Welcome to countdown. It is 6 00 in london this friday morning. Bloomberg reporters are standing by across the world, ready to deliver the stories that will drive the day. We have the latest in hong kong on the tension in thailand. Ryan chilcote is live in saint it is berg at russias biggest business summit. And hans nichols has the latest on ges bit. First, live to saint petersburg. Dont miss our interview with the ceo. ,n thailand, schools are closed tv stations are under the command of the military, and International Broadcasters including bloomberg are off the air. The military seized control following a sixmonth political stalemate and Economic Growth in the country. For the latest, lets go to hong kong. Zeb, this has been boiling for a while . It certainly has, but it took the military just minutes to accomplish with the protesters have been trying to copley four months, which was to dissolve the government and seize control. That is exactly what we saw yesterday after several hours between the rival lyrical factions. Chief, rful military the general coming on National Television and say that he was seizing power, staging a military coup. In somethe 12th coup in time. Announcing the military takeover on television. Military units and armored sweeping intoiers bangkok, surrounding certain key areas, including the army base where the talks were taking place. Obeys,a bloodless coup, no shots fired. Coup, noas a bloodless injuries, no shots fired. Today it is a quiet scene. The stock market is open, business functioning. Schools are closed, but the government is functioning. Civil servants were told to report to work. At this hour, the thai army has ordered 114 more people to report to the government headquarters. A list of names shown on militarycontrolled television stations. Broadcasters,onal all International Broadcasters including bloomberg are off the air. The only thing on the air in thailand is the military channel , the military making its own announcements. Foreign diplomats are said to be briefed later today in bangkok by the military on what happens next. It is a volatile situation indeed. We will keep an i on that and as news breaks, we will bring you that. Decrying whats happened in thailand and are deeply concerned over night. Ok, from the east, lets turn our attention to a man, president put in addressing Business Leaders later fed a in st. Petersburg at the International Economic form. Ryan chilcote joins us from there. The past couple days, those who have shown up in st. Petersburg, what do they want to hear from putin . Would likewhat they to hear is some conciliatory language, accommodating comments , suggestions from the russian president he will play ball, in ukraine. Yesterday, in the east of the country, it is not bode well for the elections. Soldiersf ukrainian were attacked at a checkpoint in the east of the country, 16 killed, the single biggest loss of life since the conflict began for ukrainian servicemen. Atsian president speaks 11 30 london time, that is to 30 here. It has been a couple of day since he spoke about the ukrainian crisis. People looking for any handset as to how the russians will handle the selection are looking for any hints as to how the russians will handle this election. Germany, andates, the European Union have all said if russia disrupts the selection, there will be more sanctions. Will meetat the e. U. Tuesday. The u. S. Has moved quickly on this. The last thing people want to see are more sanctions. Manus . Ryan, aside from the big address, a great deal will be focused perhaps on the position in ukraine, what else is on the agenda today . We will try to look at is this in russia from a couple different angles. We will be talking to jc deco. They have been in this country 20 years. How they are negotiating the crisis, why they are here, why does french inc. Have so much here in russia when the u. S. And western europe has stayed away. We will also be talking to the Russian Finance Ministry just after their meeting with visa and mastercard full stop the russian government and visa and mastercard are involved in a fierce conflict because visa and mastercard declined to service some russian credit cards on the back of sanctions a couple months ago. It was a temporary suspension, but it led to the russian government demanding very large collateral from visa and mastercard that the company say they will not pay and they may exit the country. Those are important talks. There has been some accommodating linkage from the russian government, but a lot depends on the meeting that will happen just before i sit down with the deputy finance minister. Manus . Forward to, we look that later on from st. Petersburg. General electric has agreed to give more time to consider it 17 billion bid. Hans nichols has this story from berlin. Weeksthis is a matter of they have been granted, yes . Three weeks is the deadline. It puts this to june 23, when alstoms board has to make a formal decision on what they will do with this bit from general electric, 17 billion. Its the latest number we have. Has alreadyrd signaled they are for it. They have not formally approved a takeover. Aat this extension does is gift bit more breathing room to work out the details with the french state. It also gives siemens, who has made a rival bid, a chance to have more time to go over the books and make their bid formal. Right now it is just an expression of interest. Ge has some work to do with the french state. The industry minister earlier basically gave the french state more stay in blocking these deals. Confident,ge is blustery as always. Here is what he said about Investor Confidence wednesday you have to trust us a little bit that we know what we are doing. Ge has sweetened their offer. What they are talking about is having a swap for the rail signal business. They are not that interested in the local motive side of things. They have indicated that is something they could live without. The Sensitive Energy business side of things, they are working to work with the french stake am especially Nuclear Power reactors that are so crucial to the economy and security. Hans, there will be debate over whether this time is squeezing the price, as you have touched upon, or giving siemens the opportunity to rehash their bid, rehashed their offer. Is that something that we think is a possibility . Absolutely. There are risks in whatever ge does. If this goes through, he will be seen as brilliant and a lot of talks about how he massaged the French Public and made assurances on jobs, how he convinced the french government this was a good deal. If it doesnt go through, everyone will say, why did he give so much time, why didnt he involve the french government earlier, why the secret negotiations with alstom before informing the french government . Then Business Schools will be studying this as a case of how not to do a takeover in france. We will have to see how this goes. It looks like june 23 we will have certainty, two days after the longest day of the year. It is a story about how the deal went through, would it say they worked for a night that was not dark. Manus . Very good, hans nichols on the latest with ge and alstom. Up next, germanys top measure of Business Confidence. We will see what investors are watching as the gdp numbers come in. First. Bloomberg. Time for todays company news. Hewlettpackard is cutting more than jobs. In addition to the 34,000 positions already eliminated, they will be cutting between 11,000 and 16,000 more. They report a secondquarter sales that fell short of estimates and gave a disappointing profits forecast. A single model as part of its bid to and losses in europe. The car will be sold only in italy by 2016, consisting of one vehicle for fiat. Wants toian brand produce the spider, featured alongside bridget ardo. Sold 5 billion of bonds in the first offering since the bank unit pled guilty to helping americans cheat on their taxes. The sale show that Credit Suisse is not being punished at the moment by the bond market, even after moodys downgraded them. Welcome back to countdown. Im manus cranny. Germanys most watched business measure of Business Confidence comes out today. David tweed is in berlin ahead of the release. David, everybody is looking at this measure. We know there are a little bit of tremors about europe. What is going to hit this number . What is the top of the agenda . I think the key thing here, thes, is to see whether impact of russia and ukraine, whether there are slowdowns in china, whether the slow growth is undermining german Business Confidence. If its beginning to do that, we could see german businesses to delaying investment decisions, delaying decisions to hire, maybe even shedding staff, and that is what we look for in those figures. We expect to see a little weakness in the figures. But remember they are coming from a very elevated position. The German Economy has been doing ok. And about an hour, we will get the final gdp numbers. That will be interesting because we will get the breakdown and see how strong Consumer Spending is. That is what i will be looking at. There was Something Interesting that came out of the pmi numbers yesterday. We saw a slight slowdown in the expansion of manufacturing in pmi, still well above the 60 number, but the key number i thought was interesting was what was going on in the service industries. Is that an indication that we are seeing a rebounding taking place inside the German Economy, away from exports, more towards consumer and domestic demand . If that is true, it will be interesting because think about it the imf, the oecd, even the United States has been on onncellor earned shall go chancellor Angela Merkel saying that we need a rebalancing of the economy. If that is taking place, we may get another clue later this morning, manus. Ok, david tweed for us in berlin. A slightly different depth view at this mark with jeremy stretch , the head of fx strategy. Good morning, manus. We just heard david talking about a whole host of issues , the eversia, ukraine present threat. As david said, is very rebalancing in germany. What is your view . Absolutely, it is one of the integral Business Indicators for the eurozone. Clearly the German Economy remains the bellwether. Its the lead economy within the eurozone. If you look at the gdp numbers and q1, it is the only economy is the eurozone debt growing, dragging everybody else in the slipstream. The question is, are we going to see a rebalancing, which david touched upon. I think we also need to look at the expectations. The comparative survey saw a big fallback and expectation. You can argue that may be influenced by events in ukraine or something similar. If we were to see expectations come back this morning, i think that just underline some of the pressures structurally that are very large in germany and europe for the ecb. That brings me to my next question, which is the german data, the one big break in the data wall that almost pushes the ecb to have to take a significant action . The french pmi was not good at all. Is that the best we can say in terms of forcing the ecbs hand . The ecb will say that the primary risk remains inflation, and that forecast will be pivotal to the decision process. If the cpi numbers are down below three percent target threshold, that will be the final justifier. If you add to that some question about the german economic recovery, i think that just pushes the ecb very much in that direction. We have to see what the interpretation of that will be from the bundesbank. A number of comments yesterday from the italian finance ministry, nothing new there. What would be a bit of a shock for you in terms of they might possibly expected in june . I think we will see measures in june. The story has been clear and consistent. A negative have deposit rate. We possibly have a targeted ltro, which is microphone and. Funding. Is mike rowe the first aware linking other in terms of the rights and looking at the deposit rates. I think the target is entirely possible. You could perhaps add to that the nonsterile is asian of the s p. I think that is the range of measures. If we still had deflationary tendency, there would be questions about the Banking Sector into q4, perhaps you move into more unconventional measures that could be a oxymoron that gets back into the qe type of policies we have seen in the western central banks. The euro has traded lower this week. Are you a believer in that . We have been a believer for some considerable time. One of the reasons we are using as a catalyst is the divergent weakness in the Central Bank Balance sheets over the course of the last couple years. Stilld is expanding, expended cant even though they are tapering, the ecb is contracting. I think that the virgins i think that the virgins is likely to compress. I just adds to the justification to say that cyclically it may well be a question, but from a shorterterm perspective, i think it will go lower. Your, we will get perspective after the break. We will also talk about the upcoming ukrainian elections and what that means for global markets. For a little more about germany after the break. Welcome back to countdown. With the head of fx strategy, jeremy stretch. Jeremy, we have the elections this weekend in ukraine. All the rhetoric movements is to try to carry on favor with the west. Is it a risk for the Foreign Exchange markets . I dont think ford Exchange Markets are looking at is a primary risk. I think it will be fascinating to see what mr. Putin has to say about that at the summit today. That will be pivotal to see how he addresses this situation, if he does, and whether he is somewhat conciliatory towards the west. I think the markets are probably looking through this and really seeing how the process will evolve over time and whether we see a further escalation of what is still a nation of a military skirmish in the eastern part of the country. We have heard minutes from a variety of central banks. As a head of strategy, you look at where the fed is, the bank of england, the debate, and the bank of japan, some say it is only a matter of time in term of the matters. When you look at the sweep of giving you the best direction in terms of how to look at the markets . A you are right, we have seen number of chemo vacation strategies from the central banks. I think the fed, in part in the road minutes, looking at the rome communication strategy, that is the hugely relevant point. We go to this crisis and think about the exit strategy. I think that will be the pivotal factor. Were still very much reliant on the data. Clearly the minutes told us the greatest risk in terms of action comes from the bank of england, despite what we heard last week with the quarterly Inflation Report press briefing. I think there will be an the u. K. G body within that wants to see some degree of modest normalization and policy. From the japanese perspective, its fascinating. If you exclude the comments, look at them in isolation, you could argue he is more hawkish than the markets. Saying our actions are having an effect, the desired effect . Is, weink the question can all draw parallels in 1997, what happened back in, stymieing the economic recovery. You could argue the external factors of the asian crisis that came in, but the question is how much of a correction are we going to see in q2 . It wasthe q1 gdp data, not just consumption that was relevant, it was also the boost in capex. Sign the japanese economy is better than perhaps perceived. Perhaps the reality check we may be expecting from the japanese aid and q2 is not as extreme as we would have thought. Translate that into the yen trading . We have seen investors running short of yen for considerable time. Some of the weakest orders have been cleared. We have not gone down through 160. I think there may be a fall down, but there may be a modest progression back to the top side. Jeremy, thank you for being with us. Thank you to jeremy stretch, cibc. Coming up, as ukraine prepares for its president ial election sunday, violence in Eastern Ukraine escalates. More on the latest development after the short greg. Stay with bloomberg. Welcome back. I managed cranny. Lets go back to i manus cranny. Lets go back to jonathan. Thehe slow grind lower for u. S. Dollar, pmi data from france, concert of contraction. They have work to do. Today, it is about german Business Confidence. Ro, medium forecast, 1. 32, ubs calling for 1. 25. These are the Bloomberg Top headlines. InterNational Television stations are off the air in thailand a day after the military coup. Retainedcurrency lay regained most of its value. Violence in ukraine is casting a shadow in the president ial elections this weekend. Suffered theires worst losses in the east since the conflict began with prorussian separatist. Voters go to the polls sunday. Two troubled eurozone countries have been upgraded as their economies begin to improve. Greeces longterm debt will be increased one level, and Standard Poors raised spains Credit Rating one level. Ukraines elections this sunday should herald a fresh start after the last few troubled months, but the violence is racking most of the east of the country. For some citizens, it could be a dangerous endeavor. Regions, noatist turnout may undermine the democratic process. We have this report from the separatist city of donetsk on the barriers to braving the ballot. Supervised has voting stations from this small office in two Previous National elections, but this weekends voting will be different. Im not scared, she told us. My life is not in danger. Nobody threatens me here or at home. Im just doing my job. Withob got harder recently the newly declared peoples republic of donetsk came to confiscate National Voter lists. Soon after the interview, her office was one of several in the city the separatists forcibly closed. Ukraines interim government has probably printed tens of thousands of ballot papers for sundays president ial elections. Hundreds of International Observers have arrived in kiev. But overseeing a fair vote may be a tough task in the east of the country. A few days ago, this checkpoint was made entirely by the ukrainian army. Today it is staffed by a volunteer of the local militia. There is a changing and politically uncertain landscape in the city. After driving 35 miles outside we eventually found members of the ukrainian army, too nervous for us to film them. Yesterday, 11 of their fellow soldiers were killed. Their continued absence may mean the power of the separatist gun will trump that of the ballot box. Always give us hope about something new, she told me. Neww government, a president. That is the point of the election. However, in the new peoples sk, many votingetask sunday may not fear or hope but rather fear. May not feel hope a rather fear. Ukrainian president ial elections are taking place this weekend. For a closer look at the issues is the head of emerging markets. Iq for coming in. Thank you for coming in. We have had a lot of debate about the elections. Looking at the polls, do you get the sense when the elections pass, is that a constructive mood . Its positive in terms of ukraine, in terms of maybe having a president , but we got to watch for the headline risks. Russias reaction. Is russia going to recognize this election . Are those elections going to be held in a peaceful way . Are we going to see renewed tensions . What happens in the instant part of the country . Be marked with violence . A few headlines and a few questions remain to be answered. In terms of credibility issues, hopefully being answered in part next week, the you think russia do you think russia acknowledging this election and the president elect is critical . Yes. It would be another step in the right direction. If you look at the crisis the past few weeks, we have seen a turnaround of the panic. Mr. Putin has said the troops are going back to their base. That to me was a breakthrough already when we heard that last week. Another step forward would be a conciliatory move and a conciliatory message on the part of putin, saying we recognize the elections. The big question. When we look at kiev and the e. U. , there is the assistance with emergency funding on the way, etc. , but these elections create a more solidified union u. , thereiev and the e. Is a person in charge, so to speak. Oroshenko could a seed to power . Yes, critical and the story is the imf needs a stable political environment to get , and then a program the Ukrainian Government needs to deliver on the imf program. A lot have not really touched on the ability to deliver. This is a country that has essentially been a crisis. Yes, well, if you look at the whole picture, there is an easy job in a difficult job. The difficult job is to deliver the Economic Growth, because precisely the economy is on the verge of collapse here. To have job is perhaps shortterm stabilization. They have huge debt obligations that with new funding they could cover that, it will be easier. Speaking of debt and funding of it, ukrainian debt is near seven percent, one of the bestperforming debt instruments in emerging markets. Is it sufficiently appealing . Would you participate in this stock market . The currency is down over 30 . What does it take to get you involved . Back into the emerging markets, investors have in looking at the gyration. Ukraine is part of that. Investorsans a lot of have turned much more constructive on ukraine. Away from ukraine for a moment, in china we have seen valuations within emerging , thets begin to change clients, what are they asking . What are they talking about when you go on trips with them . The tone is much more constructive these days. I think the main thing with the emerging markets is still the question about Economic Growth. Is, well, itthat is looking better on the secondary level. China for instance is still in contraction mode, but less than before. Think its turning around. We have been grateful for what weve gotten. Russianspoken with the ministry, talking about the nuclear option, entire sector sanctions of russia. How critical would that be to the emerging market growth, the overall growth story . That is i think a pretty serious scenario. If that happens, im going to be worried about the global markets, not only emerging markets. That would be a big enough issue for you, the next crisis juncture, serious sanctions, that structurally changes this . It is a very low probability, but, yes, that event would be quite serious. Lets think back. If you have sanctions that severe, it means there are to put onr the west those sanctions, and that is a condition of the crisis that makes it bad enough. That is a risk. Very, very true. Great to get your perspective benoit. Rning, ebnoit up next time israels Prime Minister has an unexpected thr obamasone of president most controversial moves. Find out what that is after the break. First. Bloomberg. Time for todays company news. Is never a wing who gets to see new members posts, dialing back wickets shared on the social network after debating years of outrage over its privacy policies. The change reflects how facebook has been working to adjust the working to adjust the site. Gap reported quarterly profit that topped estimates. The quarter got off to a slow start, business rebounded in the end, especially the lower cost of the old navy chain. General electric agreed to the french government and cory to expand until june 23 the deadline for its proposed 17 billion acquisition of alstoms energy unit. Ge had been asked to delay consideration of the offer as french officials seek better returns. A very welcome back to countdown. Im a man this cranny. I manus cranny. Thailands military seized power the 19thdless coup, time since 1932 the military has staged a coup. After the coup, there is call month the streets of tank, soldiers dismantling protester cap. Beools and universities may closed, some broadcasters off the air, sam manufacturers have canceled night shifts because of a curfew, but thailand has experienced so many coups, locals take it in stride. For most, this is how people learn how their country was once again under military rule. Firstly, the constitution of the kingdom of thailand is suspended except article to regarding the monarchy. Secondly, the caretaker cabinet is ordered to cease their duties. The announcement came as the military lost patience with the leaders tuesday. The ring two days of martial law, the during two days of martial law, they urged leaders to end the political impasse that has been gripping the country. With no result in strike, the troops took over. There are is some activity, combat soldiers. Are walking people, blocking people from leaving. What are you doing . Is there a coup going on . Governmentilands removed, the supporters were next. Rival protesters who consider the government little more than a proxy for the Prime Minister were also removed. It is a bitter divide between the poor and the urban elite, which has seen thailands lurch from one political crisis to the next since the last coup in 2 006. Has expressedions dismay that the military is once again in charge. The secretarygeneral is seriously concerned about the military takeover in thailand in appeals for a prompt return to constitutional civilian, democratic rule and an allinclusive dialogue that will pave the way for longterm peace and prosperity in thailand. While it has been a peaceful and bloodless coup, the next step is potentially dangerous as the delicate task of political reform looms for a deeply divided nation. Paul allen, bloomberg. President obama was right on according to benjamin netanyahu. He spoke exclusively to bloomberg with jeffrey goldberg. Elliott has more on the story. It was a wideranging conversation, but really quite fascinating in terms of the conversation. You may recall that the u. S. Wanted to launch missile strikes against syria after the assad regime crossed the red line of using chemical weapons, but then the Obama Administration backtracked, handled handed the negotiations to russia, dismantling the stockpiles of chemical weapons. Benjamin netanyahu said that was a very good thing. He described it as the one ray of light in a very dark region. He said some 90 of Syrian Chemical Weapons have been destroyed. Given that they were on israels northern border, that can only be a good thing. Manus . Iran, theyt, on do not see eye to eye . Their views are quite divergent. When obama came to israel they they share the stage and they were broadly of the same page. Socalled breakout capability of obtaining Nuclear Weapons. Now they dont exactly see eye to eye. He said the americans say we will not let iran have Nuclear Weapons. We say they should not have the capability to produce Nuclear Weapons. 12said even keeping iran months away from having that capability of being able to obtain Nuclear Weapons is still too close for comfort because down that road lies the path to the north korean situation, and we all know where we are with north korea, which has Nuclear Weapons. Manus . Elliott, the pope is visiting this weekend. How has that been seen, how was it received . What does that do in terms of the groundwork for israel power at the negotiations, discussions, whatever word we might choose to use . On the eve of the popes visit to israel and palestinian territories, i think it is fair to say that netanyahus take on things do not give a lot about them is him. It was a wideranging discussion over his view of the middle east peace talks that u. S. Victory of state john kerry put so much effort into. The collapse of the talks on the building of segment on the building of settlements, but netanyahu said that is not the case. They asked the Palestinian Leader to come to the negotiations and choose between a settlement. He said we chose to release palestinian prisoners. The palestinians were well aware of what they were going to build on the settlement, how much they were going to build, and where they were going to build. For them to come out and be outraged about continued settlement building during the peace talks he said was not justified. He said the palestinians have somebody who can seal the deal and signed off on a copper has of peace deal with israel. He said the israeli Prime Ministers always thought they were on the verge of success, then arafat backed off, the current Palestinian Leader backed off, because they cannot conclude the negotiations. We dont have a Palestinian Leadership that is willing to do that. I think its fair to say that the list indians would view things somewhat differently, but on the eve of the popes visit to the holy land, it does not give one a huge amount of optimism these peace talks will soon be back on track and we will have any peace deal anytime soon. , we will leave it there. Coming up, where to find the best burgers in europe. Back in the newspaper section, coming up next with john farrell and olivia sterns. A very welcome back to countdown. Just an hour to go before the start of european trading. We have much bigger issues on the agenda of countdown. Olivia sterns will be with me next hour, and johnny farrell. I will go with cheap burgers. Date is friday. ,ff to the wall street journal flipping fantastic, where are the best earners in europe . Inis the welldone burger bologna, italy. Look, st. Ives, apparently that is a good choice. Check them out. It is all about shake shack in new york. One sheep gate per week i cant believe it one sheep gate per week, i cant believe it. Lets go to david tweed in berlin. What have you got for us . This would be your last official newspaper section ever on countdown. And its right, manus, have something i think is sort of appropriate. It is an article that has a picture of mario draghi on the front dressed as caesar. Ecb, theine reads the bundesbank, and the fight for the euro. Somehow i think that is appropriate because the last five years or so, most of my life it has been dominated by this fight for the euro. David, we wish you well in hong kong. You have acan say good crisis, my goodness you have. Well done, we appreciate everything you have done is our european editor. Have a fantastic time on your bloomberg journey to hong kong. Its amazing where we have come in the past four years. Four years ago i was with francine lacqua, the first overnight session. I remember thinking at the time, jeez, are these guys really staying up all night for this . This whole greek bailout thing, i think they are overhyping this. Laterovernight econew the greek government that has been upgraded yesterday by s p to b. And along the way, david tweed has covered every bit of it. Would you believe the daily mail is the number one gossip rag in the United States . You think of it is a british publication, but today im picking a royal story. The kremlin is hurling abuse at Prince Charles commented for tat in the british media, there we go. I will try to hold this still. What happened, Prince Charles canada and in compared Vladimir Putin to hitler. Now the kremlin is hurling back abuse. Well, we will stay focused on ds amazing story, from twee last day to burgers, i have luxury property. Central london, 4 million square feet have been reclaimed, another 2 million to come. Stay with us for the next hour of countdown. All the top stories that is breaking at the top of the hour. A country who silenced. It suspends the constitution and shows off International Tv stations and schools. Russian president Vladimir Putin will address the Economic Forum in st. Petersburg later today. Countdown the event. Asks gerench government to extend the deadline for its bid for three weeks. We are live from st. Petersburg today. Interview. Our and talented, schools are closed and local tv stations are under the command of the military. International broadcasters are off the air. For the latest on the situation, lets bring in zeb eckert. This has been brewing for some time. Took certainly has but it a few minutes yesterday for the military commanders in bangkok to seize control. This came in admitted meeting with both sides. The Army Commanders apparently losing patience and the general seizing control yesterday in the 12th crew in thailands history. You see the drama 12th coup in thailands history. Than a hundred people from rival sides have been ordered to report to the post tcoup headquarters. The Prime Minister reported there in just the past hour. No word on how long she will be detained or what will happen to the other leaders of the countries that are also due to report. They have not so far and they are considered fugitives. Today, the stock market in bangkok is open. We have seen a decline for shares. The currency has rebounded in thailand. Goals and universities were closed. The main airport functioning as thai as normal but airways saying to expect delays. Imposed fromonally 10 00 p. M. Till 5 00 a. M. So far, this is a but thats a but there is a lot of uncertainty. It is a volatile situation. The u. S. Expressing its dismay that democratic and suppose in thailand have been did been suspended. Thank you for that. Putin willt address leaders in saint petersburg. Ryan, you told us the story was not so much just to showed up but who didnt show up. How about among those who have showed up in st. Petersburg, what do they want to hear from putin . Ent they want to hear some conciliatory language from the russian president. We are coming up on this president ial election in ukraine on sunday and i think theyre hoping to get some clues that rush is either going to accept that language or at least that perhaps some of the violence in the east and the south of the country will subside. He is going to be making that speech at two 30 local time here in st. Petersburg which is 11 30 in london. That is what people will be listening for. The signs on the ground dont bode well. We had an attack on ukrainian soldiers last night. 16 killed. Germany, the European Union to an extent have all said that they will use the results of those elections whether those elections are disrupted as a trigger possibly for more sanctions, possibly economic sanctions though. Im not sure there is a lot of unanimity on that front. One thing that we much everybody here at this business form agrees on is they dont want to see any more sanctions. Address from putins today, what else is on his agenda . With firstng giving that speech and then he is going to be having dinner with some of the Business Executives here. We are going to be turned to look at business from a couple of different angles. Decill be talking to jc euax. Exactly how do they navigate this crisis, why are they here, that is what we will be discussing with jc decaux. We will be talking with the finance ministry to see how they are dealing with the ukraine. They are having a meeting with lisa and mastercard, two companies that are in a big conflict with the russian government. The russian government said you have to put up a collateral now if you want to continue to do business here. Thateo said that, in case, it is prohibited and we will leave him there are talks today just before visa, mastercard and the finance minister before i sit down with the deputy finance minister. We will give everybody the latest on those discussions. Antisemites. Another gray light of interviews coming out live from st. Petersburg. A little bit of breaking news for you. Selling insurance to cruise liners to the over 50 priced at wme in that tone of voice. I was disappointed that it is nice to the slow in the range. They will raise just over . 21 billion. Exit does seem to be a soggy ipo in london. We have seen a couple of disappointments. News from gdp, gdp news from germany, gdp. The other big news is the investment in germany storming ahead. 3. 2 . The market was looking for 3. 21 . So a good set of numbers all around. This is ahead of the evo not the efo numbers. David, this is actually a nice set of numbers. Headline gdp beat. Construction of an consumption up. It is the consumption that i think is really interesting because if you also have a look consumption, it came in slightly better than expected. But look at domestic demand. 1. 9 versus 1. 4 . The capitald out investment numbers. Very, very strong one. One third stronger than forecast. Interesting about what we are getting today from these numbers is this is the breakdown of the confirmation of the initial numbers that we got last week when i was at at at at. This is what i have been looking for. It is almost a confirmation of a rebalancing that might be taking place in the German Economy. I was talking about it earlier because yesterday i was talking with ing and he made a salient point about the pmi numbers we got. What we saw was, yes, we still have an extension going on in manufacturing but the real strength was taking place in strongerpmi, much than expected. So it looks like this rebalancing is going on in germany and that could be good for the rest of europe as well. There is also a little bit of news in terms of Credit Ratings. Spain and greece have had their ratings raised. I feel like, in a way, we are drawing a circle. He mentioned before that this is the last time i will be on Bloomberg Television talking about european debt. Four years ago, i started covering the downgrades in greece the lettuce into the spiral of the european debt crisis. Feels appropriate to see that we are seeing these upgrades coming through. The primary surplus, they got the primary surplus them made remarkable progress on the fiscal front. The most challenging phase for adjustments for greece is behind them. Bottomnomy asserting to out. Some will save a look at the employment, the pain. But greece has done a lot of work and it appears to be turning the corner. Coming up, as International Pressure following russian sanctions keep the ceos away, we will be talking to one, jc deca ux on why he chose to attend and what russia means for his business. Welcome back to countdown. Lets get you straight back out to st. Petersburg where the International Economic forum is going on. Ryan. We are joined by the chief executive of jc decaux. In st. , you arrived petersburg. I arrived in moscow. You made a lot more money than me. Youve got time to catch up. Im not going to ask you why youre here because i understand any business person that has 350 million worth of revenue, that is what you have your in russia, would want to be here. Did anyone ask you not to come to st. Petersburg . Anybody from the french government . No, i didnt get such a call. Not at all. I noticed that the french delegation is one of the biggest here. France inc. Is represented pretty prominently here. Just before this, the french said, despite the pressure, we are going to go ahead. Why are the french year when everybody else isnt . Given the state of the french economy, we need to boost our export business. This is the pragmatic view. And french have a lot of companies that do extremely well in the export business. We have a lot of big corporations, including ourselves, that are relying on business outside of france. We do revenue out of france. Which is quite unique in our industry. Which is very local. Probably the only company with such a massive footprint outside border. Rench the European Union is been together on tuesday to Start Talking about sanctions. What do they think about the ukraine action and more sanctions. What do you think about that idea, more sanctions against russia and how that gets shared . I heard many french people feel you can tell me if this is right business people, that the brits, the americans have been pushing for tougher sanctions but not at their own expense. I think more french would be wrong. I think the europeans have to find a way to work with the russians. Naturalrussians are a part of europe. This earthly speaking, russia belongs to europe. The problem with the European Union is that there is not one voice. That makes it pretty difficult. We have operations in ukraine, by the way. Ukraine is not one country. Creation after the war. That is why it is a very difficult issue. You cant look at ukraine is one single country. How much business do you do there . What percentage of your revenue . About 30 million. Is that how you look at it . Is 30 million on one side of the confidence or 50 million on the other . Presumably. Everything counts. If you start ignoring markets in the multicountry business, then youre in trouble. What you were just saying about how ukraine isnt really one country, it sounded like you are a bit understanding of the russian position. Is that the case . I do want to make a political statement. Crimea was given to ukraine after the war but it was part of russia. Think of yugoslavia. It was also a creation. And it ended up breaking up the country. We are in every single market. There are different people, different countries, different history. Geopolitics are also business at the moment. Here in russia, you have 10 of your revenue. It would be 10 of our revenue if we were considering 100 of our business. But we only own 25 of russian business. The business to build their business in russia in 20062007, you cant do business here without a russian partner. Sometimes, you figure out who will be our best russian partner. We ended up doing it with vtb. We have a 25 stake. Governmentthe moscow , they wanted 10year contracts with the other panels last august on the basis of reducing investment by 30 . This reduction hasnt happened yet. Laws up inot of moscow. In other words, we are saying the higher range based on the. Number of people which is not supposed to happen. Previous number of people which is not supposed to happen. He came to the exhibition which we had last year. Remember, we are also infrastructure. Providing automatic public toilets in kiev. Weve got toely, go. There is a lot more to talk about. Thank you for joining us. Thank you so much. Decauxt interview with jc coceo. The uae has been reclassified as an emerging market for almost a month. What does that mean for investment in the region . We will discuss the next. Welcome back. In the past month, the uae has gone from being labeled a frontier market to an emerging one. What does that mean for investments . We are joined with managing director and vice chairman of abs securities in abu dhabi. Looking to the show. Thank you for having me. The upgrade that you have seen, this is quite important, positionom one status from frontier to emerging market. How important is that to the region . It is very important for the region especially for abu dhabi. Abu dhabi anticipated that move and prepare the country infrastructure, legally, and capitalization. It is being used as a great bridge for business and also investment coming into the uae. We are seeing that move quite positive. It has been an incredible year for investment in abu dhabi. The benchmark grew 44 in 2014 alone. We are five months in their property prices up 35 last year. That sounds a little bit frothy. Do you think this is still a good time to buy in . Where you seen these opportunities . You have to see opportunity in technology. Today, abu dhabi has invested a lot of money into technology, technology that can be used worldwide. You can see the opportunity into banking. Enoughnow sophisticated to receive very important clients, very big amounts. Abs also had to adapt itself to abu dhabi upgrade. Also, its true the money is there. Capitalization is Even Stronger from asia, abu dhabi, and also coming to europe at the latest. Is driven into the emirates come around the whole region. You will see a lot more bond issuance from abu dhabi, from dubai, etc. What kind of critical your we talking about . What kind of risk do i have to take to access that story . Basically, yield is 10 you see in europe. This is important because of the opportunities that abu dhabi has over there. On the other side, risk is very important for abu dhabi and corporate governance. It is important that europe knows and the west knows that abu dhabi is doing everything to ensure that risk is very well calculated and their money is safe. Obviously, abu dhabi, the uae is in the middle of a region that is suffering from a lot of turmoil right now. Egypt looks like it is going back to a military dictatorship and iraq looks far from stable. How can you pitch people on the stability of the markets in the middle east given that context . Abu dhabi has pitched itself as a nonclinical country. It is a business country. You feel when you go there you smell the air and you feel youre doing business. It is a different environment. You dont feel at all the instability. You feel great stability, great security. We had the National Bank of abu dhabi in here yesterday. They were talking about growth, expansion, building a global business. We are seeing a lot of people here in london and various Financial Centers go into redundancy mode. Some very talented and knowledgeable people exiting their current institutions. Is that an opportunity for you in terms of hiring . Of course, it is an opportunity. There are very talented people, like you say. It is important that we look into it and we are always in seek of more talented people. What we are surprised is that more local people in the uae are externally talented. They are bringing added value to s, sometimes more than us foreigners. They are not just importing Skilled Labor anymore. Next, the London Housing market, as if you didnt really know if you didnt really note, some people are saying is stuffy. We will get the perspective from a man who has the inside track, the ceo in our Party Development , quinton the states. Dont miss that. Welcome back. The euro is on the move this morning. Just a little bit of a touch. Heading for a Third Straight week of losses. A flurry of german data but the big one comes that 9 00 u. K. Time. We are expecting a ticked lower on that as well. A bit call from ubs. For this to finish at a dollar 25, what you have seen in the last couple of uses a in the acb. That is about to turn around and that will move this will lower. The year and forecast is 1. 32. These are the Bloomberg Top headlines is money. Schools are closed today and interNational Television stations are off the air in thailand. A day after the military seized control. The thai baht regained most of optimism over political stability. Forces suffered their worst losses in the east since the conflict began with prorussian separatists. Voters go to the polls on sunday. Two troubled eurozone countries have been upgraded and their economies begin to improve. Fitch will increase greec elongterm debts. Standard poors raised spains rating. An in home prices are at record highs. This morning, we get earnings from one of the companies specializing in Property Management and investment. Max james, thank you so much for coming down. Lets start with wembley, probably your biggest project. Two thirds of your total assets. Give us a progress update. How is that going . He also had some initial sales. Very encouraging. We spent the last 10 years in the Company Involved in the project. But over the last three years, we have been developing a big recreation destination. The next piece of news that people are looking for are our essential sales. They have gone extremely well. 570 point square foot. You are trained to get a huge project out the doors. How is demand . Can those prices hold . Is there a risk of oversupply at this kind of price point in the market . Point, if youe look at the london market, you are going to see some quite clear tears in the market. In the market. They are well within the range of professional london. We are providing in a formal solution for people try to get into the market. It is in that piece of the market where we see the greatest sort of supplydemand imbalance. Been adon market has prescribed three years. London is more than 500,000 pounds, much more than a new york. Center i am in howicular interested in him much demand have you seen for the overall retail so far . Its been good. We are announcing a number of new retailers. Downully, we will get you there buying some shoes. 80 solar. We are up to 90 . Real Critical Mass there. It is appealing to people looking for that bargain. The first outlet within london. Britain does not have enough sales. Politicstalk about the of funding at the moment. We are not building and houses of the bank of england. This is their single biggest concern. The financialhat policy committee should intervene . Should there be a macro credential even though youre selling in the 300 to 500 range . This is potential a risk to your business if the fpc step in and the banks adhere to the multiples. Moment, you are seeing a number of House Builders and developers are responding particularly in the london market to this kind of supply. From that perspective and to keep the economy going, it is really a desire to keep that supply on board. I do think coming back to my thesis that there are a number of tiers to the market, the one you are looking to supply products that can be bought by londoners who are working in london. Are you seeing overseas buyers . One of the criticisms on a lot of the projects are overseas buyers sweeping in an . We have seen that side can just to give you another reflection on that. We rent out a letter property so we are actually pushing hard into the landlord business. Professionally run. We are running vacancy rates and we are occupied 97 . The moment someone leaves, that one is sold. No wonder i couldnt find Affordable Housing for these too much. To get the cabinet right sized, you have been in the company to use. You stood back from projects in greenwich and invested from divested and from Student Accommodations. Planks we set ourselves on have been delivered. A lot of Student Accommodation has run quite well. We have had a fantastic performance over the last six to seven years. I think it is a very strong market if youre producing highquality Student Accommodation. Again, it appeals to overseas and domestic students. So you get the price point youre looking for, 300 to 500 pounds, things that lenders and selves come by but were specifically . Where these two pockets of opportunity . Works butce point critically you have transport links. That comes back to the key thesis which people want to be port good public trans when they get into town. Take you so much for joining us. Rising medical costs in the u. S. Are driving a mechanism receives. Hipedures like replacements, bypass surgeries are up by 90 . Look at the takes a numbers behind the business of medical tourism. Need a new hip, a bypass or maybe a full facelift . Take a few days and travel. Medical tourism is booming. An estimated 1. 2 million americans will travel abroad for medical procedures this year and they will spend as much as 55 million. What is the draw . The rising cost of u. S. Health care for one. In the u. S. , it cost 34,000 for any purpose and surgery. In india, 7,000. So buy a plane ticket, get a hotel, and you will still have plenty of money the film or for some r r. Spinal fusion . , 18,000stateside dollars in south korea. One reason why procedures in the us cost so much . Americans love to sue. The high cost of malpractice insurance rise up the cost of procedures. Turkey has 41 americanaccredited hospitals. 225hailand, there are over u. S. Boardcertified doctors. Even if you can save 90 on getting procedures abroad, some things will cost you more elsewhere. Bypass is gastric 18,000. In mexico, it is almost 28,000. Electric up, general extends its deadline for the offer at the request of the french government. What the french might do in the threeweek extension. One of the most talked about ipos but shares sold at the bottom of the range. Details on saga. Welcome back. Its time for todays company news. Dialing the quick is shared over years of outrage over its privacy policy. Facebook has been working to adjust the site based on what its one point 3 billion users say they want. And gap reported quarterly profits of that topped analyst estimates. Off to a slowt start. Business rebounded to the end of especially at the lower cost chain old navy. Extend its asked to bid deadline. Ge has been asked to delay consideration of its offer as french officials seek better terms. Welcome back to countdown. General electric have agreed to give more time to consider their 17 billion bid. Hans nichols has the story for us from berlin. How much more time exactly has been granted . Asked for . Weve got three weeks. That was the request. That is what was granted. This will give time to formally approve the ge deal. They have already signaled that they approve it but have not formally done it. But it will give time to put give zemann time to put forth their own bed. What you are hearing about from ge is a great deal of confidence. A great deal of confidence that they will be able to get this deal over the finish line. Froma look at this quote ge ceo at Investor Conference in the states on wednesday. It is all about confidence. Us a littletrust bit that we know what we are doing. The finance minister in france has signed a new decree that gives the french state more power to block any kind of takeovers. Seems to thinke so. Ge has three in their deal. There talking about maybe a joint venturer in the railroad signal business. They dont want to give up locomotive manufacturers. This is really about ge being at the core of what alstom has further purposes and that is gas turbines. A very interesting story. Incredible to hear that Francois Hollande is pushing for job assurances. Backether the germans come ath a counteroffer, the is political football at the moment. And the ceo of alstom wants it, too. As you know, saga as a provider of insurance to bridge over the brits over theo age of 50. It seems like it was a case of mistaken identity. Here is a company that does mainly insurance but sources ellis they went to investors and said we want to be treated as a Retail Company because retail attorneys have higher valuations. Most of their business is done in insurance, isnt it . They do. There is a great growth story but this is an Insurance Company and they want to be compared to entertainment which is one of the big deals of last year. Investors were not buying that story. It will be interesting to see how they rate today. What are you hearing from alice investors about the appetite for shares today . The prices at the very bottom at the range. We were looking at analyst knows he is today that say that we had a fund that invests in stocks on the plume of aging. They say they will not invest because it is expensive. Overall, the ipo market is a little bit soggy, right . Companyhase, the retail. What is the overall ipo environment like right now . Last quarter, they raised about 10 billion. This quarter, it is close to 2 billion. Numbers are down. You had companies feeling ipos filing ipos. I think investors have seen the gdp numbers coming from last quarter. They are not as strong as expected. There are somewhere is on deflation. A company in that environment may not have good growth. They are a little worried. If we talk about the sustainability of this proposition, i go back to the audience of over 50, which is they have disposable income of 175 million pounds. The correcting you can tap liquid gold. Long time, there is a sense that this is a good start. Today, we might see some weakness because investors have clearly said they dont want to pay above a certain price for it. That will probably be reflected in the trading as well. A lot of money to be made in the socalled longevity economy, having a lot of disposable income. I hosted a conference on the longevity economy. This is a huge growth area. In japan, they have these fitness statistics that more people over 65 will be wearing diapers by 2015 grandbabies than babies. Was so excited about this. I wore green for you. Coming up, who knows where you get in the next section. It really changes its gdp calculations. Welcome back. Jon ferro is here with all the macros scenes you should be watching today. Do that again. Hethis story about it till is brilliant about italy is brilliant. Include the sales of Illegal Drugs and prostitution in your gdp calculation . Spain and italy have complained over the last couple of years about their and implement statistics. Obviously, if you are working in the unofficial economy and the black market, youre not counted as employed. So they can be inflated somewhat. If you include these statistics in your gdp figure, its not going to help your unappointed figures. It might. Heres what is going to happen. You have a budget deficit target of 3 of gdp. So you grow the economy, make gdp bigger. One way of doing that is including those numbers from the black market coming putting illegal drug sales, prostitution, and that is what theyre going to do. On the face of it, it seems like a national forest. But there are reasons they are doing it. Do we think the germans are going to allow this for a debt to gdp ratios . Out there. Utting it the eu rose to do just that. How big of a visceral talking . I think it will be horrifically difficult to calculate. We are just going to have to see how it plays out. It makes sense to me to try to get things that are in the black market on the books in the sense that you use to go shopping in cash. Please start making actual paper receipts. But to include prostitution and cocaine trafficking in your overall gdp seems a different direction. Any sense what the origin of this is . You look at the lexus spain, italy, a black market accounting for 20 of the economy. It is a huge slice of the economy. Im thinking that as people paying in cash rather than drugs and prostitution. A lot of it will be illegal activities, like the mafia, which is a large slice of gdp in italy. Lets read it i can now. I think the dark economies have enough. We are waiting for the full. They have had nice, strong german numbers. What is your feeling for the markets today . It was a bit rough. I think a bit lower. Germany is not the eurozone right now. It is a third of gdp. But they are continuing to put up good numbers. They are much more reliant on the likes of china for some of their growth. They are likely to be impacted by what happens in russia. So they have external things to worry about. Eurozone, here in the france was the standout from yesterday. And french gdp last week was terrible. The pmis were in contraction and it did not look good for the rest of your printer. The euro hitting a threeweek low as we go into these elections. We have 10 trading days left. Youre counting them down. Baycol from ubs. ,he last couple of years expanding Balance Sheets at the federal reserve. We are getting to a point where that is going to turn. Ecb are going to expand that balance sheet. That is what the cause are. Kennedy pointed out a greater role saying that european leaders are looking for an ikea model. We will see if that keep that in sink. We are going to be live in st. Petersburg in russia. Welcome to on the move. I am mark barton out Bloomberg European headquarters in london. We are moments away from the start of european trading. Our markets team has everything covered, from companies to currencies. Here with me now is jonathan ferro. Zeb eckert is in hong kong. Ryan chilcote is in st. Petersburg. Hans nichols is in berlin. Jon, futures, a mixed start. A little lower through the morning. Week, itart of the asked if we could make it a sixth week of gains . 6 10 on theout week. We are not talking big gains, just grinding higher. Ryan chilcote, you have the zeb eckert, you have the story on thailands coup. The former Prime Minister being deposed by the military. The question now, what is the future of thailand . The military is in charge. I will have the latest. Lets lets get to st. Petersburg, to the International Economic forum. Good morning. President putin will address these attendees later today. Is right. The russian president president will address investors 3. 5 hours am now ahead of the president ial election in ukraine on sunday and the prospect of more sanctions next week from the eu and you knighted states. We