Transcripts For BLOOMBERG Countdown 20150206

How will the plunging Oil Price Effect statoils earnings . Plus the first interview of the day with the chief executive. Social climbers. Twitter and linked in shares soar after beating estimates. Welcome to countdown, i am mark arden. Barton. I am manus cranny. The u. S. Nonfarm payroll figures. We infer those. In the meantime, lets give you the numbers for stat oil. They are breaking across the terminal. He will be made with me a little later. Net income for the fourth quarter. Comes in at 9 billion kroner. The key is the dividend will be flat for the first three quarters of the year. The dividend remains for the first three quarters, no change. Capital expenditure, the other key issue. The trend is the same at statoil. A Capital Expenditure program reduced. 218 billion this year. The Cost Reduction program they will lift. To 1. 7 billion. Lift that to 1. 7 billion. They will provide total cash improvements of around 5 billion. The dividend remains intact for the next three quarters. Capital expenditure has been reduced by 2 billion this year. Those are the banner headlines. We will get into that conversation with the ceo. He is in the building. It will be a first on bloomberg. It is his third day in the seat as ceo. French president and german chancellor merkel heading to russia to press for a ceasefire. Officials are skeptical a quick resolution is possible as more troops and firepower from both sides pour into the conflict. The ukrainian economy getting pummeled as a result. The country devalued its currency in efforts to stave off the fault. Ryan chilcote is on the ground in moscow. What is on merkels agenda today . Both Francois Hollande and Angela Merkel arrived later today. They will be here for talks with president putin at 5 00 p. M. To read that is there 5 00 p. M. That is after their trip to visit the ukrainian president. Theyre calling this a lastditch effort before an escalation in the crisis. There is a proposal that would maintain the territorial integrity of ukraine while bringing peace to the east of the country. There is deep skepticism. Also in kiev was secretary of state john kerry who said, i have my doubts is going to work. Have a listen. As i have said there have been a number of off ramps for russia to take over the course of the past months. Unfortunately, they have been left in the rearview mirror. Just in case you had any doubt how ruinous this has been for ukraine more than 5000 people have been killed in the conflict. Hundreds of thousands have been displaced. Ukraines currency has lost half of its value in the last week. That is because the central bank has decided to let it go in an effort to win 50 million in Financial Assistance from the imf and eu. That is on top of it losing value before that over the course of 2014. Give us a sense of the consequences if the efforts fail today. Got a little bit of problems technically on this and. What is at stake here is extraordinary. We have on one hand the u. S. Threatening to harm ukraine. Arm ukraine. President obama is set to make a decision in the coming days. The incoming nominee to be the next secretary of defense has said he is inclined to support such a move despite the fact that president obama is saying he has concerns and in no final decision has been made. You have the european union, the informal summit of leaders. That starts third in a thursday. On the table, possibly more sanctions. The greeks watered down the language. They removed the words restrictive measures. That is code in the eu for more sanctions. That does not mean they couldnt slap more sanctions on russia. Ryan chilcote in moscow. The u. S. Is coming off the best annual jobs growth in 15 years. We got the data for january. A survey estimates that the economy added in the region of 230,000 jobs. Unemployment rate holding at 5. 6 . To discuss this, the u. K. Managing director at charles schwab. A big day with markets. We sit with bated breath in terms of how many jobs the u. S. Will produce. We do know and nine out of the past 10 years, the initial number is lower than the estimate. It is a tough month to make the call on. Yes, it is. As you pointed out, it is indisputable that the u. S. Economy has been creating jobs. Wage growth has not started to kick in. We saw 1. 7 wage growth. The expectation is 2 this year. What the fed is looking for is 34 . To feel comfortable. While jobs are being created the issues are that the unemployment longterm unemployed are not being taken up. Can the fed raise rates with wage growth so low . In todays report, they raised 0. 3 . Can they raise rates with wage growth static . The consensus has been pushed out further and further. It is interesting what happened with the currency. A 10 increase in the strength of the dollar. It is normally the equivalent of 75 basis points for Interest Rates. The currency mightve taken some of the options to do that out of their hands. You have said you can expect the possibility of a decent sized stock market correction. I like a guest that stands out from the crowd. Why . We have an army of analysts. We have been 3. 5 years without a correction. On average, you get one every 18 months. There are number of factors external to the u. S. Valuations are rather rich. You wonder how much more with deans earnings can do to keep the market expanding. External factors, oil, currency greece. One of these things could push the market into a correction. We had a pullback that was almost a correction. We are long overdue want to read other factors at play. Will is one of the factors. Oil is one of the factors. A fall in the price of oil could occur. We have been saying all along, the u. S. Economy is made up 60 is dependent on the consumer. The Oil Price Falling is a net positive to the economy because the consumer. The money the consumer has been saving, some of it has paid back debts. Savings rates have gone up. The concern is what that does to the unemployment number. On a net basis, the oil is a net positive. In europe would you still be as bullish with qe coming into play . And the euro falling . What will drive your perspective on europe . By ua should are rich in the u. S. Even more so in europe valuations are rich in the u. S. Even more so in europe. Spain was one of the standouts. That is one of the only two countries that dealt with structural reform in the labor market. I would like to see other countries do the same. The greece situation has proven immensely volatile. On monday, we had the Stock Exchange rise 4 . Tuesday, falling 3 . Are they going to have their tails between their legs . There is a big speech do sunday. We have we will get a that are sent then. Get a better sense than. Since then. It is all political posturing. From an economic perspective, europe can deal with greece leaving the euro. But it is the president it sets for spain and italy and other countries like that. Spain is a big country as his italy as is italy. You can find out more on the story and a complete guide to the u. S. Jobs. Go to bloomberg. Com. Lets look at some of the other stories we are following to read the australian Prime Minister saying he will oppose a motion seeking a vote on his leadership. Comes after a party member sent an email saying they must address concerns about him. The ballot will go ahead. If half of them back the motion a decision to bestow a knighthood on prince philip. We are not the labour party. We are not the labour party. We are not going to repeat the chaos on instability and instability of the labor years. Australia has lowered their growth and inflation forecast and predicted inflation will rise. It comes following a collapse in the price of iron or, which generates one out of every five austrian dollars of export income. Twitter forecast the number of users will pick up. The company says revenue increased 97 , with a net loss narrowing to it is projected adding between 1360,000,000 users in the first quarter. And faster than the growth in the prior. Revenue projections sparked concerns among investors. Shares fell 15 . Executives announced a profit range for the Current Quarter that trailed estimates. Firstquarter estimates are expected to fall 46 from the fourth quarter. Abandoning to the euro would be unthinkable. They said there is no limit to how Balance Sheets can be. Adding, it would go on for as your with forever with efforts to defend the euro p eg. If anybody starts having doubts about the paid, we will have an issue about the peg, we will have an issue. We will keep to the peg. Do whatever it takes. We can go on forever. There is a report of fourthquarter profit over a year earlier. The largest French Network equipment maker boosted margins. And stay with countdown, because we will be speaking to the cfo of a patel lucent alcatel lucent. Tell us what you think about the show. What many call the biggest piece of Economic Data in the world. The u. S. Jobs report, also known as nonfarm payroll. Just a duo. Manus cranny and mark b arton. Coming up next, the statoil ceo. We brought you the earnings of statoil. They reported a Net Operating Income at 109. 5 norwegian krone. We are joined by the chief executive, eldar saetre. I think it is day three for you in the job. This is a tough set of results to deliver. This has been a tough quarter. Why . Apart from the obvious . The obvious, which explains the Net Operating Income. We have seen the drop of oil and gas prices of 10 . That is having a Significant Impact on our company. Summary said we were going to have a conversation. The alpha and the omega of the oil industrys Capital Expenditure, which you have cut right to billion dollars. The second piece the dividend. You are sticking with it for the next three quarters. You are scrapping a policy to raise the dividend. Why are you dropping the policy and can we be sure that dividend is secure for the best the year . We are not scrapping the policy. We are highly committed to the policy. We remain a flat dividends. That demonstrates we are highly committed. I think it is a very competitive dividend. The flat dividend is reflecting the current market environment. I appreciate that. But there comes a point in the oil market where usa ceo have to be brave and say, i have got to cut this dividend if im going to protect the longevity of this company . Where is the bandwidth for oil that puts pressure on that dividend . Not one ceo has dared to give an answer. We are highly committed. We are also demonstrating a financial framework, flex ability within that framework. Which makes it possible for us to safeguard the dividend. We are trying to find a balance in oil. I am reading 5060 dollars. Where would you project im not asking you to guess the price of oil pretty see oil trending . In the short term, i am highly uncertain as to what kind of price environment we will see. We will see volatility. We could see a low price environment for quite some time. Fundamentally, we are in a part of the cycle. We will see a rebound at some point. Whether there are structural changes for the longer term it is too soon to say. We dont see any changes in the fundamental leaf in our commodities in the fundamental belief in our commodities. What concerns you in terms of the supply side of the picture . Opec is still there. We have to look at an annual decline of 56 . U. S. Production will be absorbed into the declined. We will have a situation where it balancing supply and demand and the cost of the supplies will define the oil price going forward. Which brings me to Capital Expenditure. It was originally 20 billion. It is down to 18 billion. Will that be domestic . Norwegian . Or international . Where will we feel that squeeze . We are investing in a highquality portfolio. We have sanctioned a lot of projects that are ongoing. We have a project ahead of us which hopefully will be stationed this year. A short timeframe. This will provide us with profitable growth going forward. We are using a lot of the flexibility we have any flexible part of our portfolio, including a significant reduction in the u. S. Onshore business. Reduction in u. S. Onshore. What about was ill, angola u. K. Brazil, and glaucoma the u. K. . On short will continue and we will add a new worldclass project. That represents an increase of 10 from last year. Quite significant flexibility we have in the portfolio. What is the risk here . There is a figure about your offshore workers being paid 150,000one 70,000. Do you need to negotiate the onshore offshore . Surely that has got to give. In such a Turbulent Oil environment, can you are continue to enjoy that kind of privilege . That is the best in the world. My main focus is the work on the underlying improvement can read the kind of improvement we can sustain in terms of cost efficiency for a longerterm. How we Work Together with our suppliers that is my main progress. Is to billion dollars the nadir . 2 billion the nadir . We could take it down in the u. S. To even lower levels. Looking at having a Sustainable Business and the outlooks ahead of us. This is the best judgment. Flex ability within that part of the business. You said yourself you initially were not understood in becoming a fulltime ceo. What changed . Human nature. That is good great . I changed my mind. I had four months of experience and it change the way i looked at it. Im glad. We wish you well in your tenure. That is eldar saetre ceo of statoil. Check in on the Foreign Exchange markets. It is job is they. Jobs day. These numbers should come in around 230,000. The biggest miss was in 2011. Must night, the federal government or fed governor of philadelphia said can indication too long and confusing. There was no agreement about dropping the word patient. Keep an eye on the dollar. Aussie dollar. The market is not remotely bothered by the challenge to tony abbotts leadership. The aussie dollar has had the biggest weekly gain in almost a month. The rba produced the growth forecast 1. 75. They kept the inflation target. If they had wanted to say they are more dovish, they would have dropped their inflation guidance. Squeeze the neck of the turkey. Morgan stanley said, you have rates at 1. 75 percent. There is the euro dollar. They allowed the Greek Central Bank to attribute 59 Million Euros worth of liquidity. Did they have the right to cut off the funding . The top stories on bloomberg at this hour. Angela merkel and Francois Hollande will head to russia to press president putin for a ceasefire. John kerry says america is working to change russias behavior. Tony abbott the yesterday and Prime Minister, says he will oppose a measure by liberal party mps seeking a vote on his leadership. It comes after an email saying they must address concerns about him. The ballot will go ahead. If more than half of the 102 liberal mps back the motion. A decision to bestow a knighthood on prince philip. Greeks have held a rare progovernment rally in athens. This came as a person familiar with the ecb said it will allow almost 60 billion euros in emergency funding. Prime minister alexis is sitting out going to set out the most detailed plan yet. What exactly was he not able to come to terms with . And they cant even come to an agreement on what the terms are or the timeframe. They are arguing about so much. He wants to keep greece in the bailout program. They want to have a discussion about a temporary bridge loan to get through to may. What he has seen in terms of new moves from the greek government he is not impressed. We didnt even agree to disagree from where i am it standing. We agreed to interinto deliberations as partners with a joint orientation to a european solution for european problems. We did not even agree to disagree. That was in response to a statement where they said, we did agree to disagree. He said he wanted to say greece stay in the program. He is concerned about their most. The rhetoric coming out of athens. He was back in athens, greeted by protests. They were progovernment protests. This gives you a sense of the tension the push and pull, that the new greek government is going to get. They are not getting love from german officials. They are facing pressure to stick with the antia stare antiausterity message. How will the banks fund themselves . How much spending do they have . This is the latest out of the ecb. They are going to approve 50 billion euros for emergency liquidity assistance. On top of that another 9. 5. That get you close to 60 billion euros. This is a rotating, so it is not like they have to refinance. It does seem there is enough space as long as the banks and the Greek Central Bank is off the hook. They are responsible and assume liability. They have had some money cut off. The Interest Rate is 1. 55 . The old window,. 05 . Hans nichols. It is friday. Some of you might be considering a night out at the opera. Our next guest runs one of the grandest and greatest opera houses in the world. We are joined by that man who runs britains leading company the Royal Opera House. Great to have you with us. It has been a long time since i have been in your hallowed institution. I have been to a variety of houses. It is a very grand event to go to the opera. How you run a business like this . It is a mixture of philanthropy and government in ticket sales. Talk to us about the business of the Royal Opera House. We are a interprize that relies on a huge range of sources. Philanthropy. Ticket sales. Also, commercial partnerships. Touring fees. Coproduction arrangements. That is the crucial thing about our enterprise. It is a mixed economy with many lakes to the table. You were hurtling towards bankruptcy 18 years ago. Things have looked up since then. How is the business doing . Not bad but it is a high wire act in any form of theater. Lyric theater in particular. We have achieved a small surplus every year since 1999. We are about to publish our annual report for last year. We have achieved a small surplus. That is a tough achievement and read it requires a lot of focus. In america, here in america, europe is a little different. How hard is it to get the checkbooks out . The opera house in the u. K. , we are in a good place. We are not as in the u. S. Entirely reliant on philanthropy. Or entirely public, but a mixed economy. That has changed over the last 1530 years. 15 years ago, more than half our money was public. Now it is less than a quarter. What has made up the difference is philanthropy and corporate support. There is a groundswell of interest in supporting culture. People understand at times like these it is culture that unite us. It is important that people be given the opportunity to express their creativity. Art forms that have had 400 years plus of history can inspire audiences and we invest in theres future. There are people that want to be part of that story. Social media and a new technology. How does an old art form mary those things . Use it to leverage the opportunities that come your way . Artists have always been technological magpies. No exception in opera. Last years production of don giovanni use the latest projections and extraordinary video designs. The designer of the limbic Opening Ceremony was bringing that to the stage. We have a large social media presence. 180000 twitter followers. That is the opera house, not me. Seriously opera and ballet have been around for more than 400 years and reinvented themselves every decade, taking advantage of whatever is around. Technology is at the heart of our business. The world has moved on from the nostalgic days of domingo pat roddy. Pavorati. Two audiences want now . What do audiences want now . Of course they want stars. Each generation brings new stars to the four. Fore. We had a revival of the flying dutchman with a superstar. Every generation has new stars. There are many more ways people want to get involved and inspired, whether through participating themselves in a workshop. Or whether that is going to a cinema. Part of a live relay. As we approach the election how is your relationship with the culture secretary . And his department . They did cut funding to the opera house. What can the government or a new government postelection do to help the Royal Opera House . We are not immune from all the forces that are applied to public subsidies at the moment. A lot of pressure on us. It is right that we should take our fair share. We have had to adjust the Business Model to accommodate. What we would say to any government coming in culture and creativity is in the central part of our fabric. It is important to society and is worth investing in. We understand we have to take our fair share of public funding fccuts. Here is his twitter handle. Come on, followers. We are all on the make for followers. Thank you for joining us. That is alex beard, ceo of the Royal Opera House. This is our chance to plug our twitter handles. Just to reiterate that is where you can find us. Next up, we are going to talk about the French Telecommunications Equipment Company up patel lucent alcatel lucent. Alcatellucent just reported their earnings. Joining us is an executive. Thank you for joining us. Pleasure to be here. You were profitable in the fourth quarter. To use the word of your chief executive, he said a quarter ago, the ship is no longer syncing. Can we read it a that . Does the ship no longer syncing can we reiterate that . Is the ship no longer sinking . I reported 2013 results. When you look at the progress made since then, on every metric, we have made significants strides. In every respect i think we hit the mark. When you step back and look at the Balance Sheet at the beginning of 2014, there was a refinancing. Reinforcing the Balance Sheet rate reducing our average interest cost. All that has been done in 2014. As we enter 2015, we are on track to reach the 2015 objective. Mr. Raby, what is the next part of the plan . You are you to reach her objectives and the profitable. What is the next phase if you are no longer a costcutting story . What story do you want to tell investors from here . The story is to be focused on 2015 objectives. Cash flow positive. Continuing to grow the next generation revenues. Cloud ip. That represented half of our revenues in 2012. They now represent two thirds. Thats the story we want to pursue. A story of innovation, continued transformation. Growth. That is how we have set up the company. At the same time, we are not losing sight of the cost base. We are continuing to improve the efficiency of operations. We will not let our eyes off the ball. Can you give us a sense of where the global Telecommunications Equipment market is right now . In europe, the u. S. And japan . In europe, we have been suggesting europe should reinvest in its network infrastructure. We see signs of life in that respect. What vodafone announced confirms that. We think europe is turning around the corner in terms of renewed investment in infrastructure. In asia as a whole, the activity remains robust. China will see significant activity. The first half of this year given the continued focus on rollouts. As far as the u. S. Is concerned it remains a healthy market. We expect some differences from last year. Last year was a year where investment was front loaded. We expect the reverse this year. The second half to be heavier than the first half. That is the function of events happening in the u. S. Market. Regulation, the debate on net neutrality. A spectrum purchases. Competitive pressures which may lead some operators to exhilarating investments. Others to reduce. Overall, the rate of the market is we expect a slower h one than h2. Can you tell us more about what is happening in the Telecommunications Industry . It is quite exciting in the u. K. Bt has bought ee. There are talks it is very exciting. What does it mean for Companies Like you . All these telecoms and Cable Companies are coming together . It is indeed very exciting. I came to this industry from banking. I find it more fascinating to be honest. The theme is that explosion. That explosion everywhere, having to cope with it. The digital lifestyle which is transforming each and everyones lives. The way we set up this program. From our perspective, our objective is to a company or clients. Deal with the explosion of technology. It is important to scale given the exponential demands. Help our clients increase commercialization and their ability to profit from that new consumer and digital lifestyle. We intend to lead, change and be at the forefront of innovation. 2014 not just about being cash flow positive and returning a profit. You were going to sell part of your submarine cable division. Can you give us an update on that . Absolutely. It is going to happen. In 2015. The order book continues to grow. We see now the upswing in the cycle. That is a reflection of the overall trend i just described. It is affecting positively our submarine cable business. We have new orders coming in. F qs that are in the process. The ipo is going to take place in the second half of 2015. On the back of q2 results and we feel the market will give it a positive reception. We are the world leader in that space and at the forefront of the positive trends in the telecom industry. What is your assessment, as a former assessment baker and a man who knows the european economy, what is your assessment of the economy . After the enormous Quantitative Easing Program . Your home country has not grown much in the last years. Will this give the required boost . As far as i know, as a banker , i know what to comment on and not comment on. I will not comment on quantitative easing. Anything that spurs growth and investment for the long term is something we welcome. As we said before, europe needs to invest in its telecom infrastructure. Anything that helps that has our support. What do you make most about being an investment banker . Bankers are paid too much. [laughter] many would agree with you. It is good to speak to you. We look forward to speaking to you again. Thde alcatellucent executive. Is it fair to say Investment Bankers are paid too much . An honest answer. Just over an hour until the start of the trading day. Having a look at digital pix. You got yours. It is about michael kors. The fashion brand in the u. S. We will be big in wearables. The chief executive previously hinted at tech collaborations. They have a relationship with fossil. Getting involved with intel and google. Everybody wants to get into wearables. Tiger woods, what has happened to his career . He has withdrawn with a back injury. He baying blamed it on an injury. It performs to he never loosened up. It is the eighth withdrawal as a professional, we are he has not won a major since 2008. He was number one in 2013. Some are saying the tiger woods of old will never return. We are back in two minutes. Ukraine on the brink. Merkel and a lond Francois Hollande to press putin. There have been a number of off ramps for russia to take over the course of the last months. Unfortunately they have been left in the rearview mirror. Thousands of greeks rally in support of the new government. As the ecb allows 60 billion euros in emergency funding he prepares to set off his most detailed plans yet. And shares soar for twitter and maintain linked in. Welcome to countdown i am mark barton. Fax i am manus cranny i am manus cranny. We will be looking at the nonfarm payrolls coming out. Angela merkel and Francois Hollande heading to moscow. It comes after they met with the ukrainian president. U. S. And russian officials skeptical a resolution is possible as more troops and firepower from both sides poor interview pour into the conflict. Ryan chilcote is on the ground in moscow. Good morning. What is on merkel and Francois Hollandes agenda . Germany and frances leaders arrive in moscow. They will meet with the russian president in the kremlin which you see behind me for talks. The aides gather at 1 00 p. M. They were in key of kiev. the french president saying they have an initiative that will restore the tour toil integrity of ukraine. A lot of skepticism on all sides particularly in the west. We have seen talks not just in moscow but minsk, milan. Normandy. And geneva, going back to last summer. None have resulted in a lasting end to the violence. There is deep skepticism. This was reflected in statements by the u. S. Secretary of state. Have a listen. As i have said repeatedly, there have been a number of off ramps. For russia to take over the past of the last months. Unfortunately, they have been left the rearview mirror. If there was any question about how ruinous the situation has been for ukraine, hundreds of thousands of people have been displaced. More than 5000 killed according to the most recent u. N. Figures. The chretien currency has lost half its value in the last week alone. The ukrainian currency has lost half its value in the last week alone. Give us a sense of the consequences if the efforts fail today. There are two things to think about. And eu meeting scheduled for thursday. The heads of state gathering to discuss greece and the situation there. The prospect of more sanctions against russia. The Foreign Ministers met in brussels. They decided to explain and expanded the blacklist. The greeks took out the words restrictive measures from their resolution at the end. That is eu code for more sanctions against russia. The diplomats say that does not preclude the prospect of more sanctions being imposed against russia. Particularly now if the talks fail. In addition, the secretary of state was saying yesterday president obama is considering arming the ukrainian military. He has not made a final decision about that. John kerry said he will make that decision soon. The nominee to become the u. S. Secretary of defense has said that is something he is inclined to do. There is a debate in the u. S. That perhaps the sanctions have not been effective. The force or reaction needs to be ratcheted up. There is a lot on the line in these talks that will take place at the kremlin today. Back to you. Ryan chilcote in moscow. Breaking news in the Retail Industry and the u. K. Pound of land pound land going to buy a group of stores called 99 p. Pound land is going to pay 47. 5 million pounds. It is going to add to their earnings per share. This plays around the bigger retail story, who is stepping up whom. Tesco. The british retail landscape is changing. Not just with the discounters on food but on nonfood items. Pound land to purchase 99 p stores which has a total value of 35 million pounds. 55 million pounds. Leaders have headed to athens. They will not are not able to narrow their differences on ending a german led austerity regime. He will lay out his most detailed plans yet for reviving the economy in parliament on sunday. Hans nichols is in berlin. What exactly were they not able to come to terms with . They couldnt even agree on what the terms were. And additionally, with the timeframe is. Greece once a bridge loan. They want to get through this time. He wants to keep them in there because that is what was previously agreed to. He made it clear in so many different moments he was not impressed with the move the Prime Minister of greece has made since coming to power. I could not conceal my skepticism that some of the measures the new government announced my colleague told me they are not decided yet. They did not go in the right direction in our view. He said they agreed to disagree. But the other man could not even accept this. We did not even agree to disagree from where i am standing. From where i am standing, we agreed to enter into deliberations as partners with a joint orientation toward a european solution for european problems. The Prime Minister is back in athens. Those were progovernment protest urging the new government to stick with their antiausterity message. How are the greek banks going to fund themselves . Yesterday we talked about the quiddity liquidity restrictions. They are going to have the assistance all the way up to 59. 5 billion euros. They had drawn 56 billion out of the pot in december. Because they have lost their access to the overnight funding the ela comes in at 1. 5 in Interest Rates. That is open up to 29. 5 billion euros. 59. 5 billion euros. There could be a bigger crunch in may when bonds become due. More on that story at bloomberg. Com. Lets look at some of the other stories. Statoil has halted dividend growth. As norways Biggest Energy Company Struggles to whether a plunging energy prices. They reported fourthquarter operating income of 9 billion norwegian krone. In the shortterm, i admit i am highly uncertain as to what kind of price environment we will see. We will see volatility. We could see a low Oil Price Environment for some time. I think we are fundamentally in a cycle and we will see a rebound at some point. There are some structural changes fundamental changes for the longerterm, it is to early to see. Yesterday and Prime Minister tony abbott says he will oppose a motion brought by liberal party mps. This comes after a party member sent an email saying they must address concerns about him under party rules. The leadership ballot will go ahead. More than half of the 102 liberal mps back emotion. He is struggling to quell this movement. I want to make this very simple point. We are not the labour party. We are not the labour party. Were not going to repeat the chaos and instability of the labor years. Meanwhile, the central bank of australia has lowered their growth and inflation forecast to read the rba thinks the economy will grow between 1. 75 and 2. 75 . It comes amidst a collapse of the price of iron ore. Forecast that the number of new users will pick up for twitter. Revenue increased for the microblogging company. The net loss narrowed. They are projecting adding between 1316,000,000 users in the first quarter. Significantly faster than the 1. 4 growth in the fire prior. Grow poll gopro shares fell as much as 15 . They announced a profit range that trailed analysts estimates. Alcatellucent has reported fourthquarter profits that doubled from a year ago. That helped frances largest equipment maker those are the top headlines we have got from the morning rundown read go to twitter. A tweet is out a lot on your statoil interview. I tweeted out a lot on your alcatel. It is all about quid pro quo. We do have flexibility to you have him on the oil prices. It was his first interview. Three days in the job. I to drop one for you on all patel. Alcatel. Alcatel will sell the submarine business. The think he misses most about in basement banking is Investment Banking is the money. I wonder if you have an opinion. Denmark says they will do anything david bloom joins us next. Stay with us for that. The Central Bank Governor told bloomberg the hague that abandoning the peg to the euro would be unthinkable. They would go on forever with measures to defend the hague peg. If anybody starts having doubts, we will have an issue. Therefore, our message to the pension industry and investors is we will keep doing whatever it takes. There is the limit on our Balance Sheet. We can go on forever. Whats get global perspective on the currency markets. David bloom has been waiting in the wings. He is the head of ethics research. Fx research. Where have we heard defense of the realm rhetoric before . Two days before the swiss had to abandon sterling will remain you are going all the way back the swiss have not lost credibility for themselves but hurt it for others. They have credibility through the central bank. What they have done, when we hear what we have just heard you start thinking i have heard this before. They have hurt others. The swiss pull out and you say who else could it be . That is how our kids behave. But i think they are taking a mistake in the case of denmark. They are backed by the ecb. That did not stop, as you know, doubting. It is very different. They are in a mechanism at the moment which is a joint party. I dont it is going to break at all. I said the same thing about the swiss. Im tried to get the egg off my face on that one. But i do not think the markets have a stomach for a fight on this one. Everybody is allowed to have a blooper. You have an interesting take. Euro swiss, the swiss at the lowest level 105. What is happening is the euro is on the rise. The big trades were oil. The euro dollar. You are saying the big trade is swiss. We have seen the competing break down. The easy trades are over. There is some story that the swiss are intervening between 105110. I dont know what where that came from, but thats the story going around. In this world, what are you going to buy . Dollars or maybe the swiss. You cannot fly buy yen with qe. You are left with the dollar. Every but telling us to buy dollars. It is not my fault you wont listen. When does the dollar rally and . It has already started to show signs of albums. It ends when it starts harming the u. S. With the number of companies saying the translation of earnings is harming us. The fed has said, the models have shown the rising dollar is hurting growth less than we thought. The limit to the Dollar Strength is when it is not harming the u. S. Then the u. S. Will push back. How do they do that . They can say, youre not raising rate. You are manipulating your currency. He stayed away from that. We are still buying dollars for the moment. You are heading or deflation handiness or deflation. What is the house call at hbc . All i have to say about that how can it be possible . When an analyst says what the house call is, you go we are not calling for a rate rise because we think they need a rate rise. The fed is telling us they want to raise rates. When japan raised rates, they had to follow that with massive qe. When the eurozone raised rates they fold that with massive qe. You have to make sure your economy can withstand it. Who is next david . China was number 13. Where is the next big surprise coming from . I can tell you otherwise. Come on. The shock is, it is a surprise. Ozzy, surprise. Only seven strategists we spoke to could not guess the aussie dollar. The problem is, it does not really stimulate the economy it historically did. Wall street purses main street. High prices of oil are good for wall street, but are they good for main street . The second strongest currency in the world in the main currencies is yen. It has risen 4. 98 this year. The only other one was the swiss franc. The superiority of the bank of japan. What did they do next . They keep going. The japanese are all in. They are going all in. They are not going to stop. What do they do next . The yen has not increased the volume of exports. It has not done much towards headline inflation. They are not going to give up. That is what they are going to do. I think it will keep pushing up until 128. The biggest fear is they will lose control of Monetary Policy and then you get a destructive dollar rally. That is a dollar rally which is associated with buying the dollar to buy an asset to only dollar. But to own the dollar. You are buying something with the dollar. That is the beautiful benevolent color. Dollar. The destructive is when you buy dollars to own dollars. That is a very dangerous scenario. Distractive dollar. Three things, one the japanese lose control of Monetary Policy. Two, the eurozone has a crisis. We have seen a financial crisis but never a political crisis. And third, an oldfashioned p. M. Crisis. Em crisis. Theres nothing you can do to keep the dollar from rocketing up and being destructive. Many are calling it a crisis looking in the direction of greece. Where does that leave greece the rest of the eurozone . Greece story is going to roll on. Either they stay in and it rolls on. Or lets pretend they leave. If that were to happen, you have to ask yourself, what happens to greece . What happens of greek growth picks up by leaving and it looks like a Success Story . When argentina broke their peg, they had 8 growth. You can get this growth. It ultimately failed. They get 8 growth for two years. That becomes problematic for other countries. The story does not end with greece staying or leaving. It is something that rolls on. 30 seconds on central and eastern europe. The pressure from the qe. They have been sucked into the currency wars. If they do not cut policy the hungry and poland there currencies are going to rocket. We think they will have to loosen policy in order to stop their currencies from appreciating. David bloom, great to have you with us. Up next, the auction for the next round of premier League Football closes. It is 7 30 and london. Lets of the foreignexchange traders view the dollar. We had a conversation with david loom from hsbc. This is a benevolent dollar. They buy property infrastructure. The risk to the dollar is this. You could have a destructive dollar, which is where an event happens a geopolitical event. The japanese lose control of Monetary Policy. And people rush to the dollar. The rally was showing small signs of just beginning to fade the overall upshift you have seen. It is jobs day, if you did not already know it. One of the most closely watched data points in the u. S. How many jobs to the u. S. Add in january . 230,000 is the estimate. Nine out of 10 of the past january estimates missed the number by 57,000. The aussie dollar is a tortured soul. It has had a tough run. The last 30 days you begin to understand the overall momentum. It is beginning to turn. Tony have it has a potential leadership challenge. The rba reduced growth targets but kept their inflation target in the bandwidth of 23 . I am reading that says they are less dovish. Please it hard. 78. 53 9 . Squeeze it hard. 78. 5 or 79 . Football is big business, not just for the clubs but for television and telecom companies. The competition for customers intensifies in the sect or. Having lied games as part of the offerings. The auction for the next round of merely writes closes later. Next round of the legal rights closes later. Hello. Thank you for joining us. Who needs it more . Sky or bt . Sky needs it more. It is their core dna. For bt, it is additive. Tv is important but not the major driver of their business. Are we looking at huge rises in inflation like last time . 70 increase to 3 billion pounds last time, the entire rights package . Surely it cannot be the same this time. You could argue if off sky and bt played the game, you could walk away with 1015 inflation. The risk is, if hypothetically bt wants to get more. To start showing they are starting to think about a 25year model, they might one more rights. Why wouldnt they want more . Part of the problem bt has is they do not have a tv platform that is hostile. The tv business is not good. Do they sit there with their existing business and resell sky sports . They can show it on their own tv proposition . Or do they go more aggressive to buy the rights . If sky does not win the biggest share of the rights, we have heard various calculations it could lose 15 are sent of the highest paying subscribers. 15 of the highest paying subscribers. Is that pessimistic . It comes down to how many games. They may have a similar number of games but less packages. The key thing is to retain the foundation. Sky has sunday lunchtime and or clock. Those are and 4 00. They spend over 2 billion a year in the u. K. On programming. Football is between 800 and one billion. Sports customers are 4050 of their customers. Maybe less. It is not the most dominant part of weird they have other products. Discovery. Throw in itv as well. Do they pose a threat . Discovery who owns euro sports . They have a paytv platform. Whether they want they u. K. Right or european rights, the european rights could be more useful. What sky suffers in that regard it has german and austrian assets. They want the european rights for those assets. What about what is going on there . Two things are going on. There is a message to bt. Do not get too aggressive and do not give too much away. Evidently has cost implications. Virgin is saying, we are slightly nervous. We only have about 40 of our games shown. Other markets, closer to 60 . They want more products. They are a big wholesale buyer for product. They are nervous. If prices go up, wholesale prices go for. Go up. They get a raw deal. Are the right in saying there are not enough matches available . And from the bitter as well . Bidderas well . You have a lot of games you do not that people dont want to watch. Most of the games that matter are shown. Is all happening. The Telecom Sector being shaken up in the u. K. Vodafone. Liberty. It is all happening. Who is in the best position to offer the quad offering everyone is talking about smart all the operators are making sure they have the ability to make an offer. Bt decided to go with the instructor infrastructure model. Skies to trying to create a defense. Vodafone injuring the home market by offering broadband. The interesting thing about the u. K. Is we do not really know whether Consumers Want quad play or bundles. But if they take a bundle, they expect to discount. The challenge is to get more customers to buy more products. That is a challenge to. If they are aware of it, who is vodafone going to buy . They have talked about buying everybody. For the shortterm, they will make a partnership with sky. And see how that develops. That will probably take a couple of years to work out whether that strategy works created works. Any longterm, who knows. 35 years away. Great to see you, guy. Guy teddy, head of telecom research. You can find more on that story at bloomberg. Com. A growing taste for fine whiskey in asia. Some are prepared to pay big bucks for the rarest labels. We look at what can only be termed as an intoxicating investment. This bottle was retrieved from a shipwreck. This is the kind of bottle that i think is worth collecting. He is not an economist but he is familiar with the principle of scarcity. He owns some of the rarest single malts in the world. One of the most prized is a Rare Japanese whiskey he tracked down in athens a few years. I think it will be difficult to find a bottle of ace of spades now. The ace by itself is the most important card and a collection. When i bought it, it was expensive in my opinion. 700 u. S. Dollars. This represents a wider trend. The rise of whiskey as an investment. According to the Investment Grade scotch in tax index the top single malts returned for 40 returned 440. Patient investors are developing a taste for rare spirits. Sothebys hong kong sold a bottle that set the record for the most expensive single malt ever sold at auction. It is a growing market. Lots of Growth Opportunities in asia. Not just china. It it is getting started. If you visit shanghai in the last 23 years, there are 56 whiskey bars popping up. You are seeing a lot more whiskey selection. It is just the beginning of what we see as a 10 year trend. That is good news for collectors like chan. A bottle similar to his ace of spades whiskey sold for more than 14 times what he paid for it. But the idea of parting with the single malt is a sobering thought. I probably wont give you a price. It is so hard. But everything has a price. Why dont you make an offer. Bloomberg hong kong. Follow us of both on twitter. You can find out what mark thinks about whiskey personally. I dont mind whiskey. I will do it. More a cognac man myself. How make a yards are trying to change their image make a yachts mega yachts are trying to change their image. Time for todays bar chart. I am talking about silver here. Even though the metal dumbed by 10 in january, the biggest increase since june, it was not enough to boost purchases of Exchange Traded funds backed by silver. On january 22, the green circle silver closed at 18. 22 an ounce. An increase from the fiveyear low reached on november 5, 2014. The red circle. Close but no cigar. You need an increase of 20 to call it able market. Seven days after the peak, silver sank 6 . It wiped six 45 million from the value of global funds linked to the precious metal. The volatility over the past five years has been double that in gold. Figure prices increase the chances of bigger losses. When you compare silver to gold silver dropped 19 . Holding the Exchange Traded products backed by silver they fell despite the increase in january. Gold Holdings Jumped 4. 1 in january. Silver differs from gold in that half of its use is as an investment. Jewelry. Compared to 90 for gold to read the other half is for industrial use. This dual role, as its full tally. This dual role adds to its volatility. He said silver is riskier than most metals. There is a net game, the devils metal. That has not deterred hedge funds and other speculators. On january 27, the most bullish since july. Maybe there is love for the devils metal. These are the top stories at this hour. Andrew merkel and Francois Hollande will head to moscow to pressure Vladimir Putin for a ceasefire. This came after they met the ukrainian president yesterday. John kerry says america is working to work russias behavior. The danish centralbank governor says abandoning the peg to the euro would be unthinkable. He said there is no limit to how big the ellet sheet could be. The Balance Sheet could be, saying he would go on forever to defend the peg. Euro are close substitutes euro and krone are close substitutes. Our message to the pension industry and investors is we will keep to the peg. We will do whatever it takes. There is no limit to our Balance Sheet. We can go on forever. Go pro shares tumbled after revenue projections sparked concerns they are too dependent on the holiday for the sales of action cameras. Sales fell 15 . That trailed analysts estimates. First Quarter Sales are expected to fall from the fourth quarter. Super yachts have gotten bigger and bigger. They resemble floating palaces. Mega yachts are trying to change their image. Im just been it Angus Bennett reports on the industrys attempt to go green. We are at the london top 100 yachts show. The largest and the most expensive yacht builders. 100 million we are talking. Currently closer to 150 million pounds. You do not get the helicopter. We can included for a next her cost we can include it for an extra cost. He owns a dutch builder. The dots for the planet. They like yards there yachts at large. We see a trend toward greener yachts. For the last few years, the companies which make boats over 90 meters have been pushing green credentials. This one of seven meter yacht is in the construction phase. This one of seven meter 10 7 meter yacht is in the construction phase but if you will have a hybrid engine. If you want in environmentally friendly boat you buy a sailboat. Is the ceo of another dutch builder. His company was the first to deliver a hybrid super yacht. Going green is as much of a sales pitch as an environmental concern. Is questionable whether it is really saving the environment. But it is cool to drive in total silence. You say captain, can we go to Battery Power . No sounds whatsoever. You jump off your yacht. Perhaps green is the new black in the world of makeega yachts. I only ever get to look at them from the beach. Likewise. Tech earnings, a big week. Linked in and twitter. s, results. Here is the tech kuru, Caroline Hyde where do you want to start . What is the bigger story in tech . In terms of share price move, twitter. A stay of execution from his investors. He promised so much. In november, seven hour meeting with investors planning a rollout of products. We are starting to see some of the products reaping was roads rewards. Basically investors announcing that after he got word of his coo they are starting to take action. They have a what you missed feature so you can catch up on tweets you missed. You have ways to chat in a group or edit video. Getting more people on twitter and to stay longer. When you look at the amount of people they are adding, still not living up to expectations. Fax a said that was down to they said that was down to apple. 4 Million People they lost because of the upgrade to ios eight. The only added 1. 5 users. For the quarter. The 20 uptick for the year. This is a company where investors are saying, i see your product but show me improving amounts of people on twitter. Show me how you are luring advertisers. Have a deal with apple where you can see tweets in search. That will help them become more prominent, not just us on tv showing tweets. That gives it that global scale. A 30 increase in shares. People were pleased. Still up 20 , but slowing from 24 . Investors want to see the scalability of this. Can you reach one billion . They have 22 88 million. I think linked in is the only major u. S. Tech company in china. They launched their and double the amount of users. 8 million. They beat in terms of profit sales, forecast. This is a company. The chief executive does not want it to just be about people hiring. It is about salesforce, marketing. They are trying to increase the products. They said it was he twitter when i joined in september. I have yet to join linkedin to read i joined, get out. Take you for being with us. On the move is next. See you monday. Have a good weekend. Happy friday and welcome to on the move. Im jonathan ferro. Moments away from the start of european trading. Lets get straight to your morning break. German chancellor Angela Merkel and french president Francoise Hollande head to russia to meet with putin. A push for peace in ukraine for her do not back down. That is the message from the greek people. Progovernment demonstrations in athens. The turmoil continues. The bank of greece insists that profits are safe. It is job stay. 230,000 is the median amount of jobs created in the u. S. Those are three things we are watching this morning. Futures off by 26 points. What a week we have had. Manus cranny with your market open. Hey, jon. These equity markets, it is interesting. The debate is interesting as to whether the European Central bank overstepped. By declining the greek sovereign bonds. Because they are not technically still in the program. That is one of the articles. Oil had a second week of gains. Volatility at a sixyear high. A 7 year high in terms of equity markets. Saudi arabia still selling their oil at the cheapest price to asia and 14 years. The danes