the ecb cuts rates. the ecb strategy with a former board member at the central bank.hat is later on "the pulse." ♪ >> welcome back to "the pulse." time for a quick check on the equity markets. markets are trying to digest what mario draghi did yesterday. qe-light. the beginning of unconventional measures. the size ofe near the balance sheet the federal reserve managed to do with quantitative easing. the ambition is $3 trillion. 2.7 billion euros. european equity markets taking a bit of a pause. the real impact is on the currency market. yesterday whenop we had that come through. i caught up with citi. this is the currency funding of choice. 1.25 is potentially achievable. you want to go into turkey, rand, high-yielding currencies. ready to bank of japan do a little bit more action. that seems to be the message coming from the bank of japan. that is it for me. let's see what anna is up to in the next part of "the pulse." ♪ >> welcome back to "the pulse" live from bloomberg's european headquarters in london. here are the bloomberg top headlines. mario draghi has called

that's after, as we said, the ecb announced its new voting rotation for the next six-week ecb schedulefour weeks. and the fact that jans weidman won't be on the march 2015 vote making decision. therefore, qe is slightly more possible. >> i want to bring your attention to an interesting development in the mobile space. visa is going to assess a stake on monetizing. on the back of that, we are seeing shares of monetize move lower significantly, down around about 10 points on the day. visa going to assess a stake in monitise. they enter into an agreement in 2009. we'll get you more updates as they come in. >>> the long wait is nearly over. alibaba is set to debut on the new york stock exchange on friday in wakd be the world's largest flotation to date. shares expected to range from $66 to $68 each. while investors will be trying to get in and insiders may be trying to get out. according to "wall street journal," about $8 billion worth of additional shares could hit the market friday as a lock up restriction doesn't apply to certain pre-ipo shares. cnbc's eunice yoon has visited one villag

how much can ecb do? lend to and medium-size enterprises to get the employment up and to get the demand in the economy up. you see the reflection in the first auction. isember, that auction becoming bigger and bigger for the ecb. does he get that up by a trillion euros? >> there on the road this week, heading down for a meeting. the euro is falling at the moment. yields are at the front end of the curve. the push for qe is growing. they were talking about the fact that merkel needs to stop drawing a meddling in the eurozone. it is interesting to hear. a big busng to get stop that the ecb is the germans face off and say enough is enough. >> persimmon believe this is what they wanted. they wanted a weaker euro. heads tome time, he naples in italy. that whole push for governments to push through on reforms, the italian prime minister talks about not compromising with the unions. how long have we been hearing him discussing and talking about reform? he is trying to deliver them now. i think naples is an appro

the ecb is quite far behind.d --e, under trichet, they hiked rates. >> jobs is the big number. >> 230,000. >> the strongest year in 15 years if we stay above 200,000. >> "on the move is next. >> have a good weekend. we will see you monday. >> welcome to "on the move." stocks are set for an interesting day. it is the morning after the day before the euphoria. here at bloomberg we are calling mario draghi's action qe-light. rate, thencing marginal lending rate and the deposit rate. german industrial production, not too bad. we caught up earlier with the voice of doom and gloom. he seemed quite impressed with the ecb. >> it doesn't really matter whether you buy private assets or public assets like sovereign bonds. what they decide to do is increase significantly the balance sheet. that will have a significant impact over time, together with other policies like fiscal policy and structural reforms. >> stay with us. you can enjoy that full conversation later in the program. ryan chilcote is inside wales in berlin. was

reforms,lk the euro, ecb, monetary policy. " is back in two.markets pushing high. ♪ freefall, the euro falls sure way as draghi says he is ready to take action. but is it time for government to do more? strikes.e gives into serious customer say the new iphone then's in their pocket. -- bends in their pockets. goo

. >> the ecb's surprise triple rate cut. european markets fall back. >>> markets are anticipating a solid jobs number. but kenneth rogoff tells us the central bank is not ready to hike rates. >>> reports emerge after shelling in the eastern ukraine hours before and rebels are expected to confirm a cease-fire. >>> the u.s. readying a fresh round of sanctions on moscow, regardless of any peace plan. >> announcer: you're watching "worldwide exchange," bringing you business news from around the globe. >>> and you're looking at live pictures from new port in wales where nato leaders are expecting a military flight path which is happening as we speak. >> there we go. that's the fly past. three planes and -- >> well, of course, we'll be back to nato throughout the day today. continuous updates from hadley gamble who is there. we'll be discussing the significance of those ecb monetary policy measures yesterday, which are obviously taken by the market as a complete surprise. >> absolutely. we saw that huge rally yesterday and quite s

advances in the fed and the ecb and the bank of japan. continue to strengthen for the remainder of the year ended 2015. >> thank you so much. the global chief investment strategist at blackrock. thank you to olivia sterns and alix steel. as olivia was just talking about, i want to get over to guy johnson, the polls anchor who has been at the press conference monitoring the press conference, coverage out of our london office. tell us what you heard from mario draghi. >> we heard mario draghi in some not saying this is full-blown qe and maybe we will not get that far in the midterm. we have the scheme they will be doing, the strategy they will be putting in place. security purchases will include -- the balance sheet quite significantly, and they will be buying covered bonds. it is not the same as the previously announced policy. it is a different one. not everybody is on board with that. the germans, i would argue, probably are not. this was not a unanimous decision. a big step forward for this ecb. full-blown qe is tricky. it is very diffi

the speculation that the ecb, they could step in, we could see some type of action from the ecb, there is work to do some type of a full bond buying program, it would essentially mean they would be following in the foot steps of the fed and the bank of japan, too. just to mention, we've got a whole punch of meetings taking place in the banks this week. the ecb, the bank, the rba leaving rates on hold as expected earlier in this session. bank of japan meeting this week. and the bank of canada. to round it up, you've got the manufacturing index and consumer spending for the month of july, as well thank you very much, louisa. lots of data still to come this week. the european equity market is up. >>> the russian minister lavrov has announced a western bank party of war. lavrov said ukraine is pushing for nato membership in order to disrupt peace efforts. meanwhile, ukrainian troops have abandon their defense on monday in the latest of a series of military reversals. the defense minister announced the country's attempt to liberate the east was over and the focus was now defending ukraine f

edmund, i have the ecb. a vaguely know where the ecb is going. have all kinds of things at the moment that are on my risk radar. prior toys those for me -- prioritize those for me. >> it is a big question. i am not sure you should be invested in equities right now. >> why not? >> september is a tricky month generally in this month is proving to be no exception. we have had quite a big cell of bonds. -- a big sell off on bonds. there is greater uncertainty over the outlook for bonds that normally would be the case. normally, september is a good month for bonds. this month has not been. of front and center is the fed -- upfront and center is the fed. if you look at the ecb , what can they buy? this is a market they need to create. that will take time. shrunk balance sheet has 33%. >> will be back in a couple of minutes. ♪ >> still too many people who want jobs but cannot find them. too many who are working part-time who would prefer full-time work. too many who are not searching for a job, but would be if the labor market were stronger. >> that was

london time. 45 minutes, the ecb. then half past 1:00 p.m., mario draghi's press conference live and in full. smartphones two new in a berlin yesterday including one with a wraparound screen. international correspondent hans nichols discovered smartphones are just the tip of the iceberg as far as the cutting-edge technology is. good morning to you. take us behind the scenes then. think of this conference for all of the gadget you will take with you. you'll be doing all of the household chores that i'm sure you get out of doing. here's what we had yesterday. 4 andg had the new note we are talking about connectivity in the home, watching ash washing machines, and increasingly interconnected world but as we talked to the managing partner about it, the challenge is getting everyone and all of these devices to speak a common language. a problem that we have as an industry is there is no common industry standard. the different appliances and different competitors cannot communicate with each other. is the other aspect of th

will the ecb take any action today? what can we expect? the man that has been figuring all this out for us, manus cranny. >> guy, it would be folly if they don't deliver something. some form of action, some form of roadmap, some form of movement. very few analysts think they will move. the conversations that i am , he hasith bnp paribas got to really grasp the moment, to not do something would perhaps be folly. jpmorgan were in here this morning. john norman saying the markets are expecting so much. i think that is demonstrated through the move in euro. down to 1.25, down to parody by 2017. the government bonds now below 1%. by gosh did his words yet again move markets. today is the day, the potential beginning of the ecb with their hand in their pocket. everybody else has to pay for the movement of european sovereign debt bond yields. everybody else has had to pay for the movement in the euro lower. it is the dollar story that is moving higher, not the euro. german government bonds hit just under .80. the positioning of markets, the posit

there has been speculation the ecb will do more. i doubt that.'t think they are going to do anything until they see the outcome. they are supposed to start on the 18th of september. until we see what type of effect that have, and i have my doubt as to whether they will have any then i thinkfect, the ecb is going to sit on their hands. >> isn't it win-win for equity markets? it geopolitical tensions might impact the economy, which means central banks will be in the game for longer which means assets rises continue to rise? cycle we have seen, will that not continue to play out? >> i think there is an element to the argument. valuationsi think have to affect fundamentals. for me it is the law of diminishing returns. to ease offtarting the gas. i think everyone is speculating the ecb will step into the breach. just don't think even where bond yields are globally, how much further can interest rates go to fuel this ever-increasing cycle of growth? >> you mentioned this program the ecb has to put money into the real economy by lending it to banks. in

. >>> will the ecb launch any fresh stimulus? >>> standard life lifts the ftse 1 hup as investors share a special dividend after a 3.7 billion sales of its canadian operation. >>> coming up, the sony of ceo tells us why it's taking so long to turn around the business. >> announcer: you're watching "worldwide exchange," bringing you business news from around the globe. >>> nato is poised to bolster its european defenses and increase its support for ukraine. president obama landed yesterday after a turbulent day which started with hopes that russia and kiev started with a cease-fire and ended with vladimir putin outlining a road plan for peace. president obama dismissed the plan as, quote, deception. >> meanwhile, the french president francois hollande says despite the prospect for a cease-fire, the conditions for paris to make the first delivery are in place. ahead of the summit, hadley gamble said to the head of the center for strategic studies asked him whether the fears about russia's expansion were justified. >> far too many c

but the euro dropping on expectations of the ecb.o draghi is currently speaking, but in an interview ahead of his speech, the central bank president pledged that the ecb would do more if economic conditions worsened. geopolitical tensions are weighing on business tensions while unacceptably high unemployment could hurt the strength of the recovery. how are u.s. futures looking? >> it would be interesting to see how u.s. markets react to that movement in the euro. the lowest level since november 2012. right now, you can see arrows pointing to a higher open. the dow jones up about 16 points in trade. some say yesterday's move in the u.s. markets seem resilient, given that there are buyers on the sidelines waiting to get back in and buy that dip after that three-day sell-off. taking a look at the ftse cnbc global 300 index, down about six points. a good gauge of stocks around the world. let's dive into the uran markets. we are looking at the euro trading at the lowest level since november 2010. how are markets responding? they're.respon

the ecb unexpectedly cut benchmark rates to a record low.k has agreed to start buying asset-backed securities. nato is skeptical of vladimir putin's he spat -- peace plan for ukraine. that putineculation will keep waging a shadow war to retain control over eastern ukraine. to theare going back bloomberg sports business summit. cory johnson is there if the incoming head of the nba players association, michelle roberts. the nba players association. always an interesting topic. it has got to be one of the most laborsting jobs and relations. michelle roberts joins me. you have a lot on your plate, taking over a complicated situation. what are you doing to get ready for this big job? lists., i have lists of [laughter] i am doing a lot. in addition to putting together a senior management team because we do need that, what i am planning to do is plotting out my next few months. it includes a lot of player interaction. i will eyeball every one of our players come every one of our teams, listen to every one of our players and begin to talk about our

we will speak with a former ecb board member. stay with us. we are going to talk about the ecb.n twitter. the euro has the potential go to 1.25. that is it for "on the move." ♪ >> nouriel roubini calls draghi's one trillion dollar stimulus plan a step in the right direction. an expert opinion. we speak with former ecb executive board member lorenzo bini smaghi/ . plus, nato leaders gather for the last day as the eu considers new sanctions against russia. obama and david cameron urged nato to confront the islamic state. we are live in south wales.

the ecb for draghi, late august at jackson hole said that the ecb will use all available instruments needed to ensure price stability. since then, you see the stoxx europe 600 index gaining about 2.5%. the latest read on gdp was disappointed. inflation has dropped to a 5 1/2 year low. unemployment is at 11.5%. which is pretty much at the same rate it was at this time last year. so a lot of challenges facing europe and that's why we'll be keeping an eye on the ecb decision. ahead on that, european markets slightly lower. back to you. >> thank you so much. we'll see you again tomorrow. >>> in the mean team, european central bank is hoping that monthly policy meeting today, market are anxiously awaiting that announcement because it could be different this time around. teresa marr, sri, darrel, gentlemen, thank you for being here today. >> thank you, becky. >> wooerp playing up this whole idea that the ecb decision could be different this time. mario draghi signaled that maybe there's something more on the table. do either of you think there is going to be some sort of stimulus today? >>

ecb announced their results. we will get some perspective on do that in just a moment. >> good morning. welcome back. you are watching the polls stop we have been speaking to the chairman. on thet heard him subject close to his heart. manis wasn't just going to let the conversation ends there. this is what he had to say. >> this talk about rate hikes and there are two bottles they talk about. they don't have a fast overtime and others say, let's just wait a little bit longer. they are willing to go faster. that is the cost to debate between beast to bed adds twortainty -- between these and adds uncertainty. >> does the fed go to early? that it faces a danger of going too late. i think the recovery is more firmly established than many investors and the market think at the moment. the risk for prices to come up above the target rather than below target is higher. my preference would be earlier moves. i am not a policy maker. for me, the important issue is monetary policy in the united states. it is a half year or w

i think it was a major change in the ecb.ey approach the ecb about a policymaking between monetary policy and fiscal policy as well as the mix between special policies. his speech was very interesting. he is opening the door for more cooperation between the government and central banks in order to put in place better conditions for growth both in the near-term and long-term. i don't think it means there will be a change very quickly in the ecb policy especially since they have already put in place a significant package is just before the summer and different measures of being implemented gradually between now and the end of the year. i think we should not get too excited about this week even though you will do some position about the way he sees this corporation and the way he can see possibly more ecb action later on. >> good morning. in terms of detail, are we going to get more detail on the asset-backed security buying program and what that may look like and a little bit of detail of what qualitative easing may look like i

he wants to see more of that coming from the ecb. >> i think the ecb has to do more.t the moment, we are seeing anxiety, concern over deficit, and there is no offset. it is hard to see how you come back out of this. the combination of loose monetary and tough deficit. we have to see that across europe. added tor voice being the nudge nudge wink wink for quantitative easing coming for mario draghi. ian cheshire will be handing over the reins to the female head of capital armor in france. she will be taking to the helm of the kingfisher group. how were her voice -- how will her voice add to it? we'll be talking about disruption. these guys can talk the talk. it says something about mobile, online. mentioned seamless about six times within a particular interview. they are all very aware of the disruption, the move to online is happening. they are talking the talk i'm it but all they walk -- talking the talk, but are they walking the walk yet? we will be talking to the ceo of domino's pizza. of sexinesstle bit going on. -- coveringlking to everything, i think. >> we have

peter, you've got the story on the ecb decision today.sking traders between rich's story and your story which one had the most impact, and they really are having trouble deciding. >> reporter: well, liz, interest rate cuts by the ecb matter a lot to american investors and to american workers because europe is our single largest export market, and the ecb, as you said, surprising analysts with this unexpected cut in key interest rates. it coupled that with a new bond-buying program designed to encourage bank lending. investors had not been expecting either of these moves until later in the year at the earliest, but the ecb was worried about signs of weakening in the european economy just in the last month alone. ecb president saying europe's recovery was losing momentum x if it does not speed up after this, draghi said the ecb is ready to provide more stimulus through, quote, unconventional instruments. qe? quantitative easing, liz? you know all about that, bond-buying program. liz: that's exactly, that is exactly what he's doing. you are

>> according to the ecb, yes. first of all, on the size of the balance sheet, a lot of people look at the size of the balance sheet in 2012. eurosee 3.1 trillion where it is now 2 trillion. i think the ecb wants to expand the assets held for policy isposes which at the moment 7.100 billion. realized by the teal is also a the tltro's question. so there is some uncertainty on canspeed in which the tltro size the balance sheet of the ecb. they also need to buy assets. but a bsf and cover it would proceed relatively so it -- but abs would be relatively slowly. it could be something like corporate bonds, agencies. european agencies before they get to a bsf and covered bonds. in terms of the substance of what the ecb will be doing, they will be buying bonds issued with a pool of guarantees by government, essentially even though it would go through the markets, in my opinion, it would be budget we something close to efsf with thes intervention of the ecb. i don't think. government bonds are the last resort. the thinking

full coverage of the bank of england and ecb conference today. you can watch the news conference live and in full on bloomberg. " is coming up at the top of the hour. >> the ecb will be the top of the agenda. we will talk to martin wolf. beginning one of the chapters on the eurozone, he says the euro has been a disaster. there is no other word for it. he is not impressed with a single currency and has not been impressed with the austerity measures that have been imposed out of berlin. --has not been impact impressed with the policy response. what happens next? what does draghi need to do? we will discuss all of that with him. we will also pick up on what you were speaking to kevin about, whether or not the u.k. can continue with the currency of the union. i suspect the answer is no. talking of building things, we are going to be talking to lego. lego is a private company. huge.s and it will be fascinating to evolvingthey see it and what happens next in terms of where you take lego. the, we will take on russian sanctions story and the downgrading

data and the ecb move. and the dollar clocked some gains against the other currencies including the euro this morning. but is the run up short-lived? market analyst kenny polkari joins me now to talk about that. we got what we wanted from europe, kenny. i was a little bit surprise thatd market wasn't able to extend its move to the upside more. >> you felt it right away this morning, right? we did. we challenged the highs 2010 on the s&p. but then i think what ends up happening is that after they start looking at it and they pull it apart and digest it they really wonder, a, is this going to solve the problem number one. and b what does it really mean? has the market run up in anticipation of it? there is a whole lot more up side here at the moment or does the market need to come back and churn and build more of a base around the 2000 level. and i think that's just what you see happening. because once again, we're not getting explosion in volume, which would really be indicative of large asset manager kind o

it is cheaper than ever for banks to borrow from the ecb. draghi and announced another student is measure. >> in addition, the governing council decided to purchase private sector assets. the euro system will purchase a growth portfolio of simple and transparent asset backed securities. >> that means the ecb will be buying up loans and bonds but the measure has been criticized in some quarters. if those loans are defaulted on, it is european taxpayers that will have to cover the cost. >> the decision to cut interest rates took traders and analysts by surprise as well. >> the ecb's announcement boost the stock prices all over europe this thursday. the euro plunged downwards, of course. if investors get even lower returns in the future because of the interest rates being so low, this makes other currencies more attractive. besides this, the ecb's policy is controversial discussed on the trading floors and many people doubt whether lower economy in the eurozone needs to get back into gear. thanks have even fewer excuses for not lending to the r

so the ecb only wants to buy the safer slices.es available to the credit hedge funds that typically pump up the credit boom and leaves the bubble elsewhere. so this will lead to more risk-taking behavior because the ecb will be hording the safe assets and that means the riskier assets will be more attractive with price. >> i'm interested as well, brian, you made a point in one of your notes that credit issuance in the u.s. has continued to surge. does that mean that the monetary policy used in the u.s., quantitative easing, has in fact worked with the balance sheet very strong? >> the company balance sheets are improving and the quantitative easing has helped a little bit. the main driver of the u.s. credit boom has been the fact that our pensions are trying to reach for 7.5% return, which is crazy in a low-rate environment. and that means the credit funds they hire, they mimic long-term capital management from the 1990s, that they buy incredible amounts of corporate bonds. last week was the labor day holiday in the u.s. marking t

we will wait to see what the ecb does later on this week. the story is more focused on what is happening and eight dollar rate on a tear at the moment. people will be paying attention to that data and trying to and works how it fits with what the ecb will do next. story out of asia is japan doing well. the data was more positive than anticipated. income.s is on fixed that will be the story for here. there was an interesting piece talking about correlation between the fed and the bond market breaking down a little bit all stop -- a little bit. important than the u.s. data. whened seems to be timing the first hike will come through. the question with the inflation story we are moving towards. happening onsports the ground in the ukraine. story, what central banks do, the liquidity, it is important for investors and we will work our way out of the program and in to the ecb. two may balance each other out. it will move the market for. interestingly enough, it provides bond markets, the surprise out performer of the year. it turns out that bonds

is the ecb running out of options? number one byed institutional investor magazine as top global strategist. you are watching bloomberg "surveillance," streamline your tablet, phone, and bloomberg.com. ♪ >> coming up, later this morning newly minted nba commissioner will be joining "market makers." stephanie ruhle will be speaking with adam. he made bold moves in relation to the l.a. clippers and the former owner. adam silver at 10:00 a.m. this is bloomberg "surveillance," i am scarlet fu with adam johnson and brendan greeley. tom keene is off today. >> unprecedented. >> it is so rare for this man to take a day off when it is not christmas and new year's. >> for family. growth problem, gdp is flat. it also has a jobs problem, unemployment is still at 11.5 percent. the question is whether mario draghi will present a viable solution. was lele of deltec institutional investor's number one global rank strategist. draghi's new bond translate on theght translat ground? >> there is a purchase program of asset-backed securitie

ecb meeting is it's serenely important.is when mario draghi explains how they will reach the target of 1 trillion and how long it would take. how exactly it's going to be and how they're going to develop the market, who will guarantee it? all these are important questions, and what happens if they don't meet the target? likely yes because it will increase the chances they will consider alternative measures. thank you. >> thank you for coming in and joining us. we were bring you more insight into what may be -- world biggest share stale share sale, alibaba. stay with us. we are back in two minutes. ♪ to> welcome back" to "countdown." that was a stronger dollar. the interpretation of the forecast for rates a more hawkish time driving the dollar higher across the board. check out euro swiss. there is going to be a big talking point. 0 against-- it is 1.2 the euro. a lot of people talking about the swiss national bank responding. a little bit less pressure. we are at 1.21 against the euro. meetsiss national bank today. will the

data and ecb. major market move, what we see in currencies this morning, let's bring in nick, the head of currency strategy with wells fargo. nick, a rare treat i lead off with currencies, but a 1% move gets everyone's attention. negative on the euro, does this mean that that move has further to run? >> well, i think it has further to run over the medium term. the contrast between the u.s. and europe is stark at this appointment. the economic performance, the recovery that you mention in the u.s. versus the slow growth in europe, and, of course, contrast on monetary policies. we had a target of 127 in 12 months. i think the euro could be as low as 122 and 124 in 12 months, but not 100% sure there's downside just right now. >> what's going to trigger that? the full-blown quantitative easing as steve mentioned draghi left the door open to? >> important for the near term. the ecb spent the monetary ammunition and measures you mentioned, so it would depend on whether they do the quantitative easing. i

>> i do welcome the efforts of the ecb.i think they've been very accommodative to the economic recovery which we so badly need. and the main key issue for us ministers will be what should we do, how can we step up our efforts to take advantage of the time that basically the ecb is giving us. >> so it seems that the ecb got the message that now they can deliver further, but it seems to be limited now in their firepower. so now it's up to politicians and it seems that they have got that message. i'll be trying to speak to more finance ministers during the day and keep you updated. >> thank you very much, annette ta. head to cnbc.com for more with that exclusive interview with the bank of finland's governor. >>> now, edmund shing is joining us live from paris. we've been talking about the ecb's most recent set of actions. that pushed bond yields very low, but cash yields very low. and i was reading in your notes that the savings levels in the uk, u.s., germany at record highs. why is that when yields are so low? >> that is an

the same sort of political pressure on the ecb. greg -- >> greg, thanks for joining us. let's stay with the french angle to bring you a bloomberg exclusive. we have been speaking with the ceo of havas. mark barton got his reaction. >> i think the euro is a good question. growth haveopean had a bad surprise in their regions. question.e broader the euro is slightly going down. inbe we will have a surprise the coming half. for sure, we have had an impact on every other european-based group. , one of europe's top stock gainers. first-half revenue beat estimates. more from our exclusive interview with the ceo of little later on "the pulse." let me bring you another exclusive. we have been speaking to the ceo of pierce chrysler. -- fiat chrysler. sergio marchionne says the merger may take place on october 13. >> the run out. bethe run out period will october 24 by our calculations. it happens to run into a weekend where there is a transfer of systems. the mug likely date for a u.s. listing is october 13. >> the ceo of fiat chrysler, serg

aying ecb >> it is more of a recovery in spain. bondyou have got spanish yields approaching 2% they are not going to get much lower. >> spanish bond yields approaching 2%. the euro dollar keeps on slipping. a lot of people think that is going to help the economy. it helped japan. ?hy would that help europe >> japan made some big mistakes in the banking sector. i think the ecb has learned from mistakes. they are taking a different course of action. partlyas an economy because of demographics of japan. they have an aging population and don't allow immigration. europe might have an aging population, but it does allow immigration to fill in the void. >> thank you for joining us. stock calls. i am going to hold him to that. coming up we are moments away from the latest pmi ratings out of germany. we will bring you the biggest as soon as they cross. 1.2857.lar, you can follow me on twitter. we are back in two. stay with us. >> welcome back to bloomberg -- "on the move." your looking at german manufacturing we were looking for 51.2. servi

the question is can you fight ecb where european stocks are concerned. they have bicker problems than we do. they have negative growth and far higher unemployment in places like spain. there is some question will ecb has as much regional domestic power as the feds domestically. to really fix a problem, you probably need a lot of policy and fiscal changes, what's even more astonishing if anything could be is the fact that the european markets in many place are trading at about the same multiple as the u.s. ones. they are trading about the same price as the ecb. >> at this point with the big currency moves, would that be a head wind for u.s. stocks and a tail wind for european stocks, therefore, tipping the favor maybe to europe. >> the dollar it had made exports tough here. that's the flip side, you have to think about u.s. multi-nationals. we have been talking about it. there are these new highs and under performers like mcdonald's can't get out of their own way for good reason. i will fake issue a little bit with what you said. if you don't fight the fe

looking forward to the ecb meeting on thursday, expecting perhaps more easing. the ftse 100 is down just below flat. germany is off 0.1%. france is off about 0.5% and italy off a similar amount. let's look at individual stocks. rbs shares have rallied, up nearly 4% after the state-backed lender that has expected losses from bad loans to be significantly history than previous forecast. the bank said it will release 800 million pounds to have a lot on bad loans. a different story, alas, for a similar amount. rbs is up 4% which has slumped to the bottom of the index. this after the warning it will lower its index unusually warm weather continues. >>> shares off italia off 0.9%. lufthansa, another strike today as a dispute over benefits continues. annette joins us from frankfurt with the latest. >> yes. departing from frankfurt, the rest of the flights are departing with pilots coming from management. so lufthansa management is struggling to keep the operations ongoing. it's really seeing the opposition of the pilot's union to management plans to scrap early retirem

eurozone inflation as well as the ecb meeting.hat i want to talk about is whether the ecb can get that balance sheet up. how do they do it? >> it is not going to happen in a harry. the best they can do with the asset purchase program is less than half of the 400 trillion euros. q1 whento wait until deflation is much nearer to zero and they will be forced to start doing the qe. if you look at the underlying interest rates in terms of the qe and all that, you are still running very tight monetary policies relative to the u.s. we consider the growth differential is favorable to the u.s. because the ecb hasn't done enough. >> very quickly, european equities, back end of the year, higher or lower from here? markets are all about discounting the future in terms of how fast the qe it is going to come. a lot of the good news is already in. i would have thought we are more than fairly priced for the short term. typically, the short-term holders of this are going to be coming out of this rather than buying extra at the margin. we expect a d

draghi, the ecb president, said he would do whatever it takes. cut through the noise, what does that mean? >> he is trying very hard. companies have tried hard themselves. we have seen falling prices reported in the surveys. a half yearsn without any material acceleration of demand, and we are still facing a consumer sector troubled by debt and also will most -- and also almost no wage inflation. stays with us. stocks on the move, air france gets its signals crossed. the french transport minister says they have scrapped their plans for the low-cost carrier. the comments go against what air france says. they say that is premature and the stock goes higher. we're also watching rbs. the ipo less than what they wanted, their stock down .4%. ♪ >> welcome back to "on the move ." i'm jonathan ferro. ipos, rocket internet has almost doubled the amount they are seeking in public offering. they are now targeting 1.4 billion euros. they could become germany's largest public offering this year. hans nichols has more on the story from berlin. what is behind t

you know, certainly it will depend on the ecb.a quite exciting month with ecb coming out and we have the fed coming out in september. i think that i would say people should be fairly cautious in common bonds going into september. >> how significant were the first split votes we got from the fed and the metropolitan committee in the u.k. when do you think rates will start to go up in those countries? >> it is certainly not a 2014 event. it is most likely, we could see bank of england move in the first half, i would expect the u.s. in the second half, but it is very important to look at evaluations. the fed, you looked at the meeting, the average ofnc members was 2.5 for the end of 2016. the market is only pricing in 1.7 at the end of 2016. and now that the fed has become more hawkish with the data continuing to improve, it is very important to watch the new forecast at the end of september. >> what are we buying now? broad anything it out including the entire scope, argentinian bonds, greek bonds, let's throw it all in there. >> yo

a little more progress in the middle east, and you also had today's ecb which was far in excess of what anyone expected and the markets can't hold the rally. i think markets want to go lower even though i'm generally quite constructive. you talked about whether this is a u.s. weight dynamics weighing on this. i think it is. you had a non-manufacturing ism where we were, payrolls well north of 300, a number on friday, a place where i think alo of people think the fed is well beyond the curve, i'm one of them, so that's the dynamic here. >> right. >> i think markets have had a couple of great event, and i don't like the way they are trading. >> also have the jocks report that could come out. that could possibly be more reason for the fed to sort of pull pack a little bit more and there was some talk. an interesting note out today saying there would be more pressure in the euro against the dollar short term and they believe that the considerable period language could actually be taken out or pared back come the september date. >> if you're bullish for bonds, which i still am, this has been

don't necessarily want to fight the ecb either. it's going to take time, though, to see stabilization in europe. so if you want to pick in europe and buy a little in europe, that's fine. i'd rather buy u.s. companies out of exposure in europe. in terms of bond call, absolutely. >> do you sell? >> tell you what, if you think rates are going to go higher gradually, not spike higher, yeah. you want to still own stocks. the reason, the u.s. economy shows improvement. this week has been impressive. last week, impressive in terms of the ism, pmis and manufacturing, 2.3%, that's huge. i think the economy can handle higher rates. the stock market can handle higher rates long as it's gradual. >> the points i got from our conversation, it's that, again what i've already said. that there's a belief among, i think, you know, the people like tepper and maybe others, that stocks and bond yields can actually go higher. your thoughts in a second. michelle, give a quick thought on what we've spoken an now and bring in jim o'godfrey on the other sid

that is the only tool the ecb has.theyging are moving away from the rather arbitrary fiscal policy objectives they set for 2016. think there is a desire to spend more on investment and infrastructure. austerity was a double-edged sword. it was too restrictive in the context of a weak economy. much less report -- support from the smaller amounts of fiscal consolidation that they have planned. i think that is a good thing. >> [inaudible] >> i think it goes beyond europe. what i saido earlier, the claimant has changed. there is no longer a desire for more austerity. interest rates have not shut up. they have not been what you would expect given the increase in government deficits. a little bit more spending on infrastructure. we all want motorways, hospitals, schools. >> the problem is where is the money going to come from? they're struggling. mire.ly is still in the -- italy is -- >> ireland is coming out well. >> economies do bounceback. we are all looking to policymakers all the time for control and part of the economy

of course, ecb on thursday.l 300 is a good gauge of stocks around the world currently trading down by 15 points. similar story when you look at the individual european markets to see that it is red across the screen with the ftse mib down 164 points. the cac 40 down 16. the xetra dax down 21 points. the ftse miz down .79% ahead of the ecb meeting on thursday that will be a market mover. >>> so how do you make money in markets like these? here's what the experts have been telling us this morning. >> if we see bond yields rise, i think the risk premium is 1% too high, meaning we could see the u.s. equities trending in 17 times, plenty of upside to the market. >>> i feel like i am more progressing on the potential companies who are growing as leaders in regional, not just in one country. the hang seng also gets a lot of chinese companies. they are doing very good in other asian countries. >>> the u.s. dollar has had a very, very strong run here as of late. and money's moving into treasuries because based on a balan

>> don't effect, the ecb -- under the ecb, they cannot buy sovereign debt in the primary market.nes buying the debt, everybody asking the question, why are europe pine rates so low? they're so low in the sovereign debt market because it's all the individual regional banks and local banks in europe buying their own debt. spanish -- >> stop there. keep it easy. spain buying their debt. when they buy it, end up getting a valuation from their central bank. here's a pile of ten years in spain i'm holding as the central bank. whether or not you think they're worth the price, full collateral benefits at the ecb? can't they? >> no -- >> who's the next end up owning this stuff? >> the ecb will eventually have to -- >> is that a good thing? >> there has to be a cosigner. somebody to give credit to make that doable. >> let's say that all of the people that aren't kicking the tires on central banks being in the twilight zone, at some point say they win. we have 4.5 trillion in treasuries. ecb has trillions of dollars of asset backs and win. inflate or die. inflation goes up. what happens to

both in the u.s., and as you said in europe in terms of the ecb.n the u.s., jobs will finish the week on friday. we're looking for 245,000 for job growth which would match the three-month moving average. it's a bit above the consensus forecast but we think that the early indicators on labor market all have been healthy. in the sense that initial jobless claims have continued to come down hovering around 300,000. the consumer confidence numbers were strong, in particular labor differentials narrowing as more people are saying jobs are plentiful. the manufacturing data has been very healthy. and that's suggesting that we should see continued hiring in that sector. so to me i think that the jobs report should provide one additional and important piece of information that the economy is, indeed, continuing to grow and continuing to expand. which is absolutely critical for people when they're thinking about the rest of the second half of the year. >> okay. let's get back to mike. mike we cut you off in the middle of that. but what do you think happens f

the ecb is where we are going to be looking. >> what are you expecting, james, from the ecb?et some big announcements on quantitative easing? were you expecting -- what are you expecting? >> is a bit of a balancing act for the ecb. mario draghi has put these measures into place. we have not seen all of them, the results of those. we haven't seen what they are going to do. what will be interesting is mario draghi has to keep the tone of, we are acting to solve the problem. i expect tomorrow, not to see the quantitative easing announcement. i would be expecting to see some kind of rate cut again. thet just to say -- we know small cuts, when the rates are so low, they don't make too much in the way of a difference. when we are looking at dragon he low inflation figure higher. what they will do, by cutting the rate again, it will show we have the measures in place already. we have cut rates already and we will cut them again now. we are oking to do qe as we go through. it will be a case of, look, we are still looking at this. now is the time for quantitative easing. this is a mis

is this a proxy war being forged at the ecb? >> i think that is an important point about a more pro-german government. i don't think there is a lot of difference between hollande and vall. it is not worth picking public .ights with the germans it is better to try to do it more and close doors and at summits. that is more the hollande-valls approach. think policies have changed, i think it is a question of tactics and how to deal with germany. >> thanks very much indeed, greg from paris, a bloomberg exclusive, speaking to the ceo of havas. his reaction to the french prime minister's call for draghi to weaken the currency. >> the euro is a good question. there has been a bad surprise due to a very high euro. it is a higher question. shown thateks have the euro is slightly going down. maybe we will have a good surprise in the coming half. for sure, we had the impact in every other european group. >> great interview, i will play you more of it later here on "the pulse." let me bring you another bloomberg exclusive, speaking to the c

europe has been trading flat all week ahead of the ecb meeting. and it's now having opened slightly up, it's now up 8el 0 basis points. quite a big jump in the last 20 minutes, as you can see. that following that weaker than expected pmi data, if we look at individual markets across europe, it is that same story that i was saying. much, much stronger in the last 20 minutes. we're now going to have a look at some individual stocks. hermes is moving sharply lower, down 8%, that will see lmh deliver all of its stock and it's similar. the iconic handbagmaker has been trying to prevent this. as a result of the deal, lvmh and its subsidiaries agreed not to buy any stake in hermes for the next several years. hugo boss is off about 5%. now, danone is up about 2% after the chief operating officer has been named as the new ceo, emanuel faber. from october, frank ribou will be flipping his role after 18 years at the realm of the consumer giant.. those shares have been under scrutiny as health food baby sales have dropped off in china. there's slightly less m

next tom, i want to start with europe where bond yields are falling once again, below zero on that ecb stimulus. ireland of all places where manufacturing numbers are the highest in the world. >> so bono is staying the irish government money. >> i think bono has has money somewhere else. u2 -- >> that i had not heard. >> i am informed. >> some other nuggets -- germany where industrial output rose 1.9 percent. germany is totally detached from the rest of europe. here in the u.s., i have got three words for you -- jobs, jobs, jobs. it was actually up from last month's 6.1%. 230,000 new nonfarm payroll jobs are theory being created. no earnings of note that we should mention, but president obama is speaking at 1:00 in wales at the nato summit. >> incredible report and we will talk with that in a moment. let's look at stocks, bonds, currencies, commodities. the 10-year yield higher over the last couple of hours, 2.4%. euro.euro, currency depreciation in europe. onto the next screen if you would. the vicks 12.64, the dow still over 17,000. i put the spanish tenure over this is not a good re

the ecb would like it to be bigger.are going to have to find another way of forcing it into the system. we will watch euro-dollar and little bit later on. let's look at what else we are watching today. now by ourd international correspondent hans nichols. he is in berlin were later on, the french prime minister will be as well. what is the subject of conversation going to be? >> spending. they are having lunch. my most important question about the lunch that they will have today, how long will it be? is this going to be a short working lunch with a pick through the agenda or will it be a long, leisure, more french lunch? that is at the core of things. he would not change the 35 hour workweek. germany wants france to get more in line with structural reforms. about 4.4% of gdp on deck for spending this year. the question for merkel is, can makee flexible and can she an exception for france? there was a broad recognition within the german political elite that france needs to be put in a position to succeed. notharshest aus

tomorrow we have ecb and europe's banks fund a lot of the emerging markets, what's your view if the ecb does qe or hints on that, how will that impact emerging market stocks? >> well, i show, i'm a bit of a cynic on qement qe 2, qe 3 were very poor performance merging market equities him i'm not sure qe is the big story for us. i think where investors are much more concerned is when the fed starts to move short rates. now, with regards to the ecb doing something, then it probably at the margin will be more useful for greece and then turkey, due to their proximity and linkage with the european financial system. >> all right. you have recently upgraded brazil. so you are recommending that investors jump on the rally that's already unfolded? >> yeah. i think there has been a number of important factors for brazil this year. one, the price of borrowing for emerging market companies has been falk the simby yield versus come down. you've had currency strength in brazil. we've seen very strong flows into em-fixed income. that helps brazil. we also got the hope of policy change with the most re