keepshe bank of japan monetary policy intact. we will have the latest from o'gara. hitting the brakes, we are live in frankfurt talking to a ceo this hour. and deutsche bank is said to be considering losing more than 20,000 jobs, that is 25% of its work force. ♪ francine: welcome. bloombergthe

headquarters, i am francine lacqua. we will be joined by former bank and member of the institute for butrnational economics, first, the bank of japan has refrained after the economy shrank last quarter. nearly one third of economists see the doj making moves by the end of next year. we are joined from tokyo with brett with the very latest, right, what is the likelihood of the move in october? brett: the likelihood is increasing. we have one third of economists saying that right now. as the governor pointed out today, the expectations are flat overall right now. very much what is in focus also is the oil market. reaching the inflation market is pretty much determined by how

oil moves over the next several months. there are also some indicators in the local economy. consumer spending has been quite weak. that seems to point to the possible need for more action. francine: bread, how much will they be looking out for the yen? it has climbed a bit today. brett: the boj has many options available at the moment as people look forward to what may happen on over 30. the possibility the bank could buy more government bonds, the bank could look towards others. there are quite a few options on how they can expand stimulus. we have to keep in mind not all economists see far ahead so soon, some look as far as april. japan losing face in economics? this is a big financial experiment.

brett: i do not think it is just jet, but it is certainly losing patience. at the average japanese, they are certainly finding things tough. wages are not increasing as much as people need to. that is one reason consumers are not spending enough. on the other hand, we are seeing strength in markets. the stock market has done well. for the man or woman on the street and japan, things are not so great. week, consumer spending is weak. francine: thank you, brett. now let's bring in the president ,f the institute for economics the one and only. great to have you on the program. the bank hear you on

of japan. we are expecting more stimulus in october, should they have done something today? guest: i think people are expecting too much from the boj. the bank of japan really believes there has been abuzz. they have not met the 2% target, but i think your report understates how much there has been progress on the real side of the economy. consumption continues to disappoint, that is true and a lot of the world. wages disappoint, that is true and a lot of the world. , realou look at profits wages did rise this year. pristine: a touch? guest: yes, a touch. but the boj does not want to get ahead of itself. christine: you are quite confident this will work. when do the markets stop expecting too much? if there is a dichotomy between

what they are doing and the market is doing, does not work. lest we gotally, was speaking at a conference of economists. we will having a discussion i was leading on does the failure of the monetary expansion me for macroeconomics, because we all expected it to work. there is no question, if you're being honest, you have to be disappointed. core inflation has not moved up. the big thing is, unlike with the central bank talks about, moving expectations ahead seems to be hard. the fed talks about anchoring expectations, raising expectations, but it looks more and more like that may be a mistaken point of view. you can only move the expectations if you move the real economy. to hisat gets you back markets. the markets have been ahead of the curve, now they are disappointed.

the good news is, their disappointment may not mean that much. it may not be as big of a deal as we thought. the bad news is after this long may have some right to be disappointed. francine: at the overall markets, are we looking at a correction or is there underlying concern that we are touching or we are seeing the specter of the recession becoming more real? adam posen: you have conflict things stories. japan, the united states, and parts of europe, you have very high profits. like bobgh people schiller, the nobel laureate, say it looks like a bubble to him, the fact is you can make an argument that there will be some correction. on the other hand, there obviously is reinforcing feedback that everybody outside the u.s. is knocking down. in the end, i think we will not have a recession. some warn, we always listen. i may miss it will stop at the

fact is, the u.s. is not in bad shape. europe, despite the tragedy in greece and the human tragedy, be economic news will better. japan is mediocre. i did time you put that altogether, it is a solid basis. this team: so you do not worry about deflation? adam: not the way i once did. japan showed us deflation is not quite as bad as we thought it was. i still think we should fight it, you do not want to be entrenched but i do not think it is a panic situation. christine: does it actually make a difference whether they hike? adam: good point. it is more psychological than not. it is about setting president and getting started if there's going to be a hike. if the u.s. is anywhere like its normal shape, 25 point should not matter.

christine: to the u.s.? markets, emerging there are certain bond markets that are overbought and continue to be. the fact is, that is not the feds area. -- it ismajority of more important to get rid of the low confidence. i was in jackson hole, the story came out that the vast majority of bankers said, just get it over with. you are driving us crazy. francine: adam, thank you for joining us. we have plenty more to talk about. the you kate next. also on the radar this tuesday morning, it deutsche bank. talking about cutting jobs in addition to the 15,000 that will shed light selling some of its

banks. this will mostly affect administrative and technology jobs. what some high-level positions may also be eliminated. meanwhile, $18 million paid to allegations. how it operated. more than $50pay million in fines in what would social --d for security exchange commission. primengly is sixth minister in eight years. comes after the ouster of tony abbott following a late leadership challenge. and the brazilian finance minister has opposed a new round of spending cuts and tax increases designed to close the budget cap and protect brazil

from further downgrade. capping the salaries of civil servants, trimming programs, and putting a limit on financial transactions. now the frankfurt motor show. carmakerse british first entree into the suv market. on sale next year for $38,000. twitter question, what do you want to see from the frankfurt motor show. that.n tweet me about , two days away the feds big decision. liftoff finally coming this week. we discussed that with adam posen coming up next.

♪ francine: welcome back to "the pulse." in case you have not noticed, the u.s. reserve has a crucial decision do. a reset for lift off. the president of the peterson for international economics and adam posen is joined by simon kennedy. thank you so much for joining us. we were talking before break, adam, about the fact that a lot of the emerging market leaders have been asking for a fed rate

hike. at least it is done, we should move on. do you think it should come this week? >> i expected to come this week, but i don't think it should come this week. as they close call, but i would put it at a 65-70% likelihood. that makes me a liar because, again, it goes back to, do you believe the u.s. economy is fundamentally ok? then you will not see that much improvement in the labor force. i think that is where exactly the vast majority of voters are. the economy is not where it but theynce it to be, are not going to see this nonparticipation back into the labor force for. more.ee there is forward-looking thinking. the chairman made this clear at jackson hole. there is a case that could be made that you should wait until you see the whites of the eyes of inflation.

i think a better way to put it, which is something someone said 25 years ago, if you've got no inflation risk, push as far as you can because inflation will not leap up on you. however, there is a 25-year inflation theory that says you experimentrd to based on the 70's. i think it is legitimate to think that way. as a predictive matter, i expect them to think that way. francine: if you look at and experimentation given the turmoil we see in china, and we are looking at in many times this would not be the right time to experiment. >> it could be at them is right if the market just wants to get over it. maybe the anticipation is worse than gratification. dovishomplemented by a

message in the press conference. they talk about waiting to see the results. increase risk appetite. those economies in europe and japan with a weaker he currency might get a lift upwards. francine: adam, what is the risk of reversal? 15 central banks? adam: 15 central banks tried a hike and pulled back. is the the message opposite. nothing terrible has happened to any of the ones who have rehearsed. francine: according to the fed? adam: exactly. there's is a difference between making a forecast error and a regime arrow. -- error. -- nobody knows

if they care about inflation or not, it sends the wrong message. there is no question this bed cares about the dual mandate, doesn't care about inflation, the margin. to me, they should not feel a reverse. it is better they should high, from their point of view, i am not advocating, it is a prediction. that are from their point of view they should hike and cut, especially if it is going to be some outside event like china that causes them to cut then hold off and be perceived as too late. francine: i don't know of the markets make that decision but it is -- adam: to some extent, they want to do the right thing whether or like it.arkets francine: if you have a huge correction -- adam: it yes, of course it does but it goes back to something simon said. i don't want to say so much dovish versus not as in the

speech because it is impossible to believe them as being dovish as the current rate predictions are. but i can't imagine them saying we have a good path to go, we are not going to go that high. that is a good message. is it not a level playing field? >> i'm sure they are right about the currency laws that gets is running for our guns. there is some talk of currency wars, there is a concern out sort outt currency growth or shows markets and public you are doing something. a continued truce. obviously, the g-20 talking about evaluation. there is definitely concern out there.

i think g-20 deserve some credit, because they did move to something approximating a formal truce. about three years ago, the treasuryetary of the has been trying to get that to be a g-20 agreement. essentially, you got that. the risk is the prospects on the obama summit right now, two weeks away. 1.5 weeks away. not looking great. could breakisk that up the currency issue because the chinese people's banks, as simon said, has been leaning against the outflows. stabilizing the currency. isis a question whether that going to get caught up in some of the other u.s.-china tensions. francine: thank you very much simon kennedy,

bloomberg's chief economic correspondent. we will be back. wednesday night, the fed rate decision. we will join bloomberg for an hour-long conversation at 6:00 p.m. new york time, 11:00 p.m. in london. stay up, it will be worth it. cuttingbank could be 25% of its workforce according to a person familiar with the matter. more, let us get to nicholas reporter comfort. how does this fit in to what was set forth in july? when brian came along, on his first day he highlighted cost. he said this was going to be one of the areas he was really going with.ht on and win other ceos of deutsche bank in the past have not gotten anywhere with them. it will stay the

same. he was trying to do some kind of sustainable reduction in cost and to birth profitability and please shareholders. rinsing: nick, which departments will be hit and how will it be received by shareholders? : we do not have the level of granularity we would like yet. far, the cutst so will be focused on the back office. facing areas of deutsche bank. however, we have heard from deutsche bank in the past they will be reducing assets. those reductions in assets will come with a reduction in headcount as well. a close just under 1% yesterday. down again today.

it feels like, to me and to many analysts up there, that this is a positive in a forest of negative news. that we want to know more details to see how it will pan out and whether it sticks in the end. : nicholas, thank you so much. that was nicholas comfort in frankfurt. than 200 new car models are making their debut. international car models are trying -- manufacturers are trying to outdo each other. here is our reporter on the prospects for international car sales. he began to ask whether now was the right time to begin production in china. >> i can understand the growth of the china market can be frustrating for companies and china. all opportunity. firsts going to be our

festivity -- facility. local facility. we have a 20 million car market in front of us. it is a source of joy, not worry. >> what about brazil? brazil is a source of worry. market down 20%, by the end of the year where forecasting a 25% decrease. unfortunately, we're going to have a couple of years. reporter: 2017? more? theos: that will depend on decision made. in order to get brazil back on track. the potential of the country is still here. reporter: another decision we

are looking for is what the federal reserve my do this week. are you concerned about what it might do? carlos: you know, that is a big question. i am not so worried, because i have the impression it is already anticipated by the market. now or threepens months time the road or six months down the road, there is so much from the world market at this point in time. the growth , if there isconomy any reaction, it is going to be mild. i am talking about the u.s. now. the united states might be much bigger than that, but in the u.s. i think it is strong. price. most of it is next year, for example, for 2016, we are seeing strong growth in the car market in the u.s. between 1%-2%.

reporter: one final question, are you concerned about what the federal reserve rate might do outside of the u.s.? where will it have the most impact? arlo's: emerging market. a lot of emerging markets are struggling. uncertainty around the interest rate in the united states. i think that will be an impact on the emerging market. this impact is even bigger because of the problem the emerging markets are facing. christine: hans joins us live from the event. what else did he have to say? hans: he talked about the market in russia where he expected it to turn down. he is not overly optimistic. he is looking potentially for some state support in russia to boost auto sale in the low to

mid markets. some very interesting commentary from carlos gone there. gohn there. he is not worried about the sedan market. he is expecting it to sell well. at thenchor gets a car auto show. maine is, you get a silver city and boring, but only to contrast with your sparkling personality. manus cranny. christine: i will let him know. you will be so happy when he comes back from holiday. to see what i get. i am concerned, scared, and excited. twitterng us to today question. what do you want to see at the frankfurt motor show? some very strange cars being

chosen for anchors. we will find out more after the short break. you can follow us on twitter. adam posen is back from the peterson institute. . .

>> the u.k. returning to zero in august driven down by the cost of fuel and clothing. a measure of core prices also easing. core price exclude volatile food and energy costs. consumer prices unchanged in august compared with a year earlier. the figure in line with economists on a bloomberg survey. core inflation excludes food and volatile energy. from 1.2%.

what does this tell us about the path of u.k. interest rates? mark carney, the governor said the time for a rate hike is approaching. we have had more bullish comments in recent days. committee members seem to be on the hawkish side. it was minus 0.1 in april. it is a long way away from its 2% target which the bank of england does say it is confident in reaching in the two to three year horizon. francine? francine: thank you. adam, what do you make of this inflation? zero as expected? the bank of england still expects it to inch higher in one or two quarters. adam: the thing about the bank of england is we have the rivers

of blood fan charts. this doesn't change maybe the median forecast but it should have already happened. it has to move down the downside risk. widen the fan chart at the bottom. you're seeing this nonpickup in wages pretty much the same as everywhere else. much more vulnerable to the immigration problem. and to china. because of this talk, they have talked up the pound. i don't know why they are so intent on moving. it is not clear that the u.k. is doing that much better than everybody else and has that much lower inflation risk. this is not the u.s. and then the second point ises not clear that two years from now they are going to be on batter path, particularly if the currently elected government chooses to pursue the fiscal consolidation

they claim they are going to per sue. i don't understand why they are talking up the pound and a rate increase. francine: at the moment markets are pricing -- october 2016. should governor carney try and talk down the pound? adam: people are going to complain about my saying this of all people, but i think in yen the m.p.c. should talk less. because they are making too many specific promises. it is not they are debating the economics out in public. there are too many people including the governor saying we are going to do a raise. we think we're going to lean this way or that way. that is creating noise. this is the nth time we have seen them say we're going raise. or put a calendar date almost on it and then pull back. if they want to talk, talk about sources of inflation, member

forbes, forbes sort of did that recently and came out specifically in terms of rate hike. stop talking so much about the rates. francine: corbin was elected the leader of the labour party. is it dangerous he is not market friendly? he is not a moderate. can he influence the referendum? adam: it is the e.u. referendum. the brexit risk. even if you believe the labor party comes to its senses and changes leadership before the next election, the potential referendum on the e.u. membership is in the next two years. one stepped down from the front bench because he could at best get lukewarm reassurances from leader corbin on the e.u. demonstrated this is not a labor

government or leadership that is going to fight for british membership in europe. i think that is destructive. i think it is bad for the british people and economy. i think it is contrary to labor's real international ideals. for someone who is talking all of this nonsense from 30 years ago about being outside of nato nd unilateral disarmament. anti-israel and all kinds of stuff. saying we want to be part of the largest voluntary assembly of democratic nations and peaceful people. i normally don't get involved in partisan stuff but what has been said so far is horrible. if corbin and his cabinet reverse themselves, that would be great. the risk is you're not -- you're going to have tepid pro e.u. from the conservatives and from labour and pro e.u. only from the scottish national party.

francine: so you'll have another party. you have so many defections from people who are from the labour party. this maybe an historic turning point for the u.k. adam: it is a fair point and you and many others have raised the idea and i agree. you look back at british history. the time that the liberals have risen often times is in the relationship to europe. if you go back 30 years, the social democrats came out of the anti- nuclear activists were too far left for them. you had motte rat labor going off and creating this party. maybe that is going to happen again. if so, i hope it happens quickly because you're going to need something strong to stand up for constructive economic policies that are moderate and that stand up for british membership in the e.u. there is criticism. that side why they lost the lection.

they were too moderate. they gave away too much austerity. i agree on the austerity point. what corbin is talking about is beyond the beyond. francine: adam, great to have you on the program as always. adam posen. now here are bloomberg's other top headlines and japan's central bank has left the monetary policy unchanged deciding against adding to their 80 trillion yen stimulus program. policy makers say the economy is continuing to grow. the chinese -- suffering their big west to-day loss in three weeks. it comes after data over the weekend shows the world's second argest economy is slowing. turnball has been sworn in after ted. ony abbott was ous

we're just days away from the from the federal reserve's most critical policy decision in years. .et's check in with mark barton mark? mark: equities continue to be battered and boosted by the fortunes of china and before, expectations of what is going to happen thursday at that federal reserve policy meeting. asian stocks rose and they will. european stocks rose and fell. let's look at what happened in japan today. the b.o.j. deciding to keep monetary policy unchanged. attention now focuses on the october meeting. a one-year anniversary from when .e. was revised by mr. kuroda. what happened before the b.o.j. announcement? hetopics rose as much as 1.6%.

equities fell, finishing the session little changed. attention turns to the october meeting. they expect the b.o.j. to print more money. this is the aussie dollar. challenged tony abbott for the over the e leader liberal party. minutes from the r.b.a.'s meeting earlier this month have -- the feel-good factor after the central bank said china's slowdown and market volatility increased risk to global growth. the aussie dollar is declining once again. it is down 13%. this is one of the only gaining industry groups in europe today. the auto industry, car sales in europe rose 12% in august. the second fastest gain in 2015.

customers are snapping up models and .m.w., mercedes benz republican all the. -- and renault. the former stronghold of china, brazil and russia are not so strong now. auto is one of the few industries -- industry groups rising today. that's it for me. francine: thank you so much, mark barton with the very latest on these markets. the world's largest car show, the frankfurt car show is kicking off today. let's cross live to hans nichols who is joined by the opal c.e.o. hans? hans: i am joined by carl thomas newman. e is the c.e.o. of opel.

you're going to help return to profitability in europe? >> we designed it from scratch. it has innovations in it and features that apoint ins the upper class. hans: the upper class. the rolls-royce crowd. they are going to think they are ? ssing something on the table >> exactly. we bring luxury to standard ordinary cars like massage seats. safety features. we have a new light system that doesn't glare to oncoming traffic. hans: the new system won't annoy the chauffeur of the rolls-royce. won't get into that. give us an update of when you'll return to profit. >> we didn't change the entry price but we hope and think we can generate more money with a car with all of these options.

we are on track and committed that we want to achieve, break even next year. we never said it is easy, but we are working at it and we like it so far. hans: 2016 is the calendar year you expect to break even at opel? >> correct. hans: that is the goal? >> we never said it is an easy goal. there are draw backs like the russian crisis. the important thing is that we are able to grow and that we can grow with new cars that are profitable. this will be the third year in sequence where we grow market share. even though we exited russia. we need to execute the plan. it is hard. hans: is the market share growth where you want it to be? it seems like you're still struggling for market share. >> you're right. we would like to see more. russia is -- i think the more

important factor is that we can make up for the issue with russia, in russia, and we can grow and we for example, we grew by 13%. hans: when we look at where the euro is at now, is that sustainable? is that a challenge? where would you like to see the euro? >> a stronger euro would be better. let's see how things develop. hans: 120rks130. how much stronger do you need it? >> the more, the better. for the group, it is a different picture. it is important the strong ter euro, the better. hans: where do you see the european car market heading? is it going to continue to grow and how much of it is artificial? >> it is growing but to be honest, it is growing very slowly. there is always something like russia. it is growing by three percent

points. it is still way behind its maximum 10 years ago. at some point it should start growing stronger. the european country rs strong and the u.k. has been a good market. hans: some of those eastern european countries could be affected if the federal reserve thiss interest rates later week. how concerned are you about what the fed might do and how it might affect auto sales in europe? >> the key question is where is the economy going and what do people feel about it? do we see any disturbance? it is not helping us. anything that leads us on the way to stability is good for us . hans: how is the karl doing? how is it doing on its profitability? >> it is depending on the korean won very strongly. we have confidence that we can make this car work and actually it is very successful in the

market. we have won -- hans: it is selling like hot cakes. you're winning awards. >> correct. hans: but you're not making much money off of it. >> you never make much money off such a small car. this was a car where we got got our dealers into supporting us. we have drink level cars. the place -- the dealers, the real estate is now used for -- rather than some third parties. hans: i think i finally got a little bit of usable advice from this car show. don't make any money from small cars. , i am going to buy small cars. back to you, francine, in london. guys? francine: thank you so much, hans nichols. still to come on "the pulse," the e.u. ministers hold ergency talks on the refugee

cry where do we go from here? we discuss that with ryan chilcote next.

francine: welcome back to pulse live from bloomberg's london headquarters . now no firm deal was reached yesterday when embs u. ministered met in brussels to discuss plans for relocating refugees. negotiations will continue aheads of another meeting set

for next month. let's bring in bloomberg's ryan chilcote. what did they manage to agree on? ryan: what we have now is impasse. the ambition was to agree on how to distribute 150,000 refugees. they only agreed on how to distribute 40,000 refugees. they really didn't get very far other than agreeing to disagree until they meet again on october 8. a lot of the eastern european countries, the czech republic and perhaps most importantly hungary said we don't agree to this idea of binding quotas. there are two -- that were revealed in the fight yesterday at the european union. the first is luxembourg which holds the presidency of the european union. they said we like unanimity. like to make decisions with all 28 countries onboard but in this case it may be necessary to use a qualified majority.

gary, r words, hundred czech republic, we may have to go without you. you'll just have to go along with it. there are some countries in the european union, you figure out which ones that get funding -- that get financial aid from the e.u., structural aid that maybe they won't get if they don't support this measure. another step. another form of leverage that they feel is necessary. this feels like one of those situations until the e.u. leaders sith down, they are not going to make any progress. francine: have we heard from any of the e.u. leaders at all? ryan: no. merkel is sitting down with regional leaders and we see hungary taking big actions. they have helicopters flying above the border. armed troops on the ground. they have razor wire fences. at midnight last night a law

came into effect if you illegally cross the border you can go to prison or be deported. finally they are starting to suspend some of the official crossing points because there are too many refugees on the serbian side. this is a new era. we will not allow migrants into our country anymore. francine: ryan, thank you so much. we will be following this refugee crisis closely. up next, now that a deal has been done, can iran be the next frontier market? stay with us. ♪

francine: welcome back to "the pulse" live on bloomberg tv and radio and streaming on your tablet, phone and bloomberg.com. now that a nuclear deal has been done, can iran be the next rontier markets? some investors think so. we paid a visit to the teheran stock exchange. >> it is monday morning at the day ran stock exchange. with the nuclear deal inside, foreign investors are sniffing around. wondering if they should take a dip into a multibillion dollar market set to open up for the rest of the world. this is the heart of iron's small but growing equities market. some say this is the next big frontier market.

50 foreign investors have registered to trade on the stock exchange since march. they can't buy anything yet. sanctions are still in place but they are poised for when the deal kicks in. >> if they don't invest -- they are awaiting because they cannot transfer their money in yet. >> for these retail investors there is reason to be optimistic. the nuclear deal is set to end iran's isolation from financial markets and reconnect its banks to major international lenders and remove barriers to foreigners who want to buy iran yanickities. equities.

>> -- that we have in the market. this market is diversified market. >> it is 12:33. that means the end of trading today on the teheran stock exchange. the doors are lobbed and people are going home. in teheran, the trading day is short. a typical sign some visitors say of a frontier market ripe for investment but some think it may have to change soon. bloomberg, teheran. francine: now for those listening on bloomberg radio, "the first word" is up next. for viewers the second hour of "the pulse" is coming up. we'll be talking about deutsche bank. they could be making serious cuts by shrinking their workforce. as many as 20,000 jobs could be gone. we'll go live to the airlines congress for an interview with a c.e.o. more from the frankfurt motor show. we speak to the bentley board

member. you can tweet me at flacqua. hans nichols is at hans nichols and guy johnson is at guy johnson tv. ♪

the bank of japan keeps monetary policy unchanged refusing to deliver stimulus despite a shrieking economy. shrinking economy. we are live at the frankfurt motor show. and deutsche bank is said to be losing 20,000 jobs, a quarter of its workforce. good morning to our viewers and good evening to those in asia. i'm francine lacqua.

this is "the pulse" live from london. let's get straight to mark barton. mark: the expectations components of this index is the disappointment because economists were going for a number of 18.3, which was still down on the previous month 25 points. it has fallen as much as 12.1. expectations has come in at 12. 1, down from 25. the current situation there has improved because the survey which is an investor expectations survey has risen to 67.5. the expectation was further survey to slightly decline to 64. so, the current situation has improved. actuallytation has slumped. let's see how the euro's responded to that change against

the dollar. down by roughly .1%. to be fair, it is all about the fair, -- the fed, and the chinese economic slowdown. as shown by industrial production and investment data over the weekend. but the current confidences not too bad. but the expectations component certainly something to worry thet, adding to signs slowdown and emerging markets does threaten to be a drag on growth in europe's biggest economy. e bank of japan has refrained from boosting stimulus even after the economy shrank last quarter. in a survey, more than 1/3 of j making a see the bo move by the end of next month. zew.e have to future expectations not looking great. then we have the bank of japan

keeping everything on hold. you are expecting bank of japan to do something in october. expect bank of japan stimulus will come in october. japan is going to have one of its biggest ipo's in two decades. it will be the right time to build expectations. fewbesides, there are things we have to bear in mind about japan. we are talking about -- the return on equity that's happening. the situation in japan was so bad, that it did not take so much for next -- to change expectations. so, i think i'm overweight japan and the reason is i see an improved return on equity. i had a guest of has been bullish on japan.

we'll work. even he conceded that the underlying growth, or there are fundamentals, wage growth is uch, but it a to is a little too slow. are you confident that abenomics will deliver? 0--- a: they have a one poin 1.5% gap. if you look at what prime minister abe has been doing. in japan it takes long to decide something, but once they decide something, the whole economy can turn very quickly. remember, when the japanese yen went to 75, there was a lot of cost-cutting. now you are back to 1.20 and thinking about going to 1.30, and that is going to help japan. also, you're looking at new employment growth for the first

time in 10 or 20 years you're seeing job growth on a permanent job, not temporary. you're seeing wage increases. i'm very positive this is going to work. francine: i want to bring it brett miller. we're just talking about the fact that he still thinks abenomics will work. is japan losing out little bit of faith -- losing a little bit of faith? we are having technical difficulties. we will go back to brett, but basically, it was nice and we heard from brett earlier to get on the ground. there is a lot of positive news. but how do you deal with a higher yen? if they cannot do anything in a sober, will that change your investing view or are you taking a longer-term view? manish: i'm taking a longer-term view.

a lot of that has to do with the risk off scenario. when you saw the problems in china. there is hardly anyone that will disagree that china has both a structural and economic slowdown that is happening. on buy -- you lose both equity and the currency but these two things are going to kick it again. an.nikkei is in position.ctive francine: everything is linked. this is the problem of the moment is that we do not have that strong news apart from the market moving in china. everything is linked back to the fed. investor confidence fell for a six month in september. that is linked to the fact that investors are little bit spooked. should the fed hike just to get it done with so it removes the uncertainty? manish: my view is the fed

should hike. it is a coin toss at this time. my personal view is they should raise. fed has said they are going to be gradual. if they raise in september and then if they raise in january and february, that would be gradual. i think the messaging does not work. we are not an emergency situation. thinki think that -- i the fed has to create uncertainty as well. it is like a consensus. i would like to see the fed has more control. for that reason, i see that fed should raise rates. i think the only reason that the fed does not raise rates is because of things it has to help china.

china and the u.s. need to coordinate. you do not want the chinese yuan to weaken. so that makes you think that maybe they will not if they look on the spaces. -- this basis. i would not be surprised that raises, but it is a coin toss. francine: going to make for an exciting couple of days. thank you so much. on wednesday night, ahead of the fed rate decision, we will have an hour-long conversation at six clark p.m. -- at 6:00 p.m. deutsche bank is considering cutting as many as 8000 jobs in addition to the 15,000 it will shed by selling a banking unit. now, the new cuts will probably mostly affect administrative and technology jobs.

tonwhile, credit suisse is pay $80 million to settle 't disclosedit didn to its clients how it operated its dark pool trading. the swiss bank will pay $50 million in fines and what would be a red -- a record settlement with the sec. and $30 million would go to the new york attorney general. turnbull has been sworn is as australia's sixth prime minister in 8 years. a comes after the oust of tony abbott. he's place to revitalize the australian economy. the brazilian finance minister has her post new round of spending cuts and tax increases that are designed to close the budget gap. now, the move includes capping the sellers of civil servants, chumming social programs and introducing a levy on financial transactions.

the frankfurt motor show opens to the media today. among the cars is the jaguar. now, it will go on say -- on sale early next year for $48,000. an immediateed to conference after the ceo collapse sure he was helped off stage. is now recovering well after the moment of dizziness. that brings us to today's twitter question. what do you want to see from the frankfurt motor show? there are new hybrid cars. we are also hearing from big suv's from luxury car companies. we will see more from hans nichols. now, still ahead, deutsche bank could be making some serious cuts from shutting down operations to shrinking its workforce by 25%. we will have more on the bold

steps they are planning to take coming up next. ♪

francine: welcome back to "the in london. deutsche bank could be cutting 20 5% of its workforce according to a person familiar with the matter. the bank is considering losing 8000 jobs. for more, let's get to our

europeaneditor for finance. how do these plans fit into the mission the ceo set forth when he took over in july? heorter: right, well, when took over he inherited a strategic plan which had -- which he had supported in his previous role. cheatings the bank and your savings at 3.5 billion euros a year. this job cutting plan is one of the first details we are hearing about in terms of how that might be achieved. in the original strategic presentation, what really lacked were any substantial facts as to how these cost savings -- where they were going to come from. this is 1 -- the first significant part of that. francine: which departments are going to be hit? the 15,000 us from the assets

that we knew they would sell. then there is it is this extra 8000. could that be hitting the front office? elisa: at the moment we are told it will primarily hit the back office. non-lclient staff. there will be some reductions that have fallen into that category. clearly, again, the devil will be in the details. how many of those are going to be -- in the investment bank. they will see the assets being shrunk. again, we are not sure how much that is going to affect staffing in that department. francine: how is this being received by markets? there has been a lot of hope for the ceo seen as a fixer. after years of indecision, he will fix everything quickly. elisa: that is right. yesterday.were up the last time i looked, there

were pretty much in line with the market, down a little bit. i think people are focusing on the bigger picture, and again, wanted to see just how this, how the plan is going to look. there is one analyst today saying that the cost-cutting 3 billion a one off of euros. there are still a lot of unanswered questions that the ceo will be called on to answer when he presents the final details next month. francine: and we heard from the company today? the company is not commenting. the next date is by next month is when the ceo has said he will come back to the market with the next installment in his plan. francine: thank you so much. our bloomberg managing editor for european finance in milan. e-readers fell short of an

agreement yesterday over plants -- e.u. leaders fell short of an agreement yesterday to relocate migrants. hungary has decided to deport or imprison people who join -- who enter the country illegally. joining me now on the phone is the ceo of frontex. give us a sense of what you're seeing on the ground? we are extremely concerned about these human efforts. can you give us some updates on what you think would be the right response at this moment. >> good morning. borderthe e.u. management agency. we have identifiedan increase in th number of a regular migrants heading to the e.u. external borders. we have registered more than 520,000 a regular border crossings this year. our we are beefing up

preparation to support the frontline member states. first of all, greece, because greece it is on the eastern mediterranean migration route. most of the migrants are syrian nationals. have people from afghanistan there. tot frontex is doing is increase the registration capacity because registration is key. if then, we want to process the migrants. asylum-seekers or the regular migrants who will be later on iturned if they -- if turns out they are not asylum-seekers. francine: we seeing live pictures of the buffer zone. on the hungary-serbian border. talk to us about winter. it presents a lot of difficulties because it's more dangers, cold.

how are you looking ahead to winter? is it focused on the distribution of those already there, or do you need extra preparation to counter the conditions? fabrice: there are different steps that can be taken by different stakeholders. in the middle east, of course, the e.u. decided yesterday to increase the trust fund. there is one part which is based on humanitarian support and support for the first countries in the neighborhood of syria in the middle east and especially also in turkey. soso this is one step the -- this is one step they e.u. decided yesterday. when it comes to the external borders in greece or in hungary , because most of the flows go across their. -- there. for me, the most important thing

is that greece maybe hungary have reception centers where the migrants can be accommodated in a decent way so that we can process the asylum applications. then identify who are the people. in terms of order management, what is important is to have a reception center -- in terms of border management and a detention center because some of these irregular migrants are a rate who are not asylum-seekers. and according to e.u. law they must be returned. francine: you're talking of the economic refugees. there seems to be a shifting pattern in the geography of these migrations. more people are trying to walk through the borders instead of crossing the mediterranean. is this something that will continue? what does it mean for the winter? it seems that this would be

safer, but i may be wrong. fabrice: that is true that now migrants or refugees are walking from greece to hungary. now, the landse transportation means also through turkey because this is safer than using libya. at the beginning of 2015, the situation was completely different. we had huge flows including syrian nationals going through libya, then crossing the mediterranean sea. still, we also have a high number of crossing, through the central mediterranean route. this year from libya to italy we have registered more than 113,000 the regular border crossings. so the risk that additional

casualties happen at sea remains very high in winter especially. francine: we are also seeing, again referring to the live pictures we are seeing of the hungary-syrian border, we are seeing more border checks. some countries are putting controls in place. do you see them remaining in place for some time? how concerned are you about this? well, member states are now stepping up different kinds of checks. so, hungary decided to build what they call the technical obstacle. i must say this is not requested by the european union. but it is up to every member state to decide how he, it wants to. manage the border. but i have to say as the frontex

executive director, i do not encourage this kind of means. an agency, we encourage corporations in neighboring countries, in this case, syria, i would like to see that frontex cooperates with western balkan countries. we have seen, also, the reintroduction temporary reintroduction of kind of border checks at internal borders. for instance, germany announce this some days ago. austria and some others. this is according to e.u. law, it is possible for a limited period, so this does mean the end of the free movement era. it means that member states facing critical and unprecedented situation, decided to carry out this kind of

checks, because they cannot accommodate more asylum-seekers. that is what germany explained. so i think this is something that can be or must be perceived as one exception, but which is embedded in the schengen system. francine: thank you so much. talking about the refugee situation. now, th world's biggest car showe kicks off in frankfurt. our international correspondent hans nichols joins us live from the event. how hopeful are carmakers about sales in china? two: well, there are undercurrents, what is happening in china and brazil. the message we are getting from the ceo's is full speed ahead. that was especially true with the ceo of volkswagen. when i asked him about china, he said he expected a normalization

process. a normalization process underway in china. we are convinced that china will continue to grow, no longer and two digits always but it will continue to grow in the west. we are getting ready for this. still growth. in the northwest, we have set up a new factory two years ago. a budgetis to build car for the west of china. hans: there's not a: of concern about china. that is sort of surprising, given what we have seen happen to equity markets. automakersf these are confident. you get a different response when you ask about brazil. you almost get guffaws. there are concerns about brazil. renault-nissan,

threw up his hands. similar story in russia. they do not expect a big turnaround. some ceo's talking about the importance of, the need to have some sort of russian state support to prop up in the. otherwise, i'm struck. most of the last three or four months we have been talking about global financial headwinds. not a lot of prospect of growth. i we have seen global growth downgraded from the imf. yet, all of these automakers are full of confidence. they say they are gaining market share and selling more vehicles. and they continue to invest in sleeks and these sexy things behind me. i'm next to a porsche. they will unveil something new behind me. that is why it is getting a little loud. francine: you are surrounded. pretty excited.

up next, we are live at the world's low-cost airline congress and speak with the ceo of wizz air. what would you will have to say -- he have to say? find out next. ♪ sure, tv has evolved over the years.

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francine: welcome back to "the pulse" live from london. i'm francine lacqua. japan's central bank has left monetary policy unchanged, deciding against adding to the country's 80 trillion yen customers program. policymakers said the economy is continue to grow at a moderate pace in the current easing is having the intended effect. the chinese shares slide has continued with stocks suffering their biggest to day loss. data confirmed over the weekend

confirmed that the world's second-largest economy is slowing. been swornnbull has in as australia's six prime minister in eight years after he ousted tony abbott. placed revitalize the a strong economy which has been battered by the slowdown in china. 10:31 in london. let's check in on the markets. jonathan? jonathan: rolling over into the red, the dax down. losses on the periphery. in london, the ftse 100 four day losing streak. there is a question that needs to be asked and it is fundamental - essential to what is happening in the global economy in global markets. on the one side, you have a debate on whether the federal reserve will hike interest rates. on the other side, you have a call from citigroup of a global recession in 2016. globalyou reconcile a recession with tighter monetary policy? that is a big question.

right here right now, is the likes of glencore that are taking the pain. by a big question over the demand story. glencore down by 5%. biggest loser on the ftse 100 so far this year. they outlined a $10 billion debt reduction plan last week. stock is backthe to a record low. a question about the supply and demand story that is driving copper lower. down by one full percentage point. declining commodities a problem for central-bank pushing inflation down, feeding into zero inflation and the u.k. month for theight bank of england is looking at inflation number below their target. it is a problem for them potentially. at a problem for the bank of japan as well. overnight the boj does nothing. we drop below 1.20 for the yen. a stronger japanese yen against

the dollar. . the next meeting october 30 a lot of economists say the bjo will -- the boj will make the move again. goldman sachs predicting that the dollar-yen will rise. think about the japan side in the u.s. side of the story. next big data point, u.s. retail sales coming soon. francine: thank you so much. jonathan ferro with the market check. in 25 minutes is "surveillance"" with tom keene. you're looking at the fed and brazil. tom: i thought jonathan ferro did a great summary. for globalm scenario recession. that will be one of our themes this morning. we will look at that with david woo of bank of america merrill lynch. yes, you data polled the know on brazil.rnight

extreme austerity led by increased taxes. we'll have to see how that folds out. the real opening later today. a very special hour. you will love this. daniel yergin and gideon rose will join us and we will speak directly to dan about his commanding heights and how he opens it on your united kingdom. we will fold that right into jeremy corbyn. all going on and united kingdom politics and around the world as well. francine: looking for to it. thank you so much. minutes fore" in 25 the world's low-cost airlines congress is in full swing in london hosting the biggest names in the urgent aviation industry. guy johnson is joined by the ceo of wizz air. over to you. guy: thanks. yes, he's joining me now. wizz air the new kid on the

block in central and eastern europe. ao's earlier this year bought whole bunch of airbuses. good morning. nice to see you. we've heard from a bunch of your competitors they had a great summer. did you have a great summer and are you going to have a great winter? jozsef: yews. s. what we're seeing is the industry is in good shape. the market environment has and doing a lot of favor for airlines. theously we benefit from environment. but it is a great summer, a great winter. the most important issue for us is to make sure we use these times for building our strength in terms of refining or building liquidity. we stand firm already. we take advantage of that situation. less flexible now you have ipo'd?

jozsef: one of the factors that has made up what we are today -- we are quick to make changes in the business. we are quick to making decisions. those issues and opportunities. we've maintained that spirit of the company, no matter whether we are private or public. of course, being a public company comes with more scrutiny, but we -- we maintain the spirit of the business. guy: you are bringing in a bunch of a-321's. the new engine version. what is that going to mean to your business? what is it going to mean to the aviation environment? jozsef: it is going to mean a lot to a lot of people. as far as we're concerned, this is a real game changer. there going to take by-- 15%.one by 10% to

it is great for the environment. more green. much more environmentally effective aircraft. but it also predicts the growth rate of the business. we have managed -- we'll have % annualg between 15 growth over the next nine to 10 years. we have lined up capacity for that department, but -- orwe can go up, down, sideways depending on the conditions of the market. this is a key step forward for the business. over the next 10 years. guy: you're going to be a much more fearsome competitors for your biggest rivals which is ryanair. on onstage and he was saying maybe nader no longer the biggest and the baddest anymore.

do you feel that you can carve out for yourself a business space, an ultra low cost? is that the rice model -- the right model for central and eastern europe? jozsef: i think it is important for low-cost does not mean that this is bad for the consumer. hthe low cost is simply a way of delivering your business. to engage with consumers at a very positive way. and this is what we have been focused on. we keep saying -- you don't need to be bad just because you work in an efficient way. to be able, we want to lower costs in order to deliver a lower fare to the market. keeping in mind that central and eastern europe is a -- people do not have much money.

people have to be brought into flying. we have always been fair to customers. over 80% of them have a university degree. they have a positive attitude to people. low-cost does not mean that quality. it means you have the ability to create a high level of engagement with their customers. guy: a quick question. does the future of the polish airlines which is up in the air at the moment sort of factor into your thinking? that story go, and does it affect your thinking? jozsef: what you see is that all international carriers have been

struggling in central and eastern europe. some went down. some were kept alive including polish airlines. all airlines are doing business within the market environment. that will change. i think the industry will have to consolidate. and we will see more consolidation going forward. those issues are unpredictable because of the political involvement in that process. the markets will have to consider it. guy: migration. clearly it is in your backyard at the moment. a big story for the whole of europe. can you give us a, your feeling of how this is going toward fro your airline's point of view? do you worry about border controls imposed by -- all of th ese issues on the table at the moment.

you? it affect jozsef: so far so good. i keep checking the stat3e of bookings, whether we have seen any impact especially in hungary . not really. we are still seeing bookings going up. borders remain closed, it may mean that people will fly more because ground transportation may become more difficult. so, we will see. i think it is a mixed bag. there are potential for negative consequences. or may give more demand for airlines. we will see. guy: thank you for your time. the ceo of wizz air. so, a lot -- a few planes. a few more things to talk about. trains, maybe. francine: guy johnson speaking

to the wizz air ceo. now, we're of course getting breaking news on the migration crisis. e.u. ministers met in brussels to discuss a plan for relocating 120,000 refugees. negotiations continue ahead of another meeting set for next month. with the latest here's ryan chilcote. what did they agree on? on veryey agreed little. the ambition was to decide how to do via up the 100 60,000 migrants. all the agreed on were binding quotas for 40,000 refugees. so, 120,000 still to sort through. all they agreed on was that they would discuss this again on october 8 when the e.u. interior ministers gather. there are couple of sticks

coming out to break the division. it has been mostly eastern european countries that have an sort of declining to agree to binding quotas, specifically czech republic, slovakia and hungary. we heard yesterday from the german interior minister saying some eastern european countries are getting financial aid from the european union. maybe that ought to be leveraged to get them on board. we heard luxembourg which is moderating these conversations say, you know what, if we cannot get the unanimity, in this case it is not obligatory. we could have what we have called a qualified majority. most of the members on board. the other members that have not agreed just have to play ball. francine: this is a way of getting around hungary's opposition. ryan: what they want to do is get hungary on board. that is looking difficult. what they want to do is avoid this turning into the next

threat, the next exhibition -- existential threat to the european union. a division breaking out yet again between the east and the west. the new members of the european union and the traditional larger economies. so, they prefer to get hungary on bored. they prefer to keep all the countries on board. but it's increasingly appearing that that is not going to be so easy. at lease without getting the leaders themselves involved as opposed to their acolytes, their interior minister's. francine: ryan chilcote with the latest on the migration refugee crisis. back in two. we have more on the story. we'll also go to -- what the markets are doing ahead of the fed decision. ♪

francine: welcome back to "the pulse." let's get more on the migrant crisis that is topping the headlines on bloomberg. our bloomberg budapest are chief joinsbureau us on the phone from the hunga y ian-serbian border. we are watching live pictures coming in. what is a situation like? >> i am in no man's land between the two borders, that is where authorities have set up a transit area where migrants can

registered legally as they try to cross into the european union on their way to germany. peopleere are many here. 50 people were frustrated by their attempt to try to get in to the centers. they decided to do a sit in in the middle of the highway forcing police to shut one of the major border areas. they are refusing food and water and all they demand is that they be let through. earlier today, hungary had effectively sealed the serb bord er, deploying thousands of army to prevent migrants from entering its borders. one of the things we are hearing is that if the refugees or migrants cannot get through the border, hungary's border with serbia, their next move

might be to go to romania and croatia and try to get in that way because there is no fence. are you hearing anyone talking about that? zoltan: on the ground, i am not. that is a distinct possibility, though, what you say, especially as what really hungary's doing is essentially, it's shutting off, sealing off its borders from refugees. even those people who get through and manag to register, almost all of them will be turned away since --gary has labeled survey serbia a country. ryan: what are the impressions you get her one of the characterizations of hungary's prime minister and the western media? playingeyman of europe, hardball with the migrants that want to cross the border. saying they represent a threat

to the e.u.'s christian values. does he enjoy a lot of support or is he getting flak within the country for this hard stance on the migrants? zoltan: according to polls, he has gained. so, it's proving to be politically popular what he's doing. the primeys, what minister says, he knows he has compassion as well. although that may not come across in media. what he's saying is that european leaders need to come up with a sustainable policy to dealing with migrants. what he says that his policy is one solution, effectively saying, telling migrants, don't come because there are too many people coming. and it's, authorities cannot handle that kind of numbers at that speed. what really he's calling for in europe is for somebody beyond saying that they want to be

compassionate, to actually come up with policies that actually made the reality. these new lawsve taking effect at midnight last night making it a crime to cross the border illegally. we understand the hungarian cabinet is meeting today. do people on the ground know the situation, are they aware? are the refugees -- you said they were refusing to eat and drink. to protest until they met through. is there talk about what they would do next? somen: i did talk to people who were waiting outside of this newly set up transit yearsand one person, 30 says thedamascus, he reason they are there is they know that effective from midnight today it's a crime punishable by prison to cross the border illegally. so, that is why they are trying to wait. others are frustrated. they say they have been.on the roads for days, weekst.

th do not understand whye they are facing off with police in whenrmyy and facing fences all their dream is to go to germany and have better lives. ryan: a quick one. you mention the prime minister says he wants a lasting solution not a band-aid fix. yet, you know, yesterday we had that meeting at the european union where hungary, along with other eastern european countries, was clearly at odds with some of the western european, bigger countries at the meeting. and there was even talk that the german interior minister saying that financial aid to those countries should be used as leverage to get them to play ball and except refugees. do you see any chance of reconciliation between this rift we have between the western european and eastern european countries?

zoltan: uh, that is a tough one because really what hungary's position is, as unpopular as it may be and some western countries, is that even if you system, that sends a message to millions of other refugee camps around syria that we have a solution in place so you can come as well. helly, orban says he knows is being hardline but he wants to be tough and sending that message, so that those millions of people still in refugee camps around syria do not start heading over to europe. francine: thank you so much for the update. budapess passed -- bureau chief. could iran be the next frontier market? some investors have applied for licenses to start trading. correspondent paid a visit

to the two ron -- tehran stock exchange. reporter: it is monday morning to read with the nuclear deal signed, foreign investors are sniffing around, wondering if they should take a dip into the multibillion-dollar market that is set to open up to the rest of the world's. this is the heart of iran's growing equities markets. dozens of foreigners have visited this floor in the past six months. some of them say this is the next big frontier market. 50 foreign investors have register to trade on the stock exchange since march. they cannot buy anything yet. sanctions are still in place but they are poised for when the deal kicks in. t they i don't invest in ehran stock exchange. they are winning because they cannot transfer their money in yet. -- they are waiting. reporter: the nuclear deal is andto end iran's isolation

reconnect its bank to major international lender's, and thereby, removing barriers to foreigners who want to buy ukrainian equities. -- buy iranian equities. >> i see potential in the stock exchange, can absorb considerable foreign investors. because, you know, industries that we have in the market. ed.s market is diversifi reporter: it's 12:33. the end of trading today. the doors have been unlocked and people going home. in tehran, the trading day is short. a typical sign of a frontier market. but some think that may have to change soon. now, that is it for "the pulse."

stay tuned for the surveillance team up next live from new york. you can follow me on twitter @ flacqua. we have live pictures of the refugee crisis. we have been talking about it all day. these are refugees. refugees in transit between hungary and serbia. we understood from our budapest leadinghief they are in some families every 15 minutes or so or only if they want to be registered. hungary has been stealing off the border with serbia and began enforcing a law allowing authorities to in prison or deport migrants across the -- across the frontier illegally. european politicians are talking about this more and more. now is the time we need to have some action done. our repters on the ground will follow any developers. ryan chilcote keep you abreast with any breaking news on that

story. have a great day, everyone. ♪

announcer: this is "bloomberg surveillance." tom: the indecision builds as janet yellen considers international events. brazil into austerity. in this hour, david will. china stocks continue their

dissent. , wethe elephant in the room consider the return of a strong dollar reality. good morning, everyone. this is "bloomberg surveillance ," live from our world headquarters in new york. it is tuesday, september 15. i'm tom keene, with brendan greeley. ,rendan: the thing to look at thatim levy is the face international investors see. they have tremendous benefit. groupk at that interest and say that is where the interest is going to stop. tom: it was a surprise to see it, they be a touch of desperation as well. right now our top headlines. here is ramy inocencio. ramy: good morning, everyone. japan's central-bank is betting the economy will turn around without any more stimulus.