>> hsbc and bank bosses are questions over the recent tax scandals. >> limits to lead fed chairman. she says she'll not risk the recovery by tightening quickly. we will look at the implications. >> insufficient. we will ask the finance minister if he thinks the proposal goes far enough.

>> welcome. you are watching the polls live from bloomberg european head quarters in london. i am guy johnson. >> we have a great lineup and we will be speaking exclusively to the finance minister. and the outlook and personalities behind the parties for the most famous spin doctor tony blair, a former campaign manager. >> the head of hsbc will be questioned over the tax evasion scandal. >> the last-minute decision by the treasury select came off of the emergence that he had held a swiss bank account by a

panamanian company. that starts at 2:15 london time and they will answer questions about tax avoidance and if the institution is too big to manage. >> let's go to anna edwards on what we can expect from the treasury committee. >> have we mentioned it is an election year? the most senior bankers are going in front of the u.k. treasury select committee and politicians get a chance to grill the executives about what the bank was doing and how they change things since then. the bank says they are sorry for what they did and the allegation was made that they helped tax evasion by criminals in 2007. the bankers said sorry and took

out full-page ads to say sorry. more on that. they said they change the bank a great deal since that time. the late edition said that the bank account is established and paid into to try and give some privacy for colleagues. it is an election year. the coach or is being described and the scene i am painting could sound otherworldly to others in the electorate. we could see them try to paint a picture of the wealth. it comes with increases in penalties and it is something

that people have been talking about >> the problem is that it never looks good to the person on the street because it is convoluted. >> even some suggest that they cannot quite work out why. >> that was a pretty standard account at the time and it was just a thing being done back then. >> it is fascinating and it is starting. >> a says that he does not believe the bank is too big to manage and believe in a universal model.

they're going to talk about a bank that is very big and part of the bank did not know that in 2007 what the other part of the bank was doing. to the extent the bank has changed, that could be a crucial part of the conversation. the fact that the company has brought down the profits that suggests that it needs to be broken up for the bank to address that all stop deutsche bank has become a byword for complexity and risk. because back -- it goes back to 2007. >> this is a complex story. >> there are angles on the angles. >> love the story. >> we will take the testimony later on.

the appearance before the treasury so kemeny -- treasury so community -- committee will be on tv. our bankers held to too high a standard? what do you think? should they be given an easier ride? are they being appropriately remunerated? they're all kinds of ways of looking at it. let us know what you think. >> we have had great responses that we will round up for you at the end of the hour. it looks like janet yellen has come to her limits. if you look at the markets and what she is saying and the market expectations of a rate hike they are different. >> i listened yesterday and read her of the transcript. here is my take away, went pretty much every single bank

cannot find consensus, she did a good job saying nothing and that was the takeaway. someone who does not want to commit to what they are going to do and was conditioned by what happened with the taper tantrum and worried about what happens in the market if they signal the rates changing. there is concern on her part to not say too much. she is good at saying nothing. >> she said enough to keep everybody happy and, at the same time if you think the data is going to get better, there is a rate hike coming and she is going to be very careful in doing that. she is very dovish and will because she's in making those moves. if you were to say if it was a

slightly more hawkish or dovish which side would you be on? >> neither. there is patience and that could come out of a statement. it does not want to be seen as an immediate signal. the fact that communication went on, they are laying a groundswell for a rate hike later this year. i compare this to taking a playstation 4 of a child. you tell them they're going to take the toy and you think that they will grow up and mature. when you take the toyota way, we know that it does not matter how careful it will be. there will be tears when the rate hike comes. >> that is the story of my life. >> taking toys from children. >> having tantrums. >> a good analogy. >> the central bankers are the

parents of the financial markets. >> a great analogy. thank you very much. we should mention the janet yellen is just one of the central bank your parents speaking today. mark carney and the ecb president's is taking to the stands. with one would you want as your parents are smart >> that should be the twitter question. who would you like your central-bank parent to be? answer that question. the former greek minister and the outlook for greece. >> plus, lego takes on the oscars. with the snub of the lego movies, trophies. we will talk about taking on

disney with the ceo.

>> welcome back. streaming on bloomberg and your tablet and phone. >> the cash-strapped countries cleared a major hurdle with a list of reforms to extend the bailout agreements. the creditors have a starting

point. joining us now is hans nichols from berlin with more. the imf is unimpressed. there is a stopping point and a lot more needs to happen. what is going to happen? >> we may have turmoil. the imf is thinking and later not think of the greece has gone far enough on implementing the bailout package. you heard the negative comments and the ecb. two of the three members in the troika. take a look at what was written. she wants more specificity. we know that there is neither a clear simple -- plan for design and unequivocal undertaking to continue agreed upon policies

for opening up closed sectors. that is saying that she does not buy will greece is saying and she says that they need to build trust. at the same time, it is just as important as everyone else in the negotiation because of the billion to be disbursed. it was almost as critical and opened up questions about financing. we have an agreement and it seems like the parties are skeptical about it. >> what are we hearing from leaders. is the drama over or is this the first stepping stone? >> that means it has not held the title long enough. listen to what francois hollande

has to say about it. >> i think a good compromise has been found that expresses what degree people have expressed and the eurozone is charged with safeguarding. >> the question i ask myself is what greece will do to finance itself. there was talk about raising the ceiling and the approval for that. that is a discussion of according to an official. it will be a challenge to meet. christ yes. a lot of thinking to do as a result of that. thank you very much. hans nichols joining from berlin. >> let's go to a bloomberg

exclusive. she joins us. it turns out -- there is good news that the government may have decided to land and understood that was promised and the rhetoric can be forgotten. and, they realize that, if they want to continue and get greece out of the crisis, what they need is a strong reform program and they have to get the reforms done at last and, of course what they said was some kind of magical way to fund all of the promises.

it is not possible. the parties were unrealistic. the parties encourage the reforms. the political system is for over five years that we had to fight against. it will not exist anymore and it will be only very small parties. i sincerely hope that this will be from the system. >> you think that they understand the reality of the situation? do you think your party would

fare better? >> we need to work a lot on that and it is not so easy. it has been one month and we made our mistakes. there is no question about that. i was wondering said the policy was a disaster and it really was a disaster. we have to work on that. what is important is that we chose the right path and we were not perfect. far from it. we had a very strong opposition and a lot of difficulties. we knew that we wanted greece to stay in the european union and in the eurozone. we managed to do that. even the eeoc said the reforms

-- the start of the reforms -- we should do more. we are supposed to continue. the elections were historic and we cannot afford to lose time. there is a lot more with greece. do you think that, at the end of the month, the government will continue in a way that it has not already, maybe finding a compromise? or do you think that we will not see the parties agree with

the ground being too great. >> i am an optimist and there will be an agreement. it takes into consideration the needs. let me tell you that i am not an economist. the problem is agreed and did not have the results we expected. the recession was bigger and there is a real problem that we have to solve. >> we're going to take a break and come back to you the former greek minister of foreign affairs. interesting points from a

political point of view, like look at what the bailout means. that is probably more of a political statement that emphasizes the party. >> yeah. we will get a different view on this in a few minutes. we'll talk to the irish finance minister. it is an exclusive interview. michael noonan is coming up. has greece done enough? how is it to be in the room? all of that is part and parcel of a conversation surrounding greece. michael noonan coming up. >> the 10 year yield dips below 1% for the first time ever. is this a story of investor optimism? it looks like a story to me. we will have more on that next.

>> welcome back. a number of comments and talking about some of the elements of the package. new democracy, give us your take. is there a concern greece has not gone far enough and there is not enough details?

greece will continue to cooperate. do you think it is enough? there is four months and do they think that even this is going to far? >> it is going to be a tough time for these people and the government. they concentrate before the elections and there are people and members of parliament who believe that there might be some other solution to the greek problem. they have to be much more clear with what he will do. now, he is trying to gain time. he needs time and he does not have a lot of time. he has to make it clear to the

ecb and the greek people that they know what will go on and what the policy will follow. they have change what they said before the elections. >> will take a break and a big part of the conversation today with the exclusive interview of the finance minister of ireland. michael noonan. we'll ask about the 10 year yield of our response and talk to him about the negotiations. there were economic lessons. all of that is to come. we will talk in front of the treasury select committee later on today. that is coming up. keep it right here.

>> welcome back to "the pulse" live from bloomberg's european headquarters here in london. i'm francine lacqua. >> i'm guy johnson. these are the shares to we're watching today. >> janet yellen signaled that the fed has interest in holding interest rates to near zero. yellen is set to testify again today in the senate. >> hsbc executives and c.e.o. will be asked questions about the recent tax evasion revelations and we will bring you to grilling of these

executives live and in full starting at 2:15 london time. >> gazprom is seeking a u.s. stamp of approval. they are working on a fresh two-year authorization to move as much as $2 billion in natural gas to the u.s., mexico and canada. they might impose additional sanctions on russia. >> let's check out what's happening in the markets. first stocks. yesterday we had some highs. today we backed off a little bit. though we're not down by much. the ftse is down less than 1/10 of 1%. the dax has backed off a little bit as well. still north of 11, though after yesterday's highs. i think it is holding ground to be honest. these are fairly smufles. >> let's have a look at some of the currencies.

yesterday we were talking about currency wars. janet yellen was down playing the notion that central banks around are the world engaging -- being labeled a currency rating. they were expecting still a big majority for june and it seems as though that has been pushed back. >> the message hard to decipher what she was saying. almost like greenspan. i think the message was we have a recovery. we think we need to raise rates at some point but we won't risk it delivering the rate hikes early. >> still very, very data dependent. that's what she is suggesting. china's manufacturing rebounded for february. the p.m.i. number was 501.

>> let's get more on this from bloomberg's tom -- tom, what is behind the -- in this hsbc p.m.i.? >> so i think it was a striking reading. a four-month highs, as you mentioned. we came back above the 50 mark improving from deteriorating conditions. at the same time, this time of year you need to pay really close attention to seasonal effects. when you step back from the details, contracting real estate sector in china, global demands which remains pretty lackluster it will be surprising if this reading in the p.m.i. marks a turningpoint in china's growth trojectry. alcoholic it up to seasonal

effects and wait for a reading later if the year. >> i think a reading of 501 which would be stellar but it is actually 50.1. what does this mean for policy? >> you're right. 501 would be awesome and we wouldn't have to discuss policy at all. 50.1 is a little bit more meet observinger. last year, the central bank cut interest rates. since then, inflation has fallen so much that real borrowing costs are higher now than they were before the central bank cut rates. if you put that together, monetary conditions uncomfortably tight, real concerns about growth, i think the stage is really set for further monetary easing, probably more interest rates to come in the first quarter, second quarter. >> tom, let's switch gears. let's talk about uber. the company planning a big

hiring spree in china. >> right. so i think -- i think for me this is really an example of how technology has the capacity to solve some of china's problems even when the government is a little bit slow to press the reform button. it is very hard to find a taxi here in beijing because taxi fares are too low so taxi drivers don't want to get into their cabs. companies like uber, some chinese apps are doing very well, are stepping in helping solve the problem by offering higher market rates for drivers who are willing to come pick us up. >> thank you so much. it was amazing, we were speaking to one of the earlier investors in uber. she said you just have to scale up. this is what they are doing to get market share in china. >> go big.

later hsbc. let's talk about what is happening with commerce bank now. it is now in the news again. it is a tax probe that we're watching. let's get details performs let's go to berlin and re jim: hans nichols. >> guy the commerzbank is being really clear they are participating with this investigation. they have launched their own internal inquirey. now here is what we know. frankfurt offices, law enforcement have been descending across the country to determine

whether there is tax evasion. germany is taking it very seriously these days. here is a statement commerzbank put out. they are interested and the investigation is based on old cases dating back 10 years or more. it is important to differentiate. this is about private individuals, not about the corporate tax or low tax rates that were put in place by the luxembourg government. 2 jean-claude juncker no confidence. this has to do with germany taking tax a avoidance and shelters very seriously. >> hans, thank you so much. the latest on some of these tax rates. m.p.'s will be grilling two top hsbc executives on taxes. we will bring you the full coverage that this afternoon. >> right. i think stocks are not down by muff. they are off their highs. we went to the closing price

high on the ftse. dax backing off a little bit as well but still very much north of the the 11,000 mark. but given where we are and where we have come from and how far we have got, there may be a above it top slicing of those portfolios. what yellen said last night is something we're watching carefully. ♪

>> welcome back. you are watching "the pulse" live from bloomberg's london headquarters. we are talking about greece. getting more comments from the finance minister. saying some really interesting things. >> laying out exactly what the government will or will not do. saying the government will not sell assets. this is something we have heard before. they are not going to go back on privatization. he said greece hasn't secured the financing for growth. they will continue to cooperate with the e.u. and the i.m.f. and is giving clues on the fact that they will -- property tax in 2015 which i imagine means they will get more tax. >> some would probably be a good idea. i think it sets -- with neighbor

troika when we think about what greece wants and the funding program it is looking for and the potential to bring down current account surplus. let's get some analysis on this. good morning, paul. >> hi, paul. >> does greece have what it needs here? we have a short-term story. the program continues. it doesn't solve greece's problems. >> it is just a -- there was financial pressure that had to be solved. i guess the -- to use the nuclear option which led to disaster. here we are. in four months we have the same problem again. >> what happens in four months? it is my understanding they won't see any money until april, or february 25. there is a month in between. are they going to be able to pay back? >> i think the deadline is in

june, as i understand that will have to be dealt with and then the agreement today is just for a month and then the same problem. creditor nations still are in the most of denying the problem which will come back. >> how do you restructure greece's debt without restructuring greece's debt? >> in the hand of public authorities. testimonyly it should be easier. previously it was in private hands. now it is in public hands which makes it technically easier but politically more difficult. there is a move saying no, we don't want it. the greek has been so bad. we are not going forgive them. but yet -- it would be easy to

do. the e.c.b. for example could say well -- >> easy to do. >> technically. >> the unanimous vote and certain countries. the spanish with the spanish finance minister was very tough on greece. >> it is difficult to do. yet it is unavoidable. you can continue to deny and we don't want to do it but yet at some point you cannot push a country in a democratic environment into austerity for the next 20 years. because that is -- the program really wants greece to be in. and that will lead to little upheavals. we have already seen some of these political upheavals. it is linked to austerity. if you go on doing this, what can happen in that country? right? so we should really start being

realistic and say well at some point you have you to be ben even leapt and -- >> -- ben even lent. >> you're caught between the devil and the deep blue sea here. it is politically impossible for germany to undo the euro-zone. you're in this sort of situation. you these two really big issues. neither -- you don't want to say either of those two options. does it therefore come down to -- do you think it will come down to the i.m.f. ? christine lagarde seems to be taking a hard line. she doesn't have the details she wants. the europeans can't throw greece out. do you think the i.m.f. has the political clout or the political bravery to actually do something fairly significant here? >> i don't think so. the i.m.f. sitz constrained.

it has already been -- in the past for putting so many resources in rescue programs in europe. basically the i.m.f. is a worldwide organization. i don't think it can take over. that is out of the question. >> do you think he can walk away from giving greece more loans though? if it does, it will make life very difficult. >> it would make life politically difficult. technically no. essentially the i.m.f. has been brought in for political reasons. motte for technical, financial reasons. >> provided political cover. >> that's right. it was a political move. it was not because we needed -- europe -- an institution with financially deep pockets. no, the pockets were deep enough in the euro-zone to do it. the political cronstraints -- >> i guess it is just another check.

but i know you're saying this program is not sustainable for the next 20 years. but at the same time, if greece were to do the right things, collect more tax, go through privatization like most of the western scruns then they have a better chance. this is not the message that we're getting from the current government now. >> that's right. i think there is the potential to come to an agreement. i do believe this particular government now this extreme left government now in greece has some credibility. >> with whom? the voters or europe? >> in europe, yeah. this is a party that was outside the establishment, now comes in and i think has the intention of changing the tax system. that is the reason and the way they came to power. it can do it. it has the ability to do so. that is one of the major items in structural reforms.

i do think they have a capacity to convince the creditor nations that they are serious about this. i think that they want to do it but then the counterpart would have to be that the creditor nations say well that is fine. we are willing to be more flexible in terms of austerity, the primary surplus. we will relax it a little bit. this makes it possible in my view to come to an agreement, but of course what has to be overcome is the distrust is still there. an essential distrust of northern european countries distrust greece. the first step has to be made by the greek government prrm if greece is seen as being a winner this process or even coming out with a reasonable deal, how do you think that will affect the political landscape elsewhere

and do you think there is a danger for the spanish or whoever else will -- because they fear -- or whatever else? >> that is a risk. for sure that is a risk. i do think if the greek government comes in they are doing serious regime reforms in terms of tax reform, collection. then the fear is that one may have for other countries disagreeing may be much less intense. why -- while i do think there is a window of opportunity to move forward. >> we're talking about spain, right? spain is a big concern. do you see there is a big chance? they have less chance of winning because voters will look at greece and say they have a great government but they didn't get that great of a deal or would they say they got a better deal? >> that is of course a

possibility. and of course we'll also need as many as from the present spanish government in accepting -- assistance from the spanish government of accepting any deal. it is full of risks. uncertainties. >> let's talk about another risk. >> let's talk about russia. what do you think is the biggest risk to europe now? the policy of vladimir putin or the policy of -- and the response from germany in both cases very interesting. the talks ongoing. going to have talks about ukrainian gas. put those in context for us. where do you see the russian story evolving to? >> surely in a way, the russian story is risker than the greek story. for the simple reason that at least the greek tragedy -- we

have -- it is in our hands. we can -- if there is some reasonable thinking and reasonable approach to why our relations with russia, we don't control it. here you have an authoritarian system. we have to see how far this system is willing to go. in the long run, much stronger risk for europe, i would think. >> we had an advisory yesterday that was saying the other problem is that we don't really know that there are not enough politicians in power that know what is going on in the kremlin. how would you deal with president putin? are sanctions the only way to

go? is it backing away, trying to be more friendly? >> i have a proposal some months ago which was the following that is to introduce a tax, russian oil and gas. which i think would be the right moment to do. prices are going down. >> it hurts them more. >> it hurts them more. i think that could be a way to move forward. to put pressure. of course i am aware of the fact that yeah, putin and then the system there may not be driven primarily by economics motives but more by politicalives and this idea of making russia grander and restoring the old glory of russia, that is of course a very dangerous idea that will not stop if we introduce such a -- of taxing import of oil and gas.

but i think we should do it. put more pressure on these people to make them clear where we draw the line. if we don't the temptation will go further. >> chaos. >> it will be unstoppable. >> thank you for all of your comments. professor at the london school of economics. >> american express is raising interest rates on a range of cards. more than a million commerce have been told their annual rates will climb to at least 12.99%. in a letter to customers the i remember the firm said it is making the adjustments after finding its rates were below those of rival credit cards. >> hewlett packard will miss estimates. they said the impactors the rising u.s. delor will be greater than estimated and it plans to split into two companies. >> telefonica wrote down value

of assets by 2.8 billion euros after switching to an exchange rate 76% lower than the previous one. >> coming up next, we'll speak to telefonica's c.e.o. >> that is the conversation at the top of the next hour. stay with us. plenty measure coming up on "the pulse". -- more coming up on "the pulse." ♪

>> for our viewers, the second hour of pull pulse coming up. we'll see you in a moment.

>> hsbc set for a grilling. the bank's bosses will be questioned by m.p.'s on the tax scandal. >> janet yellen lays the ground work for a possible rate hike but won't tighten too quickly. >> greece's plan to ask irish finance minister michael noonan if he thinks the professional goes far enough. >> good morning to our viewers in europe and good morning to those in asia and a warm welcome to those just weigh up in the united states. i'm guy johnson. >> i'm francine lacqua.

this is "the pulse" interest london. >> we're going to speak exclues ily to the irish finance minister. michael noonan. we'll ask him what happens with greece. what is going to happen with greece. >> and does the u.k. face its most uncertain election in the 1920's. talk we'll take a look at them with tony blair's former campaign manager, alastair campbell. >> that is just the next hour. o the course of the day swrerks a lot more for you. hsbc will be questioned by british m.p.'s over the tax evasion scandal that has engulfs the swiss arm of europe's biggest bank.

he will appear at 2:15 london time to answer requests about all of this. looking forward to that conversation. >> mark, there are so many questions. when they are going to get grilled, they are going to basically try and understand what the people in charge were doing at the time and what they have done since. if this has been corrected, hsbc has said sorry numerous times. are they going to say sorry again? how do they explain c.e.o. having a bank account in switzerland? >> have i talked with him several times. his big concern is banking culture. that is what he is going to be focusing on. these revelations suggest that the biggest bank of europe it is in every scandal the u.k. has to mention. it has put aside billions of pounds for the scandal, for foreign exchange rigging. it can't move without finding itself in trouble.

the finance director while all of this was going on in the swiss banking industry. that's what we had the rell vacations about. he is going to need to know why you have a -- to channel your bonuses through as a way as gulliver has put it hiding how much he was paid. it looks bad, doesn't it? >> it looks bad. >> i don't know how many panamanian accounts you guys have got. i have zero. i don't know what wr to start. if they could see the bank accounts could they also see customers' bank accounts? it says something about internal control. there is a serious set of questions to be asked as well about the lackor firewalls between the investment bank and the retail bank and again, this is something that -- this idea

that casino banking has no place in taking deposits. their big fear is the authorities might break itself up. it has a quarter of a million employees? >> how do you -- what you just laid out is a very complex organization. that is ultimately run by a very small group of people who probably don't have the band width and the capability to be able to understand that level of complexity. >> the governor himself said if we have this many employees, can i guarantee none of them be do -- >> no. also i think it is global bank, yeah. how much of its revenue -- profits, how much profits do you think it makes in asia? that is not -- it is -- it is making 80% of its profit in asia

. twob in charge and in control to know what is going on with your employees over there. >> what do you think of them splitting up the bank? what are you hearing? how do you summit up a bank like this? >> it is very hard. what we have seen in the past few years is regulators imposing capital rules making it harder to do business. there has been some effects. barclays has talked a few times about whether it would. i don't know how you do it as a regulator. you don't want to be in the business of telling customers how bibig they are. >> maybe the message is to investors, there must be a discount that is applied to large banks now. there is. it is a capital one. there is a discount that has to be applied. get smaller that, discount gets smaller. some of the evaluation goes up. are investors best served by the institution? >> it is very rare to see what is effectively a conglomerate.

choose to split itself into different units. no matter what the financial sense of that is. it is not in their d.n.a. that is a very hard thing for the investors to push. >> especially in the u.k. where this country has had to bail out. >> we'll be taking the testimony a bit later on in front over the treasury celebrity committee. 2:15, we'll take it live and in full. that brings us to our twitter question of the day. we're talking about mark gilbert. when you 250,000 employees can you be sure no one is doing anything wrong? let's move on. >> europe's telecom industry could see a new round of -- a possible merger could be happening as early as 2016.

caroline hyde is at the telefonica u.k. headquarters in london. over to you. >> yes, that deal could be a cool 10.25 billion pounds. owned by telefonica, i'm joined by the c.e.o. of telefonica u.k. roanan dunn. we have heard about the numbers you posted today. strongest quarterly sales in six years. strong growth. at this time next year, talking about your numbers once again, will you still be here? >> i think what we will be is part of the market because what you saw in the fourth quarter was while all the talk was consolidation, convergence, we just focused on the customer and as a result we grew faster in the fourth quarter than we have in six years. we will do exactly the same in 2015. >> because at the moment there is a viewing that -- the deal

taking over 02 will be done by 2016. that is a whole year from now. so will you still be two distinct brands? will you be starting to analyze how you will be working together? >> the first thing to say is we haven't struck a definitive deal. we are in exclusive talks. as soon as that deal gets done then we have to go through the clearance process. it could be this time next year. what we are absolutely focused on doing executing in 2015 as 02. we're very much a telefonica company until such time as any deal closes and will be focusing on the market here so it is business as usual for commerce. >> you said business was taken up by talk of consolidation. could we see more consolidation mow? we have four players turning

into three if we see 02 and 3 joining together. what concessions are we going to see? are you going to have to start to sell off assets to be able to abide by the regulations? >> i think two things to say. it is a bit to early to speculate any remedies that might be asked for. specifically in relation to spectrum, our current hold overing spectrum if we put them together, we would still be no bigger than vodafone in the u.k. and smaller than the holdsing of spectrum before it does its merge. we have to make sure there is plenty of choice for customers. we have announced that we will offer wholesale to total. the choice for customers is actually growing in the u.k. market. that is a good thing. >> is that how we alleviate

concerns about competition? will we see more policy about wholesale deals being struck? >> certainly the experience in ireland and germany was that the availability of wholesale was a key component when they were reviewing the competitiveness of the market. certainly the u.k. has a very strong markets already. highly competitive and i think the combinationor scale players who were able to invest in innovation and infrastructure coupled with a broad retail offering is a good outcome for both u.k. and the customers. >> you have 02 that you supply wholesale agreements and already provided -- anyone else? >> at the moment what we'll do is focus on the top, top deal and the sky deal. we're absolutely open for business. if there are other wholesale opportunities, we'll look at them. >> would virgin media be a

possible partner? >> i think that is a question for tom, but i think at the moment they are focused top implications of the merger for them. >> let's talk about offerings that you have because interestingly, we are seeing not only that we want our mobile phones our mobile suppliers potentially bundled within television and land line. give me your sensor what bundling is. do you see this it is a future? is the fact that you're not being sold by sky the fact that we want to see b.t. and e. together? >> there has been a trend toward convergence in europe. i think it is driven by different factors. the effect of competition in all of the elements. i think there is an opportunity for a mobile focused customer champion the middle of that market. yes, i have no doubt it will

mean there is more on the supply sidor converged offerings. we already have an offering from virgin in the u.k. and from talk-talk. i think it is a case of either are. it is a case of insuring commerce of choice. brilliant mobile is what we do. >> what about brilliant home will you be in the connected appliances? the heating for your home? you do have stores, about 460 out there in the united kingdom. >> that's right. two things. we have done a deal with tezzla. the electric car company. -- tesla the check car company. we have announced also that we're going partner with at&t and bring their connection into the u.k. the more things you can control

with your mobile phone, the more control that the individual has. there is a great opportunity first to put more services on to your phone. >> last question. are you 02 or telefonica? where will you be? >> what we say here passionate about 02 and that's how we will be. >> and are you chief executive? >> i'm exactly that. >> very nice to speak to you. c.e.o. of telefonica u.k. ronan ds dunne. back to you in the studio. >> thank you so much. >> coming up, we're going to take a break, but up next an exclusive interview with michael noonan. we're going to ask him about the irish tenure this morning. below 1%. what is going on with greece and should aeroling us be sold to

a.i.g.? ♪

>> welcome to "the pulse" live from bloomberg's european headquarters here in london. >> bond markets very much in focus this morning. the 10-year yield dipping lower for first time ever today. it seems appropriate that the irish finance minister michael noonan joins us for bloomberg. your timing, sir, is perfect.

>> just for the bloomberg interview. >> excellent. you have the power. is that a reflection of what mr. draghi is doing smp is that the q.e. effect manifesting itself? >> it is a number of things. our unemployment is down significantly. all the national statistics are positive. as well as that contingent risk. that is all gone now. there is a surplus predicted for both institutions. and then we have the european events. mr. draghi's quantitative easing has helped but also the start of process for greece yesterday. that has helped also. the movement is downward but the movement is downward. >> how concerned are you about that? if you look at what q.e. is doing and inflation expectations, it seems that a check on the markets or the

checks from the markets on politicians, on deals -- because actually even when we were at crunch time for greece and i wasn't sure whether we had an agreement, yields were still very low. >> we're into an undepreptsed space i think. i say ms. yellen this morning said u.s. interest rates won't rise in the next six months or so. that is downward pressure again. so, you know europe has gone through a very bad period. almost eight years of recession. you just can't stand back and do nothing. you rely on whatever instruments you have and one of them is to try to increase liquidity in europe because that liquidity is certainly one of the problems which was keeping european growth rates slow. i have been calling for quantitative easing for over two years. it certainly suits the irish position although we won't be the prime beneficiaries from it. >> do you think low interest rates might end up leading to another housing boom? you guys have got experience

with that. >> it won't in ireland anyway. there are various checks in system fow. people were burned very badly and there is a very strong memory of us investing in houses and getting burned. but the tradition in ireland is for people to own their own homes. so there is a big demand again in ireland for young couples to want families and they see owning their own home as one of the prereck zits of. control the availability of finance. we'll be very watchful into the future on that issue. we don't want the boom and bust cycle again. three times it has let us down over two generations. reasonable growth across all of the sectors without downturns. as we look ahead we see growth between 3.5% to 4% for the next

five or six years and we would like to sustain that without the boom and bust model intervening again. >> one of the final questions on ireland before get on to greece. when will you be returning allied irish banks into private hands? >> we own 99% of it. that is the state that we have retained goldman sachs to advise . we need to restructure the shareholder first. it will be at the very back end of this year if we move this year. otherwise it will go into 2016. and we will not put more than a -- on the market in the first instance. >> christine lagarde in a letter has slammed the proposals that have been generated by athens. she is very much of the view that the proposals thrack clarity necessary. -- lack the clarity necessary. if that is the view from the

i.m.f. , why did the euro greek decide it was efficient? >> there was a huge dwergeance between the euro group position as soon as the government was formed. that gap has been nair -- nair owing now. it would lead to an extension of the greek program to give them time to deal with their sovereign issues and banking issues and also if we give time to seek and the two sides being brought closer and closer together in terms of solutions to the greek problems. so bearing that in mind, what has been agreed is to start a process. the elements that followed in the greek communique yesterday were simply a kind of menu on which one might draw to put conditions on an extension of

the program. so there was no value judgment on the nature of their conditions. there was sufficient -- >> so this is what the euro group is looking for goodwill from the greek government. is that fair? >> it was fairly heated but yesterday wasn't heated. people had decided that greece made a fair effort yesterday and the evaluation of the institutions was the list was comprehensive enough to raise the possibility of leading to a at the end of april. so that is the position now. we have our red lines in ireland. we don't want writeoffs in greece but we want greece to continue to stay as a euro-zone member within that space, we are prepared to negotiate or be helpful. >> how do combrout those twow thoughts in a -- process for

greece, though? greece stays in the euro-zone. it has in many peems minds an unsustainable debt load. how do you mare those two up? what kind of compromise do you think exists that can be negotiated that will allow those two problems to be solved? >> i think those are middle of the road. it is along the linesor what we did in ireland. you negotiate. make your debt more sustainable. even without getting -- and that involves increasing maturities, maybe, parking debt for some period of time as the greeks have done already. so a incident combination of issues. >> you think the german also go for that? that the northern european also accept that? >> they accepted it for ireland and portugal. we both got extensions on maturities and lowering of interest rates. both ireland and portugal are

repaying our i.m.f. loans. of course that is making our debt more sustainable as well. we have them practically paid off. and at the last meeting in brussels, we got permission and paid the i.m.f. loans. there is a number of moving parts. it is a question of agreeing on the parts that move to make the debt more sustainable. and it is in that space that negotiations can take place. >> it was eated. there were arguments, discussions were heated in brussels last week but not yesterday. what was the defining factor that innocent groups got closer together? >> the first thing was to ask the greek government to apply for an extension over the program. they campaigned on the basis that they were abandoning programs. once they had agreed, the discussion became about the condition at and then the -- came up that they would put forward a list which would be suftly comprehensive to have

within it solution s of exchanging one condition with another and now the process continue bs. it has moved quite a bit. >> was there anything that surprised you? the discussions ? >> no. he wasn't particularly aggressive. i wouldn't describe t as such. he is a strong view. he has been quite successful in spain. they are coming out of their difficulties now. those of us who are in programs like spain portugal and island, we have insights that other members wouldn't have. we would be making suggestions and fairly strongly about the way to get outor difficulty along the lines that we used in our countries, rather than demanding a nuclear option of writing off debt or not continuing in the euro-zone. >> there seems to be the view in

berlin that there is a belief that for nose power that greece is -- is that -- and therefore, if it were the exist exit, the impacts of that would be limited. is that the belief on the euro group? >> there is a view that the euro is the kind of a -- financial project flawed financial project. the architecture to underpin a common currency zone is fitted. and if you go back years, it wasn't there. now it has been fitted. like fiscal unit. like banking unit. it is because the euro-zone is

underpinned now by real financial measures and regulations and i think that evaluation is probably correct. >> that view does exist that if greece was to leave the euro-zone, it could be -- the damage will be significantly less limited. >> it is not a view vested in the greek situation. it is vested in what europe has done over the last three years in terms of putting the architecture in place to underpin the common currency like to united states started doing it in 1790. >> where are we going to be in six months? >> i think we'll be in a reasonably good place. europe is sometimes slow to move. the project continues. if you want to measure the success, looking forward it

always looks like mission impossible but looking back over a three-year period, you see fantastic achievements. who would have thought that? who would have thought that croatia would be the latest member of the unit to make it 28. so if you look back, you'll see who is moving forward. if you look forward you say another impossible situation. >> three years ago we were talking about debt neutralizeation. we don't even that have conversation anymore. what is the union going to look like? >> you have an agreement that there will be a legal agreement that there will be no more blackouts by european taxpayers

of banks in trouble. it will be berlin using the asset of the bank. again, progress has been made on the neutralizeation issue. >> can i talk about i.a.g. shareholders are onboard. i understand the conversation is starting with the unions to get them onboard and the process there is seen as being straightforward. the irish government wants more. more concessions from willie walsh. he has already guaranteed five-year stocks out of heathrow. what else? >> i can't negotiate on the airwaves. i'm very constrained because i hold shares as finance ministers. i'm very constrained. >> are we close? can you see a deal happening? >> a deal certainly is not off the table. those participating --

commercial grounds, not political grounds. >> do you think they will return with a better offer? >> we'll see. it is very ack kabul and discussions are -- amicable and discussions are continuing. ryanair has a number of shares as well. the airline pilots association has about 6%. so there are a lot of players in this and they all remain silent and the focus is on the government. we're a 25% shareholder. we don't control the match. we believe that willie walsh and his people have been very upfront and in their discussions with us and the discussions are continuing. >> if you look at the prospects for ireland do you think there is this idea that we can use dublin as a -- for heathrow on transatlantic routes. do you like the idea? is there a concept there that you think could work? the new dublin airport, the new

terminal that is brand new and shiny and would be used as that option? >> there are certain advantages of people from the u.k. going through dublin rather than through heathrow. you can preclear customs and immigration and you go fly in if you're in one of the northern english towns you can fly to dublin as easily as flying to heathrow and get through quicker and then you don't have to go through the entry ports into the united states. you can flea fly to a city in the center of the united states once you're precleared. there are many advantages. >> all right, thank you so much for your time. the irish finance minister. let's get another check on the irish bond markets. >> francine wore green for mr. noonan today. very nice of her.

you can see the 10 yoir yield dipping lower. >> let's check in on markets. jonathan ferro has your asset check. >> some headlines in the equity market as well. the dax still at record highs north of 11,000 points taking in a breather across the rest of the your zone. 15 years to break it yesterday. then we come back a little bit at 1/3 of 1%. the data outor china has been pretty good. back in expansion territory. the enthusiasm the there. people buying the aussie dollar. aussie dollar is higher. stronger against the dollar off the back of those chinese numbers. that is their biggest ebs port destination. the swedish central bank came out a couple of weeks ago cutting rates, introducing bond buying program. this morning we got the minutes and it showed a little bit of

division. a little bit of dwix division what you're seeing this morning is a little bit of a retracement for the swede irkronor. weaker dollar. that is the f.x. market. we talked about the equity market and the record highs there. let's get to the bond market. the irish 10-year at a record low. this is the nine-year. 0.88%. the 10-year running at the bottom of the screen as i speak. below 1%. quite remarkable. who saw this coming 12 months ago? this is not about credit. it is about the q.e. coming from the e.c.b. inflation, when you experience deflation, investors, they are willing to accept a lower yield. the big moves in the bond markets, big moves in the equity markets that is the world we live in. bond yields, record lows. i challenge you to find a moment in history where that has happened.

>> none. i challenge you to find a graph thank shows that. >> we need to work on. right. let's move on. wrapping up the markets. janet yellen signaling the fed maybe has limits to holding interest rates near zero. the federal reserve chair began by laying the ground work for increasing borrowing costs later this year. >> hsbc executives will go in front overp u.k. m.p.'s today. the bank's c.e.o. and chairman will will be asked questions about the recent tax evasion revelations. we'll bring you the grilling of both executives. >> and gazprom is seeking a u.s. stamp of approval. they are working on a fresh authorization to move as much as $2 billion in natural gas. to the u.s., mexico and canada

and everything in between. at the same time officials in washington are warning they might impose additional sanctions on russia. you can see how these two fit together. >> the leg of movie might have been a shut out at the oscars but it was a winner when it comes to the company's revenue. >> the revenue up 13% thanks in parts to thelogue movie's success maybe not at the oscars but at the box office. let's get more on the the company's award-winning performance. good morning to you. congratulations on the numbers. look. where do you go from here with this business? you got a new movie that is going to be made. you are broad tng base in terms of the products that you're offering. you're changing demographics and the gender story when it comes to the offering as well. can you continue with this pace

of growth? are you able to up this pacor growth? >> well, i think, you know, we'll see the growth rate come down somewhat with. we can still continue with a very healthy growth rate. we're only growing organically. we want to stay very true to thelogue brand. i think that is what makes us unique as a company exfment that uniqueness gives us a global appeal that applies equally well in beijing or berlin or boston. that is why we need to stick to it. now i am confident that we can continue to grow. if i look at the company, an 18-year history, we seem to be growing roughly with the growth and the global household income. it is a world continues to grow and as new markets develop particularly in asia, the lego brand will continue to grow. >> we're talking actually about

it with guy earlier. it seems that we -- we spend weekends building logse with our children. when you look at the figure today. 12% top line growth and that margin, how difficult is that going to be to defend, these numbers are spectacular at the moment. >> yes. overbly, i think we have a -- i'm extremely proud that it is our 10th consecutive year of organic growth. i'm mindful that of course one should never be come placents but i do try as a privately held company owned by just one family to not no focus too much on disappointing financial performance but not disappointing stake horlsde. our partner needs to be making money sellinglogue products. our consumers need to recommend us more. we want our staff to be highly creative, motivated and engaged.

we mention that as well. that is really where i focus my attention to make sure we never become come placents and continue to reinevents ourselves and i hope with that this n mind we will continue to see some awesome financial numbers as well. >> how dependent are you on this sort of creativity of others, though, to make this work? mine craft you got mine craft lego which seems logical in so many ways. frozen, star wars. etc. etc. you seem to -- you have great licensing people. they are doing a good job. is that -- the creativity stream in front of you that you can latch on to really take advantage and keep the growth rate going as well? >> first of all i think it is important to say that the mainstay of our sales is on products that we develop ourselves swirle entirely and are based on the creative idea

of the legal break. that idea is so appealing when people develop other creative stories such as frozen or mine craft or star wars, it is always thelogue brand because it is the leading and most popular brand in that market. they come to us with their ideas. with some of them such as mine craft to star wars we have a fantastic creative dialogue which means we inspire each other in terms of developing the property going forward. thanks to the legal brand star wars has been introduced to several generations of children because we were those children's first experience with the star wars brand. remember there is a movie coming out later this year but it is the first movie in many many years and if meantime the legal brapped has kept star wars a major brand in the world of entertainment. >> that is true. as kids get younger they forget the classic. give us a sense. regionally what is very hot now?

who is buying more legos? is it a tieup to star wars or products catered more to those ahead of the game? >> the growth is actually very broad based. we're seeing it withlogue technique. we are also seeing star wars remaining very popular and growing. our preschool offering is one of our top five lines. it is broad based and in terms of the global spread it is very good. in a place like sweden, it must be a very mature market. we have seen growth in belgium sw and the u.k. and the u.s. certainly in places like china, we have seen more than 50% growth and russia, 35%. 35% to 40% growth rates. i would say that the growth is

also broad based and i think the explanation to that is one, is this really a globally appealing brand? it is a global assortment we're selling. kind of like a few other major iconic global brands. children are children everywhere. they do have different influences. some children have not heard about star wars but child's play is the same in most countries around the world and interestingly parents also value the same learning and benefits from playing in different cultures. when i meet a chinese mother, she talks about the same aspirations for her child as the american or a german mother would do. >> just one final -- well, two final questions. when am i going to be able to buy a lego oscar and is the character behind you stuck together with blew? -- glue? >> no. the answer to the last one is of course no.

we don't build models that are glued. i think the image behind me is made by my marketing department so there is probably a steel structure inside to make sure it can travel the world and be displayed in stores. regarding thelogue oscar that, event that happened a few days ago was not created by us. it was the organizers who did that and they asked a lego certified professional to make one. i'm sure he would be happy to make one for you as well. >> we need one. >> my question is how long does it take? for a simple tower takes a long time. a lego oscar, that would have to take a weekend. >> congratulations. thank you so much for spending so much with us this morning.

>> we have had some breaking news. for the first time ever, germany has auctioned off the five-year note at negative yields. the first auction. >> we're going to take a break. coming up, britain is facing one of its most uncertain general elections. one that definitely challenges the rule book and the history book. we're staug with alastair campbell. the spin doctor formerly in charge of tony blair's campaigns. ♪

>> welcome back to "the pulse" live from london on bloomberg tv. >> britain is facing its most uncertain election. since 1928. the conservatives are struggling to reach voters. democrats look like they could be on the verge of a wipeout. there are a lot of new-newish kids on the block. joining us now to talk about all of this bloomberg's u.k. politics reporter. so chaos is what people are talking about. how chaotic will it be? >> what you have to realize is that last time in 2010 we had fair straightforward coalition negotiations. there was only one option on the table that got you a majority government. this time the liberal democrats are going to lose a lot of seats. neither the conservatives or labor look like they are gaining

a lots. what you're going to have to instead is possibly three or four or five-way negotiations after may 7 going on in parallel with labor and the conservatives trying woo the scottish nationalist, the democratic unionist. the greens trying to get them all to come and join some kindor coalition, a process more difficult by the fact that almost all of those parties except the liberal democrats have said they don't want to be in a coalition. instead they want to sell their votes on a vote by vote basis. so it is highly unlikely that we will know as it were who has won the election in terms of who is forming the next governments. for certainly weeks after the election and as one person pointed out to me, there is no time limit for these talks except the next general election which is in 2020. >> last time you were on the set

you said it is up to the phrasing. it depends on the question that each party is able to suggest on whether they will be -- at the election or not. where are we in that? >> i think we're still at this point where you have got the conservatives, the conservatives have got one message which is they have a long-term economic plan. it is working. stick with it. and they have a submessage to that which is you don't really like the look of ed miliband. labor on the other hand which is you don't like the toris either. you can't trust them to run the health service or education or to run all of these things that you care about. both parties are continuing to shoot these lines back at each other really without anyone making a great deal of progress. in the polls we have seen a slight tightening again. really what the polls are telling us is it is neck and neck with labor and the toris

about 30% when really one of them needs to be north of 35% to win a majority. >> all right, thank you so much. bloomberg's u.k. politics reporter. >> someone who knows all about how tricky an election campaign can be, is alastair campbell. just this week he called on the rest o labor's team to step up because there is too much focus on leader ed miliband. good morning. >> how are you? >> i'm very well. >> chaos. is that what we're looking at? >> i don't buy this idea. we don't know. in all of the elections have have been involved in as a journalist or working with tony and the labor party. have i known what the result is going to be. i think this one is impossible to call. it is a much more complicated landscape with the greens and --

i think that i can't see the conservatives getting the majority. i can't see where that is going to come from. i can see labor get the majority but i think it is going to be very, very difficult. you look at the numbers, i think the other things going on, the scottish referendum. people are disengaging quite a lot at the moment. once we get near the campaign, they will engage much more. i think narrow down to this choice. it is not about who you're going to be putting into -- it is not about whether you would like to go for a pie with nigel, who is going to lead the government. who is going to be the prime minister? i think -- i wish labor with further ahead. miliband is still standing and still going. >> how much should we be looking at this election and saying this party popular or not how much is it about the leader

personality? the charisma. the fact that whether that leader is liked or not will decide who win? >> i think rob is right. both parties have a different sort of the same struggle. i think there is a general negativity. i think that could be broken through provided you have a leader with a real clear sensor direction and strategy. i have -- this book that i have written about winning, i have talked about it. david cameron should have won the last election. i think ed actually does have a sense of strategy a and is sense of what he is trying to do but somehow doesn't punch his way through the screen into people's homes and connect in same way. they have got different problems but in the same area. ultimately i don't -- i think you can -- look. i've defined angela merkel as probably the world's most impressive current leader. i think a lot of people would

agree with that. she is not that charismatic. she is not a great communicator. she will watch barack obama make a speech and be wow. >> she is a good communicator. she is different to your normal politician. >> exactly. she is a good politician. a good leader. the communication that comes very much secondary, i think to what it is she stands for. i discovered, you'll like this. sorry, that is slightly sexist. you'll both like this. she travels everywhere with a stylist. when you tell people that. >> so did sarkozy. >> did not do him a lot of good. the job of the stylest is to make her look the same as she did the day before. steadfast. solid, reliable. that all speaks to who she is as a person and what she is as a leader. i think with david cameron, i think he is a strategic butterfly. one day this, one day that. you're not quite sure what he

believes. i think it is going to be really, really fascinate. i don't think any politician should ever say we will win, even when we were 25 points ahead in 1997. we never said we will win. we said we can win. one of the lessons i have taken from talking to so many people in sport and business is actually never rest on your laurels. never say you are doing the best that you can do. always assume you can do better. >> is ed miliband in the criteria that you talk about in the book, a winner? he have those necessary skills, that necessary personality to win this election? >> i sense there is a but here. >> the sbu coming from all the questions. people are saying he is the new blare, the new clinton, the new obama. the point i make can he be a winner? definitely yes. if you could be. it is a choice between him and

cameron. ultimately people are not going to have to make that choice. cameron should have won the last time. he had a pretty easy playing field and he didn't. i think there is a real resistance to him as prime minister and a resistance to giving the conservatives a majority. i scenes that less so maybe in this -- sense that less so in this part of world. if you go through what i have analyzed, the things you need to do to win, strategy. have you got a strategy? are you a team player? ed has held the team together pretty well. do you a sense of what it is that you're trying to do on the big things? can you innovate? if you think about it, if you look at ed's career, that was the biggest test of him so far. he won it. that must have been politically

permanently psych logically quite a difficult period. >> let me ask you this. you said he has the foundations to be a winner but it is perception. if people don't perceive him to be a winner then it is going to be very difficult for him. >> i don't deny for both of the main parties at the moment, the landscape is not as they would like it to be. let me tell you why i think david cameron is trying to avoid the tv debates. i think it is if cameron can keep the debate focused on the papers largely biased against labor and giving ed a very hard time did ed ball say something daft about receipts, keep it on that level, then cameron feels very comfortable and he can go on the news every night and talk about this and that and say look at me. i'm the prime minister. if he had a tv debate, bear in mind a lot of people who would watch it are not picking up the editorials.

they are going on with their lives. if ed does well and cameron doesn't do so well that can turn things. the truth is both of them could win. i don't think either of them will be thinking they are in the place that they want to be. but when you talk about the -- how you win, the clear objective. they both want to win and a strategy, i look at osbourne and i think actually you do get a sense of what the strategy strategy is. cameron is on the news every night talking about something different than the night before. there is no real sense of a big picture. in a way that merkel has its. putin, whether we like him or not, has it. that ultimately is what top leadership is about. >> i think alastair campbell just gave a commendation for george loss bourne. >> i would not -- osbourne. >> i would say all of them all

the top politicians if they studied leadership. we're back later on. ♪ . .

>> this is "bloomberg surveillance." tom: forward guidance is dead as a data-dependent janet yellen guides markets to a later rather than sooner rate increase.

he is the most interesting man in the world -- the mystery that is vladimir putin. and the american reality -- students buried in debt. good morning, everyone. this is "bloomberg surveillance." we are live from our world headquarters in new york. it is wednesday, february 25. i'm tom keene. joining the olivia sterns and brendan greeley. let's get to top headlines. olivia: janet yellen is signaling that patients has its limits when it comes to raising interest rates. the fed chair is back on capitol hill this morning. she began laying the ground work for a rate hike later this year. chair yellen: the modification should be understood as reflecting the committee's adjustment. the conditions should be at a point for the change in a target range could be warranted at any meeting. olivia: today she will be questioned by the house financial services panel.