a big week for mario draghi.e will look ahead to today's inflation and unemployment numbers from across the euro area. stay with us. ♪ mark: let's get the bloomberg business flash with nejra cehic. nejra: takata has ruled out bankruptcy. that is according to a person of knowledge. they say the company is instead seeking buyers to take a controlling stake and carry it through its process. -- findingstood that a suitor by the third quarter. jaguar land rover is helping to put cars with motors and the fast lane. thanks to the luxury brands sales. it -- it is cautiously optimistic about global growth. a new model drive's sails in the u.s. the airbag scandal may affect about 100,000 of its cars. it is put aside almost wanted to million dollars for repairs. the new york post is reporting that deutsche bank has emerged in a probe. the paper says no bank has been accused of any wrongdoing but investigators are narrowing their focus after requesting documents and communication from .ll of the 22 primary dealers deutsche b

it is not just something that mario draghi can do. francine: sharon bell from goldman sachs.e will talk a little bit about oil next. we also have the chart of the hour. brent crude trading over $50 a barrel for the first time in six months, as u.s. oil stockpiles dropped more than forecast. that will be our chart of the hour coming up next. ♪ francine: welcome back to "the pulse." emergency mark -- emerging-market currencies -- topping $50 ade barrel. rejoining us a sharon bell, from goldman sachs. we have our chart of the hour. this is what we looked at what we came into the newsroom. this is the spread between high energy bonds and treasuries. a sickly this red line -- bas thely this red line is distress level. anything below 10 basis points, means they are healthier than if it is at, for example, 1.8 or something like that. this is oil at $29. and this is oil at $49. us? does this tell a lot of companies which may go into administration but are at distress level, get an easier time if oil goes back up? sharon: oil prices doubled over this period. it's a short period. in th

mario draghi likes a five-year five-year, this is the five-year forward.he price of oil five years forward. wti up 21% this year. five-year forward pricing is down nearly 3%. so the elongated part of the market is reflecting that lower for longer. suction said that the market -- socgen said that the markets got slightly ahead of themselves. this all comes back to the point that $45 is a self fulfilling prophecy. off go this brig it's in shale and the deep oil wells around the world. see000 barrels, we will that will come through from the united states of america. when it comes to trying to dig a little bit deeper into the bandwidth on oil, this is a really great way to look at it. a five-year-five-year, you thought that mario draghi had the monopoly -- not at all. those oil traders can be just as smart. anna, back to you. anna: manus cranny joining us with his take on the oil markets right now. jeremy stretch is still with us. manus was talking about lower for longer on oil, whether we talk about oil or rates there is a lot of fx traders to deal with at th

it is pretty good for mario draghi.erman give him some comfort that their policies are starting to take cold. a look at the german retail sales numbers and they were not rate. it is still early days. unemployment data must be the best since post-reunification. if you look at other parts of europe, the numbers are still lagging. it highlights the challenge that mario draghi has. we will be keeping a close eye on the german data and the rest of the data. always great to have you, richard jones. stay with us of course on bloomberg television. up next, it is the pulse coming on live. we will be breaking down more data. matt always a joy to have you. ♪ >> hawkish comments from the fed. janet yellen drives market as the dollar closes on its best month since september 2014. not the end of the road. vw reports a profit beat more than the 2016 sales declined as stock falls. the short on china. as the bearish specs yuan slumps. a money meant -- a one minute slump increases for the volatility. volatility. further ♪

past three years, ecb president mario draghi has been trying to bring inflation back in line with itsandate. -- disappointing inflation news, but there may be some good news on the inflation forecast from the ecb on thursday. >> mario draghi is down to present new forecast in june -- new forecasts in june. growth forecasts will be higher than in march and this will be the best news for the ecb in quite a long time. let's cut to the chase, the last time inflation in the eurozone was anywhere near 2%, was the beginning of 2013. it is going to be a long call back to that level, isn't it -- long haul back to that level, isn't it? would make it in total, almost six years, well below target for the ecb, which is quite a long time. oil is going up and is going to help the ecb's work, but what the ecb really needs is wages and services to rise again because this would make the level of inflation sustainable and stable. let's not forget, this is important because higher foration means it is easier other countries to work down there pile of debt. this is important for countries like italy and g

back in september, 2014, mario draghi said he was going to boost the ecb's balance sheet to 3 trillion euros. back then it was roughly $2 trillion. the aim was to achieve 2% inflation. guess what? the balance sheet has expanded to 3 trillion euros but guess what? yellow line of inflation is , well below the target of 2%. it tells you that milestones are very dangerous in this age where central bankers are finding it area hard to get traction on prices. this is a wonderful charge. let's turn to the egyptair flight which went missing on its way to cairo from paris yesterday. we go live to paris. thanks for joining us. what can you tell us? >> not much has changed since this morning. the breakthrough today is the egyptian planes have cited debris from the plane. they have established it is from the plan unlike yesterday were there were false reports. investigators will go into action now and there are three investigators from france who have gone out there to help egyptians and will analyze the debris. they have no idea how long it will take it they have been very tightlipped. the pieces

i want to point to something -- some mario draghi headlines. he is speaking at an annual meeting and paying that lower or negative rates are not unprecedented and that it is felt all over the world. he says structural rebalancing is advancing too slowly, as if we did not know that and he says that reforms to u.n. institutions is essential to boost demand. he is saying what he has been saying for some time. let's get to first word news. kayla rates is in the newsroom. taylor: bernie sanders says front runner helder clinton will not have at pledged delegates to win the nomination. he is counting on being able to flip some of these superdelegates who are supporting clinton. tomorrow's indiana primary has become a last stand for republican ted cruz. a new poll shows he has some work to do. according to wall street journal, he is trailing donald trump by 15 points in indiana. he is hoping his grassroots organization can counter donald trump's appeal to displaced middle-class workers. a car bombing has killed at least 18 shiite pilgrims commemorating

i was on stage with mario draghi.on't forget, we're here in frankford, with these members, particularly the german, about monetary policy from. and that's taking place. in the backdrop, you've got angela merkel touring around speaking, pressing the case for more german exports. but taking a swipe at supply chains across emerging markets calling for decent sand fair practices. all that as emerging markets come to europe. and talking about the challenges they're facing, depreciating currencies, and you can see the undercurrent taking place across the board. let me just reference this music that you can hear behind me. this is not the call of more central bank action. this is actually japanese music as the annual meeting is going to shift to japan next year. i think one of the expectations has been the chinese bank set up for economies. no one was very welcoming when this bank first came to light, even adb because it was seen as one of the world challenges. but the president of the bank was here yesterday, talking about

coming up, mario draghi reaches and ec be milestone.u that next on "bloomberg ." ♪ years whenn two mario draghi said he would boost met thes meet -- he has limit. julie hyman is here. what do we get for 3 trillion euros? julie: a whole lot of nothing. he said he would boost the balance sheet around 2012 levels around 3 trillion euros. goal is toadded, the spur inflation. here is a balance sheet and the white line. we reached that milestone. it is a problem -- this site is inflation, so now we are looking at negative inflation. the blue line is inflation. essentially, mario draghi has not gotten what he has paid for. crux ofngs us to the the matter and the challenge with central banks -- their effectiveness with stimulus in achieving their goals. david: this is roughly october, november, and december of 2014. it is a huge diversions here, right? counterfactual, this would be lower if they had not done this? julie: you can argue that it is not the ec be's fault. here in the u.s., we should point out that we have seen an expansion of t

strikes against new labor reform measures, beginning with mario draghi. in cann,

strikes against new labor reform measures, beginning with mario draghi. in cann, the parade of hollywood stars continues along the plaza, with robert de niro hitting the red carpet. we begin in vienna, where world powers are meeting to stabilize a shaky syrian cease-fire, while reestablishing peace talks. these are the differences between world leaders. that's cross to our correspondent anthony mills in vienna. what is expected to come out of today? the different parties involved in these talks are hoping that they are going to be cease-fireive apache that has been -- a apache cease-fire that has been shattered and use those patchy cease-fires that will in some ways diminish the violence in syria, and hoping they will use those cease-fires to draw the opposing parties, the assad regime on the one side, and the militants who oppose him on the other toward some kind of dialogue, something that can manage this peace process, if that is one could call it, forward in the direction of the ofe durable absence violence. that is something proving because of the en

it's difficult to get rid of mario draghi. this is why spread concern across -- widespread concern across the eurozone. the understandable given youth unemployment problems. betty: this is behind us. mark: 41% don't know. the probability crunch is still in favor. it's the bloomberg machine. it's numbercrunching. neil: i think you need to check youfuses in the machine think the percent to remain as much too high? i do follow it. it's very useful. that includes the president and everyone else. be a disasteruld during how come the probability is 77% that we will stay? betty: we will come back and debate more. we have more economists like yourself going for brexit. it's good to see you. hotels, shares are jumping on the london trading debut. investors so interested? ♪ mark: you're watching bloomberg markets. i am mark barton in london. betty: this is the european let's talk chocolate. mark: shares her story today on the london trading debut. thestock rose 33% on investment target. is $322e of the country million. 33%. the jew expe

what does commerzbank need from mario draghi?a listen to the chief financial officer. >> we had a difficult first quarter like almost all of our peers. the negative interest rate environment, we have a strong capital ratio. i think the market reaction will be solid. the bank shares are getting hammered today, down by 9%. mark: have a look at what's happening in the currency market. they raised all losses for the year against the dollar. it rebounded 5.5%. up the seventh day against the dollar. u.k. guilds are rising. we had u.k. manufacturing unexpectedly shrinking for the first time in three years in april. the spanish yield is down by a to 1.57%.t there will be an election in spain on june 26. moving from the markets to summer holidays. itsival section is out with travel guide. we're walking through the recommendations. thanks for joining us. it's not summer in sydney. why should i go to sydney when it's winter? brett: now is a great time to go to sydney. the us trillion dollar against the u.s. dollar is at a six year low. in t

growth was better than expected. ,nflation, not so good highlighting the challenge for mario draghi.e inflation is far below his 2% target. today, we will get manufacturing pmi data. at 10:00, we get eurozone manufacturing data. we get some before that for spain, italy, france, and germany. onwill be keeping an eye those numbers and any reaction we see in euro-dollar. right now, pretty much unchanged. itwill be keeping an eye on after the data. manus: no conversation with my european colleagues would be complete without brexit. what is the latest? >> a poll over the weekend show 46% back brexit. 43% favor the eu. the thing is, some of our editors at bloomberg are saying, do not make too much of a big deal about this. online polls show a major divide in phone polls. our own number cruncher has it still at 80% stake, 20% leave. manus: thank you very much, nira. protestersres of breaching the supposedly secure green zone raised eyebrows around the world and raised questions about the iraqi government. andrew joins me now. a warm welcome. ours to consider the implications. talk me throug

you will be a friend to mario draghi for a long time for some stay with me, we have a lot more to get are watching "bloomberg markets: middle east." ♪ manus: welcome back, you are watching "bloomberg markets: middle east." he sultan ahmed is still with me. world, weok at the had some data from china this morning. we know that china is going to this rebalancing. 6.5% is the magic number from the chinese. do you think, from what you have avoided a hard landing in china? he sultan ahmed: we are in china. we ahve se -- have seen growth. china's biggest challenge in my opinion is cutting costs. we have told them we are facing a 20% increase in labor every year for the past seven years. what china is doing is cutting growth. last year, it was the first to the number of chinese entering the job market is less than who exited. danger, it is the about the working population. are you concerned about overcapacity? they don'tbout that have a grip on that overcapacity? he sultan ahmed: they are deliberately trying to. deliberately. they are moving some manufactured from the coastline which is a pl

these things tend to have that much of an impact but when we look at uncertain times and what mario draghi may or may not do, it may. 111.44. stay with "the pulse." in half an hour we speak to the president of the ifo institute. let's check the markets. this is a picture for worldwide markets. global stocks rallying with some of these emerging-market currencies. i want to show you yuan and the 10-year greek bond. we have an agreement, not on debt relief, but the european governments will disperse some money to greece. that meant the 10-year greek bond yield fell below 7%. now creeping a little bit backup. let's get straight to bloomberg first word news. nejra: the ceo of unicredit has agreed to step down after almost six years at the helm of italy's biggest bank. after his efforts to improve capital and revive profit -- lost its supportive investor. he and the board agreed there was a need for a management change. bayer says it is still optimistic in pursuit of monsanto will succeed despite the $62 billion bid being ejected. share offerys $112 a does not address the execution risk of the d

. >> what i would like to know is how do you hold 42 billion euros of debt to the policies of mario draghind other central bankers? you have the gift of free money. what happens to this transaction if interest rates go up? all, were looking at a well blended financing structure. generateability to free cash flows and the ability to also d lever. that is a coreng element of prudent financial policy and you may have seen the statement of standard & poor's and assessing what the financial structure and balance sheet of bayer is going to look like going forward. we are very pleased because it is an indication that were going to have a very solid investment great rating going forward and gives us a chance to obtain an excellent business profile for rating purposes. shery: if monsanto rejection offer, do you have the capacity to increase the offer? >> will totally convinced about the attractiveness of our offer here if you look at the fact that it's a 37% premium over and of mayhe share price as 9, that's a strong testimony to the value of the position for shareholders. the also in line with tra

francine: what can mario draghi due to counter that? by equities? -- buy equities? much firepower does he need to put behind it to play on currencies. andreas: i think they have run out of power, to be on this, the central banks. it will be less effective whatever they do. both in terms of market psychology and in terms of real economic impact. francine: where do you see the most value in terms of regions? do you look at it like that? andreas: no. spread product. it is liquidity premium, for example. term premia. it is currency. it is not where the market was. francine: thank you so much for now. he stays with us. we'll talk a little bit about brexit and the u.k. and sterling next. the u.k. is not hiring. that is the forecast for this morning's unemployment figures. we break those down next. we look at the applications of brexit. this is the cloud -- like you can see over st. paul's. ♪ francine: welcome to "francine: the pulse" at bloomberg headquarters. u.k. unemployment. a low unemployment rate in line with expectations, weekly earnings a touch weaker than expecte

what if mario draghi's whatever it takes really is whatever it takes? milton: if it means hyperinflation in germany, stocks will do well, but not relative to the rate they will create. stocks are beginning of their markets. -- itl terms, and not could be a 3000 present in the next few years. eric: there is no inflation. milton: your question was what is draghi had to do that? eric: we have not seen any -- it is extraordinary. milton: there is so much credit in the system. disallowing people to borrow more and more money does not help the system. -- it causes a greater bubble. when i got into business, there were many bubbles. each individual had its own trouble. united states inflating a bubble while germany was deflating. is one big bubble. all of the central banks are in unison. so when it pops, it will be terrible. eric: pretty terrible means what i don't know the answer. it is one of two major things. --her acceleration in place or they will turn to real inflation, which is no printing. helicopter money. it is disastrous either way. eric: a lot of p

a little bit about yen strength and i guess yen gets a little relief from fed policy, as does mario draghien you look at the fundamentals underlying abenomics, is it to zeus soon to call it a failure? jane: you can look at japan for 25 years and say where are the successes. this is a big problem that carries on. there's been lots of disappointments with abenomics. it is about slow growth in much of the developed world. term,k for japan, nearer i think a lot of the questions will find their answers in china. japan's largest trading partner and for the yen, i think china is going to be crucially important. the dollar has gotten a little stronger recently. mechanically, we get a left. a sign of relief maps to the authorities. i think we also need to be looking at the levels of the andinbi relative to the yen the levels of the renminbi overall. not only that, we've got to be considering confidence in china, global growth, and the fact that the yen is a safe haven currency. francine: what happens to renminbi. we've convinced ourselves they won't devalue. soon perhaps we were too in assuming tha

you've got to imagine mario draghi's frustration here. >> absolutely.s the trillion-dollar question for everybody. how can they do more. the european banks are unique in the sense they're financing major financiers of the commodity boom. most is coming from the european bank nchl the world they're a unique type of species. now, ubs in and of itself, you can refer to several other things. they're horn't. their wealth management was horrible and they didn't say it was getting better, so the operating environmental for financial firms is just terrible. there's no growth driver for them. so this is not surprising. and even if the ecb does something more, i'm not sure it's something that file turs like ubs. >> it comes back to the u.s. banks. so much of that was predicated operates going higher. now they're kind of casting around for direction. >> only predicated on that. i know everyone has another story that they're cheap and there's other reasons that they look okay. butly say the yield curve didn't exactly flatten tremendously in the u.s. the treasuries

if i'm mario draghi sitting back in frankfurt, my question would be why sit back in time when desperateor european corporate, why not taking advantage of low rates. >> i think fundamental, long-term equities, long-term projects, and a very strong balance sheet. so a very strong balance sheet is extremely positive for day-to-day activities. in addition to achieve our 2020 strategy, we intend to invest in order -- worldwide, also in order to boost our gross acquisitions. so for the debt situation, it allows us to take the balance sheet to improve and further accelerate our strategy. >> does that suggest you expect to take on more debt through as you step up that investment? >> i think that is a possibility to invest in the coming years. either in this or to invest. >> what does this level of investment mean for your margin, you talk be about innovation, trying to meet the demand of countries looking at your fuel efficient and innovative products. what do you expect for margins going forward? >> well, looking at 2020 a margin of 7,000. we have moved this year from 12.8 to 5.3. we're leanin

so they are able to turn the taps on much easier than the japanese or indeed mario draghi or janet yellenat's really what's going on. soros is printing a weaker yen because of the size of the monetary base, nearly the size of that of the united states. manus? manus: thank you very much. anna edwards and i will be back in just under a couple minutes. the dollar -- what happens next? our guest joins us for "countdown." stay with oil is on the rise. expanding wildfires in canada knock out one million barrels a day of output. saudi shakeup. the kingdom replaces ali al-naimi with khaled al-falih as its new oil minister. he promises to keep pumping in a bid to break the -- and channeling churchill. david cameron speaks of memories of the wartime leader as he presses the case of keeping britain within the eu. a w

when i would like to know is how beholden is your 42 billion euros of debt to the policies of mario draghither central bankers. you have the gift of free money. what happens to your company? what happens to this transaction if interest rates go up? look at af all, we well blended financing structure of securities that align with our ability to generate free cash flows and with it the ability to also deliver. that is something that is a core element of prudent financial policy. you may have seen the statement of standard & poor's of what the financial structure and balance sheet of bayer is going to look like going forward. are very pleased because there's an indication that we're going to have a very solid investment grade rating going forward and also chance that we will have an excellent profile for rating purposes. >> if monsanto rejects your offer, are you ready or do you have a capacity to increase offer? >> we are totally convinced about the attractiveness of our offer. it is a 37% premium over and above the unaffected share price as of midnight. i think that is broad testimony for t

we know that mario draghi and the ecb are going to do whatever it takes.n the meantime, it means time for the policies tort. we will see how that progresses through the summer and comes back to q3. mark: good to see you on the other side of the pond. betty, be nice to him. cook atok, -- jeremy world first. shares of royal shell next. the company beat on earnings despite oil prices hovering in the lowest levels in 12 years. why are shares falling? europeanook at how stocks are faring 10 minutes ahead of the wednesday a similar story to what is happening in the u.s. today. the stoxx 600 is down by 1.1%. ♪ mark: you are watching "bloomberg markets." i am mark barton in london. betty: i'm betty liu in new york. this is the european mark close. mark: shells acquisition is starting to pay off. first quarter estimates beat encounteringr record low crude prices. ryan chilcote is chomping at the bit and the chief executive will be happy that the peg acquisition is starting to pay off. ryan: it had its doubters and skeptics. $54 billion sounds like an awful lot to p

in terms of favorable, you'd want mario draghi from of the ecb finally be saying, look, he's an oliveranch. we're not going to punish you if you don't lend. but the 40 basis point rate is about as favorable as you can get. he's basically saying we'll pay you and just die little lending to the economy. >> to participate is the question here. >> while we have you with us before we say good-bye, a brief glance at another chart as well. this is the euro high grade market size. that's just going to continue to grow, increase? >> if our view of animal spirits being unleashed on the corporate side is correct because as their program ends we're looking at a doubling, i think, of the credit market in five years. >> that much? >> yeah. >> what does that amount to each year? >> 2.5 trillion growth. about 500. but the u.s. market told us that these things happen. i mean, this isn't a dream. is this say reality. >> and u.s. corporate spending, that pulse, is higher than europe? >> the u.s. has picked it up and done what they should have done understand a policy world. our corporates in europe have

production >>t in is mario draghi going to pull something else out of his endless bag of tricks? the last several months, go back to february, there is the idea that there was a second accord and central banks have become concerned about the strength of the dollar. i am notion since then expecting the ecb to make a dramatic move this week. >> let's move to story number two. investors were rattled after a one minute, 10% drop in the chinese futures index. authorities are not sure why it happened here this is the second time this month markets have seen a swing like this. what happened. of just how a sign rattled investors are over china? >> i do not think it is just china. we have seen these things around the world in different markets. august with dow futures opening lower, futures being down 1000 points back in august of last year. it is not just the chinese market. it is global markets and the lack of liquidity in the number .f market participants individual investors need to be careful about placing orders in any market around the world before the market opens. >> you mentione

interest rate policy here and in asia are not -- is not helping the banks policy regardless of what mario draghi may suggest. these lawsuits, they have paid up $14 billion since 2012. that could get bigger. john cryan has said that is one of his main focus is is putting a stop to one of the big losses this year. first quarter profit fell 61 percent. when we were here last year, john cryan said he may have another loss this year. a second annual loss, there are a lot of problems facing him. the most interesting thing will be sit -- will to see -- if we get a turnaround in the slump and if this zero interest rate policy actually is helping banks as draghi has suggested. guy: matt, thank you very much indeed. remember we are watching unicredit today. will he be there at the end of the day? coming up later, we are going to be talking in an interview with berkeley's ceo, just daily -- -- jess ceo, just daily staley. got-- we've problems at deutsche bank, germany's biggest bank. we need to get this fixed. how far away are we? moody's is concern that it is going to struggle. jean: it is all about the e

i think mario draghi is having a freakout, too. >> there are those that make the argument that the jobson of what the economy is, and not the gdp. >> yeah. you hear that. i think the other thing is, just going back to what robin was talking about, i think it's interesting, because we had such great paper telling us about some of these metals, gold, silver, some of these obviously a reflection of the dollar. it's really interesting. we have not seen that continue the way we have. that sort of dried up. we've had this great run. are we going to see those stepped any further than they have? i'm not so sure about that anymore. >> do you think nathan definitely makes that shift over to the telestrator? >> i think he makes it. he's a quick son of a gun. >> a flurry of activity in, where else, but the options pits. our boy dan nathan breaking it down. >> now we've seen oil, it's done its in trars are starting to lok the other way as it relates to oil and gas. etfs, today, the s&p, oil and gas etf had options volume trading 2 1/2 times average. puts were four times of that calls. one large trad

at mario when you look draghi, he does not have an easy job.ou look at the euro, qe has diminished and we do not expect any said that the can -- significant move in euro-dollar. that will be premised on if the fed steps up to the plate instead of if the ecb issues more quantitative easing. tom: if the swiss franc's litmus paper for the system, explain that. kamal: we have been challenged slightly in our view that the swiss franc would make some strong gains headed into the eu referendum, particularly as the risks around the referendum are localized but what we are seeing according to the data that swiss equity funds are showing outflows. we think that could be driven by the forthcoming ecb corporate sector program where according to our credit strategists, we are seeing significant inflows into the investment grade world. against a backdrop of a swiss economy is still in the throes of deflation, where growth is still very mediocre, and of course where we have negative rates. that is the opportunity to invest in investment grade in europe is qui

mario draghi has been very bold to draw a soft line underneath negative interest rates.een toe ecb are not have a stronger exchange rate, there's very little they can do about the fact that this is a market reluctant to take risk, even with the taxation of savings through negative interest rates. the concern is coming very much through the fact that in a world of negative interest rates, you don't have incentives to generate more productivity. you are creating incentives for exploiting operational leverage. when that is the case, unfortunately currencies like the yen and the euro tend to bear the brunt of the dp creation -- of the depreciation pressures. you can create a negative feedback loop. this is a very hated stock market recovery. nobody wants to take the risk. guy: we will talk about savers as well when we come back. let's talk about what is happening with this open. we are 10 minutes away. looks like it is going to be a positive one. it is a big week for earnings in germany. we need to tell you all the companies you need to pay attention to this morning. lufthan

anna: so mario draghi, reiterating comments that we need institutional reform in the euro. to berlin, where european democracy founder joins us now. great to have you on the program. you are the author of the book "why europe needs to become a republic: a political utopia." good to have you. i want to get your thoughts about the criticism we are having of ecb at the moment. obviously germany is fairly critical of them, criticizing the ecb. the french government, not so much. you make the point in your notes -- the french and germans are not on the same page on the number of issues. >> well, on the ecb policy, there is a growing unhappiness in germany with low interest rates, which is cutting down savings, which does not make savings attractive for germans. because saving is a big german this is the ecb policy that germans dislike; and you are right that the french do not have the same philosophy on this. weh respect to the eurozone, have been struggling to get a meaning oncal union, budget and fiscal policies and how we manage the euro crisis together, there are a couple of

if you are mario draghi or try to figure out what to do. you would probably like the euro to be a bit lower from here. >> if you are an easing central bank you want your currency to be weak. that definitely helps you and in europe that is definitely the case. the two major central banks this year that have pushed on quantitative easing have had a counterintuitive reaction. guy: so what do they do? >> they carry on doing the same thing and what's happened is that has backfired in the short ,un, but the hope for them because it is a trial and error strategy is that will reverse in the medium term. guy: mohammed will stay with us. up next were joined by the cfo of elian's after the insurer announced its profit dropped on outflows to pimco. caroline: welcome back to a very sunny berlin. this is "on the move." alliance reported -- profit in its management vision did drop due to pimco outflows. joins us now. wonderful to have us on the show. let's dig into initially some of the cost basis we are seeing within the business because we are starting

looking at what is happening, mario draghi and the ecb have talked about the balance sheet to get back is nowhere near complete. how much bigger do you expect the balance sheet to get? : as i was listening, what he is saying is not much different from what the fed is saying, which is we have diploid externa a policies and they have been affected to some degree. without inflation last year, it would have been negative, but they are saying that there is no limit and that some point, the fiscal and structural part of the equation has to pick up in order to create meaningful impact on the system. just in march, the ecb unveiled another program that included expansion of purchases of various assets, and there is probably expectations for more now that immigration the eurozone has been taken down from .5 to .2, but drinking it back to the realm of fixed income, which is where i sit, it concerns me somewhat that markets in europe are priced for nothing other than frankly deflation. when you look at negative interest rates and you consider the fact that you have an 80% surge in oil prices, tha

it is clear that the fed is ready and mario draghi wants to do better.ot talk about it anymore? narrativeimes the follows, other than the other way around. amis one of the reasons i skeptical of a secret agreement in shanghai. i think that now we have them , people will start thinking .gain about parity i think the next big stopping point is the old range. francine: what happens to swissie? >> good question. i think a lot depends on what happens in brexit. most likely we want the long dollar. swiss rate is the could he dragged down by the euro. tom: this is a trend, if i ever had seen it. is this was national bank managing the chart or is there some other story there? managing.ss are points. at -70 basis tom: they have latitude. .apan doesn't >> i think a lot of them are focusing on the japanese. i want to say this. it is not the u.s. and japan. the eu is not seeing japanese intervention either. look at the chart rate. the canadian dollar has strengthened, but canada is not threatening about intervention. francine: what does it mean? you are not expectin

it's mario draghi look at these figures trying to figure out what janet yellen does next. many ways, the fed has a broader mandate. it has a full employment as well as inflation. it has asymmetrical inflation target. it sets policy in the world to a larger degree. this is the magic of home depot. this is the last thing i bought at home depot. this is the dog bowtie collar. that's the magic. michael: they don't have dogs. they are not just selling two by fours. good morning. we will continue. janet henry, thank you so much. michael mckee and i will -- forward with hours of bluebird surveillance this morning. on greece.g ♪ is the new 2045. new demands for greek debt relief. oil continues to move ever barrel the$60 per new $50? on digital as king. this is "bloomberg surveillance." it's tuesday, may 17. with mean is francine lacqua. the may 24 eun, meeting of ministers becomes important. francine: i would argue that it has always been important because we have been following the renegotiations, the bailout, the money and the debt relief for quite some time. in europe for the l

up to now, everybody has been looking to mario draghi and expecting he was ask the economy -- he willconomy. he will make a contribution, but this will not be enough. governments have to act. they need structural reforms with growth-friendly fiscal consolidation. if they can't do that, the recovery will remain slow. guy: very briefly, if i'm a saver in europe, should i be worried? and if i'm saving in 500 euro notes, should i be doubly worried? should the ecb get rid of them? clemens: i think there is no justification for getting rid of the 500 euros note. clearly, savers should be worried, but interest rates are low because the economic situation is still fragile. i think that if europe gets back to growth, interest rates will also increase. nots really in the interest just of the unemployed, but also of savers, to get structural reforms going so that a recovery really comes. fuest, thank you very much indeed. that is it for "countdown." "on the move" is next, with me. ♪ show me movies with romance. show me more like this. show me "previously watched." what's recommended for me. x1 m

mario draghi said as long as needed. the dollars we think is an asset for growth. francine: commissioner muska vinci -- commissioner pierre moscovici, thank you. financial market stabilizing after quite a difficult week. it is a week with the federal reserve said they were moving closer to raising interest rates. it ♪ tom: good morning. bonnie, what do you see -- vonnie, what do you see? vonnie: the company down 10%. outcome is worse. third quarter of equipment sales down 4%. once again, 156 close to the estimate and revenue. chart.is is the dear -- deerehow has been. weaker yen through the week is clearly been the headline. -- mber the day after day rimimbe declining. david, you have a lot going on. david: i want to bring you optimism after a long week. markets are way too bearish. advisor and heal is david that invests over $400 billion. he relies principally on nobel prize laureates. he has a business school in chicago named after him. he thinks stocks are way overrated. that is coming up on "bloomberg ." tom: we

vonnie: do we get any kind of ecb, orhange in the even in mario draghi's rhetoric?oping he will finally tell us how he is going to buy corporate bonds. he has told us he will buy $20 billion a month now. we still don't know how he will pick which bonds to buy. our volkswagen bonds german bonds? they are produced in eastern europe and the united states. is he going to buy volkswagen, the m w, mercedes? volkswagen, bmw, mercedes? i hope he will tell us the secret formula that the ecb will going to be -- that the ecb is going to be. you mentioned world gdp. here is world gdp back 20 years with a presidential four-year moving average. here is the nirvana of the moment before the crisis for world gdp. we came down ugly but we have rebounded. why do we feel so miserable if we have come back not to where we were but pretty close? carl: is that the growth rate or the level? tom: that is the year over year growth rate. levelgraph out the world of gdp. it has not come back. draw up the level of g7 or world industrial production. tom: which is a lot worse. carl: we are down 10

as mario draghi's job worse? >> they all have the same problems but in america, she has the worst job. she is a very competent person and she understands. a lot of people would not have noticed but she is competent. >> there we go. we know him as the author of the black swan. he is a philosopher and traitor and always fun to talk to. >> find the out that skipping breakfast may not be such a bad thing. shares are sizzling after better core -- quarterly numbers. ♪ scarlet: this is bloomberg markets. it is time for the big reveal of our ministries.. let's review the tips here. our mystery pic is toying with the best gain in 29 years. chairs are sizzling after it popped out better quarterly numbers. alice: a commendation of the business and its name. we are talking about jack-in-the-box. sizzling refers to obviously what they do. not serving breakfast, there was concern about competition from mcdonald's serving breakfast. and of course the jack-in-the-box. the company was coming out with quarterly earnings that toppe

the gdp portion, it is more important what mario draghi is looking at. tom: absolutely.ou see the economy growing less in the initial estimate, which gets back to the carney announcement yesterday of a lower forecast from britain. you wonder where the dynamic is, where a economies will pick up in 2016. i have not seen it yet other than the one german item this morning. belowne: a touch estimates. the real question, how much does it have to do with a weaker euro, and how much does it have to do with real growth spurred by economic reform? let's get to the first word news. nejra: you have the numbers from the euro zone as a whole. germany's economy grew at the fastest rate in two years . gdp rose7/10 tense of a percent beating estimates. thoughfset record unemployment in germany which has boosted consumer spending. a report says the european union's naval operation to stop people smugglers in the mediterranean isn't working. lawmakers in the house of lords says disrupting the migrant business is falling short. succeeding in rescuing refugees on the high seas. in syria, the

francine: and also, when you listen to mario draghi, he says i am giving you a government when it willly. michelle: it is definitely -- willem: it is definitely not the ecb's fall. it is the political classes that have continued to do so. no fiscal stimulus, minimal reform, and a lot of talk, and indeed verbal abuse at times of mr. draghi. it is very undeserving. francine: thank you so much, willem buiter. coming up on bloomberg markets, .t is mohamed el-erian that is at 11:00 a.m. in new york, 4:00 p.m. in london. it is jobs day. a lot of the markets around the world are taking it in their stride, selling off a little bit , futures at the negative. ♪ jobs day.it is francine lacqua with tom keene. let's get to bloomberg first word news with nejra cehic. nejra: in the u.k., voters in global and regional elections gave no sign they are ready to defy their leaders and leave the european union. david cameron posco conservative party appears to be on the brink -- david cameron's conservative party appears to be on the brink of picking up seats. extend hergeon will term as they head of their

ermotti of cause a cocktail of macro events, what do you need from mario draghi right now?are miserable. what is the policy action you need to assist your bank? in basics: i think terms, it is pretty clear that for an economy like the german, which is strong in export, is a net importer of cash. all banks tend to have a very strong loan to deposit ratios. a negative interest rate environment with a flattish curv e up to the five years is obviously a very difficult environment. r runningly the job fo the bank is a team at the bank and if mr. draghi changes something in the environment, we have a difficult -- to do with it. tom: thank you for those comments on the sensitive issue of negative interest rates. when we look at the persistencey of the chronic nation negative rates, we are aware of the struggles with italian banking. we are aware of the struggles with medium and small size of german banks. can those struggles come over to commerzbank? are we missing the point that the big banks could have the same balance sheet issues and retail banking issues that the little banks

our markets are handicap and economy are higher rates in europe, they're being depressed, think mario draghiif we're concentrate on tens minus bunds, you can see the divergence. the other thing that's changed is the dollar. let's look at the dollar since the last fed meeting in april. aggressive. now let's look at it sense the minutes just last week. seems to be rounding a bit. expectations may be changing for the nearby meeting and that's significant. david, back to you. >> thank you very much, mr. santelli. let's get a closer look at oil prices, an important component of our mark action. almost of day jackie deangelis joins us. jackie? >> under $50 a barrel now but we did cross that for wti. we're up 35 where is year to date in wti. some of the reasons we're seeing for oil prices to be supported at these level, we do probably have some short covering going into the holiday weekend. typically people don't like to hold those short positions. but also still concerns about those global spupply outages, te canadian supply, what's going on in nigeria. those worries have not gone away and you hav

they used the analogy of mario draghi -- whatever it costs we will protect their dividends.l mean lower supply for the future. that means lower growth for the companies and the global economy. we may have oil supplies that we were not expecting. jonathan: there's a company out this morning -- people asking whether this is a bp moment. i'm talking about php and a big lawsuit. it is 44 billion dollars. authorities in brazil are asking bhp andhp and -- for moneyning company for a disaster when a dam broke. to the disaster for bp. authorities in brazil are raising that parallel. we have seen going after -- chevron for example. the sentiments are much lower than the initial claims. there is some posturing at the beginning of the fight. megan: i want to talk about iran. iran's production is coming up very quickly. we are putting that at 3.5 million barrels a day. that's the highest in four years. it means iran has moved very quickly to recover market share the moment the sanctions were lifted about 90 days ago. it's a remarkable turnaround for tehran to be able to increase product

mario draghi is going to be involved in corporates. it can be involved in a number of ways, whether they have some kind of intersection with the government. what i'm getting at is when they decide to pick the corporates and the whole notion of getting in front of central bank activities, they're going to be mispriced. if they're going to be mispricing europe, they're going to misprice everywhere. the long end doesn't stand a chance. to me, today was a great example. you get a cpi headline, the hottest since february 2013. the yields go up and straight back down. thinking about dell, about corporates, compression in the long end. if there's anything the yield curve tells us, it's what the fed tells us they should do and ultimate lay they don't seem to do and that is, of course, snug up rates. >> i'll add to that, rick, bank of america noting they think the high-grade market could double in size in five years because of the central bank's buying. and then, of course, they say poor lending decisions and misallocation of capital are a conc

all eyes will still be on mario draghi to see what he is prepared to do to get europe to grow at a reasonablehat is the top of mind for you? what is your biggest concern? >> the election of donald trump, does that count. we heard david saying we will get more volatility. >> it would be good for you guys but i'm not sure it would be good for america or the rest of the world. we have an election of enormous concert whence. the one thing this year that will change the world for all of this is the election. what do you think about the fact that he could win question mark >> he has support among white middle-aged working man because they have gotten the stick even during this recovery. when you have a large group of americans who see no increase in their pay after adjustment for inflation, you get a lot of discontent. you see this in europe and different countries. jon: great to have you with us. david is sticking around but steve ratner, thank you so much. the it advisers is investment advisor for michael bloomberg. we'll talk about the u.s. economy and the data in the coming weeks. okay, ready?

you know, when mario draghi announced he would be buying corporates. well, what happened?orporates around the world are going to be mispriced. it will start out in europe ant arbitrage will take us around the globe. dell, being fortified five times over and everybody is looking at watch eds and might price any minute is creating this dynamic. the yield curve is flattening. does it mean recession? i don't know. you know what it means to me if you have corp race. you can't keep them in the showroom. melissa lee, back for you. >> roads, bridges, airports, america is literally falling apart. infrastructure running at 1.4 trillion deficit over the next nine years. today we're focusing on the problem, the solutions and how can you profit. our special report is straight ahead. it was a simple idea. for every pair of shoes we sold, we'd give a pair to a child in need. at&t has been with me since day one, keeping me connected to my team, to my business, and to the reason we put giving first. toms started small, but now we've given shoes to more than 50 million children in need. i'm

mario draghi can't find more securities to print money -- >> the ecb is the most disruptive force forusing everything to be mispriced. you every day show that bund to 10-year note yield differential. and why are they so connected? because the ecb has now driven everything to a relative value trade. so if bunds are 15 basis points, sure, i'm going to buy ten years at 185 no matter if inflation -- >> but the signal represents for people looking at the curve going, aha, i know what that means, you don't know what it means. it means. you see, now you know why i missed the cue, because i can't stop talking to this guy. and yra, we should talk about memorial day honoring those who died and discussing what we discuss everyday. >> yes. it is beach season, and you know what that means, getting in speech, and those workout session sessions are just a click away. and the demand is rising. more on that next on cnbc. i don't know even where to start with that. first, let's take a look at your financial plan and see what we can do. ok, so we've got... we'll listen. we'll talk. we'll plan. baird. il

i'm always interested in what mario draghi is going to say, so friday, what we get from the federal reserveen more and the market will get very sensitive to any small moves in the data. jon: jon: we will have some -- vonnie: we will have some kind of move next week. david: the biggest job stay in history since the last one. jon: you are getting used to aren't you? vonnie: you never do. discussed aterns .he g7 di and the race for the white house .eats up is the stock market price for all this new wants and everything that will happen in the next week? >> relative to where we are with interest rates, the stock market is priced ok. at 17 times forward earnings, you would think it is expensive, but with zero interest rates and a low trajectory of rates going forward, probably riced about right. -- priced about right. we had this monster rally in the last several days. volatile, right? it is very hard to predict. low volatility are typically followed by times of higher volatility. jon: we had u.s. gdp data 30 minutes ago. just below expectations of the margin -- what do you take away from the fi