>> compromise on greece, maybe. bailout talks in brussels as germany shows signs of softening. >> bouncing back. how guy hands recovered. we will bring you an exclusive interview. >> and, worth it. in another bloomberg exclusive, we speak to l'oreal's ceo to find out why the strong dollar is good for the world's biggest cosmetic maker. good morning. you are watching "the pulse."

i'm guy johnson. >> and i'm francine lacqua. talks are ongoing between greece and the euro area today as the greek government looks to carve out a new bailout contract. let's get straight to hans nichols in brussels. what is the most important development in the last 24 hours? >> good morning, francine. they do have these technical conversations going on for a long-term program. they want to agree on all the numbers. eu officials, technical advisors, and greek officials. they are going to have a political agreement. we don't have a political agreement yet. we have an agreement to go through the numbers and continue the negotiating process. they need the same data sets and that is why we need to have -- that's why it is important that you do have these numbers. angela merkel is positive. she says that mr. tsipras was someone that she could work

with. >> we gave each other a friendly greeting. i congratulated him on his election win. i told him that from my side we want to work well together. we will take a look at the different points where we need to find common ground. it was very friendly. >> where germany's prepared to compromise, they are saying not all of the bailout program. not all of the points need to the adhered to. the greeks think about 70% is level. the question is what do you do with the other 30%? that could be where the key negotiation comes on monday. is it going to be face-saving for the greeks? are they going to be able to sell this to their public? if you do have a renegotiation, it could need to the past by all of the national parliament. >> hans, i'm looking at the

screen in front of me. euro bank, plus 90%. national bank of greece, plus 18%. alpha, 14%. the market likes it. any sign of a deal and these banks are popping. >> we have seen the banks improve. that's happened over the last three days now. there is -- there are quite a few notes of caution here. one of the notes of caution that is in just mr. juncker saying he remained concerned, the ecb has raised the borrowing capacity for the greek banks to 65 billion. so you have e.l.a. up to 65. the ecb is clearly giving the banks some breathing room.

the question is, how desperately do they need it? are the banks under more pressure in terms of withdrawals than their stock prices indicate? >> thank you so much. hans nichols with the latest from brussels. that brings us to the markets. let's look at the greek banks and the wider european markets. >> what we've got here is the athenian markets doing very well. the key level on the dax is 11,000. we've been through that this morning. we retreated a little bit. nevertheless, the market on the front foot. volumes are a little light on the dax. we've had a touch of that level. some good german data being delivered today continues to be one of the key beneficiaries of this weaker euro. that surprisingly strong gdp number probably a factor. >> we also have gdp figures out

of italy. the economy stagnated. it is not weaker, it is actually better than expected. >> all i'm saying is that germany stands out as a very strong number. >> not as bad as we were thinking. >> greece continues to be a huge topic of conversation. in an exclusive interview with bloomberg, guy hands questions the idea of giving greece a free pass while spain, ireland, and other countries have and continue to work their way through these structural reforms which are having such a big impact on their economies. >> you have the greek prime minister almost saying, i don't feel this is what we should do but i've got no choice because it is a democracy and i was voted into do it. it is a very clever way of arguing. you blame it all on democracy. we have to be unreasonable

because we were democratically elected to be unreasonable. >> how unreasonable do you think he's going to get? >> i think he's becoming more reasonable by the day. i think there won't be a greek exit. i think it is more -- >> when you say reasonable, you mean rational? >> i don't think he wants an exit. the vast majority of greeks are happier with europe than the vast majority of brits. it is seen as a very good thing in greece. what they don't like is austerity and they want to have their cake and eat it. they want both the protection and support of europe, but they don't want to pay for it. i think the germans have reached a point where they need to put a line in the sand. europeans generally feel that way. i think, for the future of europe, there probably is a need for a line in the sand.

otherwise, the risk is that every country says, if the greeks get away with it, so can we. look at the irish and the pain the irish have taken, and the spanish, to go through their austerity programs, and what it has meant to growth rates in those countries. they deserve their rewards. they've worked for it. why should the greeks be given a free pass when the irish and spanish have taken just as much pain and worked just as hard? >> do you worry that unintended consequences could come into force and we don't understand how the impact will be manifested across europe? is this a lehman moment? >> i don't think it is. the greek economy is very small. the fear is if people give into greece and give greece a free pass. the anti-european parties across europe will really seize on that. in germany, there will be a huge

swing. we are just bailing out the weaker countries in europe. they are not actually changing. why on earth do we continue to do it? you will get that across, in the u.k. it is an incredible boost if the greeks get bailed out. if the greeks don't get bailed out, i think it goes the other way. people say, there is some discipline in europe. brussels isn't just giving a money away to its best friends. there's a real focus here on some discipline. i think the real unintended consequences is the moral dilemma of giving in. >> guy hands talking to me yesterday. you can catch the exclusive interview with mr. hans throughout the day on bloomberg. >> it was a great interview.

you can also join the conversation on our twitter. our twitter question is, what did guy hands get wrong about the music industry? our guy johnson spoke to guy hands and he was pretty good on that. >> he was certainly good on bouncing back from it. >> coming up, a bloomberg exclusive with the world's biggest cosmetics maker. we will hear from l'oreal's ceo. >> plus thomas pink's international expansion. the ceo and president joins us in ennis glues it conversation later in the show. ♪

>> welcome back to "the pulse." we are live in bloomberg tv and radio. greece is seeking a new contract with the euro area on how to continue its bailout. can germany and greece find a compromise before time and money runs out? joining us now is bank of america merrill lynch's chief economist. it seems we've seen this all before. and yet, if you were to speak yesterday, i would have said the germans and the greeks have never been this far apart. it seems they are coming closer together. >> it is progress, which is

better than anything else. what we have is at least an agreement to talk about the technicalities. basically, the greeks seem to be very adamant that they should be starting things from scratch. the germans seem to be adamant that the program is still preferable. for me, the first clear sign that there is willingness to go she it -- to negotiate, the rhetoric from both sides. from the greek side, as long as there is no pressing need and i don't think there is a pressing need right now, it makes sense for them to continue to be extremely tough in negotiations. on the other side of the

equation, for germany, it would be full dish -- be foolish. i think the market is taking all this in stride. the growing view is that it is all about rhetoric, all about giving tone to everyone to climb down from their initial position. i don't think they will have something on monday, apart from an agreement to continue to talk. the ecb has been instrumental in keeping things together. this increase in the ceiling is another thing that the ecb will not do anything drastic, at least will not make any drastic decision on this. so they keep things functional. there probably still a bit of money in the greek state coffers. >> if you were spain portugal,

ireland, any of the countries that have been in the program, have had the same things imposed upon you, how would you read this story? >> it's a difficult conversation. who is spain, ireland, portugal? in some cases, and that was clearly true in ireland portugal, and spain, the governments would have pursued the kind of policies that they are negotiating. there is a conviction in the portuguese government that the reforms were needed. >> but the possibility of a better deal, this was the point that guy hands was making yesterday, why should we do this when they are getting that? if there is some opportunity to improve the deal, do we have to renegotiate? >> we have already improved the conditions for greece many

times. no one else after we restructured debt asked for this treatment. >> so they will be happy. >> they are not happy. my understanding is that currently, tsipras has no allies within the council. the government's of portugal, spain, ireland they have been selling the adjustments. it cannot be too easy. maybe greece needs to be, a pound of flesh needs to be extracted. >> at the same time, the tide has turned against austerity. by this time, we were expecting more growth than we are getting, which is none. you can say that the bailout was not mismanaged but badly put in place. a botched job.

>> on austerity, if you take spain spain is actually allowed to drift every year from its fiscal targets. look at where the deficit is today. everyone has been allowed to drift. spain is in a net fiscal accommodation because of the reform of income tax. everyone is looking the other way. germany never said a word. to me, it is a very subtle game. what matters is that things need to be not latent. as long as everyone skirts around the issues of little bit, allows himself or herself more time to deliver, it is fine. the problem that greece creates is the confrontational point of view. it is one thing not to be able to deliver on the targets once

you show that you were trying to, and another thing to say, i don't think that's the right approach. by the way, every time greece comes back with the question of the 1953 debt consolation on germany, every time they come back with the war reparations story, that creates additional tension in germany. for me, tone is not important in that conversation. >> can i have a quick 30 seconds on the german gdp number this morning? the problem is, the previous quarter wasn't -- >> germany had one of the worst gdp i've seen anywhere in the world. 1.6 is basically in line with what we have for the annual average. we should see some acceleration towards 2%. q4, i don't think is that much relevant.

what you have seen is the fact that they seem to have overcome because of russia. what is even more important for germany is that the rest of the area definitely is looking better. spain, 2.8% annualized growth. there was no fluke there. >> gilles moec chief european economist at bank of america merrill lynch. >> the world's biggest cosmetics maker. we are going to hear from l'oreal's ceo in a bloomberg exclusive. ♪

>> welcome back. you are watching "the pulse." let's get you another bloomberg exclusive. after l'oreal sales beat estimates, we spoke to the company's ceo, jean-paul agon. he told caribbean, and about the impact of a strong dollar on his business. >> to be honest, for 10 years it was negative. for 10 years, european companies and l'oreal suffered from the overvalued euro. now the euro is back below its level when it was introduced 14 years ago.

that is very good news. it will help our cost structure, but it will also of course help the translation of our profitability worldwide. it is very good news and we will make the most of it. >> does that mean lower prices of your products? >> we will strengthen the support of our brands, and it will help, as i said, the translation in euro of our sales and our profits. >> what about the currency volatility in emerging markets? tell us the outlook for asia, especially china. >> the situation is pretty stabilized now worldwide. after a period last year where

we saw some instability in different parts of the world, brazil, other places, now the situation seems to be more stable, with one exception russia. the ruble decreased a lot. we think this should be pretty stable for next year, and pretty ok for us. we want in 2015 to continue with the stronger market price that we've been starting 20 years ago , where we double our percentage of sales in the market every 15 years. we keep increasing significantly. these new markets will be 41% of our sales. >> we also spoke to jean-paul agon about the consumer products' rebound and his outlook for 2015. >> of course it is sustainable.

we had a first half of 2014 where the consumer division was a bit weak. it was due to growth of the markets. the markets globally were weaker than the year before. especially in the u.s. it never happened before. it was pretty exceptional. the end of the year was better. the market in the u.s. rebounded. we were able to grow our market shares better, i would say, in western europe and many parts of the world. so absolutely this is what we want to achieve this year and the years after. >> for the global cosmetics market last year was one of the weakest in many years. 3% to 3.5% growth, that's what

you expected back in november. what do you expect for 2015? how is l'oreal going to perform? >> good question. the market in 2014 was a bit weaker. we have to be careful. it was 3.5% compared to the year before which was 3.8%, 3.9%. we are talking about a very little slowdown. i think that 2015 should be more or less the same, or maybe a bit better. there are some positive elements like the strong decrease of the oil price which probably will translate into gas prices lower, and more money in the pocket of our consumers. we know that this helps the consumption of our products.

this could be very positive for the u.s., for western europe, so i'm optimistic. >> that was the ceo jean-paul agon of l'oreal. we are back in just a couple minutes. ♪

>> welcome back to "the pulse" live from bloomberg's european headquarters in london. >> these are the bloomberg top headlines. >> european leaders warned russia of more sanctions to force a cease-fire in eastern ukraine. angela merkel said the eu leaders called on the european commission to get further measures ready. >> greece is seeking a new contract with the euro area on how to continue its bailout. the greek prime minister met his european union peers at a summit yesterday. greek negotiators and euro area

creditors meet today to discuss the way forward. >> germany's dax index rose above 11,000 for the first time after reports showed the nation's economy accelerated last year. german gdp grew 0.7%. france grew 0.1% in the same period. we are now just below that crucial level. >> right, let's go to derby. let's talk rolls-royce. last year was not a stellar year for the engineering giant. shares losing one third of their value. the headwinds are likely to continue. here with more is caroline hyde. so, topline lower, bottom line lower. >> un-surprising. not one, but two profit warnings last year. sales down by some 6%. that was the first drop in revenue we've seen in a decade

for rolls-royce. that is what has been put into question, whether it should be doing land, sea, and sky. what caught my eye was free cash flow, down by two thirds. not only as 2014 been a bad year, 2015 is not going to be pretty. they are saying some markets have deteriorated even since november when they gave us that last update. they make a lot of the engines for the defense area. economies are slowing down in the likes of china. we are seeing less military demand. on the commercial side of things, they've had slower growth in china and europe, a three-year delay to the bowling -- the boeing dreamliner and the re-engine airbus. they are the sole provider of that. suddenly airbus is slowing down production too.

things out of their control are hitting them, notably russia. the impact of sanctions heading them there. and of course the oil price. crude prices have hit orders for the offshore oil and gas industries. this is an issue and they say, targets are looking pretty. we've got sales likely to be down 2% and profit falling anywhere up to 12%. >> at the same time, rolls-royce is implementing a lot of changes. is it enough to convince investors to stick around? >> they've announced 2600 jobs to go. they've already filled about 500 of those cuts. they are trying to impose new people at the top. the u.s. leader is retiring. they've had a new finance director imposed. but there are some really huge monumental changes being called on by the likes of invest tech.

they had a report, saying, split this company up. don't do land, sea, and sky. just do sky. selloff the marines unit and the nuclear reactors. the way that you do this is perhaps, sell the assets, get about $6 billion, or have a dual listing and increase the value by about 20%. the long term view is that the strategy they are trying to employ would work, but you have a long time to get there. are you going to convince investors in that time? they feel, if you want bang for your buck, split up. i think the chief executive is trying to sound upbeat. he's saying, in the long-term we will be good. >> caroline, thank you so much. >> let's move on. guy hands, best known for his money losing investment in the

music publishing company emi, in an exclusive interview, the founder of terra firma talks to me about how the period has shaped his investments. >> there's a group in the middle who said, it happens to everybody. terra firma is no different. the only difference is you had huge amounts of press about it. what most people did was just roll over and die. you guys spent three years fighting to try to make emi successful. in the end, debt was enforced against you. we accept that. then you've got the people who feel pretty hurt and i understand that. but luckily for us that is, i think, a reasonably small percentage. >> is there an argument to be made that you are still in the

penalty box as a result of emi? >> i don't think so. you got a huge split. we have over 200 investors. undoubtedly, there are some who've been with us from the beginning and clearly felt that emi was foldable. a lot of people have increased their exposure to us over time and have done very well with investments they've made sense. some of those said look, every major firm did some deal back in 2007 which went wrong. none of us actually expected the crash that occurred. therefore, from our point of view, the only difference between you and them is, emi was very public. clearly, you have gone on to try to get our money back with regards to citigroup. >> just to come back to it, that

is not stopping people signing off with you. maybe it is a high-profile nature of it. that high-profile problem that you had with emi is not something that is currently manifesting itself when you talk to people who are going to be investors. >> i think there are much bigger issues for the whole industry than an individual deal. >> guy hands talking to me yesterday. >> he spoke a lot about grexit emi, and the u.k. elections. >> particularly the labour party and the finance industry. he said the labour party was burned. it invested so much time, effort, and really moved itself towards the city during the blair/brown administration then got so badly burned that it feels it needs to reestablish that relationship and has yet to do so. >> coming up, the governor of

sweden's central bank says he is ready to expand the bond purchasing program by a lot. ♪

>> welcome back to "the pulse." let's get you some top stories. >> anglo american wrote down assets by $3.9 billion after commodities prices fell eroding

profit by more than 17%. the ceo spoke to jonathan ferro in his first interview of the day. >> in my view, the market is the market. their job is to be competitive arian that's what we're going to do. from our point of view, we look at the market very carefully. we don't think it makes sense to throw out volumes and diminish the price of your product over the long term. that will actually damage our ability to supply in the long-term. in those areas that we think about if the resource that we are mining is not making money we will stop mining it. >> the world's largest steel maker saw profits fall 5% after iron or prices tumbled. they also forecast lower earnings for 2015. iron ore tumbled last year to its lowest level in almost five years. >> the governor of sweden's

central bank says he's ready to expand the bond purchasing program and failed yesterday by "a lot." here he is speaking again with bloomberg's jonathan ferro. >> we talked about this in december. we said that in the next meeting we needed to have a system in place to buy bonds. what we have done this time is gone a little bit more on that, saying we are going to buy 10 billion. that is a small amount if you consider the amount of bonds out there. we have also stated that if we need to do more, we are willing to do more. we will do a lot more if we have to do that to get the inflation rate up. >> for more, let's bring in jonathan ferro. we had this big announcement yesterday. you got a little more out of him. >> my take away from that

interview was, this is the start of something bigger. 10 billion swedish krona in his mind 0.3% of annual swedish gdp. it is a message. you take the rate negative. you say there's no floor. there really is no floor anymore. you also say that you can pretty much move whenever you like. forget the regular meetings. simon kennedy and mark gilbert of bloomberg picking up on this as well. the central bank is open 24 hours a day right now. that was the message from him yesterday. these are the first steps, we can do more. >> so what does more look like? do we understand the parameters of the programs that are likely to be used? does the toolbox have any more in it? >> he's talking about tools used together. negative rates, bond buying.

in terms of size of scope, how big could this get? i pushed him on what the floor is. obviously, there is a floor. you are not going to take rates to -5%. it is somewhere between 0% and -5%. if that helps you. we've gone to -0.75%. it looks like thereabouts is where people are. rates can go further and credit can really be tuned up. i think the big issue for denmark as well is while you have this huge quest for inflation you are sowing seeds for future crises elsewhere. i did push him on that. >> jon thank you so much. jonathan ferro with the latest on negative interest rates. >> talking about this a lot yesterday as well.

there was a sense that you could only keep them on for a certain period of time. >> we are also talking about corporate bonds. goldman sachs was saying, it is not too far out from the negative bonds. >> something to watch out for. also, one of the u.k.'s most famous investors telling us about his concerns leading up to the u.k. election. more from my interview with guy hands next. ♪

>> welcome back. you are watching "the pulse." we are streaming on your tablet, your phone, and bloomberg.com. the boss of terra firma has told me that london needs to engage with the labour party. in an exclusive interview, guy hands spoke about his concern leading up to the u.k. election. >> anyone looking at the west these days needs to look at it more like the way people look at the emerging markets. your number one risk consideration was politics. and what the government could do in terms of changing strategy. in western countries today, you should start there as well. i would say the u.k. election is incredibly important in terms of making a decision about the sort of businesses to purchase.

the problem with it is that politicians tend to increase rhetoric towards elections, and then post-elections, they try to backpedal as quickly as they can. >> how nervous do you think those in the square mile around us should be about what appears to be a fairly strong anti-finance line emanating from the labour party? >> i think pretty nervous. and i don't think one can blame the labour party for this. i don't think there is a particularly good understanding of how much the city has reformed and changed since 2007. i think the labour party feels very bitter and hurt. they've made a huge effort pre-2007 to get very close. they made a lot of lords. a lot of bestowing of awards on

a lot of people in the city. then it all went horribly wrong. i think they feel that they were conned and they feel very upset about it. it is difficult to blame them for that. what the city has to do is find a way of engaging with labour and i hope they will realize the city has done some quite extreme reforms. the problem is that the ordinary person, when they see that salaries are still in the millions, the fact that they were in the tens of millions isn't any more comfort. the fact that the city is paying less well doesn't come across. their view is, it is still a bunch of fat cats playing monopoly, which it really isn't. but that's a difficult argument to get across. i hope that labour is willing to engage in that before making

bold decisions which will harm the u.k. economy. i think they will, but you never know until as they say, the fat lady sings. >> time for another bloomberg exclusive. after l'oreal sales beat estimates, we speak to the ceo. >> of course it is sustainable. we had a first half of 2014 where it was a bit weak. it was due to the markets. the markets globally were weaker than the year before. especially in the u.s. the u.s. has seen a flat market. it never happened before. the end of the year was better. the market in the u.s. rebounded and we were able to grow our market shares better, i would

say in many parts of the world. so absolutely, this is what we want to achieve, as we have been able to achieve for many years. >> still, last year was the weakest growth for the global cosmetics market since 2009. what is your outlook for the global cosmetics market this year? >> good question. the market in 2014 was a bit weaker. we have to be careful about the words. it was 3.5% compared to the year before which was 3.8%, 3.9%. we are talking about a very little slow down. i think that 2015 should be more of the same, or maybe a bit better. there are some positive elements like the strong

decline in the oil price which will probably translate into more money in the pockets of our consumers. we know that this helps the conception of our products. this could be very positive for the u.s., for western europe, so i'm optimistic. >> how could the exchange rate between the dollar and the euro impact l'oreal this year? >> it is going to be very helpful. i'm pretty happy about that. to be honest, for 10 years, it was negative. for 10 years, europe and company, and l'oreal, we suffered from the overvalued euro. now, the euro is back to a bit below its level when it was introduced 14 years ago. so this is very good news. it will help our cost structure. this is -- this could also

help the euro worldwide. it is very good news. >> does that mean you might lower the prices of your products? >> no. we will strengthen the support of our brands overall, on the planet, and it will definitely also help as i said, the translation in the euro of our sales and our profits. >> in europe, are you seeing any signs of a recovery, and what would be the risk of greek exit for the european sentiment? >> i'm positive and optimistic about europe. the reasons to be optimistic are much more important than the reasons of being anxious. the reason to be optimistic is as i said, strong decline in the

gas price. the weaker euro that is very good news. it will help european companies. many, many good news. and obviously, the greek story will add more to that. >> in france, we had the latest gdp numbers showing growth was only 0.1% in the first quarter. do you expect a recovery of the french economy? >> i think it's going in the wrong direction -- in the right direction, the positive direction. also, as i explained everything that's good for europe is good for france too. i think that we are going in the right direction. for us l'oreal, france and europe is a very important strategic market. we are leaders here, but we

absolutely intend to keep investing and growing our market shares. that's what we've been able to do last year. the market was flat that we were able to grow by market share gains. >> the ceo of l'oreal. he likes the strong dollar. >> he does. it was a great exclusive interview. he doesn't speak very often. great to get his thoughts on the recovery in europe, his optimism about the future, and that strong dollar being good for the reality or he a >> -- for l'oreal. >> let's see where we are this morning. the italian number was ok if you think no growth is ok, but the french number was a little weaker. the dax hit 11,000 earlier. the greek banks have had a solid day this morning on some sort of optimism that we may get a deal.

they have retreated from their highs. >> gilles moec wasn't so confident. we do have another european summit on monday. we have plenty more coming up. keep it right here on bloomberg. ♪

ls as germany shows signs of softening. >> bouncing back from a $2 billion loss, how guy hands recovered from e.m.i. we'll bring you an exclusive interview with one of the u.k.a.'s most famous investors. >> and we speak to find out why the strong dollar is good for the world's biggest cosmetics maker. >> good morning to our viewers, and a warm welcome to those of

you just wake up in the united states. >> this is "the pulse" live from bloomberg's european headquarters in london. >> .3 .2, those are the g.d.p. numbers, the data are coming out at the moment for the fourth quarter. this is for the euro area in aggregate. we saw a better than anticipated number, and that may be why we've seen this number pushed higher. you probably see it in aggregate rather than simply as a stand-alone number. but the data are coming through a little bit better. the greek number also out as well. >> so that greek fourth quarter g.d.p. falling .2%. we were expecting expansion, and it really goes to the crux behalf we're seeing in greece right now, so they're trying to negotiate because they a very strong mandate to renegotiate with their creditors. they say it's worked. when you look at these numbers, they seem to be right. >> think about what happened in that period. we had the calling of the snap presidential election, then we

had the failure of the government to achieve what it needed, and then we have the pushing forward of the election, so a lot of political uncertainty in this period, and i wonder why -- >> also low oil prices, so that could have helped them somewhat a little bit. i just wonder whether the first quarter, will generate a better number. you can't think about the political uncertainty during that period, and maybe that number makes more sense. >> sernl does. talks are ongoing between greece and the euro area as the greek government looks to carve out a new bailout contract with its creditors. let's get straight to our international croobt hans nichols, in brussels. we're also getting a message from the e.c.b. which is, guys, let's get this deal done. is that fair? >> yeah, that's partly fair. they need to have -- they need to figure out what the actual

numbers are, and that's why the fact that the technical advisors are starting conversations today, the technical advisors from the e.u., the e.c.b. so they can agree on the numbers. these numbers that we just saw that show greek contraction in the fourth quarter are likely to affect what's going to be a pretty difficult political negotiation going forward, right? this all has to have political sign-off on monday when the euro group meets back near brussels. last night he seemed ready to strike a deal. he seemed optimistic. have a listen to what he had to say on what he was prepared to do. >> we are talking about the event wallity of striking an agreement, to reach this bridge agreement that will lead us to a new, shall i say social contract with our european partners for six months. a contract for growth, for social cohesion and for getting greece out of the crisis. >> both sides last night

privately were talking about room for progress, a little bit of compromise on the german side. that means that the current bailout program, the one that ends at the end of this month, they would be willing to make some tweaks, some modifications. remember, the greek finance minister has said about 70% of that deal is successful. the greeks, they still accept the idea they have to have some surplus spending, but not quite as high as 4%, 4.5%. the debate is going to be where that level is going to be how you calibrate that number. >> i think that's fascinating. i think probably the more aggressive 4% is going to be quite tough. 1.5% may work. we also heard comments saying the greek talks need to consider politics, and i think the tax story is going to be quite important as well. the banks are volatile. the banks are penny stocks. they are bouncing around all over the place. today, originaling up 20%, now down a little bit.

they're certainly having a very solid day. i guess the question is, how are they dealing with this volatility? >> e.c.b. has increased the limit that they can draw from the emergency liquidity assistance program, another $5 billion, to a total of $65 billion. they still need access to the lines of credit. if they leave their bailout, if they leave the program, they're going to have much more difficulty having any sort of e.c.b. funding at all. remember, with those loans, that comes in at 1.55% where the normal the financing window that was closed off about two weeks ago, was much lower, basically jegjibble, like .05%, i believe. there's a big difference there. we'll see how the bank stocks react, especially to this g.d.p. number, which will include the debate here, right? >> it's a big miss, and it's going to affect them down the line. >> thank you so much.

>> hans nichols with the latest on these renegotiations. >> which will be ongoing. greece continues to be a big conversation of course. in an interview with bloomberg guy hands, the founder and chairman of terra firma, questioned the argument about giving greece a free pass. he said others continue to go through their use period of time plans why should greece be any different? >> we have greek prime ministers almost saying, i don't really necessarily feel that this is what we should do, but i've got no choice, because it's a democracy and i was voted in to do it. therefore i have no choice. it's a clever way of arguing, because you can blame it all on democracy. we were democratically elected to be unreasonable. >> yeah. >> how unreasonable do you think he's going to get? >> i think he's becoming more and more reasonable by the day. >> you think it's not a

problem? >> i think there could well be a greek exit and i think it's more that -- >> when you say reasonable, rationale? >> i don't think he wants an exit. the vast majority of greeks are happier with europe than the vast majority of brits. it seems a very, very good thing in greece. what they don't like is austerity, and they want to effectively have their cake and eat it. they want both the protection and the support of europe, but they don't want to pay for it. i think the germans have reached the point where they feel that they need to put a line in the sand. i think europeans generally feel that way. i think for the future of europe for the good of europe, i think there is a need to put a line in the sand, otherwise the risk is every country says, well, if the greeks can get away with it, so can we. when you look at the irish and the pain the eyish rich have taken to go for their austerity

program, what it's meant to growth rates in those two countries as they started to come out of it, you know they deserve their rewards. they've worked for it. why should the greeks be given a free pass when the eye sandrish spanish have taken just as much pain and worked just as hard? >> do you worry the law of unintended consequences could come into force and we don't understand how the impact will be manifested across europe? is this a lehman moment? does it have potential for the lehman moment? >> i don't think it is. the greek economy is very, very small. the bigger risk of unintended consequences is if people give in to greece and give greece a free pass. the anti-european parties across party in different countries will really seize on that. in germany, there will be a huge swing saying, hang on a second we're just bailing out the weaker countries in europe. they're not actually changing. why on earth do we continue to do it? you're not going to get that in

germany, right across in the u.k., i think it's an incredible boost if the greeks get bailed out. if the greeks don't get bailed out i don't think -- i think it goes exactly the other way where people say well, actually there is some discipline in europe. this isn't just fifa giving money away to best friends or matches to best friends. there's a real focus here on some discipline and actually having some action. i think the real unintended consequences is the moral dilemma of giving in. >> you can catch more of that exclusive interview later today, plus a special program we'll play throughout this evening and weekend. >> it's a great, great interview. you can also join that conversation on twitter. our twitter question of the day, what did guy hands get so wrong about the music industry? our guy johnson spoke to him guy speaking to guy, and our

guy johnson thinks it's a matter of price. >> i think the management as a whole thing didn't exactly go well. you had some fairly well known pop stars refusing to make albums -- >> collaborate. >> that didn't go down well. >> the kind of thing that rock stars do. >> buying high multiples may be probably half the problem then having a massive financial crash as well doesn't help. >> coming up, another bloomberg accident inclusive with the world's biggest cosmetics maker. we'll hear from l'oreal's c.e.o. about his outlook for 2015. >> plus, we're going to be speaking to the force behind international expansion. ♪

>> welcome to "the pulse" here in london. despite the political posturing, the markets are becoming more hopeful that greece will strike a deal with its creditors before the deadline. eurozone finance ministers will gather on monday and according to our next guest an extension makes sense for everyone. joining success head of european macro credit research at r.b.s. great to have you on the program. thank you for coming in. give us a sense -- we're just getting head linse from brussels, because this is still where the technical talks are going through, which means that actually we don't have a deal yet, but certainly there's no

breakdown, which has to be applauded. >> i think there's definitely a more constructive discussion and i have to say you know, we have not budged in the opposite view. i think everyone was talking about the exit. it has been wrong the last five years. but we still get affected by these fears n. reality greek g.d.p. is the same always the area in germany or milan, so by itself, it's contained. you can absorbed a potential loss with fractions of 1% of g.d.p. over time. the problem is the signal you're sending, it's a dilemma. do you give them a free lunch? obviously because because you would have them asking for the same reduction. so you need to find a way where you have a constructive negotiation and you find an agreement, which is credible, but not a free lunch, probably i like the idea of growth in bonds. i think that's the solution. you probably want to pay the politicians in those bonds as well. having said that --

>> that's a great proposal. >> we're writing about that. i mean having said that i think by the 20th of february, there will be a resolution, maybe earlier than that. it makes sense for everyone. a lot of investors are waiting to buy european assets because they're worried about greece. u.s. investors, asian investors, we think there's going to be even more assets rallying in europe after this resolution. >> how does it -- the relationship between this program and the other program's countries, is greece different? you talked about it there, but you look at what's happening in spain at the moment, not necessarily the best comparison, but you look at -- if greece achieves any degree of success here, they're off to the races. >> i mean, clearly the free lunch option makes parties very aggressive, so that's to be

excluded. but even insisting with austerity can leave greece with extremist parties growing. you know, you have one of two people unemployed below 25 years of age. so clearly, you know, some economic forecasters have said, ok if you cut interest even more on greek bonds, then over the next 35 years you're saying 15% of that g.d.p. the problem is you won't even get to 35 years from now. you will only have you know, the remaining greece and young people migrating to germany or other countries. so in the end, this is a political decision. it's about europe's future. a free lunch is not a good thing, because greece had cheated on its numbers to enter the euro, and then reform the process. we all agree with that. but at the same time, kicking a country out, first of all, it is very hard and secondly, it sets a bad precedent for any other country in the future that could have a different

government, a different view. >> and god help anybody that actually works for the greece. >> and it would have very severe costs for the greek economy in the first year. it's very easy to say, but in reality, a lot of people have not done the right numbers. i think an extension makes sense for everyone, three, six-month extension, also in light of many other problems that europe has, like russia and the cost of an extension is very small. the question is timing. you know, again, you don't want to give a reduction in that. a haircut is complete moral hazard, but you pay me more in 20 years. if your g.d.p. is paying less, it doesn't grow, and that allianz the interest of creditors and debtors. >> they seem more eye to eye, because there has been such a rift in language. that's a political strong

maneuver from the greeks or whether it's just, i'm not being used to power and politics in europe. >> this is an economics professor, so in the 1960's, you remember the movie "war games," this is very similar in my view to two countries that are playing with nuclear arsenals. the first triggers it blows both parties up, because in a nuclear war, so the threat in order to be credible it has to be from someone to be crazy so i think greece has been playing rationale madness here. i think the madness in the end is controlled unless you believe it's crazy. i think he knows the game very well. >> you have to be crazy in balance, because they don't have a nuclear arsenal in the same way that germany has. therein lies the problem with all of this. we need to strip out the language. >> well, i mean, their threat

is a unilateral position to pull out or do a haircut, which in the end is more self-destructive. they have a smaller arsenal. the longer they threaten, the more there's a flight in greece, the less credible that their threat becomes. i think that's why i think in the end a notion tone is de-escalating, and we staw earlier this week, a much more constructive tone from all the european finance ministers. >> you're probably one of the most optimistic. you've never even thought this could happen accidentally. i mean, in your mind, is this a 2% chance or not at all? >> i think it's less than 10%, but i think the market is overstating the probability. i'm not saying there's a chance. accidents can happen. you can have during a notion process, you can have some parties losing their everybody in, but that's what i was worried about. one of the parties was

accidentally pulling the trigger, but we saw much more friendly talk. lagarde was even wearing a letter jacket. >> fashion duo. >> just very briefly, let's get your thoughts on -- we've just seen the 10-year go below spain. anything i should read into that? people are getting quite excited about the fact we're seeing -- we're going back to an area we were back in april. >> we're on high yields. if you look at italy and spain, italy has done some more reforms recently, while spain has put them in elections. spain is growing, has more done more reforms. italy is finally catching up on the reform, the banks that are very fragmented and the government has run the presidential elections relatively smoothly. they were able to elect a president without the help of other parties.

they have a more stable political environment, and that's why, on the margin, we prefer italy to spain this year. >> all right alberto, very quick comment on germany g.d.p., because that's up to the upside, and yet it seems volatile. >> q.e. is having some impact t. works more in the markets than the real question, because banks still are not lending as much as they should because they lack capital. in the u.s., q.e. was immediate because credit goes into bond markets. having said that, the countries are doing better benefit more from q.e. because there is confidence. if i give you one euro and you have a job, you spend it. if i give a euro to a greek who doesn't have a job, he saves it. that's why germany -- >> and you saw that in the numbers. there was a pickup in retail spending, though i still think it was the swiss sneaking over the border buying lots of ipad. >> we had a story on that. thank you so much for joining us today, head of european macro credit research with

r.b.s. >> coming up, we're going hear from l'oreal's c.e.o. ♪

>> welcome back to "the pulse" live on bloomberg tv and streaming on the ipad and bloomberg.com. time for bloomberg exclusive, another bloomberg exclusive. after l'oreal's sales beat estimates, we spoke to the company's c.e.o., and he told

bloomberg about the impact of the strong dollar on his business. >> it's very helpful. pretty happy about that, because for 10 years it was negative. for 10 years, european companies and l'oreal, we have suffered from undervalued euro, so now the euro is back below its level when it was introduced 14 years ago and so that is very good news. it's very good news because it will help our cost structure, because it will also of course, help the translation in euro of our profitability worldwide. it's a very good news and we will make the most of it. >> does that mean you might lower prices of your products? >> no. we will strengthen the role on the planet, and it will

definitely also help, as i said you know, the translation in you're re of ourselves and our profits. >> what about the currency in emerging markets? tell us about the show there and the outlook for asia especially china. >> after a period last year where we saw some instability in different parts of the world like brazil, other places, now the situation seems to be more stable with one exception, of course, which is russia where the rebel decree a lot. so we think this should be pretty steable for next year and pretty ok for us and we want, in 2015, to continue the stronger market conquest so

target 20 years ago, where we double our percentage done in this market every 15 years, so now we're keeping it. this new market is the first for l'oreal. it's 4 % of our sales. ♪

>> welcome back to "the pulse" live from bloomberg's european headquarters here in london. i'm francine lacqua. >> and i'm guy johnson. >> european leaders warn issue of more sanctions in a bid toen force a cease-fire in eastern ukraine. gehancellor angela merkel said the leaders called on the european commission to get further measures ready. >> greece is seeking a new contract to the euro area, this according to officials. the greek prime minister met his european counter part at a summit for the first time yesterday. greek negotiators and creditors

meeting today to discuss the way forward, according to officials. >> the euro-area economy picked up momentum as germany reasserted itself as the driver of growth offsetting weakness. gross domestic product rose .3% in the fourth quarter after expanding .2% in the previous three months. >> right how the markets faring this friday morning? let's find out. >> thank you very much. finishing the week on a high, gains up by over 1% in spain, .9% over in italy. right here in the dax is where the headline is. growth is .6% on the dax this morning. but a big headline there because it goes through 11,000 points for the first time ever. if you look across europe and observe the figures, the takeway is europe. g.d.p. and germany crushing estimates, .7%, but you've got stagnation in italy, and then the number two economy, france, growing just .1%. as i say, markets really looking at the bright side of

life this morning. germany markets go higher. look at the journey so far this year, up 12%. this is the best performing major market in the year. so much negative news over greece, over russia in the last couple of months. if you've got absorbed by all that noise you missed that pub right there. the other interesting thing that's happened this week is equities have gone higher as has the euro. over the last week or so, you've had another week of gains. string that together for three weeks of gains, the euro against the dollar, the best weekly run of gains for the single currency since march 2014. some optimism over greece. maybe we just got out on the right side of the bed this morning, because let's face it, nothing gets done there in terms of a deal. and the end of the month is still very, very far away for them to get anything they want, whether it's germany's concessions or greece makes a compromise. in the bond market there's another headline for you. check out this. italian bond yields 1.58%,

without seven basis points on the 10-year. spanish 10-year 1.57%. a little bit earlier, these two crossed, the italian 10-year skipped briefly the yields below spain for the first time since april last year. what is going on here? just maybe people look at the political situation in either country, italy looking slight 8 more stable. an interesting divergence going on in the market, and it tells you about politics. >> yeah, it does, and people worry about spain. in about 25 minutes "surveillance" with tom keene. he joins us with a preview. you're looking at greece, russia, and oil on the program today. >> everett morris will join us from citi group with his very important call last week of $20 a barrel oil. he has world influence. he can move the price. he will join us in our 7:00 hour. we're thrilled to bring you,

with ed morse robert cinch. i'm particularly looking at euro sterling today. we'll talk to bob cinch about the one-way bet right now to euro parity and, of course, that wrapped around the news on greece and on ukraine as well. we'll visit with our hans nichols on the issues of the moment in berlin. and finally, steven whiting will join us from citi group. we'll talk to him about the spirit of america's corporate earnings and what it means for the american economies. francine, i wish you a valentine's day. >> oh, i'm touched. i'm so touched, i have similar glasses than you. i'm channeling tom keene. happy valentines to you, tom. the nice red bow tie. "surveillance" in 25 minutes from now. >> it's today. >> tomorrow is valentines. >> oh, today is the 13th, yeah. today is unlucky tomorrow is very lucky. i get your point.

right. getting my dates mixed up, let's talk about what's happening with guy hands. i talked to him yesterday about his new investment strategy and how it moves forward from here. take a listen to what he had to say. >> we got a billion euros to commit to deals. it's a very large percentage will be my money and my fell on you partners in terra firma. >> can you give us a breakdown? >> not exactly. >> the majority will be coming from you and your fellow partners. >> correct. >> that money is not, as someone suggested, maybe hinged on further x's. it's there now, ready to go, correct? >> yes. one of the things that people missed about terra firma is back in 20101, shortly after the first trial, you know, it was really quite tough. since then, we've had exits, and we've made over $4 billion

in profits. as we were the largest investors in all of our funds, it's been really wonderful, really quite spectacular performance. additionally, a lot of people came in in 2011 and bought our funds in the secondary market, and some of those have made three, five times their money. they've done extraordinarily well. >> you've always been cynical i would say guy hands is matching this up as an admission that he's struggling to raise money. would i be overly cynical if i was to take that approach? >> i think you would be overly cynical. it's interesting, the model we've had has always been we've got to invest it, and seeds have always been pretty well used. it doesn't actually from an economic point of view, what's important is the returns on the money we invest. it's nice to get fees, but the reality is you don't have more money to invest. if you have more money to invest you have more pressure

to invest it, and you probably end up averaging down your returns rather than having to do one or two deals a year, which you feel really, really excited about. >> all right, we're just getting breaking news out of russia. they're saying to plan 1,500 job cuts in russia this year. this is a bloomberg exclusive. >> yeah he's talking about this this morning, but we have a great accident inclusive coming out. soc gen, 1,500 jobs cut. that's a significant retracement, isn't it? >> yeah, that's based on an individual we've been talking to within the bank 1,500 jobs this year. that follows 1,500 jobs last year 2014 was a tough year for the bank. they've got more branches in russia than any other foreign bank, second biggest bank in france. they've got an outfit called rose bank there. they got delta credit. in the last quarter, they lost $12.5 million.

the company said they'd probably lose money there this year as well. the issue is pretty straight forward. there are a lot of bad loans, and the company expects them to increase because you've got inflation at about 15% right now, and you've got an economy that's set to contract. i was talking to the head of central banks earlier in the week somewhere between at least 3% and 4%. that doesn't spell well for a bank. >> yesterday we had a great exclusive with the c.e.o. they have the third largest exposure of any bank to russia, and he was saying it's going to be tough. he's committed to it, but certainly he says we have to ride it out, so you have to take a 10-year approach. >> i think the point is a lot of american banks left because the issue before this coming economic contraction was the expansion of the state banks in russia. that led to a lot of the bigger u.s. banks.

they were not left with not very much market share both in the retail side and the investment banking side. some of the european banks stuck around. a lot of the austrian banks in particular. for them, because they're still there, maybe this is worth riding out. there are kudos to be had to them in the fact they still are in russia. the russian government appreciates that. but obviously it's very difficult for them to predict exactly how bad things are going to get. the cease fire is maybe coming in this weekend, and that could lead to some sections down the road, but that's not going solve the oil price and russia's economic woes, is it? >> yeah. ryan with the very latest from the very nice -- well bloomberg exclusive that we got on reorganization in russia. >> yeah, retrench.

reorganization. coming up, pink is the new black. thomas pink, that is. we're going to talk to the c.e.o. of the british label about its plan to be known for more than just dress shirts. ♪

>> good morning, welcome bask you're watching "the pulse." we're live on bloomberg television. we've moved. why have we moved? >> because we have a brand known around the world for its tailored shirts. it's on a mission to reinvent itself. so we have the logo behind t. that's why we've moved, because we're going big on luxury. we're here on set with british fashion label, thomas pink, president and c.e.o. thank you so much for joining us. pink is so quintessentially english. and we've had a bit of a fashion in the last five, six years to like these kind of products that are quintessentially english. you're trying to become a little bit more than that. tell us about it. >> i think that hopefully the quintessential english bit will key whatever we're doing, because i think it's a key part of the brand. but yeah, the business is developing. we're today in over 16 years, 130 stores, and the business is

moving away from more just shirts into more lifestyle brands, so tailoring and socks and boxes and other products as well. >> is it an airport business or more than just an airport business? >> much more than an airport business. we are in every terminal at heathrow which has been a great relationship and a very good business for us. we have opened up in a few airports in miami and j.f.k. as well. but it's more than an airport business. i mean, it's great for the traveler to pick up things. you go to the airport, you grab a shirt or a pair of socks, but no, it's a major city. >> and jonathan, when you sat down, guy asked you, what's the best selling item that you had, and you said the white shirt. we're dressing down, right, in the office more and more. i used to wear shirts 10 years ago, and then now it's much more accepted to wear, to be less formal. guy even lost -- >> i'm wearing a tie today, but

it's not -- >> what does that mean for you, for business? >> there's been a huge change in dressing. casualization is a fairly -- i think it started back in about 2004. there's a definite change. i mean, the blurring between formal and informal is there. everyone wears different things all the time now. for us, it's an opportunity. you're going to wear a white shirt. there are many different types of white shirts, whether little a linen, polo, or a soft cotton. i think the color white is always going to be key, but great opportunity for us to increase our casual business. >> how competitive is the market here in the u.k., and is it less competitive elsewhere? barely a day goes by where i'm not receiving some kind of letter from tourists or whoever telling me we're discounting this shirt or that shirt. you get it from all of them. >> i think in any business it's incredibly competitive today.

there are lots of people selling shirts absolutely. it's the barrier to entry is fairly low. it pushes us to be -- it pushes us -- >> yeah. >> i mean hopefully we sort of see it as a healthy way of pushing us forward. >> how do you differentiate? are people sort of -- are they pink buyers? do people tend to stick to the shirts? >> i think men have become more magpie-esque in their shopping patterns. >> there you go, magpie-esque, i like that. >> absolutely. >> loyalty is still there but i think people pick and choose more. the reality is, as you say you're getting approached all the time wherever you are nowadays. so i think it means that we have to -- we have to just keep pushing forward. it's in design. it's in fashion. it's in the brand. >> what is the brand?

is it off advertising? how much are they supporting you in terms of expansion? do you have to be at every street corner almost to make sure that people choose you above another brand? >> i think -- i think advertising is incredibly important, but given today, gven that your smartphone is the most important piece how do you get to people? social media becomes more and more relevant. we introduce the campaign last year which to you, we got six really cool guys wearing shirts, different style of shirts whether it was our athletic shirt which is a great new fit we've done with sort of broad shoulders, narrow waist for the guys who have worked out, and just some -- i think things that actually connect with people, actually engage with them. it's not just huge money spent in advertising, it's very targeted. it's trying to get to our guy. >> you've been sort of noodle ago way at this project for a while. well, the whole business.

i remember when it opened. >> the first one was on drake and garden. >> i remember it all. >> you were too young in everywhere. it sort of has progressed since then but are we kind of -- are you sensing we're in a stage now where the brand is going to significantly develop from here? you talk about you going into new spaces, the tailoring story. are we going to see a big incremental step forward? >> i mean, i think there's been growth all along. i don't think there are any huge sort of sudden movements of change. as i say we're in 16 countries now, so there are a few big countries we're not in. it's how do we identify those opportunities? how do we keep pushing it out? how do we develop the product? >> how difficult has it been to navigate the economy? here in the u.k., it hasn't been too bad but do people

want the sales? if you give us two or three key trends in the way that actually your customers changed their shopping habits, what would they be? >> i think it's this blurring of formal to casual, so different attire for different occasions, it's sort of disappearing. i think the splashes of color for us is very important, you know, the boldness the fun element, and i think people have really appreciated that, and they're accessorizing a bit more, so it might be a white shirt, but it's a very colorful tie or cuff link, so i think a bit more meticulous and care over that. >> are you the go-to place? is that kind of how -- >> i think originally the stores were very much city-oriented, but the brand has grown so much bigger today. look, lots of our clients work in the financial industry absolutely. but it's so diverse. i mean, you only have to look at london and how the move from the city to the west end, it's

all merged so much now and i think we've just sort of gone with that. >> how do you see the future of the luxury industry? is it big groups small groups? where does the advantage lie? is there an advantage of being part of a beg group? you have the sort of marketing know-how and maybe some financial assistance, and you can take a slightly longer term. how does the industry work from sneer there's been aggregation. does that create opportunities for smaller brands? >> i think it's both. i think you get the polarization it's been fantastic for pink, and the talent and the people within the group is amazing in what we can access. equally in today's world where there's a lot of entrepreneurialship going on and i think there are some really exciting small little businesses that are growing, and at some point do they then get aggregated? maybe. but there's a huge amount of young lax are you brands growing at the moment. >> jonathan thank you so much for that.

jonathan, the president and c.e.o. of thomas pink, talking to us exclusively. >> coming up, a bounce in ukraine. we're going to look ahead to the truce. ♪

>> welcome back to "the pulse" live on bloomberg tv and streaming on the ipad and, of course, bloomberg.com. >> let's look at what we're watching the rest of the day and the weekend. ryan joins us now. the truce in ukraine starts,

implementation massive. what are we watching for? >> absolutely. the truce is set to start at midnight saturday into sunday. that's local time, so a couple of hours ahead of london. there is the issue of whether this truce actually gets implemented, because this is effectively been 2.0. we already had 1.0, and that went well. that didn't go well. there's even a risk the truce never begins, and that's where we are right now, heavy fighting, and they're allowed to fight, because remember this truce hasn't actually begun. it was heavy fighting in the east of ukraine. why are they fighting there? because it links to treble-held areas, so the rebels want it so they can have a continuous land mass. the ukrainians want it for the exact opposite reason. they want to deny them that. very heavy fighting there overnight. that's one heckup. the other hiccup is that the rebels are saying that the

ukrainians have to amnesty everybody who's fighting. some ukrainian officials are saying they're not going to do that, so we'll see if we even get a truce. fingers crossed. >> what's -- if you look at the markets, i know you went through the kind of political instinct on the ground, and the markets are more focused on what you're saying, it seesms >> yeah, the markets were delighted we got the cease-fire to begin with. i think the risk now is that if this fails, you know, what happens? the e.u. has already begun preparing more sanctions at angela merkel's request at the e.u. leaders' request. they're now working on a new batch of sanctions so fast track them, so if this does collapse angela merkel has said she wants to be able to impose new sanctions on russia, to compel the russian president to comply if she feels that he is in violation of the agreement. the u.s. is the exact same scenario.

fingers crossed over the weekend. we'll see where we are come monday. >> ryan thank you very much indeed. we're also getting commentary on the other thing that is vexing europe at the moment, and that is what is happening in greece. according to the german finance ministry spokesman greek talks with the troika have started today. the progress being made, it kind of jells with some of the other comments we've seen. >> vexing very good word to describe the situation. that's it for "the pulse." keep it right here. "surveillance" is up next live from new york with tom keene and his team. just a reminder, follow us on twitter, and this is the question of the day. guy did a great interview with guy hands. you can find that online. we're talking about the music industry. how did he get it so wrong? we're talking about guy hands. >> that is on twitter, and check out the interview. we'll be playing it out in full this evening and throughout the weekend, so check out that interview with the investor, guy hands.

in the meantime, european markets latch on to the greek story, and we will hand you over to our colleagues in the united states. "surveillance" is up next. ♪ . .

>> this is "bloomberg surveillance." greece must hold two thirds of its bailout, all of the eu --

there is fierce fighting overnight in eastern ukraine as rebels seek territory. the eu and united states consider tough new sanctions is glimmers of hope are dashed. olivia is off today, so it is two guys sitting around reading books. i got brendan "50 shades of mathematics." good morning. it is friday, the 13th. i am tom keene, jointly brendan greeley. olivia is off today. time now for top headlines with brendan. brendan: do i touch that? i think i don't. european leaders are on more sanctions against russia. they could include plans to blacklist more russian citizens and organizations full stop currently 132 people and 28 groups are barred from traveling to eu or accessing european bank accounts. german chancellor angela merkel is one of the biggest skeptics.