We see how the luxury carmaker is luring customers with exotic test rides. Looking forward to that. First an exclusive interview with frances finance minister pierre moscovici. We spoke with him in washington dc about everything from the u. S. Debt ceiling to emerging markets. He says he is not concerned about turmoil in the letter. [indiscernible] about 0. 4 tos 0. 5 over the first quarter. I dont know what the figure will be exactly. I guess it will be around that. Now, the eurozone as well as the france economy have got off the recession. Rate is about 1 per year. It is not enough. It is better than the recession but it is not enough. We want to speed up. This is why the president launched what he called a responsibility pact with the firms, in order to give them more capacity to reduce the cost of labor, to have a better taxation for the firms, to also simplify the access to regulation, to have also a more flexible labor market. This is what we are working on. With that we will be capable of welcoming more and more american firms in france. Yesterday we met with businessman from here, from the u. S. Important ceos. All of them were saying, we are there. We are happy to be there. We want to expand our business but we want new business too. I know what prevents some people to invest in france. We want that to be off. This is why i expect that if this is signed, we can have more than 1 even in 2014 and much more in the years after. Are you worried about the volatility in emerging markets . Could there be a spillover effect . Of course i have a look at it. If i wouldnt, i wouldnt be a finance minister or somebody responsible. We carefully watch the moves in those emerging countries, but now i dont see a crisis coming. A g 20. Next week we will probably discuss that. I think we must find a way to have a cooperative approach toward growth in all zones of the world. Including emerging countries. I dont see a signal or a sign of a Global Crisis. That was the french finance minister, speaking to us in an exclusive interview. You will hear more from him later on in the pulse. 10 months into his tenure, the italian Prime Minister is fighting in his own party. Yesterday he presented a new economic plan. Today we will learn whether matteo renzi will move to replace him. Hans nichols joins us now from rome. Walk us through what happened today. The last few days have generated a lot of news. Today we find out what grizzlies move is. If you want renzis move is. Look at the meeting they had yesterday. It was renzi who called the meeting. Essentially the mayor of florence summoned the Prime Minister. He is the head of the party. After the meeting, enrico letta sounded like a Prime Minister who is contemplating leaving office. I lived every day as if it was my last one, Broad Coalition change after just two or three months. I had to follow the development of the situation stepbystep, very carefully. Letta didnt know whether or not he had the support of the party. His fall would be the fourth government in 2. 5 years. The question for the mayor of forest is, does he want to be premier now or wait, consolidate his strength and be premier later on, perhaps with more democratic legitimacy. I guess there are three options. One is renzi becomes prime letta doesntse have support anymore. The other is a Cabinet Reshuffle where enrico letta puts renzis people in cabinet. The third is the call for new elections in the spring. Scenariow election would be if renzi decides to go for it today and decides he wants to be the leader. And the president will have to talk to all the coalition partners, see whether that would be acceptable. If not, having a swap at the premiership from the Democratic Party, you would have new elections. Then we would have to see what sort of coalition could be cobbled together. It is all about coupling coalitions. This is the story of italy. Hans nichols in rome. Posted the slowest sales growth in four years. We are alive with the ceo later on. Where is the Worlds Largest food Company Turning for growth . Ryan chilcote has more. Price climbed since the loss we saw earlier in the morning. The company just said they intend to announce a Share Buyback program. The details as soon as they close that sale with loreal. The big issue here is, they grew sales by about 4. 5 last year. That is inline with estimates but it is their worst growth in four years. They say next year is likely to be like last year. Erma wherelike gald they bought the half they didnt already have, it gives them higher margins and higher growth rates than they have been getting in food. They make products for skin care, acne, skin cancer. Unfortunately these things are unlikely to go away. It is likely to be a growth industry in the future. One thing we are all spending more money on is our health. It is a trend that they are trying to get into. It began about two years ago. That is when they got into the health business. Is that true . Certainly the way we consume things has changed. Is it a health world problem . It seems to be a developed markets problem. If you look at the numbers that just came out, there does appear to be a kind of diverging reality out there. One of the things that people are looking at in the developed , the packaged food business in places like the United States is showing signs of weakness. Americans are back, the Economic Growth is back and yet they are not biting packaged food like they did before. They are buying fresh and healthy. The developing world, refrigeration space is short in stores. People are getting wealthier and they want more protein. Packaged foods is what they want. If you look at the results in the developing world, nestle beat expectations. In the developed world, they missed expectations. Brian, thank you so much for all of that. We will be live with nestles chief executive later on in the pulse. Cable giant comcast is said to have agreed to acquire Time Warner Cable in a deal worth 44 billion. Here with more is manus cranny. On this isory story going to be fascinating. Walk us through the numbers. There is a new king of cable. It is Brian Roberts. He is going to have over 30 million video subscribers. That is what is going to happen when you put comcast together potentially with Time Warner Cable. Cable told charter, about, we are looking for 160. Comcast has come back with 160 159 as a stock offer. It is all paper, all stock. The two of them getting together trumps charter. Create a beasto of a cable company. Some people say that putting two dinosaurs together in an everchanging landscape. This kind of deal in the cable industry has impact across the world. Is it going to be a race for more m a . I think this is certainly one of the date set pieces on the chessboard. Had been in pursuance of Time Warner Cable on three separate occasions. , there isave got here a hes with a wonderful line. If cable business had a soundtrack, jaws would be the soundtrack. Deep, pounding noise, almost as if there is a predator and the predator is coming. Consolidation gives the Cable Operators scale. That gives them the ability to put pressure on the content providers to provide content at a cheaper price. Few places tory go for your cable provider, you end up paying more. It is going to be an interesting story. This pretty much completes the rationalization of the u. S. Cable industry. I suspect there will be a significant divestment. You can build a business this big without regulators getting involved. Mr. Roberts i suspect is doing the math on that right now. I bet he is. He rails is on our radar here is what else is on our radar. Bnp is setting aside more than 1 billion in u. S. Legal provisions. The cfo tells us staff will get less compensation because of a squeeze on earnings. There is a certain elasticity. , we will seerlier that ramification. It might be different from businesstobusiness. [indiscernible] shares in the engine maker rollsroyce are following. The company says sales wont grow for the first time in a decade. Lower demand for defense equipment. We will take a closer look at rollsroyce later. U. S. Treasury secretary jack lew has criticism for china in an interview with charlie rose. He says the country needs to stop stealing intellectual property if it wants more influence in the world. Cyber security and cyber theft are somewhat different issues. The issue that we have raised with china is really the protection of intellectual property. Policies where there is a theft of intellectual property that is unacceptable for a country that wants to sit at the table and make the rules of the world. China sees itself as the country that should have a voice in making the rules for the next in a ration. They cant have it both ways. Be sure to watch the entire interview on charlie rose tonight at 10 00 p. M. U. K. Time. Coming up, government in crisis. Italys Prime Minister resists pressure to resign. Plans Economic Growth enough to mainstay and stability . Liveu are looking at pictures of the u. K. Chancellor George Osborne speaking in edinburgh this morning. The debate, of course, about goblins independence. Scotlands independence. You will hear from mr. Osborne later. Welcome back. Youre looking at live pictures of the chancellor in scotland. This is George Osborne. Addressing the issue of Scottish Independence. I suspect we will hear him say it will not be an option for the scots to postindependence to continue using the pound. Italy could be on the brink of another new government. Yesterday the Prime Minister presented a new economic agenda. How will Democratic Party leader matteo renzi respond . Lets head back to hans nichols in rome. Francine, good morning. Professor ofh a history and politics. You know this country well. You have your crystal ball. Tell me what matteo renzi does today. Todayelieve that renzi will say that he wants to become the Prime Minister. He will say it in a soft way most likely. If he doesnt say that, it will be a surprise. Hes going to say that and at that point, i think letta is going to resign. Makes his move today, he has gone too far. Letta resigns and then how long does it take renzi to the premiere . Not very long. The republic should have official consultations. I believe that in a very short period of time, renzi can be and build hisier government. Why does he want it . If he doesnt have the popular support, if he is not democratically elected, why does he want it now . His first option would be early elections. Since he knows that he cannot get that, if he had waited with letta in government he would have been worn out by the situation. He wouldve taken a responsibility for a government he couldnt control. It was politically wise for him to say, if i need to take responsibility for the government, i want to be in full control of it. When will those elections they . I believe that if he gets in one, maybe may last even more than that. Berlusconi, what would be his take on this . I think he should be quite happy. Learn howis going to difficult it is to govern this country. Of course he is going to be worn out by that. It will show the country that he is not the miracle man he pretends to be. Is quite glad about how things turned out. We have a clear prediction that the government will fall. There will be a new Prime Minister and in the balance, this could mean the return of the conservatives in italian politics. If it is not berlusconi my name, it is his movement. Hans, thank you so much. Interesting predictions. He was also predicting that matteo renzi would have about one year in government. If i were him i would say, hold off for now. I want to stay in government possibly 3, 4, 5 years. Anybody looking for italian political advice . There he is. , looking at break live pictures of the u. K. Chancellor George Osborne. He is speaking in an barrow at about the debate on Scottish Independence. He is talking about the fact that maybe there isnt any legal should sharee u. K. Its gdp. We will talk about this more when we come back. Welcome back to the pulse. Time for todays hotshots. A sad day for vintage car lovers. Eight rare corvettes swallowed up by a sinkhole that opened under kentuckys National Corvette museum. No one was hurt in this incident but the cards took a fatal battering after plunging about 30 feet into this massive hole. We still have no information. Two russian thrill seekers find the worlds second tallest building while it was still being built. The men chose to climb the 650 meter shanghai tower during the lunar new year. Beginning at midnight they spend two hours scaling 120 floors and 15 hours waiting for the weather to record their stunt. Chinas lunar roller rover is alive. It suffered a breakdown last month. Mission control said it could not be fixed. Now the rover has responded to calls from earth. But is it showing abnormalities . Ourets get straight to markets editor, manus cranny at the touchscreen. You have had six days of reprieve. Arbitron higher, stoxx 600 at the moment taking a break. We have the longest stretch of games gains. Two to three days, we have had various voices. We have had mobius, think, a variety of people saying it is for the brave in terms of the emerging markets. Just look at europe at the moment, definitely more than a pause going on. Some of the banks delivering fairly shocking results. Lets give you a complexion of the industries. It is financials where you see a lot of the down. , talkingn the u. K. About nearly 10 billion pounds in insurance. U. S. Equity futures indicated lower at the moment, down by almost 0. 4 on the s p 500. Retail sales will come out today. That is what the market will focus on. Riseumber is flat versus a of 0. 2 . You will also get jobless numbers, 330,000. There is a bit of snow in the u. S. It is stopping janet yellen from testifying in front of congress today. Have a look at this. Dollar, this is turning into something new. Unemployment at a 10 year high in australia. Anybody that thinks they are going to hike rates in australia , that is where traders are paring their bets. You can see the downturn there. Keep an eye on dollaryann dollarrand. We believe that there. State of the nation tonight. Back to you. Eurodollar spiking at the moment as well. We will try to get around to figuring out what is going on. Still to come, getting billionaires to buy bugattis. We see how the luxury carmaker is luring customers. Welcome back to the pulse. I am francine lacqua. Here are bloombergs top headlines. U. K. Chancellor George Osborne is speaking in edinburgh right now. He is weighing in on the Scottish Independence debate. He says that if scotland leads the u. K. It walks away from the pound. There are early signs that tourists are returning to egypt. The 2011 revolution saw visitor numbers collapsed as western governments issued earnings to travelers. Since an, the warnings have been eased. Airlines are once again looking to reopen routes. We spoke to the countrys tourism minister. I got a call and u. K. Told me theyre going to start flying in. That stopped a while ago. Today, an indication of they have a positive feeling of the future in egypt. Uncovered labor violations in its supply chain. These include the use of underaged workers in factories. Apple conducted more than 450 reviews according to its annual internal audit. You have more on this, guy. I dont, ryan does. Lets bring him in, ryan chilcote. This company has always suffered as a result of its supply chain. Once again, we see problems within it. They say, that things are getting better. They have been doing these reports for the last seven years area they say if you look at underaged labor, this is kids under 16, they found two dozen this past year versus last year where they found six doesnt in one factory alone. , 95 of theid facilities they use have agreed to limit the number of hours they require their employees to work to 60. That is no small amount of hours. Lets not forget that the volume of work you have basically 1. 5 Million People in this supply chain creating last year 150 million iphones, 70 million ipads. Take foxconn for example. It is known for the volume of iphones it pumps out. It is also known for the state of suicides and those awful nets to try to prevent people from killing themselves jumping out of the factories. Last year they have labor shortages, high tone over. Workers require their to work more than 60 hours. Things are getting a little bit better but you can see that the sheer demand for apple products has really put rusher on the supply chain to deliver. We have read about how they have these labor supply chains reaching out to villages. It all happens quickly. The pressure has to be a mess. Theyre going to africa as well to look at the run materials. That is perhaps the more interesting part, when you look at the commodities that going to the phones. They are trying to exclude conflict minerals that going to their electronics. They say they have been able to do that with places like congo, they are not taking minerals from there for their phones. Then there are less obvious forms of labor exploitation. They found 12,000 students on their books in the supply chain. Under internships. They working together with stanford, dell to look at how educational these internships are. There are reports of these pretty much kids working in these factories, working the night shift, working more than 60 hours a week to try to pay for school. There is a question of whether they are going to school and what they are learning in the middle of the night at the factory. We will leave it there. Hopefully the trend is getting better. Ryan chilcote on the latest from apple and its applied chain on it. Rio tinto says its costcutting plans are paying off. Its secondhalf profit has jumped by almost half. Jon ferro has more on the latest numbers from the minor. Lets go through the Mining Company and what they came out with today. Lets talk about fullyear profit. A 10 increase, beat analyst estimates. A reflection of the broader story in the industry come at a pressure to cut costs and rein in spending. The ceo is doing no different. He has cut by over 2 billion. You see a nice pop in profit today and a nice little dividend too. We spoke to blackrock a number of times. They say, we want more dividends. Under the suntor once more dividends, especially if you invest in these miners. They responded. A 15 increase in the dividend. Came in at 1. 92. A hat tip for the guys at Deutsche Bank for calling this one. The question mark is something you called as well. It is china. What we saw last year and the reason for the big pop in profits was a tick up in the price of iron ore. China is showing no sign of backing away. What we have seen for the first half of yes here this year is iron ore. Revenue is from iron ore alone. If there is a question mark over the Iron Ore Price this year, it will be a question mark not just over rio but for the rest of the miners. They are so closely intertwined. John, thank you so much for that. John ferro with the latest on rio tinto. Rollsroyce said sales growth wont grow this year. Shares tumbling today as a result. Lets welcome Bloomberg News reporter rob wall. Rollsroyce is a complex business. They may complex products. It is an industry come in a business that has been very good at churning out decent sales numbers. This comes as a little bit of a surprise. Is it all down to defense . They are blaming defense. It is probably more than that. It is often very hard to decipher these things. Commercial, things are going pretty well. Put throughing to some costcutting efforts and that is not is going as quickly as they wanted. It is a complex story. Taking cost out of that side of the business may be proving more difficult than anticipated. It is a combination of things. One is just the way Civil Aerospace is dealt with and the very high standards answer the petition requirements making it difficult to push through change. They are hoping to get some real traction this year and get the numbers up that way. That is going to be key to resuming the growth story. Rollsroyce powered pioneered the power by the hour model, leasing engines to the airlines. Is there anything intrinsically within that model that is potentially causing problems for them . That could come but we are not at that point yet. What it does for rollsroyce is usually it provides a very safe that is the problem with today. People who invest in rollsroyce are people who dont want surprises. This is a surprise. That is what you see the large share drop. I suppose the people on the airplanes dont want surprises either. Thank you very much indeed. A you are in the markets for 2 million car, you are in luck. Bugatti is looking for a buyer. The luxury carmaker has 40 supercars to unload. They are luring drivers with highspeed test drives in enticing locations. I have never seen anybody get out of the scar and say, that wasnt what i expected. It is a very positive experience. The bugattid Dynamic Drive experience in north america late last year. It has been very successful in attracting new people to the brand. We are going to host four of these events around the country. We will bring 20 to 25 individuals and per weekend and they will have a chance to experience the car on the open road. Today we have the bugatti grand sport, the fastest open top car in the world capable of 260 Miles Per Hour with the top off. It costs about 2. 35 million. Customers can individualize their car. I have seen them range anywhere from 2. 4 million up to 3 million. Goal is to attract individuals who are cops never had a chance to experience who perhaps never had a chance to experience the brand before. They want to experience it and we have some previous owners who come and just want to get back into the brand. Of the 150 open top cars that we are ever going to build, only about 40 remain available. We anticipate this will be sold out within 10 months. There will be another model coming but we want introduce anything within the next few years. Youre not a fan . Fran doesnt think they look very pretty. But you are an italian. So i guess that probably is something to do with that maybe. Ferraris look prettier, do they . Lamborghinis . If you had 2 million to spare, you would buy the bugatti . Probably not. I think i could pick up some very nice motorcars for a lot less than that. Moving on, government in crisis. Italys Prime Minister is fighting to save his skin. It is not just his career at risk but his image. We ask the ceo of reputation. Com what enrico letta can do to stop the turmoil tarnishing him. A power struggle in italy plunging popularity for the president of france and bet on the sochi games to put russia back on the map. What are they doing . Could they do it better . How should they be doing it . Michael fertik is the ceo and founder of reputation. Com. This is your gig. It is what you do. Italy, lets start with italy. Preks you could talk about it all day. We sat down in the break, we started talking about it and we get very animated about mr. Renzi pretty quickly. And mr. Berlusconi. He is the young mayor of florence, they gave him the name a big great reputational banner that means the scrapper, the young good looking guy. He says what he means, very much not an italian politician. He is the new guy, fresh blood. Letta is kind of the gray lady. He looks older than he is. His uncle works for berlusconi. His father is a mathematician. Famous member of his family is a National Poet and playwright. And here is renzi coming to scrap. I think renzi is the big winner. Italian politics are some of the most complicated in the world, certainly in any developed world. Energetic which one do you want . Both at once. If he gets into power, once he gets into power, is he going to have to change his image . The guy that is pulling the punches is great when you want to get into the position. That is a very important question. Not only for the reason you asked, but also how he is going to get the power. He has the luxury of being the scrapper in opposition. He is going to get power through the relay, not an election. It is just a handover to him. Now, that is not the way to win. You dont have the powerful national mandate. He is going to have to have a different attitude. It is a big risk. Elections, you have mr. Berlusconi. Talk about reputation. Political when you have berlusconi in your system, everybody else looks consensus. What he does is generate an awful lot of room for everybody else to operate in. The guy is the Second Coming of machiavelli. He always seems to come up on top. Be 250 years old but he is still there. He owns the tv station. His main advantage is that he is just sure that shameless. He doesnt care. He lets everything roll off him. He makes bill clinton look like a virgin bride. He has a huge advantage. This leads us also maybe to vladimir putin. And francois hollande. That is probably a little more shameful. Why does nothing stick to him . Berlusconi, first of all he does own the major tv station. That is just huge. Number two, he has always seemed to have something on the people who are against him, either in his own party or whatever. To squeeze their elbows behind closed doors. [laughter] elbows is the polite word. I think also there is something to be said when you just will be shameless in the way you deny something and continue to behave. You have that amount of wealth and power, it works. Putin is different. He has the internal propaganda but externally, everyone has figured out who couldnt is. Is. Who putin walk me through what sochi is going to do for him. Twitter,ou seen on sochiproblems . Its amazing. It is the only thing i am watching from sochi. The big price tag was 50 billion that they supposedly spent preparing for radiators that are 10 feet high and bobsled runs that arent quite optimal and hotel rooms that arent ready. Two toilets where there should be one. It is a big disaster. Putin doesnt seem to care. He has a hard job but he doesnt seem to care. He major strength is that has the only authoritarian regime that used to be a democracy in the world. There is no other place you can point to that used to be a democracy and is now an autocracy again. He has somehow managed to pull it off. It doesnt really matter if you dont like what he has to say inside russia. He owns the electorate, he owns the process, he owns the politics. He owns the tv stations. Olympics not working out in the way i suspect he wanted it to. Lets talk a little bit about france. How unpopular can you get . You have the french president in the United States this week. How theious to know u. S. Views him. I dont think the u. S. Views him at all. I think he is done. Everyone knows that he is done. In a way, he is like obama in one respect. Hurry in america have a a very high regard for obamas foreign policy. People have a very high regard for hollandes foreign policy. Domestically, increasingly less popular. Position n this hollande is on this mission in silicon valley. He is on a mission that wont work. Is, youpproval rating know, lower than 20 . This is never before seen in the whole of europe. It went up a touch after the scandal emerged. Look, i think his governess failed and then his promise to his base was retracted. Failed becausees it was proof that his policies were unsuccessful and then he is sleeping around with a famous actress. It didnt play well. He is also just not that bashing. If he were looking like james bond he could get away with it. Berlusconi gets away with it and he is no james bond. Thank you so much for now. Michael fertik stays with us. Theill discuss whether latest violations that apple has discovered and its supply chain pose a risk to its reputation. Europe turns its attention to carbon omissions. A new rescue plan has been approved to boost Carbon Trading and encourage business. All of that coming up next. To come back to the pulse. An important move for Climate Change as the you Parliament Backs a plan to boost carbon prices. There is hope that encouraging Carbon Trading will help curb Greenhouse Gases globally. Here to tell us more is our Bloomberg Energy analyst. Walk me through what has been decided and how this will accelerate the process and raise carbon prices. What has been decided or why prices have risen since january socalled process that will withhold supply allowances sold by governments into this market has been put in place. In about one months time, the supply in the market will dramatically fall. That will change the dynamics across these markets. It has been the first step of various measures at the European Commission to reform this market. Effectively, it hasnt worked very effectively. There has been an oversupply, and economic recession. Theyre manipulating the market to get it to work better. It is an intervention. Inn the system was launched 2008, prices were expected to trade at about 30 euros. Now we are trading at about 6. 5 euros. Far away from the prices that were initially envisioned. Tot would also be required drive investment into low carbon technologies. That has been identified by the European Commission has a problem. They have now introduced to this plan and it has met much more resistance than initially thought. That is why it took much longer for this intervention. We are seeing the market react to this plan to some extent already. What does this mean for Energy Prices . From a utilitys point of view, carbon is another fuel. Prices which some people expect on the back of this measure are likely to be passed through to consumers. Which of course can raise the question, what will be the Political Support in the future . We will watch that as it emerges. Thank you very much indeed. Francine, back to you. Thank you so much. For those listening on bloomberg radio, bloomberg a first word is up next. For our bureaus, a second hour of the pulse is coming up. Here is what we will be talking about. Nestles sales growth slowed. We will be talking to the ceo. Apple uncovers labor violations. We talked to michael for sick Michael Fertik of reputation. Com. That is all coming up next. A bitter taste. Nestlys sales growth is the slowest in four years. Its ceo joins us live. Taking over Time Warner Cable, comcast forks over 44 billion to merge the giants. French finance minister tells us market tremors will not trigger a Global Crisis. Good morning to our viewers in our europe and just waking up in the United States. This is the pulse live in london. Coming up, getting billionaires to buy. Who would have thought it would be too hard but well see how the luxury car maker is luring car drivers in very exotic locations. Now with the french finance Prime Minister in the u. S. He told us hes not concerned about those who are in the emerging markets. I know the forecast as well as the central bank and the public for growth forecast is out 0. 4 to 0. 5 to the Fourth Quarter. I dont know what the figure will be exactly. If i would sum up i would say the he economy has got off recession. We had a recession in 2013. Its over. And our growth rate is about 1 per year. It is not enough. It is better than the recession but it is not enough. We want to speed up. This is why the president launched what he calls a responsibility backed with the firms in order to give them more capacities to invest, to reduce the cost of labor and to have a better taxation for the firms. To also simplify the access to regulation, to have also more flexible labor markets. This is what we are working on. And with that we will be capable of welcoming more and more american firms in france. Yesterday we met with businessmen from the u. S. In the American Chamber of commerce. It was really important ceos and all are present in france saying we are there, we are happy to be there. We want to expand our business but we want new business too. And i know what sometimes prevents people to invest in france. We want that to be off. And this is why i expect that if this pact is signed with the business, we can have more than 1 even in 2014 and much more in the years after. Are you worried at all about the volatility were seeing in emerging markets . Could there be a spillover effect . Of course i look at it. If i wouldnt, i would wouldnt be finance minister or somebody responsible. We carefully watch the move in those emerging countries. But, no, i dont see a crisis or Global Crisis coming. I think since i think things are controllable. We have next week a meeting in sydney we could probably discuss that. But we must find the way to have a cooperative approach towards growth in all zones of the world, including the emerging countries. But i dont see a single or a sign of a Global Crisis. No. The french finance minister speaking to peter cook, chief washington correspondent. Now, 10 months into his tenure, he is fighting off a challenge within his own party. Yesterday he was into the new economic plan and today well learn whether he will lindsey will replace him. Live from rome. Walk us through the rest of the day. Good morning. The analyst that weve been speaking to this morning are convinced that rensi makes his move at 3 00 today. Thats when the Democratic Party meets. The mayor of florence has decided that he wants to become the Prime Minister of italy. Yesterday we spoke with him. He was actually summoned to the meeting by rensi. Gives you a sense of the power dynamic and seems resigned to his fate. He noted that he is not going to be the one to be calling the shots in todays meeting. Lets see the discussion tomorrow. Lets see the main points. Im used to many shades. I am not the one chairing the meeting. Tomorrow is another day. One point leta made he doesnt think this crisis could be handled by a bull in a china shop. Thats a vailed criticism of the way rensi is handling this. We will find out later today exactly how the day will unfold and whether or not this plan can be excuted if it is indeed his plan. No one actually has spoken to rensi this morning. There spt any solid reporting out on what is he going to do. A lot of this is from analysts looking at the situation essentially saying that he has gone too far now to pull back. That he is going to make his move. As we know from italian politics, heavy is the head who wears the crown. Relate to rensi . He didnt actually lay out his plan to rensi. What he did is afterwards he went to the cameras. At this point he said he has a w economic plan a couple points, payroll tax cut, and ways to strengthen the legal system. One final note on this, the markets dont seem to be that concerned about the Political Uncertainty here in italy. There hasnt been a huge reaction. Now, perhaps the markets are mispricing, misplacing the rift and well know more today at 3 00 when the Democratic Party here gets together for a meeting. And he is going to have to make a decision on what his next smufe going to be and how he will excute it. We could have new elections and government formed or we could have coalition partners, we could have rensi allies come in to the government of those three scenarios the ones analysts predict they dont necessarily know, but the ones they predict will happen is that rensi is going to make his move and that he will be the next Prime Minister. Thank you very much indeed. Our International Correspondent reporting from rome. Now moving to corporate news. The slowest sales growth in four years. Live later. So where is the Worlds LargestCompany Turning for growth . Nest les kind of moving scup kale. Between health and food. Thats exactly right the bottom line is theyre not growing its sales as fast as they could like to. They have this model where they grow their sales organically by 56 . So things like skin products that we saw getting into buying the half they didnt already own is a way to do that. Thats where you have higher margins and higher growth. Its an interesting one because they think that trend is there to stay. The Company Makes things for things like acany and skin cancer which unfortunately are unlikely to decrease any time in the near future. Part of a larger trend, everybody was a bit surprised by skin care. But if you look over the last couple years theyve already been doing this especially with the acquisition of a couple biotech companies. They a Company Makes food treating people with depression. The year before that they bought a company which makes an alzheimers drink to help people with mild forms of alzheimers. So the bottom line is the sales from these new ventures, this new direction altogether add up to a few billion bucks. This is a company that does more than 100 billion of sales every year. Its not going to move the needle too much but like you say, it is the confluence of food and high tech and health. And thats where they think, and Many Companies quite frankly in the fastmoving consumerses good sector, think they should be. What is exactly their key problem . Whats the troubles . If you look at the United States, its not unimportant because nest le is not only the Worlds LargestFood Producer but also the u. S. s there does seem to be an issue with food in a broad sense. There is a price war under way for bottles water. Thats a huge double digit for them. Thats problematic. And this general there seems to be a little bit of a secular shift in the United States away from packaged food. There is a group out there called bb and t Capital Markets that put out a note last month that said americans are moving away from buying canned prepackaged food in favor of fresh and natural food. So that could be affecting not just nest le but une lever for example has started adding butter in reaction to that trend to some of its marge rins. But if you look at the developing world, its a different story because there you have Smaller Stores with less refredge ration, people wanting more protein and canned goods. So there, they came out a little better than people were expecting it because there people do want packaged foods. Thank you very much. Paul joining us live later on in the pulse. Comcast is said to have agreed to acquire Time Warner Cable in a deal worth 44 billion. This is crazy. A giant in the u. S. Cable industry. It has problems in itself. Walk through the numbers. The numbers are quite daunting in that it is 159 a share. Malone came knocking on the door at 130. Its now 160. Brian roberts turns up and said ill pay 159 and get on board. If you look at the history of comcast and look back in time you see at t, they bought the content. Then nbc, nbc universal, some of the competitor channels that we face every day but theyve got major levels. The pipe, the content, now add on a big doll lop of cream called customers. 30 million subscribers customers. Theyre going to have to give away about 3 million partly to malone and charter. But what youve got is scale. That gives you the ability to skis the content providers. So at the end of the day youll see squeezeup for the customers. Content providers could see a little bit of a slapdown in terms of overall pricing. U. S. Cable deal is so huge it will have an impact across the world. What youre seeing here is consolidation. Theres a lovely line in a piece that if the cable industry had if it had. It would be like this. It would be jaws. I was going to sing it. Ok. Were not going to be singing the theme tune to jaws. Ok, its jaws. Very, very deep deep banging of drums. The predator and the prey. This is a significant piece in the jig sau puzzle of the United States of america. Or is it more a question of the people, the three people ive just shown you which is Robert Marcus prefering to do business with Brian Roberts . There was a time when potentially you could have seen a joint buyout for Time Warner Cable but that didnt come to fruition. Well learn more about the deal and why it didnt happen. Now, heres what else is on our radar. U. S. Treasury secretary jack lew is in china. He made comments on the show. Cyber security and cyber theft are somewhat different issues and its important to distinguish them. The issue that weve raised with china is the protection of intellectual property and policies where theres a theft of intellectual property are just unacceptable for a country who wants to sit at the table and makes the rules for the world. China sees itself in the country that should have a voice in making the rules for the next generation. They cant have it both ways. You can watch the entire interview tonight. Frances biggest bank posts a surprise drop in profits. Setting aside more than 1 billion. Staff will get less compensation. If you talk about it of course there is a certain elasticity the as we said earlier the results have come down so we will see that in the bonuses. The process is a very detailed process which is ongoing so it might be different from business to business. There is elasticity between the revenues and bonus pools. And apple has uncovered labor violations in its supply chain including the use of underaged workers and abuses of migrant workers. They conducted interviews in the supply chain where people work. It is the latest fiscal year that were talking about where apple sold record numbers of i pads and put pressure to build ough devices to keep up with demands. Staying on am. Labor concerns hurt its image . Plus sluggish spending in developing markets takes a bite out of nest le sales. The companys ceo joins us this hour. Its ceo will be live later on. Now, apples annual audit has uncovered labor violations from the use of underaged workers to labor migrant workers. The company is working to sort this out but lets talk about apple. Its a major brand. But do we fully understand how it operates . The ceo of reputation. Com. Its one of those difficult journeys that apple has to make. It clearly has a problem with its supply chain but is attempting to audit that supply chain and understand it. Nevertheless, it throws up the nasty stories. How do you manage that from a corporate point of view . Its very a good question. It actually turns out we can like it or not that its not as much of a story or important as we might like to think it is in the media. Or the activists like to think it is. There are two constituencies. One are the Share Holders and the other are the customers. Unless there are egregious violations and it appears theyre not. Unless they are egregious violations, sales tend not to go down when theres a discovery of an audit process. Thats number one. Number two is the shareholders. And tim cooks being evaluated based on the share price. The price is down 170. And i think now its creeping back up. We know that the shareholders, the board are going to evaluate him based on the share price. The big story is that its become a regular company again every since steeb jobs death people are talking about it like its a regular company. And thats the major story. I think tim cook is a special guy. Its very important we dont cover it that he is gay. I think its important that the ceo of the Largest Company in the world at one point is an openly gay guy. I think its important if youre pro equality as i am in the world to know that theres a guy who can go anywhere in the world. You cant tell him no. Building an enormous company. I think its important that the tech sector, has created that and made it possible. This goes to the reputation. The fact that this was an internal reputation and they raised their hand saying were going to try to fix this. Is that the way that companies and corporations should always go . Barclays tried to do the same and that didnt work out so well. Thats an excellent point. If you can get in front of it, if you can be the author of your own investigation, and make a regular drum beat about it. What apple is doing correctly, this is the eighth year that theyre publishing this audit. So its a regular drum beat is expected and transparent. Theyve had third parties verify and audit their own process. So if you do it on an eventdriven basis it comes across as a onetime Blue Ribbon Panel apology. If you do it programically then youre doing it the right way and thats an excellent success for reputation and brand of apple by apple. Come back to kirk and draw ideas, jobs clearly an iconic leader. Cook becoming an iconic leader. Branson is another guy. Theres a book out about him trying to spill some dirt that actually the way he succeeded and the way that is inaccurate. He is a small investor in your business. But how do you perceive branson, a guy who sort of comes across as doing all the right things but still has made it to the top . And you kind of do those things fit together . Ive never met him but i admire him from afar. He is basically who he describes himself as being. The iconic image, theres a photograph i remember of his kneeling in front of jackie chan polishing jackie chans boots saying please fly on my airline. Can you imagine the humility of that . The salesmanship of that. Its so powerful. And a sense of humor. It shows the dignity of sales. Here of course branson bigger than his brand. But you understand were talking when youre flying with virgin you feel like youre flying with richard branson. Its all sort of lave endor and purple. It makes you feel part of the club. As to the substance of his business, his market cap is not as big as others. His value is not as high. But clearly he is awesome at establishing his reputation and owning it. He tweets and publishes more to linked in in the leadership category more than anybody like him. And its all about what he stands for. And he makes you feel like youre connected to him. He must have 5 extra hours a day than we do. Thanks so much. I wish we had more time to talk about humor. Welcome back. Its time for a look at todays hot shots. Eight rare cor vets swallowed up after this sink hole opened. It. Dy heard but saw two russian thrill seekers climbed the worlds second tallest building while it is still being built. Another two men climbed the shanghai building. They spent two hours scaling 120 floors. And then 18 hours waiting for good weather to record their stunt. Were waiting for good weather. And chinas lunar rover has woken up apparently. What else have we got coming up . Nestles ceo will be joining us shortly. Welcome back. Here are the top headlines. More rain and dangerous rains are coming across britain. Many commuters have already been hit by the worst floods in 260 years. The u. K. Environment agency says the risk of flooding is likely to increase in the next few days as the rirthames approaches peak levels. There are only signs revolutions the business numbers collapse. The western government issues warnings for travelers. The warnings have been eased. Airlines looking to reopen. We spoke to the countrys tourism minister. They told call and me theyre going in, stopping a while ago, is an indication they have a positive feeling about the future of egypt. A drop in Fourth Quarter profit after setting aside more than 1 billion for a legal provision tied to a review of payments due to u. S. Economic sanctions. Now 127 Million Euros is below its results since the Fourth Quarter of 2008. Rolls royce says sales wont grow this year for the first ime in a decade. Rob joining us now. Is that the entire reason were seeing the numbers being posted today . Thats certainly a big part of the reason but theres usually other issues with a company as broadly spread as rolls royce is on Civil Aerospace cost cuts not looking to materialize as fast as they would like. What does that mean for investors . They have put big pressure on internal costcutting. This has been his big push for more than a year. Ironically you could say this is actually a good thing because now he can turn to everyone and say this is why this needs to get done and they are promising, in civil arrow spaste that those cost cuts will start to come through. I guess this probably is indicative in the share price reaction, this is a company known to be stable. Almost like its engine. You want consistency. The rolls royce story for years has been consistency, no big surprises. Theyve had a decade of profit growth. So this is a bit of a shock to them. And comes after a few other surprises. They had the talks with the finish company. They were going to do an acquisition. There was the fraud probe. So things are not fundamentally flawed at rolls royce but kind of the, were not going to surprise you stories is perhaps not quite as clean any more. Warnings like this tend to come in kind of theyre not isolated. So given whats going on at this company, is this just going to be a blip or a phase of problems that we see as he tries to get control of the company and cost base and communicates what he is doing, are we going to see a few more of these . I dont think well necessarily see more of them but were clearly in a period where he is trying to catch up and transition to another phase of growth so a lot of things are coal esing and the fraud probe comes whenever. Thanks so much for all of that. Our correspondent on aviation. Aerospace. Things that fly. If youre in the market for a 2 million car youre in luck. The car owned by vw has 40 uper cars to unload. Ive never seen anybody get out of this car and say that wasnt what i expected. Its a very positive experience. We introduced the buggeti Dynamic Drive experience in north america just late last year. They have been very successful. Were going to host four events around the country and well bring in 20 to 25 people in per weekend and theyll have a chance to experience the car on the open road, and close down the road for a closed runway. Today we have the fastest opentop car in the world capable of 260 miles an hour with the top off. Imported to north america. Our customers have the opportunity to individual lies their car and i have seen a range anywhere from 2. 4 up to 3 million. Our goal was to drive experience program is to attract individuals who perhaps havent had a chance to experience the brand before. These are individuals who are serious about cars, want to experience it. We have some previous owners who come and just want to get back into the brand. Of the 150 open top cars that were ever going to build, only about 40 remain available worldwide. We anticipate the test will be will be nd there another model coming but we wont introduce anything within the next few years. Decent brakes. And exotic locations. Will b another model coming talking at brake thats what the european markets are seeing today. Equity markets are pausing with sixth straight gains. Today its about banks, about basic resources. At one stage on the global basis we lost 3 trillion. And now when it comes to looking forward through the day, i think what were going to be looking towards is the retail sales of the United States of america and that is going to be a critical number were looking for a riser of 2 10 of 1 . Were also going to keep an eye on the jobless figures as well. But there are three stocks in play. Thats graphics for you. They put aside almost 1 billion for legal issues in the United States of america. Now, that along with the fact that the dividend is underwhelming, 1. 5 euros. You can tell the market youre going to make a return on equity. Thats going up from a level of 7. 7. Lets have a look at rolls royce and these guys make huge engines. No growth this year. The reality of whats happening in budgetary constraints around the world is beginning to take effect in 2014. The Civil Aviation side may be fine but within the Defense Budget youre going to see a flat year. And talk about defense earnings dropping by 20 . Lets finish and when it comes o what drives ren all the, profitability up by 59 . Its up 60 to be fair so that is something to bear in mind. Leaving you with a thought of the overall map. Down 13 . Talk about sugar prices being down this year so some pretty big moves in the equity markets. Thanks so much. The very latest on the markets. In 20 minutes, joining us from new york with a preview. I know you have some news. It will be i want resting, well have to see what he says about his business. But all that swept aside by sorely on the merger of mergers in Cable Television in the United States. This is a huge deal in america. It affects every american. The battle between john malone and Brian Roberts over Time Warner Cable. Well dive into this with alex sherman along with sir martin and then other guests this morning on the acquisition by comcast. Brian roberts of philadelphia and comcast. Their acquisition of Time Warner Cable. This is a stunning development. It happened last night. Well perhaps see that announcement this morning. Well dive into that. Also, David Stockman with us. Well talk to him about the budget. About the deficit. About the disarray in his republican party. Thank you very much. And obble well have this coming up. A bitter taste. Nestle posted the slowest sales growth in four years. Live with its chief executive next. But things are looking up. Live on bloomberg tv later. Welcome back. Live from london on bloomberg tv. Nestle, the Worlds Largest food Company Posted the worlds growth in four years. Joining us is the ceo. These numbersall as disappointing. How would you see them . Feel they are strong figures. The growth is composed with very soft pricing that will not need it. Rep. So have grown in your definitely out performing the market. That is what is good about these figures. They reflect the environment of the world we live in. What is your main concerns . The market took the numbers as a little bit disappointing. You are saying we did not do that badly, especially if you look at the developed markets. Is there something you could have done better . Is there something you want to work on for the next two, three quarters . Have been looking in products in categories and parts of them dismisses that are not performing well in divesting them. The dynamics is there. Last year we have grown and the environment outperform the markets. At the same time, we have some that because of innovation. That is going to be rolled out. We have increased very strongly our support of our marketing spend. That should roll into the future. These of the things about what is site about the figures. What is nice about the figures. What are your advisers telling you about what the emerging markets will deliver over the next few quarters . Advised . You being what are your economists telling you, Business Leaders telling you . What are the reports back from the markets . You see more volatility, currency. O, economic polyp political volatility. We have been there, so the experience gives us maintaining perspective of things. The emerging markets is now growing slightly slower than before. With tailwinds and growth. It is coming back to normal level with some volatility, that is true. The strength of the company is that right before this we have a spread that helps us to manage that. This helps us to react appropriately to the new dynamics. Market will have slow growth. I do not see them growing very fast there. That will be subdued for quite a while. That can be sustained over time. We have never disengaged from the markets. In the invested heavily market. That is something that will combine for the future. You are focusing a lot on the positives, of course. Lets focus on the negatives, things that will change in the next 12 years. You want to focus on chocolate. A lot of investors say this would be a great fit for nestle. Are there any other investments that you want to get rid of . We have said we will look into a portfolio. It is not bringing as the joy of business. These are the things we are doing. In another way of saying it, we have quite a lot of skus. A company that has a growth per folio. We are a company that is worldwide resident, but we have to see an combine things in there that brings us growth for the future. We have extended our purpose. We are extending the boundaries. You brought it up right at the end, why are they called to you . You are in the food and health business. Skincare feels very different to reconcile with nestle. We say that we are all about nutrition, health, and wellness. There are different angles to get to that, food and beverage are in their. Already thended boundaries of our operation and upgrading the environment. That is more medical. Adding another division received. Very good growth for the future. There is a line of argument that is out there that says you have done this to keep the begging calls happy. That you have taken control of the business effectively to make the pain in the relationship. That is why it was interested in your answer on skincare. Walk me through the rationale of why you have done the deal. Was it to prevent a thirdparty coming in . Is that why you have ended up with the skincare part of the business . We always define and are thefining the pregnant call. One of the distinctions of the strategy is to look for saying growth strategy. You agree and have an agreement on how to do it then. And we stayed very deeply involved. We have done this for so many years. We are 40 plus years. We have been a long time there. What will you do with the i that you will get know we have had the announcement, but when will we hear from you . We did not say that yet. We have to have first the deal done. They look to be potentially offloading the medical nutrition business. There are options for you to spend money at the moment. Thank you. We will consider all options. I cannot express anything on this. Over the past few days, politically the situation in switzerland, it has change versus immigration. You employ plenty of eu citizens and imported them around switzerland. How big of an impact is this going to have . T is your reaction or an and what does it mean for nestee . It affects me personally because i am an immigrant. We respect that. We can maintain the company as it is. We are a multinational and have many people. Hundreds of nationalities. We are a company that really supports the free, open world and hope they will translate that wisely. Have you spoken about contingency plans . No, we will have to see how they translate it first him and then we can say what the impact will be. It is what other countries are doing, like europe. I would say lets get perspective to this and see how the day will be sorted out. I am confident they will do it wisely. Thank you so much. The nestle ceo. To take a break. See you in a moment. Welcome back. Let me tell you about is coming up the rest of the day. Dig in. A great interview coming up. Tinto. Of rio he will not want to miss that. Avocet for the pulse. Surveillance of next. This is bloomberg surveillance. Aside. Push time warner Tim Armstrong put foot and mouth. The ceo of wonder repair, sir martin sorrell. It is scarlet. Oysters. Or my good morning, everyone. This is bloomberg suveillance. Is thursday, february 13. Scarlet fu joints made. Too much of a good thing, adam johnson joins us as well. A quiet europe this morning. Wyatt europe. We did get a piece of data that came out of sweden, the Unemployment Rate rises. A small uptick. Here in the u. S. , retail sales. A very big deal. 56 of the economy is consumer spending. Initial jobless clai