>> the price of oil. opec's secretary-general joins bloomberg for his first interview in davos. >> the btv ceo weighs in. >> we've got our partners, our friends. that is why we come here. >> the most talked about man in europe is set to arrive. swiss national bank president thomas jordan faces the fourm after last -- forum after last

week -- spectacular change of policy. good morning, everybody. welcome to "the pulse" and welcome to davos. >> we are live from the world economic forum right here in switzerland. >> and it is -- i would like to say it is warming up. >> you are an optimist. we have a lot of ceo's here. >> they see some positive things. they see the oil price having an impact. they see easy money continuing for longer. they are focused on what is happening with the ecb. i think oil is the real standout story. >> for me, it is indecision. last year, the participants seemed to have a better handle on the situation. here, they are more lax.

>> there is a lot of uncertainty. >> the same for keeley. >> they can't figure out the impact. the pace is what is confusing them at the moment. the oil price has come down so fast. the swiss franc went up so fast. >> that is what freaks them out. >> there are a few black swans flying over davos. it is going to be interesting to get a take on that. south africa's central bank governor is going to be joining us. he is fairly new to the job. 2 "the pulse -- looking forward to that conversation. >> then, we have the eni ceo. this is one of the biggest oil companies in europe. it will be interesting to get his take on where the price of oil is going. we've heard everything from $30 back up to $50 and $60 depending

on how much the ceo focuses on the optimism. >> maybe we will end up with both of them. you just don't know. alexey mordashov, billionaire owner of several stall going to be joining us as well. one thing that is definitely running through davos this year is how out and about the russians are. >> optimistic. defiant, maybe. >> maybe that is the right word. >> then, we are going to have a great interview with the intent the ceo, carlo messina. this is the second biggest bank in italy. i hung out with the italian prime minister. he has been in the job for a little under a year. he has tried to push through reforms. yesterday, we had the first glimpse of the biggest banking reform in 20 years. it will be interesting to get his take on what that means for him, if he sees your rivals

emerge. >> too many banks, not enough credit, the line coming out of renzi yesterday. we are going to be talking to the most senior member of the russian government. we don't have putin this year. we have -- [indiscernible] he is the deputy prime minister. we will get his take on exactly what happens in 2015 with his government and his economy. >> that is a recession story. talking of oil, we will be speaking to tim clark of emirates to get his take on the business of consolidation. >> oil, a big input cost. it will be interesting to get his take on how it will affect the gcc. >> the man of the week in davos is -- i have three names. mario draghi, he is not coming

to davos but we get the ecb announcement. let's say mario draghi jack ma of alibaba or thomas jordan of the swiss national bank. >> i would like to talk to mr. jordan but if i would have any of those conversations, it would be jack ma. if you talk about potential to change the world, it is jack. >> we are going to try to get all three. thomas jordan is due to arrive in davos this morning. will the man who has been in the limelight for over a year now steal the show at davos? jonathan ferro is here with the details. a lot of focus on communication from central banks. how we should have read it and whether the timing from mr. jordan was flawed. >> this is the most wanted man in davos, bar none. jack ma, big deal truly historic.

if you ask any financial journalist tom of they want to talk to thomas jordan. >> jack ma hasn't arrived yet, nor has president hollande. >> jon sees the world through a macro filter. maybe mr. jordan is the one that you want. >> you can have a fantastic business if you depend on a central bank. if they take it away from you, they are kicking the legs from underneath you. >> it is too late. it is done. you want to speak to the people who give you a sense of what is going forward. >> we shouldn't forget last week. there was a truly historic move in a major currency, one we have never seen in a single day since world war ii. truly historic. we have to ask what this means for tomorrow the ecb, mario draghi. how much weight can we put on that? you have seen a major central-bank capitulate.

>> what would be the question you would ask him? you have one question, you meet him in the corridor you got your google glasses on. >> two -- >> just one. >> one would be communication. why thursday? why not friday after the close? do we go back to 2011 and the lessons of the swiss national bank and the accusations that made these things leak? maybe they made a decision and felt like they had to get that out the door. i think communication has got to be the number one question. >> i would ask him, how do you feel? >> to be here? >> it must take a toll on a personal level. people say they should have timed it differently, they should have done something different. how is he living? >> i think all these are great questions.

hopefully we will get an opportunity to ask. he is expected to show up later. nobody can get here because, have you seen the prices? >> there's billionaires here and there's journalists on expense. let's be very clear about that. >> also, a lot of the participants -- [indiscernible] >> all of that is true, but there are some eye-popping prices on some of the menus here. the question that a lot of people are asking is, does it have a ripple effect into the industry? does it have a wider implication? further down the road, the golden egg, the intercontinental. it has already a checkered history. yesterday, i went down and talked to the ceo of ihg international hotel group and i spoke to richard solomon. i asked him whether or not the

higher franc is going to impact the holiday season. >> i think it is probably not going to be helpful for certain parts of the economy. we will see how it pans out and how the other currencies move. >> 30% appreciation overnight is fairly unheard of, particularly for a big currency like the franc. >> it is for people making last-minute plans. for a hotel like this the ski season is important. we also have a big meeting space. i think for corporations, i doubt it would necessarily change it. it is going to draw people's decisions. >> is it too late to talk about cancellations? >> we have not seen that. you see it if you have a security event in a country.

then you see cancellations. or if it is a very disruptive market, like hong kong. >> richard solomon there talking to me about the impact of what the swiss franc will mean for the hotel industry, for the tourism industry in davos. we are not going to stop the conversation there. we are going to be talking to other countries' most famous banks. we are speaking to morris, he will be joining us later today to talk to us about what it meant for his bank. >> another great interview coming up, this is the other hot on the agenda in davos. it is the oil price plunged. we will be speaking to the opec secretary-general. that is later on today. >> that is a conversation that nobody is going to want to miss.

let's talk about some of the other headlines coming out of davos. chinese premier le keqiang is getting ready to address the forum. he will follow in the footsteps of a number of countries. it is going to be a really interesting session to see what he has to say. the phrase everybody is using is "get over it go is that the message -- "get over it." is that the message after the weakest chinese growth since 1990? >> it seems to be the message from the russians. a billionaire is worried about terrorism, oil prices, and vladimir putin. they are the things keeping the billionaires at davos awake at night. the one thing they agreed on is the fed will keep interest rates at record lows.

stay with us for more on what is preoccupying the world's wealthy. >> the russians in focus here as well. they are continuing with light sanctions. vtb enjoys jazz and vodka as the tensions in ukraine continue to heighten. quite a spread in terms of what was on offer. we've been talking about that soiree. we will continue to talk about that soiree. we are going to doing you -- going to bring you our bloomberg interview. we will get you some comment on that, coming up right here on "the pulse." >> state leaders, billionaires, celebrities, all coming to davos. our question of day two, would you most like to have a night cap within davos? is it jack ma? >> that would be the top of my

list. >> who would you like to have a night cap within davos? tweet us. we are back in just a couple minutes. ♪

>> welcome back to "the pulse." we are live on bloomberg tv and radio, also streaming on bloomberg.com. >> as backdrops go, it doesn't get much better. welcome back to davos. oil, ukraine, my sanctions don't matter. we spoke to vtb's ceo in a bloomberg first about what sanctions mean for russia's second-largest bank. >> this year might be the most difficult for the russian economy. we definitely expect negative

growth, maybe around -3% on gdp growth. inflation might exceed 10%. but, we still feel that our clients, russian companies, feel better than they felt into thousand nine when there was a global crisis. we already have experience how to deal with the crisis. though this year will be painful, i think our economy and businesses knopww how to deal with the stress. i don't think that's the end of the world for russian economy. i think the russian economy will start to pick up. >> let's talk about the possibility of a downgrade the junk. everybody is waiting to see

whether that is delivered. have you been pre-positioning the bank? how does it work in advance of such a move? >> it is not a very big concern. we have national markets closed and we don't have any previous borrowing which we have to pay early. i'm quite sure that all will be paid by russian companies. vtb has to pay only $3.5 billion of its sovereign debt. some banks will help private russian companies. at the moment, we feel that russian reserves allow russian companies to repay the debt. [indiscernible] there is no discussion that we will not repay to the west.

>> that was vtb ceo andrey kostin speaking first to bloomberg about what sanctions mean for his bank. >> pretty optimistic, andrey kostin. we will be continuing that conversation later today. we speak to the severstal ceo, and the deputy prime minister. >> looking forward to that. petro poroshenko, late morning here in davos. we have a great conversation with him as well. >> here in davos, vtb isn't letting a bad year get in the way of a good party. russian banks slashed hundreds of jobs following sanctions. with more on that story, we have matt miller bloomberg news managing editor. we spoke with him and challenged whether it was wise to spend so much money. he says, we have allies, we

still need to do this, we carry on. >> they need to talk to investors. really, what you are seeing is the russians being extremely defiant here in switzerland where it is comfortable to do so. any sort of push from the u.s. or eu that says you are going to become lately ostracized they are here, they are doing business, they are meeting with investors, they are trying to raise money for russia. last night, we know there was caviar, we know there were ballerinas sculpt out of chocolate. vodka everywhere. it was a lavish affair. >> and celebrity singers. >> what i thought was interesting was the head of the economic forum and he doesn't usually attend these events. i think he was there to say, the world economic forum welcomes you.

>> very much so. he does not go to a lot of events. he was providing a little bit of backbone to the russians. if you look at [indiscernible] there are still russian billionaires on site doing business. they continue having parties but also doing business. >> it is interesting to try and figure out his motives. is it because he still wants russians to calm or -- to come or he wants a possible these between ukraine and russia. we know the ukrainian president is talking later this afternoon. >> it is really escalating in ukraine. the conflict is getting worse as we said here. you have a lot of rebels fighting each other in the east. trying to get that dialogue going is going to be important. this will be the place to do it.

>> 10 billionaires from russia. in terms of the magnitude, the number of billionaires attending this event, how do they stack up? >> the u.s. has the most. more than 100 here. the u.s. has more than 25. india has about 15. indians love davos. they love the cold weather. the russians eight to 12. lots of countries with one or two. china has two, including jack ma. haven't seen him yet. i was walking down the corridors and i saw six billionaires in the span of about 30 minutes. >> we've been asking on twitter if you are to choose one person to have on a cap within davos. guy and i both picked jack ma so you cannot answer jack ma. who is the billionaire that you

would like to have a nightcap with? >> i would like to talk with paul singer. i would talk to him about the swiss franc and argentina. i would talk about oil prices. there's a lot of investing criteria out there right now. there's a lot of investors that should be taken seriously. we spent a lot of times talking about politicians and billionaires. >> fabulous. open invitation. thank you so much, matt miller. >> ok, that is what we are talking about here in davos. we are also talking about last night in washington. president obama setting out the state of the union, talking about the income gap in the united states. we will delve deeper into the state of the union right here on "the pulse." ♪

>> welcome back to "the pulse." we are live on bloomberg tv and radio, also streaming. day one of the economic forum in davos. >> we are all busy here. fran and i on air, jon ferro out tracking down the head of the swiss national bank, and stephanie ruhle talking right now on a great panel leading that panel, talking about banking regulation, one of the critical subjects. the banking story certainly

continues and remains front and center. [indiscernible] >> it is amazing. if we break it down, people want to know about qe and oil. they have more questions than answers. over the next two to three days taking the temperature from the main ceo's to see whether they reach some kind of consensus. >> if you want to check out what she is talking about, go to bloomberg.com. we will have it there for you. it is a fascinating conversation. coming up, we are going to talk to the head of the south african central bank. ♪

>> welcome back to davos.

it is the first day of the world economic forum 2015. >> now, middle class economics was the keynote in president obama's sixth state of the union address delivered last night. for more on what mr. obama, president obama, has to say, let's bring in hans nichols. talk us through the tone. talk us through the message he was hoping to deliver. >> in some ways, president obama's tone was similar to what the russians are doing in davos. they pretend the last year hasn't happened, that oil hasn't cratered. they party on like normal. what you saw from president obama was ignoring the political rally, and giving what apparently was a pretty well-received speech, especially among his supporters. one thing you can say, it seems to be working.

this new posture seems to be working. his approval rating is close to 50%. that is up some 10 points from where he was over the fall. again, not a totally fair comparison because president obama wasn't tricking vodka although he did have that glass of clear liquid. >> a little bit of defiance from president obama. cyber security also a big focus of the speech. >> cyber security is one area where he could work with commerce -- could work with capitol hill. this speech was essentially aspirational. this is a president trying to set the frame for the debate in 2016. he wanted to take a victory lap on the economy, which all indications are it is on the up. listen to how he couched it. >> we are making sure our government integrates

intelligence to combat the cyber threats just as we've done to combat terrorism. i urge this congress to pass the legislation we need to meet the threat of cyber attacks, combat identity theft, and protect our children's information. that should be a bipartisan effort. >> francine, guy, here is my reporting assignment for you. talk to ceo's, business leaders, and get a sense of if they think corporate tax reform is going to happen in the states? and, what are the prospects for a trade deal between the u.s. and asia or the u.s. and europe? that could be interesting. those are two areas where obama may be will get more done with the republican congress. >> thank you so much. corporate tax trade, swiss franc -- >> pretty long list of assignments. >> done.

>> we will get that all done. all those are going to get covered. central banking also front and center. if you were betting on a rate hike from the u.k. this year, i think you probably need to have another look. we'll have some significant news out in terms of the minutes. manus cranny is here with some more details. >> this is a big u-turn. mccafferty the dissenters facing off against mark carney. i'm going to show you dollar-sterling. this is sterling dropping. they have pulled back from calling for a rate hike. that is the blockbuster news. bank of england policymakers martin we'll and mccafferty have dropped their call for an increase. why? plunging oil prices, and they say, the fall in near-term inflation might become more

consistent if lowered expectations become self-perpetuating. this is quite an important shift in terms of the dynamics. these are two people on the monetary policy committee that are u-turning. i had a conversation last week here on "countdown," wehhere they said inflation would fall in the united kingdom. wages, let me give you these numbers. jobless numbers falling. the unemployment rate in the united kingdom 5.8%. a little bit less on weekly earnings. that is a big u-turn. >> thank you so much, manus cranny going through the vaeririous minutes. here, we speak to another governor. let's speak to lesetja kganyago.

thank you so much for joining us. we will talk about south africa in a second. i want to get your take on qe from the ecb. markets did not like qe from the fed. are they going to like ecb qe even less? >> the impact of qe has been mixed. qe from the u.s. had a significant impact for many of us in developing economies. we saw our currencies appreciate. that impacts our exports and so forth. but it is not clear what the impact of qe would be from the euro area. the u.s. has unwound. the yen is moving toward

monetization. it is going to be difficult to call what the real impact would be. you are entering qe in one sector, as sitting -- exiting in another. >> we talk about the impact oil is likely to have. we have seen a fairly significant swing from the bank of england. if you take a look at the forward rate agreements in south africa, everybody was expecting the next move from your central-bank to be up. now they are beginning to price in the possibility of it being down. what impact is oil having? >> the impact on the prices in south africa -- [indiscernible]

if the deadline in the oil price was accompanied by stability, you would see even more. basically, we have become a shock absorber in the oil price. it will improve the inflation outlook. in the same manner that central banks will, the oil price goes up. the increase in the oil price leads to a general increase. when the oil price declines you've got to strip out of the oil price what is happening to the rest of inflation. >> sorry, can i just read between the lines? everybody is now saying, maybe we get a rate cut from you. what i've just heard is maybe a little more subtle.

is the market getting ahead of itself? >> remember, the markets do overshoot. we are sitting -- [indiscernible] i can't say what the call will be now. >> you are saying the market is getting ahead of themselves? >> i can't say now, but they have done so in the past. >> you wouldn't be surprised -- >> but at the same time, you must become is an of the fact that the inflation fundamentals are on a downward trend. >> would you say it was a missed opportunity not to hike rates back in november? >> [indiscernible] we do not think so.

we started our tightening cycle in january last year. the deadline in the inflation rate actually means that real rate of tightening. >> so, due to what is happening you've got a tighter policy. given the fact that maybe the african economy is stabilizing, does it need a tighter policy? is that a desirable effect from your point of view? >> what we had been communicating is that my policy has been very accommodative. my policy will begin to normalize. we have been bubbling around at the upper end of inflation target.

the market rate is showing that inflation is downward. inflation expectation is on the upper end of our inflation target. you would like to see that increasing expectations are within the target that we have. >> what is your forecast for the price of oil? is $50 sustainable? >> i don't know what is sustainable in this environment. we had expected that the oil price will be coming down. we didn't expect it to come down with this amount of speed. i don't think any forecaster would say they called for the oil price to rise. >> we did try and find one. we haven't.

>> one of the implications of the policy formulation at the moment is, you see this as a read across of the central-bank decision. are we going to see a stronger dollar? i've spoken to markets about this. the previous heads of the finance ministry and your central-bank the dollar was an issue for them. if we get a significant ongoing dollar strain, how important is that going to be for dollars a -- for policy formation for you? >> if you look at the past five decades, you will find that a strengthening dollar is associated with a decline in commodity prices. when the dollar strengthens commodity prices come down. we are seeing the same phenomenon. commodity prices are up, for

sure. what we would like is our current system being competitive and commodity supplies going up. >> can i ask you a fun question? this is our twitter question of the day. we ask all the ceo's and central bank governors. >> i don't tweet. >> we know. who would you like to have a drink with? at davos, you can choose any person. is there anyone that you are interested in meeting or hearing their view of the world? >> [indiscernible] >> deal. [laughter] someone who is actually a mover and shaker, who changes the world. >> if there is one individual who can change the world -- >> very diplomatic. >> and very charming.

>> thank you so much, lesetja kganyago governor of the south african reserve bank. that's just one great interview. we have plenty more coming up. >> that was a bloomberg first. we've got many more coming up. we are speaking to the executive chairman of severstal. we've been talking to shazam this morning as well. we will hear why it has been raising money and the possibility of an ipo. ♪

>> seeing private gives us so many choices around our strategy. at the same time, we believe that shazam would make an excellent public company. while we can't comment on the timing, strengthening the balance sheet gives us more choices on whether we consider going to the public market. >> that was the shazam executive chairman, andrew fisher, talking about his plans moving forward. the company just closed a funding round. the big question is, now that this company has a billion-dollar plus valuation is an ipo next? caroline hyde is picking up the

story. no immediate plans, but he is considering it. >> indeed. they've set in previous months that they were running towards getting themselves in place to be looking attractive for an initial share sale. they've been speaking to billionaires. they have a couple billionaires joining in the latest round. they didn't need the money. what are they using the money for? it is all about building on their technology. shazam, we know that if you are at a bar or a clothing shop, you can listen to the music and recognize what it is. you can also recognize what the television shows are. how do you monetize this product apart from selling songs? they are getting into advertising. you've just seen the latest audi advert. suddenly, up pops the inside of the audi car. something you can see, feel. you can book a test ride.

audi wants these products. they don't want an advert to last 30 seconds. with shazam, you make that last a minute. then they test drive the car and potentially even buy it. this is where the monetization comes in. they are teaming up with cinemas and shopping centers as well. as you walk past certain screens, you can interact with the screen in front of you. also, this is a company that wants to be ubiquitous. have a listen. >> our mission is to be ubiquitous. we have over 525 million users now. 20 million people will use shazam today. in order to grow that significantly further, and there are -- we need strategic partnerships. >> he spoke to us about those partnerships. they've teamed up with the likes of spotify.

actually needing to sign these deals to keep building their consumer base. this is a company that seems to be big on expansion plans. >> how unique is the valuation in the u.k. tech scene? >> that is the key question. we all want to see more billion-pound companies coming out of the united kingdom. it is pretty surprising how many we have actually had. shazam is kicking off 2015 to a nice start. a tech investment bank, they ran some numbers last year. 30 european companies founded since 2000 have a valuation of above $1 billion. that is only nine less than the united states in a decade. that's not that bad. you had european companies, yandex in russia skype, asos

all these companies born in europe. the u.k. has managed to do 11. they had asos, spotify. we want to see the next line. who are the next ones hitting $1 billion? is it going to be the likes that we are currently looking at? a business company could be looking at raising money. these are the next generation that we want to see. guy, you asked about initial share sale. they are creating more billionaires and getting them to invest in the next generation as well. putting u.k. on the map. you see companies coming to the u.k. to grow. well done, shazam. >> caroline, thank you so much. caroline hyde with the latest. >> we will have some news may be

in the near future. you never know. caroline hyde. right, let's bring it back to davos. what is it like to attend davos for the first time? jon ferro hates to be called a davos virgin. >> but it is so funny. we can't remember what it was like the first time. >> ancient history. >> jon ferro can. find out his first impressions. find out where he thought the best networking places were. it is day one for davos 2015. ♪

>> so, welcome back. the world economic forum kicking off today. the sun is coming out. but what is this place like? >> we followed our reporter, jonathan ferro, around during his first visit to the world economic forum. >> here i am at the world economic or an in davos. it is my first time and i'm in good company. it is the first time for president hollande and prime minister renzi. i'm going to take you behind the scenes. come to davos, they said. rub shoulders with world leaders, billionaires, and

central bankers. all i've met so far our security guards and freezing cold temperatures. now, i'm in the world-famous conference center. supposedly, this is where the magic happens and the deals get done. there he is. i can't see governor kuroda, i can't see jack ma, but what i can see are lots and lots of cameras. >> it is opening night and it is starting to fill up but this is not quite my crowd. these guys are here to see the opera singer, andrea bocelli. i'm here for something a little different. let's face it. the real networking isn't done at the conference center. it is done right here at the bar.

my challenge now is to find myself one of those notorious davos parties. >> i'd really like to know how much that beer cost. >> a lot. the prices here are eye-popping. but i'm surprised he thought it was not that glamorous. >> will bring him to the right party tonight. for those listening on bloomberg radio, "the first word" is up next. for our viewers, a second hour of "the pulse." we will be talking to the ceo of eni. >> all that coming up in the second hour of "the pulse." stay tuned, coming up after this break from davos. ♪

>> leaders worry over the price of oil. >> the oil price plunge will be

over in less than two years according to the vtb ceo, along with russian sanctions. >> we come here to discuss the business situation and what is happening in the world. >> the most talked about man in europe is set to arrive -- the swiss national bank president. >> good morning. welcome to "the pulse." welcome to davos. the sun is shining. >> we are live from the world economic forum in switzerland. >> what happens next?

nobody can quite figure out what the impact is going to be. >> let's quiz one of the most important oil experts. he is the ceo of italy's largest oil company. thank you so much for joining us on bloomberg. we try to figure out what the price of oil is doing. tell us how you see -- what are the questions we need to ask? is it something structural or is this just opec staring down the shale gas producers in the u.s.? >> when you talk about market you talk about increase of shale oil production. stagnation in europe. we are looking at structural

components. what we saw in the trend that started in july -- only when opec said they did not want to reduce production in november, it was worse in terms of price reduction. we are positive in the long run. we think if we stand strong on the structural components -- only one is the shale oil. they have strong decline rates. it is something that is going to slow down. this component will disappear at this price point. we are positive in the long run. without any intervention that we see in the oil business, they

can give a positive or stable view to investors. [indiscernible] it is clear that investors who had a long presence in november want to understand if there is a stabilization. in the long run, we are going to recover. in a couple years, we think we can be in the $80's and $90's. >> the pace of change has been spectacular.

the drop is something that caught a lot of people unawares. is it possible to make russell no -- rational decisions when the prices moving as fast as it is? what kind of investment is at risk? what works? what doesn't? is it possible to make those decisions? >> we really move a big amount of money. we have felt this kind of fluctuation in the past. the average is up and one half year maximum. -- in one half year maximum. we cannot stop everything especially for projects already started.

then we will be out of cycle forever. [indiscernible] we are working on operating cost, infrastructure cost and on complex projects -- moving money to give returns. >> are you cutting investment as well? >> absolutely. we have different kind of investment. we have investments already committed and investments to start a commitment. i think the average in the industry will be a cut of about 10% to 13%. we started our efficiency program in may.

>> you talked about $70 per barrel those kind of levels. it is an interesting number you have brought out there. a lot of people talk about $70 being the line in the sand. north of that, cash flow is ok. south of that, things become difficult. what are your cash flow expectations? >> [indiscernible] dividend is based on our fundamental cost and cash flow. from an eni point of view our strategy was to work on

aspiration -- we have discovered more than 10 million barrels in the last year. [indiscernible] in terms of breakeven we are very good, we are in very good position. considering that our asset base is lower. i don't look at that as a critical problem. we have to look at the company breakeven. $70 $65 -- it is still a safe place in conventional assets. it can also go lower but you

have to reduce your infrastructure and operating cost. >> do you think the lower oil price will be a catalyst for consolidation in the industry? where do you want to place yourself? are you looking at targets? at these prices, some companies won't survive. >> the most important element the most critical element for m &a or corporate acquisition or consolidation is the stabilization of the oil price. with the market still singing i don't think a big company can take a risk to buy a company that could change the day after. after we have the stabilization of the oil price i think there

is a good window of at least one year to have some bigger corporate acquisition. for eni, i don't think that is an issue right now. we focus on the development. our cost is $1.50 to $2.00. that will be our focus. >> i'm going to ask you a slightly different question. >> i think the issue that we already discussed the

fundamental role of opec, the stabilizer of the oil business -- they are still so important. 40% of the liquid production and 80% of global reserves. we need to look at them as a stabilizer of the world. >> would your question be, why are you not doing your job? >> they are crucial for the oil business, investors, the banks. be sure that you are investing in safety and stability. we need stability. [indiscernible]

we need stability otherwise we cannot have investment. and then what is happening in four years or five years? [indiscernible] we destroy value without it. >> thank you so much for joining us. let's look at the currencies. for the first time, euro-swiss franc is below. >> it has gotten a lot more expensive in davos let me assure you of that. [laughter] a lot of people are talking about with the ecb is going to be doing next. >> there are at least 100 billionaires here in attendance. russia's fifth richest man joins

us now. n -- next. ♪

>> welcome back to "the pulse." we have two days to go. look at that glorious mountain. >> blue skies, a few clouds, a

beautiful davos behind us. we have already had great guests. >> let's get straight to alexey mordashov. >> thank you very much. >> the presence of russia here is quite extraordinary. can you quantify the mood? defiance? business? give us a flavor. >> i think the mood is positive. i think there is a certain anxiety, of course. but what is happening in russia -- the future of the russian economy -- i would not be too pessimistic about russia. we have experienced --

[indiscernible] we are having a correction. in general, that is very helpful for a nation's economy. it could have serious positive outcomes. all imports are less competitive. >> i understand the fact that a lot of russian ceos are trying to be optimistic. the pain you have to go through with reforms must be difficult. >> we have become accustomed to reforms the last 20 years. i'm not saying it is easy but it is not so dramatic like some people will say. >> is it going to get worse from

here? are the sanctions as tight as they are going to be? has the ruble fallen as far as it is going to fall? does it get tougher or do you expect that things will start improving? you have laid out the positive case. to the screws get tightened a little bit more? -- do the screws get tightened a little bit more? >> it is difficult to speculate on sanctions. they are purely political. if you speak about the specific impact of sanctions on the russian economy it is a couple of sectors. they are much more exposed. i think it is a relatively

temporary situation. i believe it is very likely -- >> what do you make of the punch in the ruble? >> for us, it does not mean much. we are a large exporter. we believe that our prime market is still the domestic market and that our focus should be on the russian market. [indiscernible] >> they asked you. they asked you to sell rubles more rhythmically? >> yes. they just remind us about the importance of coordination on

the economy and for key economic players to act with a good understanding. >> will this have a meaningful impact on your economy if the sovereign is downgraded to junk by the s&p 500? >> we have a very good position. [indiscernible] we have more problems how to place cash properly. because we are not going to borrow, we are not so much exposed. people trust in our finance. >> what impact will it have on the country do you think? >> it is difficult to say. the corporate sector has borrowed a lot. [indiscernible]

it is difficult to say. borrowing will be much more expensive. hopefully, we will reduce the central bank rate which will hopefully help us in the future. i would not overestimate that as well. [indiscernible] it is important, but i would not overestimate it. we are now -- u.s. to me -- you asked me and it is difficult to say what will happen. it could bring a new equilibrium for growth. the biggest negative is the decline in patches and power.

i hope we can overcome it. >> have you had conversations with the government saying, can you help us with curbing instability? have you had conversations with other world leaders to try to help? or is it something you assume you have to deal with? >> first of all yes, and second of all we hope the government will help curb instability. which they are doing. >> ukraine cannot be helping you. >> well. it is a different story with the political situation. i would not overestimate the importance of sanctions on the ukrainian situation on the business side.

we have to wait a little bit but new equilibrium will be stabilized to start with. >> are you planning for the dollar to go up this year? >> from what i have seen, probably a new equilibrium -- difficult to say. it is a free market economy. [indiscernible] we will probably have to wait a little bit and see. >> you are a very big exporter. steelmakers are the best barometer to understand the world. the imf had to cut their forecast. it seems that this instability is starting to filter through the world economy in different and more sinister ways than we saw last year. >> difficult to estimate, as

usual, but i don't see dramatic change in the next two months. it leads to diminished growth. we expected growth of 2%. the same for 2015. growth is 3.5% a couple of years before. all of these instabilities lead to diminished growth. >> how much concern is there on the mood of the swiss franc? >> i did not hear much about it. >> so you have just arrived? [laughter] >> i don't think the swiss franc itself is so much important. of course it is important. it is a very important sector

and adds to instability, but we will have to wait and see what the free market economy forces will have on it. >> we have been talking about currency wars with alexey mordashov. ♪

>> welcome back to "the pulse." welcome back to the swiss alps. stunning scenery behind us.

it has been a great show already . we are going to carry on that conversation right now. >> the swiss currency looks set to take center stage. we are looking to find out what time the governor of the swiss national bank is going to be arriving. probably the most wanted man. >> these are amazing days in the foreign exchange markets. the week is not done. the ecb is tomorrow. >> qe is front and center. carlo great to have you on the program. thank you for joining us. talk to us about your biggest concern. we talk about qe and expectations of qe from the ecb. >> it is important for us to

remain within the ecb. otherwise, it would not have a significant impact. but the end, you have a eurozone that is growing between 0% and 1%. the eurozone will be something that is not completed if you are not within the unity of the ecb. >> how to you look at the move of the swiss national bank last week? how do you see what happened? >> they want to be in a position to stay before the action of the

ecb or quantitative easing. the devaluation of the euro is the only way to increase the real economy through an increase in the disposal of assets and the selling of products by companies. the reality is that they want to anticipate the valuation. >> i'm quite intrigued that this is a demonstration of the eurozone at its weakest. your senses that we will not get a risk of the credit sharing -- sense is that we will not get a risk of the credit sharing? >> we cannot allow risksharing. it is a symbolic demonstration

that we have to accept compromise. it is something that from a symbolic point of view does not work. >> i want to talk about your bank. you told us you may be increasing targets. are you still looking at increasing? is there a bigger chance of that happening? >> there is an absolute chance. asset management, insurance business. we are well ahead of targets and we are growing and 9% 10% in commissions. we have to wait on the impact on the real economy in italy in 2015 and quantitative easing. >> i am intrigued that you talk

about the prime channel through which qe working being the foreign exchange markets. >> i am not a monetary expert. [laughter] >> you talk about devaluation being the primary channel through which it works. is that because the system is still broken? >> banking in italy is downgraded because we gave 28 billion euros -- it is the sum of the maneuver. next year, we will give 35 billion euros. we are giving money to the italian people. the demand of credit will demand

-- depend on the demand of products from companies. we come back to the real economy. that is the way the transmission works in real life. it is a reality that i see this year for the bank. >> matteo renzi talked about reforms affecting the banking business yesterday. we see the beginning of possible consolidation? >> from a symbolic point of view, matteo renzi is delivering. that is very important. it is a symbol. he can move something that was not there in the past. that is very positive. on the other side, on the

consolidation it is possible that there could be interest from international investors to the countries on this point. >> positive, overall? >> yes. >> we have seen brokerages going under, banks affected. when you saw that happen, what was your initial reaction? have you been able to quantify any numbers? >> the majority of our exposure in that subsidiary -- we had no significant effect from this move, but it was unexpected. >> are you much more wary of central bank communication? >> if you pass the quantitative

actions in the ecb, it would be a no measure timing for the central bank. at the end, the big decisions -- this is to bigelow the eurozone, we like the politicians -- typical of the eurozone, we lack the politicians who can move. mario draghi is the one player who can move the game. >> what kind of targets do you have in mind? >> the first point for us is to buy a brand. if we want to go out from italy

-- the private banking asset manager is at the level of the second or third player, so we are really big, but if you want to go out, we need a brand. couts is an interest for a brand. we want the name. there is no possibility to make a deal. it does bring to the possibility of having other targets. targets could be in the usa, u.k., switzerland, asia. >> run me through what you think the top three names are out there in wealth management. >> the top three are not the target. [laughter] >> the ones that could be on the list. [laughter]

>> [indiscernible] these are the brands. >> there are undervalued brands out there? >> yes. >> what are you buying? [laughter] >> i'm just trying to get -- [laughter] >> thank you so much carlo. carlo messina. we are getting live pictures out of matteo renzi. he is speaking, addressing the world economic forum. he says that italy needs to power through the reforms. politicians need to seize the motive. this is a great message for italy. >> some positive messaging over

the last 24 hours. he is continuing to push his story from rome to davos. we are going to take a break. >> we certainly are. oil prices hangover davos -- hang over davos. can russian sanctions be ongoing and what does the oil price mean for the russian recession? how long is that going to last? ♪

>> welcome back. you are watching "the pulse ." >> russia is front and center in the swiss alps. joining us now is russia's deputy prime minister. >> thank you very much. >> talk to us about how concerned you are about the recession continuing and how russia will get out of it. >> last year, we had some growth. low, but still growth. the russian economy is more stable than the oil price shocks. but it is difficult with the oil

price below $50. we are concentrating on the things that are more important than others. we need to make sure that food production will be stable. 5% growth in agriculture is very good. we concentrate on subsidies for people who need them. we concentrate on the banking sector. [indiscernible] it is daily anti-crisis work that we are doing now. [indiscernible] >> would it be a mistake to downgrade the s&p -- for the s&p

to downgrade russia to junk? >> it would be a big mistake. there is no mistake -- chance of russia defaulting. it is the overall perception toward russia. but not really within russia. it depends what the united states will do next. i think it is wrong to say that the russian economy is already destroyed. we will find ways to finance. >> we have oil analysts on everyday. -- every day. it is hard to say how low the price will go. >> prices can be lower than today for a short period of time. but not for a long period of

time. i think for this year, prices should be on average higher than today. but not much higher. >> we have talked to a number of russian guests this morning. to a man, they have talked about purchasing power for the russian people. how politically difficult is that? you have talked about the need for revitalizing the agriculture sector. but the lack of purchasing power is a big factor. >> i think degradation and lack of purchasing power is still strong. [indiscernible] inflation was 16% last year. 11th in the world. it went down by about 3%.

it is not a big reduction. we will avoid a big reduction in purchasing power this year. we will support employment. we will give grants to small businesses. we will do everything possible. >> what about inflation? food inflation? why not put a cap on food prices? >> caps on food prices lead to gaps. we want foodstuffs to be on the shelves. >> you are concerned about it? >> this is why subsidies cost more than before, so the prices can be there. [indiscernible] the pictures that are being

shown, that russian shop shelves are empty -- they have full shops. there is no problem. >> one of the things that russia is exporting his capital. money is flying out of the country. people talk about the option of currency controls. can you absolutely rule out that currency controls would be in place? >> never. but the government and the president have announced that we are not going to do this. [indiscernible] [indiscernible] they all understand that we will

be better off when we are stable. [indiscernible] if oil prices stabilize at any level, then the ruble will start improving and this will lead to reduced interest rates and inflation on the market in general. >> you would be willing to let it slide further? before you said that the deflation -- devaluation would be helpful for competitiveness. >> not 100%. we need to find the floor. if oil prices are even at the current level -- >> thank you very much indeed for your time. the russian deputy prime minister. >> we have also heard that the

ukraine's president plans to meet with the imf president. keep it right here. it is day one of davos 2015. ♪

>> welcome back to "the pulse." it is davos 2015. >> the main event kicks off. but jonathan ferro is a davos virgin. we sent them out to get a look at what it is like to attend the world economic forum. >> it is my first time and i am in good company. i'm going to take you behind the scenes. come to davos, they said. rub shoulders with world leaders, billionaires, central bankers. all i have met so far our security guards and freezing cold temperatures.

i am in the world-famous conference center. supposedly, this is where the magic happens and the deals get done. there he is. i cannot see jack ma. but i can see lots and lots of cameras. to be fair, it is opening night and it is starting to fill up. this is not quite my crowd. i thought it would arab the script and do something a little bit different -- i would tear up the script and do something a little bit different. it all happens right here at the bar. now, i need to find in a tory us dav -- a notorious davos party. >> not glamorous?

>> he is going to be replaced. [laughter] >> he is not covering the right parties. >> keep it right here. >> qe could be announced by the ecb tomorrow. we have some of the best thinkers on that subject. later today, we have oil on the agenda. i will be talking to tony blair. >> we really want to start and try to pin down thomas jordan of the swiss national bank. we know he is arriving. he is not speaking to the press or speaking publicly. central bankers are saying, i would love to have the opportunity to chat with him to see what is going through his mind right now. was the timing wrong or did he have no choice? >> the euro is trading below

parity against the swiss franc. while we have been on air lunch just got a lot more expensive. >> get ready to have a cup of coffee. >> thomas jordan is going to be here. we are winding up toward the ecb decision tomorrow. francine as a fantastic panel tomorrow that is going to be a big part of our coverage and we are looking forward to that. >> "surveillance" is up next on bloomberg tv. you don't want to miss our interviews coming up. follow us on twitter. ♪

>> good morning, everyone. davos switzerland. for the next three days, we will be in conversation will the leaders of economics and government. olivia in davos. -- olivia, in davos, they are ripping up the script. >> we start with the state of

the union. president obama said the economy has healed. he told the republican-controlled congress that the evidence was in that his economic policies are working. >> at every step, we were told our goals were misguided, too ambitious that we would crush jobs, explode deficits. instead, we have seen the fast