .8 billion

pounds. that is higher than the number most economists were going for, which was 10.1 billion pounds. the reason for this appears to be a gap in income tax receipts. predicted income tax receipts what rise, they are unemployment was coming down. people of those jobs are in the lower employment category. we are not seeing money flowing into the treasury's coffers. a chancellor is unlikely to make .is targets for the deficit entrance of the barley numbers, they are rising significantly. excluding -- in terms of the darlington numbers -- in terms of the borrowing numbers, they are rising significantly. it is down to the tax receipt story. not exactly great news for the chancellor of the exchequer.

we've been speaking to europe's chief of the digital agenda, neelie kroes. we spoke about everything from cyber espionage and online privacy. >> i think we should take into that espionage is the first oldest profession on earth. involved, in each country, with spying. when that is within limitations, it is allowed. a government will protect its citizens. if you are just forcing those borders, you are in a dangerous zone. that is where privacy in europe is at stake.

we should also take into account, for example, the judgment and the right to be forgotten. it is an analog system comparing to the digital development. sometimes you will have to find out what are you trying to tackle. and in which phase of the technology are you operating now. that is what also has to be discussed. we need to be wary of some attitudes. also, as everyone who is using social devices. it starts with the person himself and then we need to get paths.onal we need to take into account that google, facebook should not use it in that way that you are not aware they are using. if they get permission, so be it. >> net neutrality. why should i, a big telco enhancing ourt in

broadband capacity in europe when i cannot get any advantage from it? when thein advantages proposal i have on the table is accepted by the council of parliament, it is already accepted by the commission. it is talking about no blocking -- blocking also startups and opportunities. giving open internet for everybody. inis still an opportunity that open internet, the opportunity for presenting specialized services. what is at stake now, those incumbents who are aware that open internet for everybody -- theyey are investing more,

do not offer specialized services and make money. then it can be win-win. >> thank you very much. the outgoing commissioner for the digital agenda, neelie kroes . can a phone or place your wallet, apple is betting it will. olivia sterns put apple pay to the test, when we come back. ♪

>> welcome back. let's look at the energy sector. the former chairman of the u.k. environment agency will lead an initiative to research the on theof shale gas country. joining us now is the chair of the project, chris smith. give us a sense of what you are expecting to come up with. >> the idea is 18-24 months. we will look at a series of issues. environmental, energy, and economic issues. we will produce a series of reports on some of these individual areas. we will also produce a comprehensive report at the end of that period, hopefully in 1.5 years' time. >> independent and transparent but it is funded by the industry.

finding is coming from six companies from the shale gas industry. written in to our constitution is the fact that they the funders cannot have any influence over what we decide or what we say. it is my indication that we should be independent. to disentangle some of the mythology about shale gas. this either people saying is going to solve our energy requirements for the next five decades, on the other hand, people say this is in environmental disaster. i suspect the truth lies somewhere in between. finding out what the facts are and what the real issues are, that is what we are going to try to do. has transformed the outlook for america's energy demand. do you expect it to do the same here? >> that is what of the questions

we need to examine. what do we do not -- what we do not now is how much exploitable shale gas there is in the u.k. and whether the costs of recovering it are going to outweigh the benefits that can come. you are right about the impact it has had on the american economy. it has had one rather perverse impact. because the cost of gas has fallen dramatically in the u.s. and they are using more gas to generate power, they are offloading their core on the rest of the world -- they are offloading their coal on the rest of the world. coal is much cheaper coming from america where it does not need to be used. in the u.k., we are burning more coal than we have done for years. that, environmentally, is not a very good move from our point of view. >> talking of u.k. energy

policy, what expectation do you have about how the financial -- how thecy findings will impact policy? >> what i think everyone has agreed on is that we need a mix of different energies in the u.k.. some of the has to be gas, some of it has to be nuclear, some of it has to be renewables. what we have not yet got is a clear idea about exactly where we are going -- winners, the government has a terrible track record. >> that is why you need a broad spectrum. determinedld it be is a critical question. my question about the impacts on -- they seemation

to be trying to make decisions rather than allowing the economics of the various options to speak for themselves. >> you always need government overview. >> to a degree. >> you've got to consider environmental and economic prospects. run withneed to do is the market rather than against the market. is one of the biggest questions we need to look at in relation to shale gas. economically, is it going to be a sustainable option into the future? >> does that mean you will take a view on the price of oil for the next four to five years. >> the price of oil is all over the place. some of theeasons issues that are rising in the energy market as we speak is

because the oil price is dropping. what we are not looking at is shale oil, we are just looking at shale gas. to make an accurate assessment of its potential and its impact you need to look at the other options. this is a full-scale review of britain's energy policy. >> we need to take account of the economics of britain's energy policy as we look at how shall gas is going to play out. >> when you look at the price of crude, we've seen a lot of volatility. it playing out in the next couple months? as good as mine. a lot depends on what happens in happens ineast, what ukraine, what decisions russia makes. how strongly the u.s. wants to continue on the shale gas route. all sorts of factors that need to be put into the equation

before you can come up with an accurate answer. >> are you going to consider the impact of technology development and the impact it will have on british industry? one of the positives to the u.s. an embracing of new technology that has come about as a result. will that something you consider as well? >> absolutely. most in terms of the ways of using new techniques and new technology but also, the skills that go with that and how they can be deployed elsewhere in the economy. >> when you look -- we talked about what you need to give a correct assessment. what is one thing that will be difficult to forecast, the price of oil or the weakness of the euro? probably the price of oil

will determine a lot of what happens in the energy market for the course of the next few months. while we are going to be looking at is something a little longer term. looking at some of the fundamental issues about environmental protection in relation to shale gas exploration. things like what happens to residues, areas of contamination of groundwater. we will be looking at some of the local impact issues. what happens to a community is a fracking site comes and takes place in its locality. we will be looking at the broader economics of shale gas but also climate change impacts. benefitive us a real , and at the same time, is it lacking in another carbon producing fuel for a very long time to come.

>> i was reading the standard last night. in 10 years' time, we are going to have an abundance of clean energy. deep are you going to go in terms of thinking about all of this? >> i wish that were right. we've been saying for years that fusion is 30 or 40 years off. that 30 or 40 years gets moved periodically forward. it could be a game changer. in the meantime, we've got to work with what we've got. and what we've got is a range of fossil fuels and nuclear and renewables. we have to get the balance between those. we have to reduce gradually the carbon that we are producing. getting all of that right is going to be the challenge. >> good luck.

with what we've got. >> thank you for coming on. shale gas in the u.k. >> china's gdp data beating estimates. number.the year under despite the beat, the slowest growth in five years. industrial production group 8% in september. >> oscar pistorius has been sentenced to five years in prison for the culpable homicide of reeva steenkamp. each of said the prison system can -- the judge said that the south african prison system can deal with the special needs of the olympian who killed his girlfriend on valentine's day. >> total's ceo christophe de margerie has died. his airplane struck a snowplow on a mascot runway. the crash also killed three crew members. christophe de margerie saw the

biggest expansion of oil reserves at the company in 15 years. >> jonathan ferro has the latest on the markets. >> green. europe higher in after a day of losses yesterday. ftse 100 up .6%. dax up with 1% higher. the periphery is performing well, ibex up .5. looking at the bright side of life on the back of the chinese gdp number. worsta beat, 7.3%, quarterly growth number out of the world's second-largest economy since the first quarter of 2009. this year on course to be the worst year since the 1990's. which strikes me how confident everyone is about china's ability to keep economy balanced without a hard landing. i will let you decide whether that confidence is misplaced. debt markets, i'm looking at two-year bond yields in spain.

15% on theis point, 0. two year i'm looking at that auctions. the spanish treasury issue 3 billion euros of 9-month t bills. september 23t was shift on.the periphery. yesterday, italian yields up by 10 basis points. there's been so much talk about france. you see the true directory -- you see the trajectory of their debt. the 10 year yield in france, 1.31%. 2.5%.d out lighter at barry reinhardt at -- mr. r einhorn at greenlight capital said it's time to short french

debt. fundamentals have not been good for a wild, but that is a big call. >> jonathan ferro with the latest. 25 minutes from now, "surveillance" with tom keene. you are looking at oil, apple, and big bonuses. >> oil, the big call. the council on foreign relations will join us on oil and the colder weather in europe. snow in the next few days in kieve. -- in kiev. we talk about the geopolitics with russia and oil. alana weinstein with idw. we talk about compensation on wall street. delaying bonuses. we talk about venture capital.

aboutked to rick heitzman the earnings last night from apple. i was stunned by the cash generation. they will do more. holiday primed for the season. rick heitzmann there. >> apple pay. >> are you getting the six or six plus. sixa dainty woman like you, plus it is too big. >> i am married to samsung. i have an ipad. >> six plus is too big. >> for your shopping, it is going to be great. and sixthe iphone six plus 25 minutes from now.

foroming up, searching smarter cities. a developer released an initiative to make sure you look no further than canary wharf in london. next on "the pulse." ♪

>> 40 minutes past the hour. let's talk technology. the canary wharf group launched

an initiative to make sure it remains a player in smart cities for the future. the challenge, launched at canary wharf, is what we are talking about. joining us now is eric, the head to see you.-- nice good morning. give us the top down story. why is it so important? it's important because canary wharf group was always a pioneer in the way sustainable cities should be built. what we are doing with the kindness of the challenge is a worldwide search for the next generation of smart to the akehnology that will m ourselves more efficient and provide better services for the people who live and work in our city. >> narrow it down. this is making buildings more

sustainable and making my life easier. what kind of innovation can i expect? elevators that will recognize what fluoride push? -- what floor i push? many innovations that are possible. we are all working in a office with air-conditioning. your id card could contain your preferences. we could deliver micro climates. you and i will never argue about what temperature at the office should be. as a building operator, we could be more efficient. ue she's -- that's a big iss for fran is this the internet of things? sensors embedded in everything. >> it is. need too monitor, we

measure everything. that wilw us to become a saint-etienne sitting -- to be come a sentient city. will recognize that we are all heading to the escalators and make it easier. news?t about the bad security experts have concerns. how do you ensure a sentient city is a secure city? >> this is one of the most important things that the internet of things and the smart city industry needs to learn about. key things is exploring the data, how we use data, and coming up with a best practice. if canary wharf can lead that

and learn more about it for our operations, it is something we are keen to share so that we become good custodians of data. >> how different will these new buildings be? we heard about the dryer that people the hands of 50 for one pence in terms of cost. >> right. everything that goes into a building can be reimagined. we heard of next, -- we heard of nest, who reimagined the thermostat. we have a company and canary wharf that has a new hand dryer. it dries 50 pairs of hands for one penny, it tells you how used thele have

bathroom so you can save money on the cleaning bill. that is the kind of innovation that is possible. the building management systems. >> thank you very much indeed, joining us. head of level 39. >> apple expecting record holiday sales this quarter. fueled in part by apple pay. the company says it lets users make transactions at over 220,00 0 stores. olivia sterns checked it out. apple says minute iphone 6 is going to completely replace my wallet. pay tocided to put apple the test. let's see how much shopping i can get done. the disney store. it's elsa!

perfect, thank you. easy.sney store was one touch and i got all of these. i might not need a while it, that does not mean i don't need a handbag. we've got a winner. that took a little longer than i expected. apple pay did not work as my visa debit card. card. work as a credit 2 for 2. $35 ostrich egg.

apple pay works well. so smoothly that it's anti-climactic. i had to return some things, like the ostrich egg. t smoothly. apple pay does say transaction time. for stores like whole foods that are mobs during rush hour, anything that means you can move customers more quickly means more business. one more stop, i need some aspirin. that's everything. i out of money and time. i need to get home, i'm going to uber. hi, do you take apple pay. >> i have no idea. >> uber has my credit card.

shopping on the streets of new york. i am not jealous. >> i am concerned about the ostrich egg. what culinary element does that play? right, let's move on. what have we talked about? pay. cities, apple julie meyer joins us from ariadne capital. which is more exciting? smart cities, changing the architecture of the payment system? >> what i thought was relevant, wharfaid canary group was custodians of people's

data. they are going to unlock huge amounts of data. how they incentivize people to give more and the transactions around that will be interesting. the other thing, smart cities are becoming a platform. sayingry wharf group are we are going to be a platform in the same way apple, amazon, facebook are platforms, we are going to get the developer app economy.e that is good news for the industry. we need more platform companies. they disproportionately take profits out of the industry. >> smart cities will only be applied to big metropolises, right? the scalability is limited. >> interesting question. ve come to myi'

final thinking on this. local environments, whether they are country are just neighborhood, these are small pilots and laboratories. there is a great thing happening in my neighborhood. people have taken control and are deciding to solve social problems. they are using technology. i'm not sure this is just big skyscrapers. been walking through the world with mobile devices. now the world is going to start being very active as well. learnedf the things we from the financial crisis is that the world is interconnected. the interconnections are great and allow us to distribute all kinds of things around the planet. they also bring one abilities. -- they also bring vulnerabilities. >> that is precisely it. the world before the financial crisis was linear.

it had been moving into a network-based world but people did not understand and were assessing risk in a linear way. the connections that you the difference means it is exponential. if something happens, boom, o utwards. everything is based on networks. you fundamentally have to assess risk. >> the world's smartest people didn't understand the risk. are we underestimating the risk we are creating within this networked world? >> i'm not sure the world's smartest people or running the fed. think the world's smartest people who are going to the source of the problem do. >> are they being listened to? many of them are entrepreneurs. many of them are in academia. highnk the world's most

profile and most powerful people did not necessarily understand the -- >> and that is more disturbing. that the most powerful people do not understand. >> let's face it. they are living it in a way that a 65-year-old may not. >> this has to do with age. >> and digital native nests -- d igital nativeness, an implicit understanding. the 25-year-old understanding that before the 65-year-old. you do have to work harder the older you get. >> how much of a game changer is apple pay? >> all the information that has come out is that tim cook said this is a killer feature. the investments in mobile

payments and mobile banking, he feature.id it, it's a layer. is becoming a the mobile world taking over the off-line world. as we are seeing in the venture capital world. with apple.ing they have created a new layer to their business. it is not really a product or service. it is a layer that is going to come across everything. they will treat apple paid different from iphones. everybody.ot for >> really? you listen to those guys and you believe it is. this is just one of the operating systems. how does apple taken this beyond its own borders?

>> another small point they made 20 acquisitions last year. apple does not make a big deal of acquisitions. they announced a massive new partnership with ibm. ibm, changing the way people work. they do not make a big deal about it. $42y announced the iphone, billion revenue. they are the one to watch. amazon is not a cash generated machine. it is the force of jeff bezos that keeps us. apple is one of the most cash generative machines in history. $42 billion to shareholders and carl icahn says it is not enough. >> so it is stronger? >> much stronger. they do not even feel the need for granularity.

the world loves the iphone. >> julie meyer there, ceo of ariadne capital. we'll be back in a few minutes. ♪

>> welcome back. a quick look at the currency markets. the chancellor of the executor -- the chancellor of the exchequer in the u.k. likely to miss his target. be from the

monetary policy committee? minutes are out later this week. >> that's it for "the pulse." on bloomberg tv. max, live from new york with tom keene and his team. ♪

turkey shifts as fighting intensifies on multiple fronts in iraq and syria.

cash is king. $155 billion large. is writing for your holiday purchases. and the conversation with lang lang. this is "bloomberg surveillance ," live from our world headquarters in new york. 21.s tuesday, october i am tom "i hated piano lessons" keene. scarlet fu hated him worse than i did. i printed really -- >> i took piano less. we really look forward to this. difficult, challenging his. turkey and the islamic states anadarko currently has a change of heart -- by