guy: a new goal for greece. the country needs to get a plan together for a made deal with its creditors. we will look at reaction in greece and germany. francine: china fights back. the country gives banks more lending power by cutting the amount cash lenders must set aside. guy: european foreign ministers race to address the issue after a boat tragedy in the mediterranean. welcome to "the pulse." we are live from bloomberg's european headquarters. francine: the greek government

has a new goal insight as it remains at with creditors. it needs to come up with a reform plan its creditors can agree on. guy: for more, we are joined from greece by our international correspondent, hans nichols in berlin. a reporter who normally is in greece, but i've got this completely wrong he is in london with us today, which is great. hans, walk us through the roadmap to may. hans: in many ways there's a lot of talk about deadlines. the european commission is saying that mid-may after that may 11 meeting, is the real deadline. mr. dice alone heads they -- he may have said it best when he said the real deadline is when greece runs out of money. we got 80 million coming due today. later in may, don't forget that may 1 payment.

a lot of focus is on the may 12 payment. that is to the imf. there are another 200 due on may 1. mr. dijsselbloem seems to be the most negative. he says they are still far apart. take a listen and have a sense of how many people are talking about isolation and contagion. mr. dijsselbloem said just 2% of euro output is coming from greece. that seems to be an indication that there is an emerging view that you can survive an exit. one final quote, he said, on the content, we are far apart. everyone sees the process is difficult. i will leave it to my athens colleague to break down what the greek government is saying. francine: every time greece becomes hot to my get more concerned about greece, the german 10-year yield falls further.

when are we going to see it negative? hans: it opened today unchanged. the 10-year at 0.07%. it touched a low of 0.049%. i believe that was friday afternoon. it still has a ways to go. it seems like it is stock. we will see how much further it drops. there was a lot written this morning on the comparison between the 10-year note in the u.s. and in germany. there are no longer appears to be the same correlation. looks like there is a slight quality there. the question is, where is this fixed income money going? where is it going to go for yield? it is not going to find it in germany and the u.s. guy: return of my money, not return on my money, maybe some people's concern right now. thank you very much indeed. give us a sense of the different views you are picking up from

the commentary you are getting in athens and the view you are getting here in london and how big a spread there is between those two. >> i think the spread can't get any wider. this has been the case since february 20, the agreement and we will see a different commentary that the greek government has within greece and decide which of the greek creditors are talking about. we are really talking about a different level here. it seems the red lines that both parties are talking about cannot come soon enough. francine: give us a sense. the story here, greece is still running out of money. we are no closer to an agreement. are we going to see fresh elections in greece? this is feeling like they are

proud of the fact that the government has not given in. vassilis: support for the sabres administration is diminishing as default options are getting higher and higher. able showed there was -- a po ll showed there was 80% approval for the sabres government and that is down now. i think to break out of this impasse, we need to go on a very direct message and a very direct mandate. guy: we need another mandate, a referendum? vassilis: a referendum or elections on whether greece will stay in the euro or not. guy: let's bring in menacing from cross ridge capital. from the point of view of the financial markets, there seems to be an increasing view that an exit is possible. but if you talk to people, there

is still this sense that a deal will get done. i'm struggling with the increasing narrative towards the disaster which is telling us that maybe in may, there will be some sort of key crunch point. everybody i talk to in the financial markets -- is that just muscle memory or is that actually -- i don't know on what that is based. manish: whatever you've heard from varoufakis is disappointing. there has hardly been any progress. there are two things. default and grexit are not the same thing. that is clear. what can really push greece out? if the banks run out of money, then you have a big problem. it is likely that if greece defaults, you will see capital controls.

you cannot be funding banks and letting capital flow out of the country. you might see a default. we don't know yet. there's a likelihood that greece will pay as they have done. varoufakis is a master of game. . we haven't heard him say what he is going to do about it. it is also likely that maybe greece starts paying its pension employees in ireland and england. you are going down various paths. i still think the ecb will keep greece within the eurozone. francine: two free questions. if the ecb continues giving the greek banks support in case of default, this would be a political agreement. what happens to the euro the day after a default? up or down? manish: we are talking about a

serious threat on greece. it is getting isolated. i don't think it is as magnified as we were thinking before. guy: how difficult would it be to stop paying pensions? i'm trying to discount options here. vassilis: the current government is looking to take pensions away in the first of the month. they are looking to put money aside for that. in the next elections, they might be out of the government. the first thing they are doing putting the money aside. guy: what is your sense, what is the sense in athens about whether there's enough money to cover everything else? vassilis: right now, greece has today at least 4.2 billion euros in may. word is the government is short about 2 billion. guy: so only halfway there. vassilis: the may 11 meeting is

convening for a longer payment. may 12 is a very important date. i think the government will do the best in its ability to meet the imf payment. that is what they talked about in new york last week. but still, i think we are on a very tight schedule here. guy: -- francine: manish, we have to legitimize this. if greece was to leave the euro that would be a disaster. maybe a disaster according to economists. let's say that the country defaults. we keep the ecb lending facility available. we have capital controls and we have iou's. what is the likelihood then of a greek exit that would be accidental? manish: i think that if there's a default then i'm sure there's

going to be probably a referendum or a new election. they don't want to do a deal with the ecb on present conditions. there has to be a new mandate. probably that mandate has to begin on the point of whether you want to be in the eurozone for you want to exit. the people will decide whether they want to begin the eurozone or they want to be out. it will be a crisis if we move out of eurozone. it will be a crisis definitely for greece. guy: ok, thank you very much indeed. manish is going to stay with us. vassilism thank you very much indeed. coming up later, hopefully we are talking to the cypriot finance minister for his take on what exactly the story looks like this monday morning. francine: it will be great to

get his take on the negotiations and have a feeling of what he thinks about capital controls. guy: been there, done it. what else is on our radar, it is finland. the country's sensor party won the national elections. he has promised to create jobs and promote business friendly policies, taxes, and laws. finland's economy is one of europe's worst-performing and recession now for three years. francine: deutsche bank will exit part of its stake in the postbank consumer operations according to a person with knowledge of the situation. the company is weighing an option of making deeper cuts. that is the management board's least favorite course. guy: european union foreign ministers will meet today to discuss the illegal trafficking

of migrants after a boat capsized off the libyan coast. only 28 survivors have been recovered so far from what could be the most deadly of such tragedies in the mediterranean. francine: that brings us to our twitter question of the day. how should europe deal with migration. tweet us. guy: still ahead, we are going to look at china's latest stimulus boost and why the country cut the amount of cash lenders set aside. francine: and, david cameron channels market -- margaret thatcher. we will talk about the plans to sell discounted shares. guy: a meeting after the boat tragedy in the mediterranean. europe's commissioner for migration says bold action is needed. ♪

guy: welcome back. you are watching "the pulse." we are live on bloomberg tv, on the radio, streaming on bloomberg.com, and on your phone. the chinese central bank announced new measures over the weekend to stimulate the economy. a bigger cut in the reserve requirements was laid out. the one percentage point reduction in the reserve rate will allow to do lending. for more, let's welcome bloomberg intelligence chief asia economist tom orlik.

tom let's talk about the motivation of this and where a 100 basis point cut is on the sliding scale of policy options. tom: i think the motivation really comes from two sources. firstly, for much of the last decade, china has faced capital inflows. that has pushed the central bank to raise the ratio and lockup those inflows because -- before they could trigger runaway inflation or asset bubbles. that has changed. we have seen capital exiting china, so the central bank has to cut the reserve requirement ratio to ensure the banks have enough funds to lend. the second motivation comes from concern about slowing growth. on the surface, 7% improvement in gdp in the first quarter looks pretty strong. if you dig beneath the surface, there's weakness in real estate weakness in exports.

that's why we are seeing this pattern of easing as the government tries to bolster demand. francine: tom, on friday, the authorities banned margin trading through the so-called umbrella trust. how do that to actually matchup? it seems they are giving with one hand and taking with the other. tom: i think the equity markets in china are definitely entertaining. in terms of their impact on the macro economy, they are kind of a sideshow. so i think the margin trading rule is certainly aimed at curbing some of the enthusiasm the irrational enthusiasm on the mainland equity markets. the reserve requirement cut has a positive impact on the equity market but what the central

bank really wants to see is it passing through a stronger loan growth boosting business investment, giving a boost to the real economy. francine: tom orlik, our economist in beijing. guy: let's get back to manage sing. how do i translate a 100 basis point cut into equity markets? we have seen a response in the mining sector. it is what you would expect. how do i put this larger than that? manish: people are concerned about 7% growth in china. let's not forget that this would be 14% growth if you are looking at 2010 numbers. the second is that this is a liquidity measure. the central bank is not intervening in the market and buying dollars. they are selling. they are making a debt for bond swap in the market. a lot of this liquidity is also going into bonds.

this is definitely going to hurt equity markets. there is concern about, can china equity markets rally -- yes, it can rally. if you look at domestic wealth of china, 75% is tied to housing. only 25% is equity markets. in the u.s., the soft market is 78% almost. there is more to go. if you are talking about -- china's premier leader said they will intervene when there is a slowdown. i think there is more to come. the cost of capital has to come down. francine: we are not really worried about the growth rate. what we are worried about is an overheating economy. there's a danger that if we create bubbles that burst suddenly and that we weren't expecting, then there's a meltdown? manish: i think what we have seen in terms of equity volume

is because of policy response. you have seen the sean -- the hong kong shanghai connect market. you are seeing people funding but you are also seeing that china is careful of not letting it go into a bubble. they will give more stock to short. they are putting that measure in place as well. the chinese economy will have some give and take. that is what we are seeing from china. guy: if you were to look at the main economic engines on the world right now, how many are firing on anything close to potential? manish: if you look at the recent number the q1 gdp number could be as high as 2% to 3%. in this country, there was an article yesterday that you can do a five-year mortgage at 2.6%. you are also benefiting from low oil prices.

if you look at the number coming from europe, the numbers are going up. europe is plus 50 and the u.s. is -50. i think you are going to see a quarter of european growth. with growing consumer sentiment the sectors are going to do well. and also, what is happening in china. francine: what is your take on emerging markets? you are saying, if we look at the contribution of china in the world economy, we should not be worrying at all. manish: sure. i would say, china consumes half the metals of the world. francine: and oil? manish: oil as well. you are going to see is some impact. there is more to go in terms of liquidity. if there is a greater slowdown,

then brazil, peru, and other emerging markets will be impacted. francine: thank you so much for all of that. manish singh, head of investments at cross ridge capital. guy: deutsche bank madey ditch its retail operations. francine: also, we will be speaking to the cypriot finance minister about the situation in greece. ♪

francine: deutsche bank may be planning to ditch its retail operations. this is said to be part of a strategy revamp that may be announced as soon as this month. let's bring in our european finance team leader. thank you for joining us. what options is the bank considering? >> we know the bank started with five models. it has narrowed that down to two those being a partial exit of its consumer business and a slightly more radical shift which would see all of its consumer businesses combined and an exit from those. as part of both scenarios, there would still be a scale back in the investment bank, but that will depend on the size of the retail divestment, which is being pondered now. third scenario which was

presented a few weeks ago, that we should see the perimeter of the bank unchanged while the bank scale back the cost of business. at the moment, that is the least favored scenario. guy: what is the timeline on this, do you think? elisa: we understand that there's a supervisory board meeting as soon as friday, in which a final decision may be taken. that is not entirely certain yet. both the management and the investment community are still somewhat -- [indiscernible] on the advantages and disadvantages of those two scenarios. the most radical potentially raising concerns about how the bank will fund itself in the future. it will be splitting off the deposits. the ones in favor pointing to a boost to profits in the

immediate term. guy: we are going to wrap it up there. elisa martinuzzi joining us in milan. we are going to take a break. ♪

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fast in the hallway. i feel like i've been here before. switch now and get the fastest wifi everywhere. comcast business. built for business. francine: welcome back to "the pulse" live from bloomberg's european headquarters in london. guy: these are the bloomberg top headlines. francine: china has reduced the amount of money lenders must set aside. the biggest cut since the crisis. the reduction is about $200 billion worth of cash to the markets. guy: china and pakistan will sign an agreement for $28 billion over the next couple of days, this according to officials. the deals will take place during president xi's visit to

islamabad. francine: in a real estate deal worth $5.9 billion, private jets -- prtoologis has agreed to buy ktr. the move will expand its presence in key u.s. markets. guy: we are 17 days away from the u.k. general election. as campaigning continues, the conservatives are taking a page from margaret thatcher. if they stay in power, there will be a retail offer of lloyd's shares. reminds us of the early 1980's when we were selling off gas and telecoms, everything that was part and parcel of the government sector. anna has the story. anna: more than overtones of thatcher in this policy. what is being proposed is that shares in lloyds banking group would be sold for the first time

in a retail offer. the government is reducing its stake that it built up at the height of the banking and financial crisis. they owned 43% of this banking group. it is now down to 22%. this is the first time we are hearing the government talking about a specific retail offer. no doubt echoing those ads of the 1980's that we've been talking about this morning. some of the details on what will be on offer if we see a conservative government the stock would not be sold at lower than the given price. that is defined by what the government paid to get into lloyds banking group in the first place. you could buy tranches of 250 pounds up to 1000 pounds worth. there will be a loyalty bonus. you get an extra share back if you hang on to the shares for a few time. francine: the day could be

dominated by the launch of the s&p manifesto. what do we expect? anna: one thing that is going to feature heavily is more power for scotland. the snp wants to give that parliament more power. the other feature will be anti-austerity policies. not just anti-austerity for portland -- for scotland, but for the whole u.k. they make mention about plans to influence nhs policy across the rest of the u.k. to ensure it goes back into public hands. they are not shying away from the question about how legitimate is it for scottish mp's in westminster to vote on issues that are about england and wales. the snp argues that it is legitimate in their right for them to get involved. i think we've got a short -- a chart showing how many seats the snp could win. the latest polls suggest they

could win about 50 seats. that is a big yellow line at the bottom of the chart that would look like an enormous outlier. back in 2010, they just got six. this would be a real sea change in british politics if we see the snp winning 50 seats. guy: maybe it is the weather, but let's talk about europe. everybody seems to want to talk about europe. francine: the tesco chairman talking to the independent newspaper it is all about uncertainty for business. that is where he was putting his focus. he was saying that companies could easily move their headquarters into the rest of europe or globally if the u.k. decided to leave the european union. that is something the conservative party has pledged to give everybody a vote about. remember, to add to that the virgin boss richard branson said

that if there are things we don't like about europe, we should sort them out rather than leaving. those are just a few of the comments we are getting about the role of the european debate in the broader u.k. election. guy: thanks very much indeed. anna edwards on what is happening in the u.k. francine: staying on virgin, u.k. how prices have climbed to a record. we are joined by anthony codling. great to have you on the program. let's talk about london property prices especially. we have so much money coming in from the eurozone. it seems that people held off. we have this surprise, saying we are again at record highs. is it just a matter of not enough houses? anthony: london is a collection of hundreds if not thousands of different markets.

i think we split inner london with outer london and we find that there are slightly more people buying a home in outer london than the rest of the u.k. that would suggest there isn't an affordability crisis. are there issues of supply? london is a great, global city. lots of people want to work here. if there were more houses in london -- guy: if we are to see the next government launch a project or a significant housebuilding scheme , what impact would it have in prices? if you were to significantly increase supply, what would the read back the into the rest of the market? anthony: in theory, an increase in supply should lead to a reduction in house prices. in london, that would effectively increase the supply of london housing so you could commute from a new garden city rather than having to live in

inner or outer london. guy: a lot of people have rented. i wonder what the percentage of them that would step out of renting into homeownership. there seems to be -- i'm wondering how deep the pool of people that would make that leap would be. anthony: 6% of people are in private rented accommodation. if you look at the rest of the u.k., that is about 17%. it could be that sort of swing. francine: what does it mean after -- how does the election actually change? anthony: all the major parties are very similar in terms of housing policy. all of them want to see more houses being built. i don't think any of the major parties want to frustrate the suppliers. there is not a huge amount of choice in terms of the different political parties. guy: does the u.k. have a

housing shortage? anthony: i don't think the u.k. has a housing shortage. i think more people want to live in certain areas, which drives up prices. guy: do we have a housing crisis or a transport crisis? anthony: interesting point. you could argue that they are linked. if you had more transport links into london then people could come in from a greater distance. that would essentially increase the size of the commuter base which would reduce the pressure on housing in london. francine: if we look at the market in london, i'm thinking more high end or prime, a lot of it is fueled by uncertainties in the eurozone. that is likely to continue. anthony: while there is uncertainty and london remains a global city a more stable currency than the euro at the moment, the attraction for

investment in london property will remain. guy: what is the yield on london property at the moment? anthony: around 1% to 2%. guy: that low. anthony: just a safe haven status of london. an overseas investor might say, my capital values are rocksolid. guy: what would change that? that is a low yield. what is another opportunity -- once another opportunity avails itself, that would change. anthony: in theory, yes. if a new area was to have as much cachet as london, you might accept a lower yield elsewhere. guy: you think yields will get lower? anthony: i don't see why yields wouldn't get lower. if the shortage of property remains, that is going to underpin. guy: you think we will go lower from here? anthony: there's no reason why they should reach the same levels as the rest of the

country given demand and the shortage of supply. francine: anthony, thank you so much. guy: after the break, the eu holding this urgent discussion after another migrant boat tragedy off the coast of italy. we are going live to rome for the latest. francine: that brings us to our twitter question of the day. how should europe deal with migration? we will round up some of your answers in about an hour and a half from now. ♪

guy: welcome back. you are watching "the pulse." we are on bloomberg television. let me show you what is happening. thursday and friday not great for the equity markets. today we are bouncing back. should we think the chinese for that? maybe. if you think about various issues in the global market, the back end of last week, people were getting concerned about greece. does china trump greece? nevertheless, equity markets on the front foot again this morning. francine: if you look at the greek 10-year, those yields have been rising quite significantly. check out the german 10-year. in the bond markets, this may be the week. this may be the week that german 10-year yields turn negative for the first time. could be this week, could be next week, it could never happen. if you look at the trend, money

gets piled into german bonds. guy: the question is, does it really matter? francine: negative yields -- guy: i guess we are about to find out. francine: psychologically nobody cares if it is 0.01%, and yet it matters to the psychology of the market. here are some of bloomberg's other top headlines. guy: google will overhaul the way it search recommends sites on mobile this week. the change will affect mobile searches in all languages worldwide. it could penalize sites not optimized for mobile. i checked it out this morning and it definitely works. stay with the google story. google has a great interview coming up. francine: that is with the eu competition commissioner.

we will ask her about the antitrust charges. guy: gm's joint venture in china steps up investment to compete for market share in the world's largest car market. shanghai. gm targets a market share of more than 10% in five years. francine: labonte monitor -- the bond manager who has been 99% of his peers says the impact of the fed's policies have yet to be felt in the market. he says the feds extreme policies have been very well-intentioned. he says a june rate hike is very unlikely. guy: european union foreign ministers today will meet to address the issue of illegal tracking of migrants. the meeting comes after fishing boats packed with 700 people sinking refuge -- seeking refuge

in europe capsized. it could be the most deadly such tragedy in the mediterranean sea. the italian prime minister called for more eu action to crack down on the traffickers. >> our priority is human dignity , as well as national security, to stop trafficking of human beings. the new slave drivers cannot think europe considers this a second-rate problem. guy: right, let's go to kevin in rome for more on this. what do you expect to come out of this meeting? kevin: there have been quite a few calls for urgent action to stop the influx of refugees and rescue those who take to the boats. there will be a lot of talk and probably no action. it is important to remember that the eu foreign policy chief has already warned that there is no

magic solution to this crisis. francine: kevin, what are the latest details on the search? kevin: the details are, 28 people have been rescued. we don't know if that number will go up. in addition, there is an italian news report that up to 950 people were on that boat. that number has not been confirmed. it is a number that is going around. guy: kevin, thank you very much indeed. kevin costelloe joining us from rome on the tragedy in the mediterranean. francine: that brings us to our twitter question of the day. how should europe deal with migration? you can tweet us. coming up, monaco showcases the world's most desirable and expensive luxury cars. guy: we are going to talk to a man who helps buyers choose a

car when money is no object. ♪

guy: welcome back.

you are watching "the pulse." we are live on bloomberg tv. let's talk about cars. it is nothing like the geneva motor show. let me make that clear. when you go to monaco, you expect the finest. top marks is the show where everybody goes when they want an incredible car. how do you choose that incredible car? tom gibson went to get some shopping tips. >> top mark monaco is the ultimate when it comes to luxury car shows. who better to help the nick lancaster, the car dealer to the stars? the former boss of london's leading luxury car dealership has some pretty good tips. >> some of these cars are not great on the road because they don't have the same kind of steering the other cars had. they have a different kind of suspension.

this has been an enormous success. it puts you just above in people's perception of being where ferrari used to be. when i was a dealer, if a car like this came out, we would order as many as we could get. this is a specialist design company taking either tesla or nissan product and changing them with the wheels and suspension. a growing market at the moment particularly in asia where people want to show their car is different from the guy next door. >> even the local dealerships across the globe rented space to join the feeding frenzy. the organizers say 70% of last year's exhibitors sold. >> we have the promise of one coming back this afternoon. that is two.

>> not bad, considering there will only be five of these in production. rng racing are reviving the golden age classics. an agreement with aston martin allows them to re-create old models but with 21st century engineering. >> around 600,000 pounds versus 22 million for an original. you would argue this is very good value for money? >> but it is another model that nick's got his eye on. >> it is around 170,000 euros. you can customize as you want. >> i think i might buy one. i think it is a beautiful car. it looks great. frankly, it offers something different. it is a great sunday lunch car. it will make it a very valuable car in the future.

>> top mark might have something for everyone. tom gibson, bloomberg. guy: a great sunday lunch car. i'd like to have a car for every day. francine: when guy was looking at this, all i could hear was "ooh ahh." guy: that last one looks great. a lot of car companies are increasingly taking to the classic designs, reengineering them. you get some old jags and get new derivations of them. very pretty with the great lines but upgraded for today. i like the idea of a sunday lunch car. i really do. i would like a monday morning breakfast car as well. francine: driving it around the studio. for those listening on bloomberg radio, "the first word" is next.

for our viewers, a second hour of "the pulse" is coming up. guy: we are talking to the cypriot finance minister. here is a man with some experience of what greece is going through right now. people are talking about currency controls. he has dealt with that. it will be interesting to get his take on where we are and what the greeks are thinking right now. we will get his sense of where we are and what is coming up next. the next few weeks are going to be -- francine: all about greece. it is just amazing that they've been talking for weeks, if not months, where it has started being really important. guy: when you talk about greece, since 2008 -- nevertheless, we always knew it was coming back at some point. francine: we will also talk about google, facebook microsoft, the companies

reporting earnings this week. guy: the strong dollar is going to be an issue. google is going to be a huge story this week. google reports thursday. we got a great interview. francine: we will be talking to the eu competition commissioner. that is coming up later on. we will talk about all these tech companies. we've been talking about valuations and business models. unclear to me, even a company like at the -- like eytsy, once it ipo'ed, shares went through the roof. guy: mr. dudley is also speaking to us as well, the new york fed president. he is going to be at bloomberg headquarters in new york. we will be live at 8:40 a.m. eastern time if you want to listen to that interview. if you want to follow us on twitter -- francine: please do so.

we will talk about everything from when the german 10-year will go negative, whether you should care about european equities, and the huge migration around europe. ♪

francine: greece needs to get a plan together for its creditors and unlock eight. we will look at the market reaction. guy: china has given its banks more lending power by cutting the amount of cash they must set aside when they make a loan. francine: european foreign ministers address the issue after a boat tragedy in the mediterranean. guy: good morning to our viewers in europe. good evening to those in asia. a very warm welcome to those

just waking up in the united states. francine: this is "the pulse" live from london. guy: we begin with greece. the government is still at odds with its creditors to unlock a and it is no closer to a deal. francine: for more on this, we are joined by our international correspondent, hans nichols in berlin. our athens reporter is in london today. hans, run us through the greek roadmap. hans: the roadmap starts in a couple days. there will be a preliminary conference call. they will meet on friday. that was previously the deadline. it was the deadline the greek state set. they are going to bust through that. here's what mr. dijsselbloem, the dutch finance minister saying the real deadline is when greece runs out of cash. that could be early may. that could be in mid-may. that could be in june. one thing to look at this week

and heading into the meetings is to what extent are finance ministers talking about how isolated greece is. can the contagion be contained? mr. dijsselbloem talk about greece being only 2% of europe's output. not a lot of optimism from the dutch finance minister. everyone sees the process is difficult. there's one imf official saying that there's been slight progress in the technical levels of the talks, but not a lot of reason to be optimistic. you look at the yields on greek debt, they are all up this morning. in one case, up 110 basis points. guy: that is the view from berlin. let's get the view from athens via london. let's talk a little bit about what the view is out of athens right now.

i'm really trying to understand the psychology. this is all about psychology now here it -- now. reading between the lines, what is going on in athens? what is going on in parliament? vassilis: the current government that was elected on the standard mandate that they would work on a much harder stand trying to get some leeway on austerity measures that were imposed in greece. so we are having -- we are heading towards what could be the fall for greece. the greek government is standing by this strong stance that we are not going to be allowed to honor our promise to the greek people. this rhetoric got the government to power. it doesn't bode well with creditors. the greek people see this as a government that tries hard and fights hard for the people. however, as time goes on and the

greek default is looming positive opinion polls for the tsipras administration are going down. they are around 55%, which is a big number. francine: because he is not signing an agreement or because he can't promise on what he's been elected for? vassilis: the greeks are pro-european. as a grexit scenario gets more possible every day, people are going back a bit. the previous government was a disappointment for many. therefore, there will be some positive opinions at the beginning. it is only natural for a new government to have the backing of the people. guy: still, most governments there aren't many that have 80% approval ratings. 55%, you've still got the bulk

of people on board with you. if you are sitting there inside syriza how much more do you think you've got in the tank to keep pushing with the current strategy? how do you get out of it if you need to? vassilis: tsipras has to make a decision with his so-called left platform. these lawmakers are coming from the communist party. they see a great future outside the euro. the tsipras administration has to deal with that. if he thinks he can move to a unity in the greek parliament that is one way to go. the other way to go is staying with these left platform lawmakers and going for a referendum with the implicit question of whether we stay in the euro or not. francine: thank you so much. hans, people get scared of what is happening in greece and that makes german bond yields fall. are we going to see the 10-year

fall below zero? hans: it is one metric. last week, it got awfully close. this morning, it opened up at 0.07%. it has been trending up. i don't know if that is a response to the decision out of china. it is really a question for some of the technical experts. what happens when the 10-year note starts trading at a negative level? does it try to hang around? it is the technical question a lot of economists are acting. -- are asking themselves. francine: thank you so much hans nichols in berlin. guy: as the eurozone seeks a roadmap to avoid a default for greece, let's get a take from one of the country's closest neighbors, cyprus. we are joined on the phone by the country's finance minister harris georgiades. i have the phone line stable. i can hear it buzzing a little bit.

minister, can you give us your sense this monday morning of how close we are to some sort of accident in greece, be it a default or something else? what is your read of the situation? min. georgiades: i hope that such an outcome is avoided. it would be devastating for greece and the greek people have been through significant hardship during the last few years. significant progress has been made during the last few years. i do hope that a decision could be reached soon. i do not even want to discuss a possibility of an accident. francine: minister, are you talking about a default or an accident of a grexit? we are hearing that it is unlikely that the two sides will come together in time for greece to do all of their payments. is that a fair assessment? min. georgiades: obviously, both

need to be prevented. that is why i do hope there will be a resolution. i cannot speculate when this resolution will be decided upon. obviously, time is now of the essence. we are close neighbors. that is indeed the case. we share the concerns of the rest of the members of the eurozone. obviously hours is a different economy and we are following our own cause and we are implementing reform and market policy which is delivering. but this is not to say that we are not sharing the common concerns of everyone in the

eurozone that the situation needs to be resolved soon. guy: minister, you have in certain ways provided may be a roadmap for what greece can do. do you think that is a real assessment? when you look at your experience in capital controls, you stayed within the euro despite having capital controls. do you think that is a roadmap for something greece could use? min. georgiades: i hope that it will be a roadmap to be avoided. the cyprus economy was led into difficulties and had to impose capital controls because of indecision and postponing of difficult but necessary decisions. however, for the last couple of years, as i have mentioned, we are implementing a pro-reform and pro-market agenda.

we have eliminated the budget deficit. we have reformed our banking sector and we are edging out of recession. very recently, we were able to do away with those capital restrictions which became necessary to years ago. i wouldn't -- i would hope that greece will not have to go through a similar situation. i think it can definitely be avoided. i take note of the commitment of the new greek government to continue implementing its own reform agenda. the issue now is to specify and to agree with institutions on the details of such a policy. i will repeat for the third time, i hope this happens soon. francine: finance minister, a

lot of people hope this will happen soon. what is the likelihood of us finding an agreement between the creditors and greece in the next couple of days? is it a 50-50 chance? min. georgiades: i don't know. i wouldn't really like to speculate. since i'm not a direct participant in the ongoing negotiations. the eurogroup meeting next week should be able to receive feedback. if this does not happen, if we do not receive feedback on good progress, it will be a negative development. guy: final question, minister. are you creating a plan for greece to leave? are you -- you are a leader of your people. you have a responsibility to make sure you map out everything and make sure they are looked after. have you considered a plan, is

there a plan b? min. georgiades: first of all, as i have mentioned, we are a separate economy. we are following our own policy. that is the best safeguard against any negative development. secondly, such an outcome would imply that we are entering uncharted waters, for which no planning can ever be fully articulated. i'm not referring to the cyprus economy or to the rest of the eurozone economy, but i am referring to the consequences primarily within greece. that's why i'm not even willing to speculate or to discuss an

eventuality which the greek government itself has ruled out. it is an issue of making contingency plans. it is an issue for everyone involved to take the necessary decisions without any delays that would prevent such an unfortunate outcome. francine: finance minister let's hope that you will be proven right. the finance minister of say chris -- of cyprus, harris georgiades joining us. guy: coming up, finland votes for a new government. can the prime minister resurrect the economy? we are going to helsinki to find out. ♪

francine: welcome back. let's get back to greece. joining us now is the head of economic research at independent policy think tank open europe. great to have you on the program. is there going to be an event that forces the issue? at the moment, creditors and greece are making no leeway whatsoever? >> i think there are some payment dates which are going to force the issue. we have heard about the first of may and the 12 of may. there are also payments to

pensions and salaries at the start of may. by that point, greece has run very short on crash. it will have to make a choice between paying the imf or paying its pensions and wages. it has a mandate to say it will always favor its own people. guy: i have read countless articles over the last few days talking about the idea that a default does not mean exit. is that the correct way of looking at it? raoul: it depends who they default on. if they don't pay the imf on the 12th of may, i think they have some leeway to stay within the euro. what would happen would be, they would have a month until the managing director of the imf notifies the board and officially counts a missing payment from greece. at that point, eurozone countries would have to decide whether they consider their loans to be in default. that is a political decision.

it is likely that the eurozone countries would say, we will give you a little more time. if the month has passed and they have been able to get the funds -- francine: that will give them a bit more time as long as greece is making steps in the right direction which so far they haven't done. am i reading this correctly? raoul: that is true. they would have to step up. we have heard some comments over the weekend. i think if greece misses a payment to the imf, they will have little choice but to move a bit closer to the eurozone countries. let's not forget the type of countries that have missed payments. somalia, sudan zimbabwe. guy: stay with us. we need to talk about finland. let's go to the country where the center party has secured a victory in the national elections. the self-made millionaire has promised to lead the country out

of recession. let's get a little more. kathy is bloomberg's bureau chief in helsinki. tell us more about this win and how it was achieved. kathy: the center party had a landslide victory compared to its 2011 results. this is a powershift. they essentially spent the last four years in opposition. together, these parties look like a candidate to start talks to form a new government. francine: what kinds of challenges does the country now face? kati: finland was known during the euro crisis as one of the better countries in the euro. many of the internal challenges are being masked by how others looked worse. finland is basically failed to

recover from several hits its economy took during the financial crisis. now it is suffering from a drop in exports to russia. there's a couple of major industries that have completely vanished. consumer electronics was driven by nokia and the electronic online news, ipads and that sort of thing. this has hurt public finances really badly. budgets are in the red since 2008. government debt has doubled since that year. the growth of debt is alarming. what makes it all worse is, finland's population is aging at the fastest pace in europe. that is shrinking the workforce already. the economic prospects are rather dim. the central bank forecasts about

1% growth a year in the long term. the new government has to things it has to do. it needs to find a way to balance the budget while not killing growth and finding ways to actually boost growth and try and get it onto a faster track. francine: thank you so much for the update. guy: let's get back to the political developments with a different point of view. we are back with the head of economic research at open europe. finland has always been an interesting story, particular;ly in the context of the wider european story. you've got grease at one end of the spectra and and finland at the other. at one point, they were the standout story for resisting help from southern europe. does this election change anything in terms of finland's place in europe? raoul: it is becoming clear how

poor the economy has been doing. if you look at the forecast going forward, finland is very low on the list of eurozone countries. i think in terms of the eurozone crisis in greece, it has always been -- the real question now is what the coalition will be and if the finns are in that coalition. can you have a coalition that votes to approve a future package for greece? there will need to be something for greece when the bailout and's. we could see any new coalition with them involved coming under significant strain. francine: what do you make of the new person in charge? he has said there are no magic tricks. do they have 10 years? 10 years is a long way off. raoul: i think their problems are very structural. as we heard, they have long-term problems, which may mean they have to open up to immigration.

they've always ranked high on these competitiveness indicators. people question why they are doing so badly. fundamentally, their economy digital, metals, all of those taking a huge hit. they really have to find a new balance of drivers for growth. i think it is a long-term project. guy: about finland and the u.k. brexit and treaty reform, how do these fit together with finland? raoul: tough question. naturally, they are quite inclined in terms of their economic approach mostly in favor of structural reforms. but obviously, whenever a country is going through a tough economic period, it is always hard to make acquisitions or exceptions for other countries outside. we could see some hostility. it is hard to say until we know

what the coalition looks like. francine: thank you so much, rolled through the. -- raoul ruparel. ♪

guy: now, we are going to take a very short block here to tell you about what is coming up. ibm kicking off a big tech earnings week today. huge week for u.s. tech companies.

yahoo! arm, facebook, and google, microsoft, and amazon. you are going to see a social media story here plus a strong dollar story. we are going to talk about it. ♪

guy: welcome back to the pulse. i'm guy johnson. let's find it with tapping with the markets. mondays feels a different than a friday here in >> and ugly week last week. china goes in and cheers everyone up with a rate cut. stocks are up across the board here in europe. guess which industry group is

leading those gains? it's the minors. the biggest cut since the financial crisis. it is giving a bit of a list this morning. at least temporarily, the aussie dollar comes back. maybe we are seen economy benchmark rate. we are expecting the christ's -- price of credit in china. that risk on feeling really affects market as well. the euro is a little bit weaker. equities are higher. a weaker euro. in the bond market, things got interesting. the spread is starting to low out just a little bit. german yields go lower.

the 10 year yield in germany is 0.07%. we could go beyond that. we could go to negative rates. just imagine that. that is quite remarkable stuff in the bond market. the yield on the greek 10 year is 12 when i percent. the politics come to the forefront now. we could be heading to snap elections. it's not really about greece. it's about the chinese rate cap. guy: thanks very much. he is the chief economist at bloomberg intelligence. , why are we getting what we are getting? guest: there are a couple of factors at work or in china

means funds leaving the financial system. it offsets those capital flows. the second factor, headline gdp. if you dig down a little bit the need surface, real estate is weak and exports are weak. there are concerns that exports will continue to deteriorate. francine: what's the impact you are expecting? can you put that in contacts with the saw on right eight. -- friday. guest: in terms of the impact, the reserve requirement cuts increase is a supply of credit. it frees up funds for the banks to lend. it doesn't boost the demand for credit.

chinese firms are struggling with high debt. my view is we are going to need to see more moves on interest rates and lower the cost of credit before we see demand for loans come back. from the equity markets, i have been consistently wrong. i'm not sure i am right person to ask. you are right. we are seeing mixed signals from the regulators. on the one hand, the clampdown on margin trading and now you just move on the reserve ratio. francine: thank you so much. guy: it's a big week for tech. google, facebook, microsoft, just a few the companies that will or earnings. let's report on crowdsourcing.

we are joined the ceo of estimate ise. the facebook numbers are what i want to talk about her it --. guest: facebook is going to be huge. when we see a big consensus trend at the end of the order heading into the work like we are right now, it's a good sign they're going to blow numbers out of the water. francine: we understand what they are trying to beat. will we see a significant amount? with a lot of these valuations we look at the numbers. how are they going to grow? guest: it's all about mobile. couple of years ago the west it was could they switch to mobile. now it's how powerful is this? a bunch of these companies who buy mobile ads on facebook are

figuring out how to monetize. when you look at stuff like the fantasies boards gambling apps like draft kings, these of skilled -- scale large quickly. these mobile app ads, they are able to monetize for five times that rate. they are pushing as much capital into that as they can. facebook is exploding. twitter is a year and a half behind facebook in terms of the mobile monetization. twitter just pushed out the app install ad. they are doing well. you're going to see a year or two from now them monetizing periscope. they are setting up well for the mobile app as well. francine: what company are you most worried about or one that we should look out for because they don't have a business model that works? guest: when you look at zynga

and the other mobile gaming companies, these are hits driven businesses. king digital as well. a lot of people thought mobile games will continue to monetize these things. each game has a life's dan and then it drops off quickly. you have to be able to push out hits. zynga and king digital are going to have some problems. they been valued very highly. we are worried about them. guy: the dollar index is trading at 80 and now it's trading at 97, how much is that point to hurt microsoft and google? guest: they report this week. ibm has all sorts of problem's. it's going to be tough, especially on google which has a decent port of -- portion of

revenues overseas. we are seeing a general degradation in googles growth rate. consensus numbers have come way down. francine: what are you expecting ? do you think google will look vastly different a year from now is to mark --? guest: i doubt it. i doubt europe really gets around to making a significant difference on google. these things do put a damper on the multiple that they will trade at. any fear around this will impact stock rises. guy: what about the new algorithm that they are going to it out? guest: it's a totally different type of ad than the mobile app install ad it.

searches so different from this native advertising on mobile. it's moving away from where google is. they are behind the ball. they are getting their lunch eaten by the big players. francine: thank you so much for joining us. guy: stay with bloomberg. we are going to have an interview with the eu competition commissioner. that's coming up. it should be a great interview. francine: coming up, david cameron's privatization issue. we will have details on the bank share sale right here. guy: we will explain when we come back here in test. ♪

guy: welcome back. you're watching the pulse. these are some top headlines. francine: google will overhaul the way there search recommends sites. it will affect mobile searches in all languages worldwide. guy: bloomberg will have an interview with the competition commissioner. she brought charges against

google last week. francine: gm will spend $16 billion by 2020. they are stepping up investments. the joint venture is a marked share of 10% in five years. guy: the full impact of the fed policies have yet to be felt in the market area --. he says the policy has been well-intentioned. he sees a june fight as being very unlikely. francine: we are 17 does way -- days away from the election. we have the story. what is david cameron proposing? guest: that in the mid-1980's,

there was a campaign to sell up shares in lyon businesses are in one of those was british gas. this was the campaign. was trying to create a society of shareholders. they want to make shareholding a little bit more points read. the consensus of the weekend is they are going to make a big retail offer. that is some of the big news. they won't sell lower than the breakeven price. you'll be able to buy up to 1000 pounds.

guy: the s&p manifesto launch spectacular. guest: they will be launching from scotland. there will be more power to scotland. the amount of power that was actually passed to them. the s&p is pretty far to the left. they want to bring back the public ownership. they are not china wave home whether it should affect english and welsh policy. francine: a number of businesses of speaking out about staying in europe. guest: we're going to speak to

annex u.k. trade minister. this wanted the cause of comments we had over the weekend from tesco. they talked about the uncertainty with the eu referendum. we have the virgin boss saying britain should stay in the eu. if there are things we don't like, then let's sort them out. francine: thanks so much. guy: she likes detail. we will take a break. back in a minute. ♪

francine: welcome back. we are streaming on the ipad and luber.com. guy: let's get into the top story. the government at the reserve ratio wire meant. this the biggest cuts as the financial crisis. francine: pakistan and china

will sign agreements for energy infrastructure agreements. that is according to the souls. the deal will take lace during the visit to islamabad. guy: prologis is the largest owner of industrial property and warehouses. the move will allow it to ask and it's presence in key u.s. markets such as new jersey and california. francine: when you go to monaco, expect nothing but the finest and the most expensive. tom gibson reports. he got some shopping tips from the very best. >> is the ultimate when it comes to luxury car shows. a former boss of the luxury car

dealership, here are some good tips or it >> some of these cars are not great on the road. when you are driving them, -- if it's in perception of being where for ari used to be. when i was a dealer we bought as many as we could get. this is a design company. they are taking a tesla and then changing them with the wheels and the suspension. people want to show that their car is different from the guy next door to >> even the local dealerships want to join the

feeding frenzy. the organizers say 70% sold. >> we have the promise of one. that's too. >> they will only be five of these in production. aren g racing are reviving. they will create certain models. >> it's around the 600,000 pounds. >> you would argue this is good value for money? >> it's another model that nick has his eye on. >> it's around 170,000 euros. you can itemize as you want. >> i think it's a beautiful car.

it looks great. it offers something different. it's what i would call a great sunday lunch car. they are allowed to do their own imitation of the continuation. >> they might just have something for everyone. francine: i can still see you in a sunday lunch car. i know you want the red one. guy: a sunday lunch car sounds like a great idea. i would like to have a car for every meal. francine: a breakfast car. that's very british. we will have a lot of big guest coming up. first, the new york federal reserve president. we will bring you his discussion live. guy: that sounds like an

interview you will want to listen to. that company is heavily in rested -- invested. we have a very competitive market. francine: we will be speaking to the european competition commissioner about antitrust action against google. guy: hans nichols joins us. let's talk about google. guest: on thursday, we get the formal complaint. now we are sorting it through. we've got an indication of how they intend to respond. they are going in a slightly every direction with search. the question among many will be to what extent can the eu commission be worked over by competitors? this is the line we are seeing out of google. there was a complaint large by

microsoft. to what extent are the committee adjudicating claims from big companies question mark --? francine: we are reading the complaint. guest: anytime you have a central banker on television doing an interview you have to realize he is smarter than you. you may give indication about the rate hike. it will be interesting to see his take on the job numbers. will it be the first of many saw numbers or is it an aberration? is take on the job numbers are probably the most important. francine: they may decide -- we have then lucky with central banks in the past. guest: you've been good with central banks. you've been well prepared.

you put them in the position to make news. guy: asterisk questions. we always ask the right questions. thanks very much. hans nichols is joining us from berlin. francine: surveillance is up next live from new york with tom keene. guy: the politics show is up next for those viewers on this side of the atlantic. you're looking at life pictures coming from the event in scotland. i have to say, this shot does not do it justice. the wide shot is even more spectacular. they may be at the top of the class for the manifesto. we will get a live shot as well coming up in the politics show. if you want to join us on twitter, we will be talking about the german 10 year.

we will be talking about migration after that disaster off the coast this weekend. guy: we are back in a couple of minutes. we will say goodbye to our american audience. ♪

tom: draghi says much more work is needed by this friday. greece and european finance ministers are not a good speaking terms.

watch what they do and not what they say. china remains defensive. colorado, washington state it's time for a marijuana of date. we go one toke over the line. we are live from world headquarters in new york. it is monday. good morning. i am tom keene with brendan greeley. olivia sterns is off. brendan: interest rate yields are at an all-time high. friday's deadline for greece to present a reform package appears to have been pushed off. the commissioner in charge is saying he hopes that will happen by the middle of next month. finance ministers will not sign off on a bailout for greece. the french finance minister says