paul gordon is watching the ecb. s the third time now in less than a week, wednesday friday, and again here on monday, as we understand the ecb is now prepared to meet whenever needed to review greek liquidity. instead of giving the greeks seven days worth of money that is no longer happening. the ecb is providing liquidity. it is looking much more closely every day to say, should we get back and rethink? if a deal isn't made, we could find that ela gets frozen or cut. that makes life much more difficult for all concerned. francine: why are the german politicians calling for a stop to the ela? paul: there are a lot of german politicians who've been opposed to the idea of giving this liquidity to greece because of multiple issues. one is, do they really need it? the ecb is a rule-based organization. the quality of greek collateral has degenerated. it is getting close to running out of collateral. you should be reducing ela. the other issue is moral hazard. if greece's banks continue to get this bailout cash the governm

let's start with the ecb. far as the meetings and excitement goes, it's only the most exciting meeting. there was evidence of the economy picking up. it is the big elephant in the room. but on the economy itself, are you encouraged? >> yes. there's a time when it seems it is supporting the improvement of the micro fabric. it is still early days. there are still some early calls in the market. it has an depreciate against the dollar much further. we are seeing -- the cpi is finally bottoming out. it is much better than negative inflation territory. the suggest that the ecb has some breathing room here. it is still very much intact. there is a huge growth gap. there is under investment. there is a credit gap. ultimately, the inflation gap. even taken that away it has been below the good eight years now. mark: you mentioned the bond markets. you put it to lack of the credit he and the bond market itself? lena: are number of factors here. we are seeing improvement in the sentiment of recovery. there is zero negati

the european commission, the imf, and the ecb. could it be that angela merkel might be a little bit more lenient? the meeting -- germany might be looking to be a little more lenient. a german spokesperson has denied that. would they allow just one reform to get through? the ecb throws that lifeline. we open lower on the stoxx 600. an interesting bit of data from the u.s., the u.s. dollar trading higher. we will get retail sales, could be a jump of 1.2%. could that mean a rate rise? dollar pushes higher. euros trade weaker. a little bit of nervousness around greece. bond sales from spain and italy. similar move for spain. 6 billion euros of bond sales. rbs, after the mansion house speech, the sale of shares up this morning. no mention of the bank levy. maybe that is what is concerning the shareholders. petra syngenta is trading flat. the deal could be getting closer. monsanto wants to buy syngenta but syngenta not coming to the table. jonathan: we will be keeping a night on rbs throughout the morning -- an eye on rbs throughout the

talk about the ecb make a distinction on the fall of the on julysus the default 20 for the ecb. there is a big difference. greece has this big payment at the end of the month. they couldn't miss the payment and it would not be the end of the world. , soing a payment to the ecb the euros on it was built on these roles that the ecb cannot give money to governments. ,bviously, it has bought bonds but they were able to take a haircut on the greek problem, that would be a subsidy and a very serious know, no. more joining us to discuss is daniel morris and lisa. happy friday. the what do you think about imf and ecb? >> it makes a difference. is it a default given there are no creditors involved? people used that term default the term sleep -- default very loosely. a default in which they have not paid, but not in the sense we think. the imf has a 30 day grace. -- grace period. i think it is the mid july deadline that they need to keep too, because he cannot not pay the ecb and expect to get money back. the markets say, we don't care. we are not watching. i think the big? question mark

we know there is a last draft the ecb has presented to greece. o not know the whole details and we do not know who is being inflexible. having an agreement is the rational choice here. i think that is how we measure the success of the president. jennifer: alberto gallo -- jonathan: alberto gallo always a pleasure. as the russian economy hits turbulence, one of the company's big does one of the country's biggest airlines. ♪ jonathan: good morning. i am jonathan ferro. this is "on the move." day 2 of the paris air show. we have interviews with the biggest leaders. we have guy johnson. over to you. guy: thank you. the ceo of aeroflot joins me now. russia has been a difficult market. how tough has it been? guest: it has been rather challenging even though people tend to look at it in a more negative way. let me give you some indication. it was down and the first quarter by 40%. aviation demand is down by 2% 3%. it is down and a crisis but it is much more resilient. guy: if you had to change your network or returns of aircraft or leasing companies? how

the ecb was deliberating. how difficult was the decision for the ecb to freeze the lifeline of the great banking sector? >> extraordinarily difficult. the ecb has taken the middle line cannot have a little greece -- in not giving greece more money -- the easy be has taken the middle line in not giving greece more money -- the ecb has taken the middle line in not giving greece more money. on one side, the ecb watches to see what happens. where does intensify behind the scenes particularly with the bank supervisor. medications have intensified. should the greek thanks miss is imf payment at the end of this month, some question -- they rely on state guarantee and assets and a good chunk of government debt. should those banks be declared solvent things begin changing once again. there is a resolution mechanism. it is still at the national level. the supervisor is the bank of greece. it all gets very messy. anna: what does the ecb do next event? >> the ecb has got a lot of work on its hands. they have got to think a

this is a concern to the ecb in the past, and again now. jonathan: as far as you are concerned, the bond market will be a big heart of this discussion. but the data? doesn't that leave him happier? paul: well he has said the economy might be moving in the right direction. either way, there is a recovery going on. draghi and his colleagues have been very plain on what kind of recovery this is. it is cyclical, it is not yet structural. it will be -- it will not be structural intel government charts pushing for reforms. he said if they do not get out of this rut people never become an playable. -- people become unemployable. jonathan: hans nichols, let's bring you in. as paul said, the ecb are there any reasons to be optimistic on risk -- greece? hans point the institutions -- hans: here is a reason not to be optimistic, according to people familiar with the matter inside that document, the creditor document, there is nothing on long-term debt relief. that was thought to be potentially, a all of branch -- all of branch -- olive a lot of people

but the ecb can do about it. onfidence is lost in the process we will have an insurmountable problem. otherwise, we are still going to be talking about taking talks down to the wire. caroline: reports are that we could see the resale shuffle back monday. what message will that send? kit: catastrophic, if that were to be the case. i would have to go and check. it was serious enough to close banks -- we have never done that in this form. once you get the bank, you are in much more trouble. guy: if you were sitting on the ecb council today, talking about -- the greeks threatening another 3 billion -- how would you be feeling? kit: very nervous, but resolute in the sense -- i think my commitment to the ecb would be i am not a politician, i am a civil servant. i am only going to make a decision to stop funding for the banking system on the back of a political decision. i'm not going to push greece out of the eurozone from my civil servant seat in frankfurt. caroline: in the meantime, stay where you are in terms of the

the payments of the ecb -- the eurozone was built -- the ecb cannot give money to government.t could lend money. but if they cannot give money. if the ecb were to ever take a haircut on its greek debt, that would be a de facto direct fiscal subsidy to the greek government, a very serious no-no. alix: there in lies that july 20 deadline. joining us to discuss more is daniel morris of global investment strategist. happy friday. thank you. what do you think, dan? daniel: it certainly makes a big difference. is it really even a default given there is not letters involve -- creditors involved? people use the term very closely when it is not actually -- there is no private creditors. it is a default of a have not paid but not in the sense we typically think about. the imf have a 30 day grace. period. we don't think it really is going to be so catastrophic. i think it is really that midterm is the one they have to keep to. something has to be done because you cannot expect to have anything back from the ecb. alix: the markets are basically saying we don't care. we are not really watc

the ecb a major actor in the story. do you think the ecb are on board with this kind of not take it or leave it offer, but do you think they are on board with pitcher of record -- the direction coming from the creditors? paul: the ecb wants to see solution. it does reflect that mario draghi was at the talks. he has to be involved at the top level. until a political decision is taken on what to do in greece, the ecb is carrying the can. the greek central bank by offering emergency aid to greek letters but standing behind that is the ecb. the implication, should everything fall apart. draghi gets involved. it is not a direct creditor but it does hold greek bonds from an earlier issue. and he wants to get this resolved. it seems to me pretty much everybody has that position. only greece is the one not meeting its demands. hans: how is the left wing reacting to talk of an ultimatum? nikos: well, it is not going down well. it is going to be a difficult deal to swallow for the greek prime minister and most of his cap members,

the imf and the ecb will hear from them today. the market seems strangely detached from what is going on. this is a picture across the spanish bond yields yesterday. we saw a spike in yesterday's session. that was lost later on during the trading session. we moved away from the move toward the end of yesterday session. we did not see quite the level of tension or anxiety being expressed by investors as we have seen in the most recent days. in the athens stock exchange, a bit of an exception. across european equity markets, we sell stocks up by the close -- saul stocks up by the close. a bit of an outlier in yesterday's session. touching levels they have not seen since 2012. putting in a perspective with the global trading picture, we saw investors focusing more and what the fed might do than on the greek situation. major indices up by half a percent. investors thinking the fed would have to sit on its hands a little bit longer. with that in mind, should the greek situation delay the fed tightening process? plenty for everybody who

the european court of justice ruled the ecb's scheme is legal. kuroda's you turn said he was not trying to influence the yen when his remarks sent the currency climbing. francine: welcome to "the pulse ." i am francine lacqua. also coming up we will be hearing from some the biggest names in aviation. the ceo's of airbus and airasia will be on "the pulse" this morning. greece's finance said creditors must take his country's proposal seriously if they want to break the deadlock. after the european central bank president mario groggy said greece needed to take the necessary steps and the ball was squarely in the greek government. to get more we are joined by hans nichols in berlin. what are the creditors' plans and greece's plans and how far apart? hans: they seem far apart. we see a lot of reports at least one important report talking about plan b if there's going to be an exit and capital controls on greece. and the greek plans and according to mr. varoufakis editor interview is we will not be coming to the table with a new plans. more work needs t

it comes to negotiations with the ecb. i think in terms of getting a resolution it is clear the lines need to be kept open. we are talking about capital reforms that need to happen the next few years or later. jonathan: the two questions we try to answer every day is what breaks the deadlock and what forces the issue. the ecb faces a reputational risk when it comes to providing for greek banks. are we at that point? >> i think the ecb won't want the responsibility of being seen as the institution that causes a graccident. i think they will be prepared to keep the system afloat. it is important to remember there are other sources of funds that could be taxed. there was money earmarked for the greek banks. there are profits for the s&p program. there are all other sources of funds, which i think will get tapped at some point. further down the road, the ecb may build a bid. it is going to hinge on the ecb because otherwise the banking system is insolvent. we will come to that at some stage, but i think there is enough money to

the big question is at what point does the ecb need to act? for now let's get you up to speed on some of the top stories. greece has shut its bank and imposed controls. the move comes after alexis tsipras announced on july 5 referendum. the banks will be closed at least until july 6 in the measure limits daily cash withdrawals to 60 euros. greece is likely to be forced out of the eurozone. the ceo and bloomberg columnist spoke to us early this morning. >> if you have to put a gun to my head and say give me a probability that greece is in the eurozone, i will tell you it is about 15%. there is an 85% probability that greece will be forced to leave the eurozone. not because it wants to but because it is no longer able to stay in the eurozone. >> chinese stocks close down for the day with the composite entering fair market territory. the central bank cut interest rates and the move was set to view share prices with mainland shares ending the longest ever bond market. let's get more on this story from the bloomberg news reporter in hong kong. i hav

the ecb's reaction and upward projection of inflation. o not expect they'll to taper the qe program that is ridiculous to discuss at this moment. for the qe to be extended but downed 2016 -- beyond 2016, you have to discuss. the environment we are in verses when they initially announced qe. mark: what are your thoughts when we hit 2016, a difficult decision? david powell: the program is highly unlikely before september. if anything, it's more likely to be asked ended. the risks lie in that direction. mark: scott, what does it mean about rates? is the bank of england going before the fed or after? david powell: certainly after. the u.k. situation is robust and our discussion about the emergency levels in the u.k., i would suggest it is not appropriate for the state of the u.k. economy. the numbers are still depressed. strong construction spending, it was revised up it revised of gdp. and a strong labor market. the bank of england moves after the fed so the november meeting would be in my mind at the first opportunity. mark: how difficult it

the former president of the ecb. hinks will happen next. . >> the s&p airline sector has fallen. we're taking a look at it. >> good morning. intriguing question given the fact that last year airlines really you couldn't have found a better place to invest if you were out there looking to find the sector that was going to take off and it's been a struggle so far this year. the question is what can we expect in the second half of this year. you have to separate the investment in airlines versus the business of the airlines, because profitability is expected to remain strong in the second half of this year. bookings, demand they're at high levels. no falloff being seen at least for the next three or four months. the one question is will fares rise. they're expected to inch a little bit higher although many are expecting how much of a resistance there will be. take a look at the index. it was loved last year. it has not been loved in the first half of this year. in part it's a sell off after a run off last year. also a qu

what is interesting is if we will hear from the ecb. is on the papers talking about the impact -- and the fact it cannot be ruled out. if we were see that payment not be made, it can have an impact on the ecb's relationship because of the capital story] that is there. we don't understand how the ecb will be shooting that but it is worth listening what he had to say last night. some really interesting points but the focus of attention is on the euro and whether we will be a member of it in greece for longer. listen to what he had to say. it is a stark contrast what angela merkel had to say. >> they will not kick us out of the eurozone. the cost is immense. economic cost, the financial burden -- if the eurozone is dismantled because of a country in default often to the european bank with great amounts is immense. guy: he is talking about the default. is talk about membership of the eurozone. it is not see any correlation between the issues. he still thinks they can go back despite not maybe even paying the imf despite not going up to thei

the ecb could increase collateral on the ela.t will increase collateral if greece pleases the payment on the fourth of july. manus: the greek banks -- ecb. alberto: the collateral remaining is around 30. haircuts are raised. some banks may run out of collateral. i do not think they should pull the trigger before a referendum decision. francine: you see how many people want to withdraw. the problem is unless they increase it. if there is a yes vote. until? alberto: until greece is fine. even with capital controls, you have leakage. cyprus lost 10 billion deposits a year. you have some slowly gets. the banks without a deal will run out of liquidity. he could be a few weeks, a month. there is leakage. francine: mark, d think regardless of the referendum are we going to have a new government in place? mark: we have not seen a pull yet. -- we have not seen a poll yet. it will be interesting to see how many turnout for the demonstration. we do not know at the moment what the greek view is. what is clear, these referendums should be the

that is something the ecb will want to monitor very carefully. it is him is like a day by day basis. the mood is broadly positive. nothing that a deal will be done. yes, once again, it seems the greeks are relying on the germans to come to the rescue. we'll wait and see. a very long meeting yesterday here in athens. mr. tsipras and certainly a lot of discussion was had. we have spoken to the coalition partner and the sense from them is red lines are being crossed by this government and we see changes on pensions and vat and changes on taxation. some ground. is it going to be enough? we will wait and see. these guys are politicians and they are brilliant over the last five years of pulling out of the deal at the 11th hour. are we really after the 11th hour? mark: jeff, let's chat with you. we are being here and a lot from the ecb. what is different today? jeff: the difference is we are an unprecedented situation. this is the decision -- and the 30th decision within a week. it is always a daily basis. and the urgency is greater than ever before. the

if the ecb wants to get fwrees go, it k. but it can step in and support the other countries, can it not? >> it raises big questions now because it's put an expire date on the ecb's commitment to greece that exposes the flaw or the nature of draghi's promise to do whatever it takes to keep the euro together. it's a conditional promise. the greek crisis has demonstrate demonstrated the government solvency and financial system and it will also go down the political institutional policy direction about a debate about foreign risk ratios and with the ratios rising across the south how risk free are government bonds. so that could really transmit the problem on to those parts of europe. particularly banks where nonperforming loans are still punching holes. so i think the fall out here in terms of just how strong it is is going to be revealed in the weeks a head as a correct fall out of the events today. >> what happens next if we do have the grexit. do they ensure a domino effect doesn't take place and they follow greece's lead. >>

anna: that is what the ecb is resting with. he odds of the ecb tightening the screws on greece at their meeting tomorrow? paul: policymakers are meeting in frankfurt and some of them will want to tighten the screws on grace either by limiting the amount of emergency liquidity or tightening the collateral standards that banks have to post to get that liquidity. total liquidity going to greece is about 118 billion euros. two thirds of gdp. 83 billion of that is emergency which will be offered as long as great tanks are solvent. conditions could be eased if there was a credible perspective to see the end of the review of the current bailout program, that is not insight. the comments are the greek finance minister suggest that there is no end in sight at the moment. not at the eurogroup coming today. that makes it very difficult for the ace -- ecb. it does not want to be seen taking the lead from the politicians. the moment may come when it has to say something. anna: thank you very much. paul gordon, our european central bank edito

>> cyprus is going to try to get them to think that it's the ecb. >> the euro group and imf and others are going on but we have no choice but to stop adding to the lending. do they want more of this chaos or take the cuts that the creditors are asking them? >> i would say coddling. >> people don't see us as going back to something -- >> european central banks the ecb was, in fact trying to keep the thing going and give the banks enough liquidity. negotiators have said. >> we have to go to lady chatterly. did you however the cuddling stuff? you don't want to weigh in on that either? >> i think the european life would have given them more because the greeks are playing. >> you are now to the ground in athens. julia joins us with the latest. good day. >> reporter: good morning, guys. well the greeks are waking up there morning and realizing the 60 euros they can take out to the atm. the greek protect tourists. they can still take cash out. >> that doesn't mean the cash is available 40% had a cash problem. yesterday when i arrived, they had no clue what

the ecb must follow the plan to the end. and kickbacks and corruption. take bribes over the world cup. .elcome i'm coming to you live from bloomberg's asian headquarters in hong kong. let's check in on markets in asia. new zealand, gains. 71 u.s. since weakening. japan.ead over to threest closed in the red futures in chicago pointing to a higher open after gains on wall street. the dollar yen. it is weakening now. news.have breaking south korea's first quarter expanded on the quarter. looking at the year on year change it rose 2.5%. than expected. the previous was 2.4%. gdp.irst quarter revised greece and its creditors have once again burned the midnight oil. trying to hammer out a deal on debt. are optimistic. the head of the eurogroup lefty talk saying the meeting was good. on friday they face the first of four payments to the imf. we are watching this with breaking headlines. >> brussels talks have ended. they were late-night talks. as you mentioned, the europe left saying the meeting was good but the talks will continue in a few days. with them is in

it allows the ecb to buy unlimited bonds to prevent a default. it has never been used, but the central bank still sees the ruling is a big victory. >> the ecb is operating within the framework of eu jurisdiction. >> there are strings attached, though. the luxembourg court says the ecb cannot announce its purchase of bonds in advance. the bank was also buy them on the market and not directly from countries. but critics of the rescue program say these restrictions don't go far enough. >> the ruling gives the ecb even more leeway. they can always justify their actions. they still have a lot of power. >> the final step now is for germany's highest court to confirm the european ruling. that is seen as almost certain. a decision is expected next year. >> europe's main markets rebounded slightly on tuesday even though as we heard earlier athens and its creditors remain locked in a standoff. our correspondent has more from frankfurt. >> the greek crisis kept investors jittery this tuesday even though the signs from both athens in brussels are not necessar

we have seen the ecb do the day by day process of managing the ela and i think the ecb would give an cation that the delay would be capped. one of the things we heard from bundestag was about the possibility of reconsidering -- there is obviously going to be a lot of discussion around those issues, that i would be very surprised to see the ecb cut off from one day to the next. caroline: you will be staying with us. first, i want to talk about south africa. an investigation into south africa's worst massacre since apartheid is criticizing a company for ordering employees to work through a violent strike. 44 people died at the minds of 2012, when fighting broke out between labor unions and the police. joining us over the phone for an exclusive interview is the chief executive, then mcgarr. -- ben magara. i want to get your take on this report. ben: we have not seen the full report yet. we spoke last night and we welcome the report because we have all been waiting for it. we acknowledge the findings, and we believe it is a vital step in the process of healing after the tragedy. caroline:

remember that the ecb is a rules based institution. as long as there's access to to liquidity, the banks are solvent and they should be open for business. the question is what if on monday there's no agreement. that's a critical meeting and then that can precipitate ecb's decision based on those rules. >> we always have critical meetings. we had one supposedly twice this week. we'll have one on monday and i'm sure we'll have five more until the end of june. >> it could be. but this sounds like almost one last stage. i think it will be very difficult to argue after this high level meeting with merkel it will be very difficult to argue that they're still able to find an agreement and i won't be surprised if the ecb increases the hair cut and that pushes the chain reaction. >> it hasn't got quite as much coverage as the banks in particular. we had a poll that suggested the german people don't want greece to stay in and increasing protests by the greek people themselves in athens. is power shifting from the politicians to the people? what d

and the ecb will react. na: help us to work out what we should expect in terms of the meetings we have taking place. you suggest that today's meeting -- if you had your highest hopes for today's meeting, wouldn't it just be a roadmap toward a deal? athanasios: exactly. so for the problems have been that the two sides have not been -- if there is a success today it will be because of an understanding. index that's will be the technical discussions to finalize all the details and make sure they add up for the greeks to approve a number of measures. for the greek side to be able to agree and for the greek parliament to be able to approve it, it will be very important to get something on this relief. the extent to which the europeans -- will determine the chances of being approved. anna: so that'sdebt relief is not off the table. the greeks have said it must be part of the deal. athanasios: it is important for them to approve their popular measures, and without it there is a discussion of the conditions -- in ter

we also have the ecb all the way up to 83 billion euros.u look at what the bank how much they had left, the cushion came down to 700 million euros. the ecb giving a little breathing room and now we have talks still taking place. the difference between great intensity and higher intensity. anna: it just keeps building. what exactly has happened in the meeting? that is where a lot of the action was last night. what have the creditors been saying? >> they describe this meeting as constructive last night. it happened after the first day close of the summit with latin american leaders in brussels. it went on until early this morning. both sides described it as constructive and said they need to get back to the technical discussions on the program with greater intensity, higher intensity. the deputies, the technicians are going to be going back at it today trying to get closer on these several issues that are keeping them apart. at the same time, tsipras is supposed to meet this morning with european commission president. guy: meeting for tea i s

do not miss that. 2:45, the ecb publishes its weekly qe details. the fed meets. give you the latest rate decision and statement as well as the news conference wednesday evening. on thursday, the eurogroup convenes in luxembourg with greece in focus. also on thursday, we get a rate decision from the swiss national bank. a lot going on. equities heading south. the dax off by over 1%. yields in spain and italy heading north. after the break, it will be "the pulse." ♪ . francine: open for busy. welcoming foreign investors for the first time. talks with creditors collapse after 45 minutes. battle for air supremacy. the paris air show today. airbus competing for orders that the total more than $23 billion. live in dubai and paris with his stories. ♪ francine: welcome to "the pulse ." i am francine lacqua.

imf and the ecb -- stephen: they are holding up the banks, is what you are saying with the emergency funding. naeem: absolutely. the $3.5 billion, which they need to pay in july, will also be possible. i think it is very important because they have lost enormous amounts of time, and that has taken in a massive toll on the market itself. stephen: if you are worried, we are worried, so we are looking forward to july. another meeting is taking place the european central bank. we've seen already the sort of upturn in the euro zone economy since the central bank started pumping more money into the eurozone. the good news for european governments, should we be thinking mario draghi for all of this? naeem: we should be thanking the bond, the ecb quantitative easing. yes, there is a major question, one mr. draghi is going to be facing, number one we need to hear something about the bond yield because as you remember, we had a massive rat in the bond yields and mario draghi has not said anything very clear about this, ok, how is it going

waiting on the ecb. jonathan: they are making what looks like a political decision. >> i think they are playing to the rules. for as long as they are supplying ela, the greek banks are sold and -- solvent. the solvency of the greek banks depends on the collateral as they post. as long as the euro system collects -- except that is good collateral that is fine. jonathan: we are moving to european leaders on monday, does that make a difference? we focus on the numbers from the finance perspective. from a leaders perspective we think beyond the numbers and the big picture. >> the pension fund reforms that is on the table, we are looking at a 2.5 billion euro gap between the two parties but in terms of principles we are looking at the big gap. somehow we have to the money. jonathan: i am interested in the investors take. you look at the banking system now, do you have a day in mind? >> i think it depends on how quickly domestic greeks take money out of the bank. you never have a capital crisis unless the domes

on an open line with the ecb, if the approval comes from the ecb, i think they put humanitarian reasons primarily because we are talking about two basic categories, food and pharmaceuticals.i am sure we will have their understanding and assistance. erik: some put the probability of the greek exit from the eurozone at 85%. where would you put it? constantine: i would not like percentages. i would like to say we still have time. we are in the 11th hour and we still have time for the great government to sit around and negotiate so that we find a solution. it is becoming a truly difficult and improbable that we will have for practical reasons. erik: what do you mean? constantine: we are talking about six days away from the referendum and still have not had questions from the government that will work to the week collectors -- to the greek collectors. it is becoming almost impossible for the ballot papers to be printed, cut and sent to the ballot stations in greece. erik: it is a practical matter. constantine: and i think we should take advantage of it and once again try to negotiate. erik:

it has been the case that the ecb wants greece to say and that it can stay. he is saying that greece could go. he also did note that the referendum -- if the referendum should support the creditors proposal he sees room for political solutions coming out of that. he is not ruling it out yet and that does suggest that the ecb might be minded to wait in the referendum until deciding what to do. there are a lot of butts, but that is a possible outcome. jon: let's get the investor take. a global market strategist for jpmorgan in europe. you talk about imf and the consequences of missing the payment. join a club that involves sedan somalia and zimbabwe. not great for europe occasion to talk about the immediate financial consequences. guest: the question is whether or not ecb will perceive this as default to the imf. but i believe they will wait for the democratic process to take place and the decision is taken at the political level. in the end the only institution that can affect the solvency of greece is the ecb because it keeps the financial institution float at

the ecb is one of the parties at the table.knows what is going on and whether or not the us patience will throw bones. they've got to offer something. he will accept their deal. stephanie: very much focused on, and when we come back, we will talk about their problems and why the gaming company is something you should be watching today. stick around. ♪ stephanie: welcome back. caesars entertainment, always putting its biggest unit in bankruptcy back since january. this week, it is down nearly 20%. bloomberg's reporter joins us now. there is a hearing today in chicago or 20 ackley can we that? >> this will be long. other bankers, there will be potentially cause. they're trying to come up with -- he actually could say, we are going to put that on hold for now. they're asking for the judge for that. but all of those classes. >> who are the biggest players in terms of investors? >> we have got oak tree, you can really name any investor. stephanie: but you have them on the same side? and then private equity guys on the other side? la

the ecb has been put in the decision of being a political organization. tom: this is a lunchtime adjustment. what is the goal? brendan: we had the optimism about this offer and what has come back is all the finance ministers are waiting for specifics. this is a song we've heard before. tom: top headlines.

that is the line in the sand for the ecb. i don't think they'll do it but you've got to watch that tomorrow. in terms of the impact on the rest of the stock market i still think not only do you have greece but let's remember what we got hit with. we got hit with china and also puerto rico. i think puerto rico's a bigger story than people are making it it out to be. >> it's interesting because people are saying puerto rico is nothing, it's a rounding error when it comes to our gdp. but take a look at all the hedge fund guys invested in puerto rican debt and/or real estate. could there be some sort of danger from another part of the market and that would be just hedge fund exposure to this? >> i totally agree. and i think when you look at yesterday's reaction the second half of the day on that huge sell-off that we saw i think a lot of that was attributed quite frankly towards puerto rico. you look at those financial insurers, they absolutely got hammered. you look again today, look at ambac once again, mbi once again, a.g.o., t

what can we expect from the ecb president? get out to julia and annetta for a preview of that meeting in frankfurt. >> thank you so much seema. a number of things will be questioned be it greece, be it the inflation stats. i want to pick up on the market moves. i would argue that perhaps the bond moves we're seeing about the inflationary trade but we also saw a back up in u.s. yields on monday and tuesday as well. it's following the u.s. in that sense and the dollar index weaker yesterday too so that's supportive of a euro higher move. but let's pick up on the inflation point and germany in particular i think. >> coming back to the point what can we expect from that meeting, we get an update on projections about inflation and gdp growth and i think people will look at that very carefully because it might actually mean that we have an early indication of how long it will last and if there's any, only the slightest indication that it might actually end before that date you might see severe movement in the euro dollar rate again b

the ecb said it's not increasing the emergency funding.hat does that actually mean that they have enough? have they said? are they going to stand by the greek banks or not? >> they say they are going to stand by the greek banks and we know for several hours, they have discussed ela emergency liquidity assistance to the greek central bank. you will recall the greek central bank has been receiving ela elas for several times t amounts to several tennessee of billsions of euros. they say they will stick with the level agreed at on friday which means there is funding available but only up to the level that was already agreed. the question is whether the greek central bank has drawn that funding down. if it has, there is no more money. if it has not, it's not clear at the moment whether it has or has not. if it has not, then there could be additional money. let's be clear about it, that that in no way deals with the greater insolvency that threatens grease and we recall, of course, as you say, they need to make a repayment on tuesday and the ind

on the 20 of july, greece has to pay the ecb. es that payment or for becomes likely that greece will miss that payment, then the story at the esp would be even much -- the ecb would be much bigger and contentious than it is now. guy: angela merkel repeated over the last few days where there is a will there is a way. on the other hand, she accused greece of dragging its feet. what is the primary message she is trying to deliver? holger: you, in athens you the government, need to have the will. if you have the will, there is a way. if you do not really want a deal with europe roughly in line to the european rule book, then we cannot help you. guy: is that a harder line the we have heard from her previously? holger: no but it does have an undertone of frustration with that greece has not responded positively to the offer europe they last week. europe basically gave greece the parameters of the deal asking greece or giving greece leeway to shift a few things around. instead, greece rejected this whole sale in public. that is frustrati

the ecb and eu leaders called emergency leaders. on will have complete coverage and on subdued global gdp global -- does global recession mean the fed must wait until 2016? good morning, this is bloomberg "surveillance" and we are live. it is friday, june 19. i am tom keene and joining me is brandon. the ecb, brendan, meets with in the minutes within -- brendan: the most important meeting happening right now is a teleconference that the ecb is called the but they really need to figure out to they continue to extend emergency liquidity assistance to grace? -- to grace? two grrece? if they pull that plug, there is no telling what happens. tom: who initiated capital controls on iceland or maybe now greece? brendan:

numbers -- at 12:45 p.m., the ecb rate decision. tom: the press conference at -- should we shoot the intern that made that typo? brendan: we should praise the people in the control room for the work that they do. thank you. tom, the data check. tom: really? ok. i make light of it, folks. you should see the mistake list. vonnie quinn keeps it for us. currencies commodities -- looking at futures, you are up a little bit. the euro moving off of what is going on in brussels no doubt about that. on to the next screen, if you will. 30-year bond back over 3%. the euro sterling there -- good morning. we are watching the dynamics in europe. let's go to the map monitor. big thanks to brendan greeley for pointing this out to me. euro forbor, down we go. i got to double-click on this puppy. we can do that on the bloomberg terminal. down we go, a little bit of hope. this is the lethargy waiting for the ecb to come in. this is this inflation, the deflation trend. brendan: if i can find this, i will put it out on treader -- on twitter. biggest effe

the next steps for the ecb. ced a cap as provided to prop up great banks as depositors race to withdraw their money. the second thing is the politics of all this. deutsche bank says botched the word in the next sunday's referendum. greece's government is that a vote on the asserted package offered by creditors rather than membership of the common current fee. third, what do the creditors have to do? reese will default on the pavement tomorrow the same day the bill it expires. the question is whether greece is creditors will pile in the pressure or will they be willing to negotiate. tomorrow is a key day. also july 20th in greece must repay to the ecb. they've got more big payments coming up. >> i was always the bigger issue. people talk about the fact they default to the imf in the ecb payment was front and center. the other thing we want just how the u.s. dollar strengthens on the heels of all of this and that is something front and center as well. the latest comment as well saying he wants greece to remain in t

-- of the ecb not moving today. rlet: thank you so much. now i look at the top stories crossing the terminal. there are concerns ukraine is headed back toward a full-blown war. separatists in eastern ukraine say 15 people in territory under their control were killed today during battles around the rebel stronghold. dear craney in government and rebels have accused one another sparking the latest round of unrest. it is the worst violence offense of the cease-fire was reached in february. give identitywill theft victims copies of bogus tax returns filed in their names. the move comes after a bloomberg news article about an identity theft victims' effort to learn how much of his personal data identity thieves had included on a return filed in his name. complicated. the irs says thieves of stolen 104,000 taxpayers and used the data to file some 13,000 state tax returns, which led to about 39 million in refunds. scarlet: that is the least couple kitted part of that story. those were the top stories. the democratic pool of

the ecb did increase the emergency liquidity assistance up to 1.1 billion euros. they did get a little bit of a lifeline from the ecb, but there is still little pressure. guy: i wonder if that was draghi committee kidding by the bank we will talk about that later. jonathan, if anyone is praying for a deal, it has to be swiss. jonathan: absolutely. the best case scenario is today they would downgrade. the cap is gone. the cap is dead, it is unlikely they will bring it back. rates are at -0.75%. we know the smb are good at surprises, the question is, what form does that price take? the guy is in the middle of a storm, within the eurozone crisis how do they react to a grexit? euros swiss, as strong as it was these guys have another option, crossing their fingers. i think that is the best case. guy: you will be talking to the main man later, is that the conversation? jonathan: number one, the eurozone officials can respond to a grexit. the credibility question, three months ago i said to the president, the swiss is strong what are you going to do? three months later,

they are arguing about 1.5 euros on the deficit. ecbpp them another -- lobbied them another 3 billion euros. angie: at the end today, is this political posturing? or is it economic reality? ard: it is about the principles of economic reform. the money is a small difference. angie: more of a symbol. in order to have a sustainable path to the economy, you can't be reliant on european support. it is more the basis of how you manage your economy. the greeks are saying, we want to run it the way we want. europeans are saying, then off you go. angie: what is the contagion on asia markets? : first we look for the contagion in europe. that is where it began. this time, there has not been much contagion, because the economies improved somewhat in the past three years. growth is better, if it's a are are down.ficits you would not expect to see contagion in asia. angie: there are a few things happening this week, china's flash pmi, they are calling it something different. manufacturing data coming up for china, we have the selloff last week in ter

i think the crisis with the ecb comes before the 20th.e ecb has no political fig leaf anymore for continuing with emergency liquidity assistance. the banks are asphyxiated and the greek governments will need ious. >> thank you for joining us. ben steele from the council on foreign relations. >> and when we come back apple music. we'll get a first look at the service coming up a little bit later. >>> is greece providing a buying opportunity for stocks in the united states? find out why one strategist says now is the time to buy. you can catch our live segment in power lunch. more "squawk on the street" come right up. we live in a pick and choose world. choose choose choose. but at bedtime? ...why settle for this? enter sleep number... don't miss the lowest prices of the season, going on now. sleepiq technology tells you how well you slept and what adjustments you can make. you like the bed soft. he's more hardcore. so your sleep goes from good to great to wow! only at a sleep number store. right now, find the lowest prices of the season wi

the ecb -- now that is the stage that we have reached.he points were greek has more yeley money -- at many of the points were greek has more yeley money than liquidity, can we chose the system for quite some time? >> this is emergency lending. it has to stop. people put it under their mattresses. they don't spend it. they may bring it back to the banks, but they need certainly. guy: thank you for stopping by. we're going to wait. there is plenty more still to go this evening. we have another yeley call from the ecb tomorrow. looks like we will be here for a while. the story will run all week. back to you. matt: i heard you got in last night and you spent time in athens previously. has it changed? is it different? bloomberg has a great story of people taking money out of banks and trying to do anything to preserve it. guy: people have been buying cars, high assets. people have been taking it home and stuffing it behind radiators. businesses have been buying all kinds of strange assets around europe. we did a nice piece on one business that

i think the ecb -- this is a measurable situation. na: of course, alexis tsipras talked about if greece leaves the euro it would be the beginning of the end. i know you don't believe that martin. why if we see one member leave does that not mark the euro's demise? martin: well of course, it changes the structure. on the other hand, if one member basically can force all the other members to pay constantly, without changing, that would be also a very bad sign for all the other countries, a lot of governments asking themselves why do we go to all this pain of restructuring? in the end, the eurozone has to become more competitive. it needs a lot of work. i think in the end, it is a trade-off between the sign that the eurozone stays together forever or giving the sign that we have certain rules that need to be followed and i think we have reached a point where this position has to be made, and my feeling would be that in the end, a false compromise might be as dangerous for the eurozone in the future as a clear-cut. anna: do you think the e

francine: you think the ecb will keep the ela in place? do get some kind of default? marco: that is all about the agreement. merkel had an interesting quote. there is a way if there is will. if they say they are moving toward an agreement, it is only a question of a few days, they can overlook a non-imf payment. however, i don't think they can afford to go beyond june if there is not a staff-level agreement. francine: will greece be in the eurozone by the end of the year? marco: i think that greece will remain in the euro area. francine: because the creditors will give in? marco: no, i don't think so. grexit would be detrimental for the euro area. you destroy the argument that membership in the euro area must be considered permanent. you undermine the euro area possibility in the medium-term. balance and compromise are what we need. there is a material risk. greek citizens want to stay in the euro area. francine: yes if they want to stay, then they should say so. germany just wants this much to sign off and they have not been getting this

the ecb does exactly what it should do in my opinion. cine: you don't think it should be tougher? you seem to be tougher on ireland. should mr. draghi to be same -- do the same? maybe they should be tougher? >> we are permanently tough on our recommendations. tough on our advice, and to adjust when necessary and where necessary. it is absolutely clear that the ecb has always been up to this extraordinary situation with all countries. only to speak not on the country's only in major difficulties but to speak of all countries in europe which are benefiting from the policy. it reinforces the case to asked all of them to embark on structural reforms and on the cleaning up of the houses that is absolutely necessary. it is truthful in japan, the u.s., and the u.k. the policies of the central bank are giving time for the other partners to the house in order. manus: let's talk about the armageddon scenario. and -- and asked -- an accident might happen. are the firewalls in europe sufficiently strong to deal with the unwanted policy -- possibility