manus: sweet success here to switzerland's second-biggest bank smashes second-quarter estimates. the company's new ceo tells us why he is looking forward to higher interest rates. >> the interest rates are fundamentally -- bank do well under various growth. higher interest rates are good for us. manus: parking parliament. the second package of creditors demands moving greece one step closer to a third bailout. but on the gas -- put on the

gas dime was profits of 64% -- daimler's profits of 64%. live from europe's headquarters in london. i am manus cranny. smash estimates reporting -- it welcomed the news for the bank which saw a lot of 700 million francs. francine lacqua is on location today. she is out and about, catching up with the new ceo tidjane thiam. what is the news? francine: we try to quiz him.

we have to remember these are not his results. he is only been on the job for 20 days. once it these figures will lay out the strategy on which he will overhaul the bank. that strategy will be revealed by the end of the year. the key to this is the new strategy should be release some of pressures from second-quarter results. tidjane: performance of private bank is a strong. driven by asia-pacific which we have a strong interest in. they were very pleased with the way things were developing. profits were up 150% in the second quarter. [indiscernible] 54 billion. 4.2% of asset management. very strong quarter.

if you think about credit suisse, we are one of the premier brands in the world. private banking and worth management -- and wealth management. the investment bank has been under pressure. the equity's performance is pleasing. advisory up to 2%. francine: are you disappointed? tidjane: i think they are in line with what you would expect. [indiscernible] if you look at what is happening in the second or with greece and china and that has an impact -- that has had an impact.

most of them is the capital and leverage. -- most important is the capital and leverage. we took down leverage by 11% in these next's -- in the first six months. the end of your target is 622 600. -- the target is 620 two 600. peter: -- francine: i was catching up with one of his advisers. this will be decided in due time. manus, there are still many points. that will be unveiled by the end of the year. it seems they will focus on asia-pacific.

possibly more on wealth and asset management. manus: when it comes to the investment bank he may close down activities and locations. it is too early to say exactly where they will focus. i remember at the news conference, he so clear in terms of his knowledge and understanding of investment banking. the math involved is really quite simple. francine: if you look at investment banking, and performance, it is clear that equities did very well. i asked him if that would be up of the reception. he did not really say. at least if he spends capital in that unit, he looks to have better returns. the symbiosis between the asset management and the private wealth and the investment bank

were at its best in asia at the moment. they use their private wealth service and the investment bank as a support. this seems to be the direction he wants to be heading. manus: fran you've interviewed him for many years. his role at prudential, he was that your leaders lunch. the sense that you get from him is aggressive the right word to use in the execution of strategy? what did you make of his decision today on strategy? francine: manus, when he started credential, he was extremely aggressive. he went after acquisitions in asia and that backfired. this time around, it is a new

did jan guess is a new tidjane -- this is a new tidjane. in the interview, instead of having big plans he kept focusing on a the execution. i think this is key, because you can have great plans but if it is not executed correctly, the bank will fail. he is sure he wants to be a strong leader and everything will be executed to perfection. manus: well done. a great interview on his first day as ceo of credit suisse. we will see you here tomorrow. now to the greek prime minister. he has faced down another party vote. he has driven through a second party that's a second -- they

voted 230 263 for a bill -- 230 to 63 for a bill. alexis tsipras said he would continue to fight. >> after the approval of this last package, according to the deal, package of prior actions we are obliged to negotiate again with the same passion in order to agree on terms of the loan. manus: we are joined by our bloomberg chief economist. second round of votes. we had to use the opposition again. he did not lose a great deal internal support. tidjane: -- ginny: -- jamie: i

think that explains why it is greater. manus: in terms of timing forgetting starting with the bailout talks, when can we expect --? jamie: the deadline has been shifted forward a few weeks. previously we had a hard deadline of july 20. now we're looking at august give. -- we're looking at august 20. manus: when you look at the greek story, it is interesting -- it seems to have come off the board slightly. the ecb rate liquidity yesterday. does the ecb raised the liquidity yesterday.

-- the ecb raised the liquidity yesterday. jamie: i think he will. there is an intense before the election to be side. we now know greece will not be leaving anytime soon. we kick the can down the road. another year down the road things are still not going to be good. the key is restructuring. manus: you want to pull your own hair when you hear people say that. they protested for six months. they contracted negotiations. grexit is still the best case scenario according to our recent poll, isn't? ; -- jamie: we'll be working weekends and waiting for those

deals to be agreed. manus: we could be back here at anytime. ginny murray, thank you very much. chief economy for europe. here is on our economy today. growth slowly in the second quarter as the mers outbreak weighed on consumers. 2.2% from a year earlier. new zealand has lower interest rates for the second time in six weeks. the country's central bank -- a move that was widely predicted by governor graham wheeler. further easing may be needed to boost inflation for the 2% target. daimler's second-quarter operating profits up 54%.

in china, a new more exclusive build. earnings before interest, rose to -- up from 2.4 6 billion from a year earlier. if you have a few coins or dollars in your pocket would you be up for mercedes? which one would you buy? we are #the pulse. i have a very old version. join us on twitter. ♪

manus: welcome back to the pulse. we're streaming on bloomberg.com. let's get more on the news now of prime minister alexis tsipras has faced down another revolt. opening the way for a third bailout. were joined now by cuyler man u way. this is the second technical process. it passed, and yet sippers had to depend upon more opposition. is he really strong a politician

? >> i think the number of -- the rebels are losing some of their mettle. there's a consensus in greece to get the bank open you need to play the game. you get more funding from the european union and potentially the hope of that refiling. the situation continues to be as it is. until we get into the first -- it is going to be very collocated in greece. manus: your base case is still a grexit, isn't it? getting a little bit of latitude with capital controls. what might that look like? you need to get greece up and

running again. dion: -- the homguillaume: if greece was to behave you could buy greek bonds later this year. it is not robust enough to deliver. the reforms have fallen by the wayside. manus: that is not painted -- the night by the government. there is this lack of confidence. tell me what your vision is for greece over the next six months. these are not going to be easy negotiations with creditors, are they? guillaume: there can be very

hard. that's they are going to be very hard. -- they are going to be very hard. less it changes dramatically elections in september october, we have a difficult scenario ahead of us. large amounts of debt restriction. that is more than what is offered in the third program. creditors are giving the money that they are going to lose. manus: that is not a very dramatic thing to do. in terms of some of the overview of data we're talking about austerity just broaden the context. europe is recovering. austerity is less.

yes, you can have the austerity in the likes of greece. what does it do for your view? how much growth will be see in europe next year? gullillaume: the forecast was always that next year will be close to 2%. italy trying to push the envelope trying to come up with tax cuts. it is following through with the decision taken by member states late last year to get austerity. greece is the exception because there is that cause i automatically of physical adjustment. -- that cause i automatic physical adjustment. they're setting themselves up to fail. manus: briefly, does it mean the

risk of the great european project falling apart? guillaume: as long as you can keep some semblance of dialogue, i think you're safe in terms of the next three to four years. there is a greater need now to speed up the conversion process. perhaps, with greece out of the euro area on a suspended members of status, who knows? perhaps we will have greater cooperation. manus: it may open up the door to greater ecb physical activity. coming up, staying cool under pressure. a rise in revenue despite a challenging environment. we'll hear from the company's chief executive. ask if you run a business like

ours, -- >> if you run a business like ours

manus: welcome back to "the pulse." the growth and sales comes as consumer groups company works to expand its global business. focusing on emerging markets. caroline hyde with paul polman

early this morning. caroline, first of all, what is the challenge here? how did you find him this morning? karen: i found them positive. the numbers are positive -- caroline: i found him positive. the numbers are positive. the emerging markets were going to be under stress, brazil china, russia. these are three big countries that have problems right now. nevertheless, latin america 13% growth. latin america very strong. china and singly also -- china interestingly also returning. it is all about sealing deals with alibaba. he is very aware of the volunteer at the desk of the volatility in china. >> investors came in.

private people entered the stock market. when you see that volatility and prices going down, 30% at first. it makes a lot of people -- i think you'll see some of that coming through. for that reason, we look at the same time for other opportunities to expand our presence in china. caroline: he said they're coming off a small base. they are going full guns into china, continuing to expand. manus: there is push and pull. there is a whole variety of elements. the quality we've seen is something that has been building momentum. where does that fit in to the unilever story? is it too early to see the benefit? caroline: that is what sprung to my mind. this should be helping a company that makes food. he said they are trying to step

away from exposure to commodities at the moment. this is why they are going to hire and brands. they have been buying up the likes of demo logica. to push up the margin and profitability. commodity issues are a concern. >> i think because of climate change and other forces prices will become very volatile. we have to be very mindful of how we run our business. the raw and basic commodity prices, we try to become less dependent my taking our products up. caroline: they try to be less dependent on commodity prices and more exposed to the emerging markets. the one really interesting piece is exposure to europe.

if the developed market is still slowing, we should see a grexit next year. manus: well done on the report. stay with us.

manus: welcome back to "the pulse." i am manus cranny. u.k. reese tail sales -- u.k. retail sales declined by 2/10 of 1%. the estimate were for a rise for 4/10 of 1%. these are the numbers. we are seeing a decline in retail sales. wages are on the up.

we have seen that. we have seen the bank of england say they are ready to increase. retail sales fall to .2%. sterling has been on the pair. you can have a look at the chart. it jobs like a stone, as soon as we saw those numbers. euro starting -- let's have a look at euro starting. -- euro sterling is moving as well. retracing a little bit. disappointing numbers for the u.k. here icredit suisse is second-quarter earnings more than one billion swiss francs. the earnings are the first since

tidjane thiam became the ceo this month. better-than-expected gains in latin america. july revenue that increase by 2.9%. consumer demand remains weak. emerging markets continued to be subdued. the greek prime minister has faced down another party revolt. great lawmakers approve a second wave of measures demanded by the country's creditors. the vote opens the way to a third bailout. to discuss the vote the prospect for the next bailout, we are joined by a greek mp. he joins me on the line from athens. a very warm welcome to the

pulse. give me a sense yanis varoufakis and former finance minister decided to vote for this bill last night in parliament. have you spoken to anyone -- has he had a moment? >> it was a strange moment. mr. varoufakis when mr. tsipras asked the authority to make a negotiation he did not vote at all. in the second voting for the program last wednesday, he voted note. -- he voted no. then he explained why he did not believe in the program. yesterday [indiscernible] then he voted yes. so it is likely you cannot understand what he is doing. manus: you think it will help

heal some of the division. do you think this will be a sign i am changing my tune because i think that needs to be done to stay in the euro? adonis: mr. varoufakis just came -- just became very popular. he doesn't influence one mp. manus: the roadmap for a new negotiation is now set. the prerequisites are done. with greece be better served if tsipras reached out and created a unity government? to be in a stronger position to negotiate?

adonis: mr. tsipras has to decide that he wants to implement the program. even yesterday, he said he doesn't have the ownership of the program. it is very strange to me because the program says the key point of the greek authority would prove they have a full ownership of the program. he said two different things and the writing he has control of the program. but he speaks that he does not have the control of the program. mr. tsipras hasn't decided exec and once you want -- exactly what he wants to do. manus: is he holding you hostage? is that you guys, hasn't he? is he holding you guys hostage? adonis: in a way, yes. the democracy was to stay in the eurozone, so we have to vote by

the program. this cannot keep for long. we see if this government doesn't increment the measures and they just say -- but in the real light, they will not do their job. it will be difficult. manus: the monitors from the creditors will arrive in greece again. this is been a difficult relationship with these monitors. it has never been easy from what we understand. the creditors will have more power to get involved in greece. shirley, this -- shirurely, this is a road to failure. adonis: there is a big amount of credibility. the creditors did -- the

creditors cannot believe that we will implement the proper measures for this reform. they want to see that this job is being delivered. they want to be here every month to check what is going on. i think it is a crucial point, because if greece does not have credibility, nobody will trust us. manus: trust is an important thing. let us move focus to your own party. there's not much difference between alexis tsipras and the people came before him. who do you want to run your party? will begin a new leader of new democracy yet who is the name of the frame for you? adonis: i do not know if it will be at the end of august. i think it will be early. i cannot say who wins.

there will be an open race. one guy will win, but i do not know. manco was the name -- manus: who is the name? whose name is in the frame? adonis: there are no names in the frame. i would say i would vote for one of the other. this is not the time for me. we will have a new leader very fast. manus: we wish you well. whether new democracy continues to support alexis tsipras. let's return to one of our top stories, credit suisse and their results. the news, tidjane thiam has been speaking to francine lacqua. he discussed the pressures on the investment bank.

that was one of the lag arts and the numbers. >> it is investment bank mostly. cost income ratio going up. that is a pressure. you see degree of capital intensity. we talk the different role, but i've always been consistent about the importance of capital location. [indiscernible] 26%. that number was published. clearly, that strategic question which is the balance between two businesses. we want to build get more in favor of a private bank. a e efficient business.

-- a capital-efficient business. -- because we have clients for whom we are also the main corporate bank. we want to be the odds for nor's -- we want to be the entre preneur's bank. it means we will increase the return on capital. we will focus on the activities when we have the return on capital is constant. there can be a portfolio through the economic cycle. value creation through a liquidity cycle. manus: let's bring in francine

lacqua. she is on patrol today. great interview. very lacks. you're talking about the market environment as well. it is going to be a wild before we find out details. to me about the market perspective. -- talk to me about the market perspective in terms of the swiss franc. francine: he will unveil at the end of the year. he will put more capital for the private bank. that may mean a bit of retrenchment or some kind of restructuring for the investment bank. don't quote me on that. that is what i got at what he was hinting at. i asked about whether the swiss franc was overvalued? he said it was a very strong economy. when i asked about interest rates, he hit -- he had a similar answer. he said -- arrived sooner than

the markets would all for. this is a distorted world where risk is not priced properly on the market. it is better heading that adjustment sooner rather than later. that will boost investment. manus: you've interviewed them many times, how did you find them? are they all flapping around echo how is he settling in? -- flapping around? how is he settling in? francine: i think unflappable is a good word when describing tidjane. he is relaxed and he said he was welcomed here. if you're going to go -- if you're going to come into a bank

which has the legacy of credit suisse he needs to make sure that he rallies the troops. so far, he has the support of his employees. he wants -- he has a clear idea of where he wants to take the bank. unflappable and smooth is how i would describe him today. it doesn't hurt when his share prices are up 5%. manus: grateful for rallying of your stock on any day of the week. fran, we will see back in the office tomorrow morning. francine lacqua in zurich. sales hard driven. daimler, you'll want to stay with us for that. i am manus cranny. what would you buy? audi? bmw? or mercedes?

♪

manus: welcome back to "the pulse." live from bloomberg's european quarters. yesterday, at goldman sachs. gold fell to five dollars an ounce. today, morgan stanley says they could drop as low as $800. commodities sank to a 13 year

low. -- a cost-cutting prim that help conjure lower demand in europe. rejecting an unsolicited $45 billion takeover from monsanto. the city's bins outpaced rival -- mercedes-benz outpaced rival automobiles in china. let's go straight to our team leader. chris, thanks for coming on. let's talk about this. the turnaround, what has driven the uplift. chris: there is an adage good

alex cure all you -- c good products cure all your problems. the complex have been scooping up new customers. the s class which is the benchmark of the luxury sedan has done well in china. it has a line of new suvs coming out like new gla's. it will be coming in a couple of months. they got new products. manus: what is interesting, not only is it a record profit, but they suggest the pace is going to continue. jockeying for the lead position where are they in that race to keep up? chris: they are net at ali's heels. -- they are nipping at audi's

heels. they do not have the freshest portfolio. they are dependent on china. audi is the leader in china. the slowdown is hitting audi pretty hard. that is opening the door for mercedes. it could be a change in the ranking this year. audi has been number two cents 2011 when they passed must -- audi has been number two since 2011 when they passed mercedes. mercedes is a comeback kid. they used to be the top dog for a long time and then tell behind bmw in 2005. over the last couple of years it is clicking for them. manus: chris, we will leave it there. thank you so much.

this brings us to our question for the day. if you had a few dollars in your pockets, what would you buy? mercedes? audi now go or be in -- audi? or bmw? coming up next, we continue the car theme as we ride shotgun with lamborghini. you heard it here first on the pulse. ♪

manus: welcome back to "the pulse." streaming live on bloomberg.com. more of the supercar than any other in the world. with little to do on the weekend, some owners have created a lamborghini club. bloomberg went along to take a ride. as the guys here to find something to do. there is not much to do in saudi arabia on the weekend. doing something different being a part of something you cannot really be a part of here it -- part of. since i was young, i've been playing with cars playing video games about cars.

[indiscernible] my father chose the high-end market. the money and the profit, with tioga, -- with toyota, that is where the money is. it is more of a passion. in saudi arabia, we sell more cars than anywhere in the world. [indiscernible] we do this once a week. >> is this your first lamborghini? >> this is my second one actually. my first one i got my graduated. >> how long are you going to get the car? >> usually two years, give or take.

usually anyone it comes out, i try to replace. maybe two years. [indiscernible] a discount, yet? -- a discount, yeah? >> that could be a good thing. [indiscernible] that's like $10. manus: some people get all the really good gigs around here. join me on twitter. we have a twitter question of the day. i want to go back to retail sales here it whether there is something more important here. retail sales declined by .2%.

this is dollar sterling. we are down by an eighth at the moment. we are rocky on sterling. over the three months sales rose. this will be the 20th quarter -- this will be the 28th straight quarter of gains. the longest stretch of recovery began back in 1996. retail sales contributed by .4% -- .4%. sterling you're seeing euro sterling at levels that you have not seen in seven years. a little bit of that. that pressure to hike rates --

that's the first hour of "the pulse." join me on twitter. we are going to do it over again. ♪

manus: sweet success. switzerland's second-biggest bank smashes estimates. the company's newest ceo tells us what he's looking forward to higher interest rates. >> a rise in interest rates, fundamentally, thanks do well when there is growth. higher interest rates are good for us. manus: in parliament, tsipras gets the second package of creditors' demands. moving greece one step closer to a third bailout. foot on the gas, mercedes helps drives daimler's second-quarter

profit up 54%. good morning to our viewers in europe, good evening those in asia and a very warm welcome to those just waking up in the u.s. i manus cranny. this is "the pulse," live from bloomberg's european headquarters in london. credit suisse reporting a net profit of more than one billion swiss francs in the second quarter. welcome news for the bank, which saw a loss this time last year. francine lacqua is in zurich. she caught up with the chief executive tidjane thiam. you've had a chat how are things going? a good report card. did you give him an easy time?

francine: it was a good report card. i try to get more hints on strategy because this is what investors want to know up he's going to unveil a new strategy. he will focus on restructuring our retrenching the investment bank to focus more on private and wealth management. he did not say in as many words but that is definitely what he hinted at. tidjane thiam: performance of a private banking and wealth management business is strong and driven by asia-pacific. they were very pleased with the way things were developing. profits are up 150% in the second quarter, 125% in asia. 4.2% of assets under management. a very strong quarter.

if you think about credit suisse, we are one of the premier brands in the world in private banking and wealth management. it is pleasing to see the business doing so well. is the foundation for the future which we want to do. investment bank has been overall under pressure. the equities performance is really pleasing. 12% and advisory of 22%. francine: are you disappointed with fixed income revenues. tidjane thiam: i think they are in line; with what you what expected you have seen peers have similar results. if you look at what happened in the second quarter with greece and china. where still activity driven. good performance in the third. most important is n h.

-- capital and leverage. you see that we are deleveraging, which is key. we took down a leverage by 11% in the first six months. we are on a good trajectory to hit our target. francine: very clearly what investors are expecting from credit suisse in the future is a little bit of restructuring in the investment bank to give more support to the private wealth clients is the model he's using in asia. a little bit more capital may be to the wealth and private banking. if this is what markets are expecting we understand they are not off the mark. a strategy will be unveiled by the end of the year. manus: interesting how he has

begun to set up a language of differentiating the credit suisse story from his neighbors at ubs which is the entrepreneurs' bank in asia. his comment on interest rates what does he make of the market environment? he touched on the macro events, greece and china. from a market perspective, what did he have to tell you? francine: i asked him about the fed, interest rate rises and he is welcoming does. he told me he would prefer if interest rate rises from the fed and possibly from the bank of england would come sooner than expected. he believes risk is being mispriced on the markets. tidjane thiam: for me, if interest rates went up it would be good news. i've been very vocal about unintended consequences of quantitative easing. it has been a good response to a crisis but we need to get out of it. rising interest rates would mean that growth is back.

fundamentally, banks do well when there is growth. higher interest rates are good for us, that is undeniable. yes, there will be adjustment pain. francine: francine: are the markets ready? tidjane thiam: one thing about the markets is we are very good at adjusting to whatever environment is forced upon us. all kinds of assumptions are made. the consequences only emerge when there's a seachange. then you see what people have been doing. any example, the u.s. treasury on october 15 moving. you look at the swiss fra nc. people, unfortunately pile in one direction. it is when things change that you discover other positions have been taken. clearly it will be short-term

disruption for a long-term positive. going back to a normal yield curve will, i think, eliminate some of the current distortions and asset prices and the economy. i am always very keen -- risk is central to my thinking. right now, the pricing of risk is distorted. we will have a normalization of risk. francine: of course he's very keen to go back to normalization. also in terms of how you interpret the markets. he was not quite say what month he will announce his big overhaul but it will be by the end of the year. manus: well done, great interview. francine lacqua in zurich. the greek prime minister has faced down another result. -- another revolt. he has driven through a record

second package of measures demanded by creditors. as anti-austerity protesters marched outside parliament lawmakers voted 230-63 for a bill that would open the way to a third bailout. tsipras assured mps he would keep fighting for greece's interests. mr. tsipras: this hard negotiation process does not end here. after the approval of this last package, according to the deal of 12 july we are obliged to negotiate again with the same persistence and passion to agree on the terms of the loan. manus: for more, let's bring in our chief european economist. another set of reforms. cleaning upon the opposition. he did not lose money more of his own syriza party. jamie: i think it reflects the

composition of the package they were voting on. judicial reform and banking resolution. i think there's less reason to vote against it. manus: i find it interesting we printed a series of headlines as he speaks. conservative circles in the eu won, we lost the fight. we will implement the program even if we do not agree. saying i do not support any of this. how can creditors trust this man to implement this? jamie: as long as it does go through parliament, i think it will the implemented. we've seen greece implement a lot of austerity. the trouble is, by doing this we are going to be in the same position in a year's time. we still do not know exactly how much austerity there's going to be. these measures are likely to make problems bigger later on.

manus: the ecb are satisfied enough to extend their cash, our cash, at 900 million, we understand has been a great for liquidity -- agreed for liquidity. that's progressive. jamie: the banks, there are still capital controls. it is still going to be an impediment to the economy recovering. you need banks open and functioning well to reallocate capital. that is probably not going to be happening anytime soon. manus: thank you for the update. jamie murray,. our chief economist here they look at our radar. spanish profits fell to the lowest level in four years in the second quarter. adding to expectations that stronger growth is translating to faster job creations. the jobless rate dropped to

22.4% down from 23.8% the previous quarter. chinese stocks have risen for six days. in the shanghai composite, it's longest stretch of games in two months. a series of government support measures appears to have called to the markets. after a four chile.e -- after a four chile dollar rout volatility is low. daimler - daimler's profits rose. up from 2.46 billion euros a year earlier. which brings us to the twitter question of the day. mercedes, audi or bmw. if you had a few dollars, which of these would you buy.

which do you think i have? mercedes, audi or bmw? @manuscranny. ♪

manus: welcome to "the pulse." live from london. let's get more news. greek prime minister alexis

tsipras faced down another party revolt and driven through another austerity package the parliament. we are joined by simon smith. thank you for joining us. they've done all the technical stuff, haven't they? they have met creditors' demands. the road is open to negotiating a deal. how is that going to go? simon: it is one thing putting these through parliament and the other thing delivering on it. that is one thing greece have struggled on. a lot of crisis has been delayed. creditor saying have we made progress on the reforms? that is going to be the issue going forward as we put together the bailout package and get to the situation where debt repair filing could be considered. manus: i had a new democracy and -- mp on the phone with me.

he said we are supporting them now but if we get a smith they are not implementing the packages robustly the political support dissipates. then you have an unpicking of a bailout. he's living on a knife edge tsipras. simon: you could never imagine this happening in pretty much any other government. such a unique situation. which makes me think the political situation in -- political instability in greece is huge. i would be surprised if the government it's still holding by the end of the year and even september or october. manus: some people were saying snap elections in september. they might survive until christmas time? simon: that is probably the longest i could see them surviving.

it is more likely to be september or october. is usually unstable when you see the agenda which were voted six months ago and what they have done now, it is untenable. manus: the other thing that crossed my mind we lived through this for 5.5 years. the monitors arrived in athens, the greeks would not show them the books. it was like sticky plaster of bad monitoring. this time these creditors have got more of a say in anything that happens before it even happens. i've said it before, my favorite word for this, a tawdry deal built on sand. the creditors have got to come first. simon: number one, the reforms have been badly put together. the imf, we've seen them walking away. and quite rightly so.

they were in a situation which has become so politicized. usually they go into a country, lend once debt is unsustainable. they've been brought into a political process which they have become uncomfortable with. as we saw basically said this is untenable in terms of the debt situation. you can see this coming through the way the imf has behaved. it has taken them this long to actually stand up and say this is not working out. manus: let's go to something more optimistic. spanish unemployment falls to the lowest level in 4 years. still coming off a high-level. 22.4 from 23.8%. does this help rajoy? he has elections coming up. from an economics perspective. simon: from a momentum perspective, it is going the

right direction. 20% plus unemployment is bad. nearly 50% under 25 unemployment is bad. from a momentum perspective, you are seeing growth and unemployment move lower, that is a positive. if you compare spain to greece since 2013, the spanish economy has grown around 3%. greece is probably 3% or 4% decline over the same period once you see the economy growing, it gives rajoy some benefit. under 25 youth unemployment, the band for rebellion is probably going to be stronger. manus: thank you for your perspective and joining us this morning. simon smith, fx financial services chief economist. coming up on "the pulse," staying cool under pressure.

unilever posts a rise in revenue despite weaker demand for products. we hear from the ceo, coming next. ♪

manus: welcome back to "the pulse," live on bloomberg television, streaming on bloomberg.com. unilever has released results that beat estimates. to .9% rise

in underlying revenue. the growth and sales comes as the consumer goods company works to expand its global reach and business. focusing on emerging markets such as china. caroline hyde caught up with the chief executive paul polman. this is a good set of numbers. a little earlier we talked about the emerging markets. what were the keys? caroline: i went in there with some trepidation. listening to the analysts calling that sales would fall compared to the first quarter. it would be less than the first quarter and we would have a tepid quarter, a slowdown in the emerging markets. we've seen china and latin america in the headlines. a concern when this is a company that has seen a marked slowdown in china down 20% in the third and fourth quarter. a company that is 10% exposed to present. it did much better than i had

been expecting. latin america, sales up 13%. they are managing to offset the weakness in the foreign exchange market and the turmoil by raising prices. they seem to be doing well in china despite the market volatility we have seen there. and everyone seeing there's an economic slowdown , we are seeing spending increase. i think what is interesting is as a company that pinned hopes on the emerging markets -- it was right to do so. 5 paul polman -- 50% of sales come there. 6.5% growth in emerging markets. we find marketable deals. paul polman: the economy is offering many opportunities. last year, our company was digital company of the year. we are advanced in bringing e-commerce and digital into our brands and the consumer

experience. we are pleased that alibaba has chosen us as partners to extend their presence in rural china. caroline: a deal with the biggest e-commerce company in china, alibaba. they will be pushing into regions they have not yet targeted. even despite the volatility in the chinese stock market they are still going to be growing strongly they say. online, they want to see about 40% growth in terms of sales over the next year. manus: the online part of the story is absolutely fascinating. that is the emerging market context. talk to me about the developed markets. we are very used to the brands. did greece feature at all? caroline: they're going upscale into the more premium brands. talking the developed markets. the developed markets are still weak. slowing growth in north america,

europe. we are seeing contractions falling sales and both areas because of price competition. there's also the retailers saying they have got to lower prices. deflation in europe. i said what about the greek situation? has that turmoil been moved to one side? are you more optimistic? no was the answer. paul polman: the greek issue is not solved, it is postponed. we need to think about how we want to deal with it longer-term not just moved from crisis to crisis. europe has two challenges. it has to handle them at the same time. dealing with these crisis is on its borders, be it to the north or east. at the same time, accelerate european reform to make the market more competitive. caroline: the greeks have felt enough pain, which is what he said to me. i said should they exit the euro and should we have a debt cut?

he wants them to stay in the euro, he feels a debt cut could be an option. manus: deliver made another record high this morning. after the break, foreign exchange. ♪

manus: welcome back to "the pulse," live from london. i am manus cranny. credit suisse's second-quarter earnings have. beaten estimates net income at more than one billion swiss francs compared to estimates of 722 million. the earnings are the first since tidjane thiam became ceo this month. unilever has a sales growth that beat estimates on better-than-expected gains in. latin america

underlying revenue increased 2.9% compared to 2.5%. the ceo paul polman says consumer demand remains weak and emergent markets continue to be subdued. the greek has -- the greek prime minister has driven more austerity measures through parliament. 230-63 majority, the vote opens the way to a third bailout. let's check out how the markets are absorbing the moves. while on the move, a call on go ld. jon ferro? jon: two days of losses in europe and a day of gains. the dax up by .25%. some gains on the periphery. a 10th of 1% on ftse in italy. in london flat. ftse mining index trading at a

2009 low. it has been that ugly in the commodities space. you see it reflected in the mining stocks. the commodity index trading at a 2002 low. in the equity markets, a load of earnings. the one we've been speaking about, the smi in switzerland, the biggest gainer is credit suisse, up 6.5% a huge beat. net income at just over one billion swiss francs. london analysts looking for722 million. a big beat and a big pop on stock. in fx,a stronger kiwi up against the dollar. even though they cut rates for the second time in six weeks. no mention of a currency that was unjustified too high. for that reason, the kiwi goes

higher. we could get another rate hike from the reserve bank of new zealand. in sterling, a weaker pound. 1.5608 flat on the day. you can see the drop on the back of the retail sales number. -0.2%. the estimate was for growth of 0.4%. a slight disappointment and data in the u.k. you see it reflected for the pound this morning. plenty happening in commodities. what was the call from morgan stanley? $800 on gold, not pretty. manus: crying for a bear market. maybe it is time to start buying it. we have the head of fx strategy and we will talk about before and exchange markets. when i was writing down preparations for this interview i wrote down for questions. commodity meltdown, china rout greece and rate differentials

fed and mpc. is that the right prison to start the discussion -- is that the right prism to start the discussion over what is going to drive fx? >> over the medium-term, the most important is rate differentials. i'm not sure it is going to go in the fx space in the direction that many people may have thought. we've been saying, i think the dollar has priced in a more aggressive hiking cycle by the fed compared to what the fomc has in mind and what the money markets have in mind. i think that over the second half of this year we are going to season differentiation in the dollar. it is not going to be a one-way bet. we're going to see some weakness in the dollar against currencies that have moved too much including the pound as well as the euro. manus: we've got some extreme

moves. the momentum is there in the dollar. every time a fed governor speaks or janet yellen indicates, we get another move. my question is, is the first hide all priced in? will that be this year? vasileios: i think 25 basis points for this year is priced into the dollar. it is definitely priced into the money market. moore is priced into the currency market. whether it was going to be september or november, i don't think it is going to make a difference. it is probably going to be more important the wording of the fomc. considering the rate outlook to 2016. having said all that, ig o - -i go -- i go back to my previous point you mentioned momentum. i'm not sure this is what we are seeing this time around. when yellen says something that is considered to be on the

hawkish side of the spectrum, we see a pop in the dollar higher but it does not last that long. that is largely because we've seen one of the most brutal dollar rallies between july and march. july 2014 and march 2015. manus: is the market long that rally or not? vasileios: i think the market is long but it is less long than it was three months ago. manus: the other quadrant, jon was just referring to gold. morgan stanley says 800 today. oil is newly in a bear market. the commodity complex is righted. that is having an impact in terms of canada, new zealand and nordic currencies. have those moves priced in this movement in the commodity rout? vasileios: i think they has.

the commodity bloc, especially the kiwi as well as the aussie are down substantial percentages. the kiwi is down 15% year to date. right now, if you look at fundamental modeling, i think these currencies probably with the exception of the canadian dollar as far as the aussie and kiwi, they are more in line with fundamental fair values. which makes it a that more difficult to trade them. when you are very close to your fundamental value, you get other factors that are in play -- momentum and positioning and all that stuff. in terms of actual trading for the short-term and medium-term, i do not want to get that much involved in the commodity currencies. on the medium-term basis, i think the risks are for some upside. manus: were you surprised they cut rates? you said actually -- the whole world is more interested in what they said. they removed their assessment in

overvaluation, which takes us to fair evaluation you just mentioned. that was the bit that you thought was interesting. vasileios: i was not surprised by the move. i would be surprised if they did not cut. i think that would have been a big surprise. i was thinking, in my view the scenario was that they were going to cut and maintain the rhetoric unchanged. i thought that going through the statement there was a slight tilt towards less the vicious because of the -- less dovish ness because of the removal of a downward adjustment still needed in the kiwi. overall, these guys sit back there and say i think right now the kiwi is at a good level. we do not want to make any comments that are going to squeeze it higher. especially on the back of short positioning being very extreme. at the same time, it is -- i do not think they are going to

try to push at much lower. manus: i just want to go back to one of the comments you made earlier. he talked about the extreme moves. one of those was sterling. that debate, the minutes yesterday, everyone is waiting for the first bit of dissent. you say that is an overextended move. is that on the euro-sterling trade? vasileios: no i think it is on cable. if you actually start digging down into the details of the price action, you are going to see that up until the elections there was a lot of downside pressure on cable. to a large extent it was driven by the dollar as the uncertainty on the elections. since the beginning of may, what is interesting is that table has overall appreciated. its correlation with the dollar has fallen, which tells me that

u.k. specific factors are taking over. i think these are positive for the u.k. and therefore for cable. manus: we have a strong economy here. i do not apply the same to my euro-sterling assumption. you say you are ground on cable. do you want to tell me something different on euro-sterling? vasileios: the forecast is we are going to range between 70-72. that is barely a result of the fact that we see the euro and the pound higher against the dollar by year end. manus: the whole concept, we've got to draw to a close here, the euro -- one of our stories on the terminal. the euro as a reserve currency is that a 15 year low. are you long euro? are you a parody -- a parity man? vasileios: no, not parity.

we are very much out of consensus. there is nothing magic about parity other than a nice number. at the end of the day, when you start putting all these things together, rate differentials and balance expansion, it is difficult to come up with the zero-dollar at the rate of 1-1 .10. i think the risk is to the upside. manus: great to have you with us. head of global fx at unicredit bank. next sales have driven daimler profits. ♪

manus: welcome back to "the pulse," live on bloomberg tv. yesterday, goldman sachs warned gold could go to $1000. today, morgan stanley is saying $800 or the precious metal has taken a battering as commodities sank to a 13 year low. syngenta has reported first-half earnings that beat estimates after cutting costs off of lower demand in europe. the results strengthen the case for redacting a 40 filling dollar - -- for rejecting a takeover from monsanto.

daimler's operating profit jumped as mercedes sales grow in china. up from 2.4 6 billion euros a year ago. more on the auto market. let's bring in our european autos team leader. what a blockbuster headline, 58% on profits. what is leading the charge? chris: leading the charge is new products, new mercedes cars. they are more modern and more in line with the times. they've got a new compacts out, bringing in younger customers. they have the c class, which is doing well. the s class is doing extremely well in china. new products. a newer line compared to the

competitors, bmw and audi. that is driving growth and mercedes. that drives growth that daimler. manus: if you think about it, daimler have invested in the new lineup. this is their new product coming online ahead of the others. how do they keep that position? they are on the heels of audi. chris: there are only about 4000 cars away. we can see a change in the ranking. it's the big question, how do they keep this up? they have a new car is only new for so long. they are still dependent on china for growth. they're doing well in the u.s. but the outpace is in china, where they have grown more that 30%. which, bmw and audi cannot match.

the question is how are they going to continue that? that remains to be seen. they still have new products coming online. the glc is a smaller suv replacing the glk in a few months. they have the c class coup coming out in august. they have some things coming out. bmw and audi are not resting on their laurels either. manus: thank you very much for breaking those numbers down. our european autos team leader. which brings us to our twitter question of the day. for cities, -- mercedes, audi or bmw? which would you buy. one person says all three. one says for a 50-year-old, a mercedes is more classy.

which would you buy? tweet me, i am @manuscranny. ♪ next, we continue the car thing. we ride shotgun with saudi arabia's lamborghini club. ♪

manus: welcome back. with food delivery services and

parks like gyms and doctors appointments, one of the few excuses to leave work. a new app aims to take away this last chance of freedom by sending a doctor to the office. rebecca greenfield put the service to the test. rebecca: the modern office is about perks, free food and other seemingly amazing conveniences that exist to keep us in the office. working for as long as possible. here at bloomberg, we have snacks. why go out to lunch when you can make a good meal out of carrots and chips? running out of reasons to leave the office. i am concerned about an app called pager. >> pager connects patients with doctors for on-demand health care. rebecca: pager is like seamless

for when you are sick. the company is launching a service where employees can order doctors to the office. >> i do not think employers are sensitive to where they care is delivered as long as it is done in an efficient way so employees can stay healthy and work better. rebecca: it makes sense that employers would love efficiency. do people really want doctors appointment at the office? rebecca: i have not been to the doctor in two years. seems like a good time to test page at out. i need a physical. hello, this is rebecca. hello? [automated voice] >> to send your message with normal delivery, press one. rebecca: i do not understand this. >> your message has been sent. rebecca: seven robo calls later,

the doctor came to our office. >> rebecca, nice to meet you. is there somewhere private? rebecca: our office has an open floor plan. this must be a problem for pager. open offices do not work for doctors visits. we did our best to find somewhere somewhat private. rebecca: i feel a little exposed. should we go to the coat closet? this is good. there's a purell machine. the closet is not an ideal location to get a checkup. i did not want to talk about my reproductive health in a room without a dork. --without a door. it took a lot less time than other doctors appointments. i can see the appeal for someone who wants quick relief or needs a prescription.

pager does make it harder to make an appointment to get out of the office. at least the doctor seemed to enjoy it. >> a gives you a personal experience with the patient, which is so much better on both ends. rebecca: especially in a cook closet. -- a coat closet. manus: i am not convinced. any away saudi arabia and lamborghinis. they have a special club. let's see what they do on weekends. >> the guys here want to find something fun to do. there's not much to do in saudi on the weekends. having this, getting out, being part of something that you cannot be part of. i was raised to love cars. since i was young, i have been

playing with toy cars and playing video games about cars. it's in my blood. [engine turns over] >> my father chose the high-end market. not because of the profit or money. the money and the prophets, for example -- the money and profits, toyota, the high-volume brand is more of a profit. the dealership in saudi arabia sells more cars than any dealer in the world. we do this twice a month. doing it now we do it once a week. >> is this your first lamborghini? >> it is my second. my first one, i got it when i graduated university. >> how long are you going to keep the car? >> usually two years.

usually every time there's a new one, i try to upgrade. maybe give or take two years. >> you get a good discount. >> i have connections. >> how much fuel do you burn? >> a lot. >> oil is cheap here. >> that is a good thing. >> how much does it cost to fill up your car? >> like 50 riyals, that is like $10. manus: see? that is what i do on the weekends. not. interesting to see how people spend their money. if you had the money, what would you buy audi, bmw mercedes? that is it from "the pulse."

francine is in zurich chatting to tidjane thiam. if you want to see those interviews, go to bloomberg.com. tom keene and the team are up next with "surveillance" from new york. we will do it all again tomorrow. ♪ . .

>> this is "bloomberg surveillance." tom: if brian moynihan consolidates power at bank of america, the chief financial officer is politely shown the

door. the bank must grow to compete with j.p. morgan and wells fargo. oil and metals try to find a bid as commodity carnage continues. west texas intermediate as well below $50 a barrel. and uber -- they stare down the mayor of new york city. there are five suburbans on each and every street quarter. good morning, everyone. this is "bloomberg surveillance." we are live from our world headquarters in new york. with me vonnie quinn and brendan greeley. jpmorgan with that report out 15 minutes ago. his story is not over. brendan: what i think is interesting is that alexis tsipras has actually consolidated control, so what greece has going for it is a functioning democracy. tom: he has to take a victory lap given what was observed over the last -- brendan: oh, i do not know if it is a victory lap. it is not one of the things that the olympic where you