Transcripts For BLOOMBERG Countdown 20141217 : comparemela.c

I am anna edwards. Also, talking the deficit. George osborne tells charlie rose that the u. K. Is a front runner in the world economy. U. K. , weularly in the have a budget deficit, even though it has come down by half. Our debt to gdp is too high at 80 . We want to be in the front ranks of economic nations. Russias currency is in crisis, and its economy is unraveling. The ruble plunged to its lowest ever against the dollar despite the Central Banks efforts to stem the route with its biggest Interest Rate hike since 1998. There is the dollarruble over the last two days. It touched 80 yesterday, coming. Own to around 71. 75 today still, the russian Prime Minister held an emergency , deciding not to consider currency controls. The economy minister insists the moves are not reflective of the countrys fundamentals. Of course, everything weve been talking about is on the stabilization of the ruble. Ratelieved its exchange does not correspond with the fundamental macroeconomic development. We see how it breaks away from the oil price movements. Lets bring our russian expert into the conversation, ryan chilcote. Tell us about this meeting that took place between ministers. First, the economy ministers announcement that they are not going to introduce capital controls really supported the ruble. We were at 80. It came down to 72. I think there is still probably a certain amount of the ruble value that is pinned to the prospect that there could be he said that they were discussing it. Obviously, not everyone is convinced as he is that hes being honest. That was one thing. The other thing is, from his ive focused on, he took a potshot at the governor of the central bank by saying that rates should have been hiked earlier. Ofis something the governor the central bank herself said later in the day. The economy minister there is the head of the Central Bank Rate their the economy minister we just heard from is the deputy head of the central bank and was passed over for the job. This war of words we are getting now is getting louder, quite surprising to hear within suchs inner circle acrimonious discussions. Are questions about whether the Prime Minister can hold his job, and there is an important debate going on between the former finance minister of russia you see on the left. He was the finance minister for 10 years, thought to be a liberal, and mr. Sechin, the ceo of rose left. Why . The day before yesterday, mr. Kudrin wrote that a bond sell t ross left had engaged in bruce left was seeding up the market. The fact that it wasnt transparent was also not helpful. Echin responded calling him a provocateur, saying that there needs to be in investigation to get to the bottom of whose interests he is pursuing. He threw him into the same category of people in the. Olitical opposition it just so happens that kudrin is one of the people rumored to replace the Prime Minister of russia. Debate and argument publicly right now between two of the most important people in post crisis russia. Meanwhile, International Business is trying to work out what to do with this, if theyve got dealings in russia. There is just chaos all over russia. Pple halted its online sales it is not a huge thing in terms of apple sales. They sold about 1. 5 million iphones out of 150 worldwide millionr, 150 worldwide last year, but yesterday they decided it was too complicated to keep up with the currency rate. Big macs went up. Carlsberg taking a hit. It has lost 2 billion of its market cap on the back of what is going on in russia. Thank you very much. We will return to this story many times. Getting some breaking news from philips, news of a takeover of the Dutch Company lighting, health, consumer products. It is acquiring a u. S. Company volcano for 18 a share. The total transaction value is 1. 2 billion. That includes volcanoes cash and debt. Is a catheterbased Solutions Company for cardiovascular applications. Philips, of course, is making a push into health, sports activity, nutrition, carving out the lighting business, which laid the companys foundation over 100 years ago. He is combining the health care and consumer lifestyle divisions into a new entity. That is further pushing that drive. As russias currency crisis ripples through the markets, a leading official at the bank of england is highlighting increased volatility in markets. Andrew bailey who is the banks Deputy Governor for prudential regulation told bloomberg that geopolitical risks are having an impact. Upwe went through a period until this alltime where, to be frank, i think the low level of volatility in markets was a surprise. Someone kept saying, things are going on around us, and there is very little discernible reaction in the Financial Markets to those events. That changed, and it changed in the early autumn of this year. It changed quite markedly in october. We have had some big movements. There are geopolitical risks going on. They are a much bigger part of the landscape now in terms of their potential impact on growth in the world economy. We will have more coverage of the bank of england later this morning. The minutes of the banks last Monetary Policy Committee Meeting of this year will be released at 9 30 london time. We will have analysis of that on bloomberg. When the greek government called a snap president ial stock market slumped. If lawmakers reject the governments nominee after three rounds, there will be a general election, which the auntie antiausterity party is seen to win. Why is greece being sucked back into crisis mode . Elliott gotkine reports. Just when greece thought they were out of their debt crisis, their politicians have pulled them back in. It begins with the revelation that the budget deficit is twice as big as previously thought. On austerity plan was announced. Four months later, greece formally requested a bailout. The s p downgraded the countrys debt to junk. Greece agreed to make 30 billion and cuts. Riots break out in the streets. Greece struggles on. A second figure bailout is approved to get through the worlds biggest that restructuring. Greeces Parliament Approves a new bailout. Protests continue. Antonis samaras becomes the Prime Minister. The real relief comes when ecb president mario draghi vows to defend the euro. 52014, the economy starts growing again, and for the first time in four years, greece sells bonds. Bigantiausterity party won in european elections. The government brings forward president ial elections. Will it work . Elliott gotkine is live in athens. All of the action tonight is going to be happening just behind you in parliament. Walk us through what to expect. Thats right. Good morning on a not so glorious day. Theust under 12 hours time, 300 members of the Greek Parliament are set to gather in the parliamentary building across the street from me. The vote is due to start at 7 00 p. M. Local time. It is not greece, expected to start on time, sometime between 7 00 and 8 00. The committee will then call out the name of every single lawmaker. They will respond in one of two ways. If they saying nay, that is greek for yes. That means they will vote for Prime Minister summer us president ial candidate. You cant actively vote against the president. You just abstain. The key number to look for is 101. Once you get to 101 abstentions, it becomes mathematically impossible for Prime Minister samaris to get his president ial candidate through. Then we will move on to round two on december 23, and potentially run three on december 29, when he only needs the support of 180 lawmakers. Tonight, he needs to hundred. He already has 155 in his governing coalition. If he doesnt win on december 29, then Parliament Must be dissolved. New general elections called within 10 days. They must be held within 21 days of that. Course, thes concern is if there is a general election, the antiausterity party could win and perhaps try to renegotiate terms with creditors. Yes. Polls,ng to the opinion they are still the most Popular Party in greece, although its lead over the Prime Ministers new Democracy Party has closed a little bit, according to the latest poll. That said, investors are certainly fretting about a potential antiausterity party victory. Scenario, which perhaps prompted some to sell off their stocks or bonds in is thatast week, serious woodwind, and then on february 28 when the current sarasohngreement ends, would be unable to negotiate a followon agreement. Would spell trouble for its economy because it would no longer have a buffer for its thanks. Debt is rated as junk. It would also be able to run unable to access markets with borrowing costs above 9 . To july whenad us greece owes a big chunk of cash to the European Central bank. It could become in theory the first country ever to default on paying its debt to its own central bank. The party has shown itself to be a little bit pragmatic. It simply wants a friendly renegotiation. 1 thank you very much indeed. We will have more from elliott threat the morning. At 10 30, he will speak with llamas retz off. He will tell us how these uncertainties surrounding the greek election could impact tourism in greece. You can join in the conversation on twitter. Theare you expecting from what are you expecting from the Greek Parliament later today . You were listening. Taking notes, elliott. Crisis ainded me of a couple years ago. We have many shots in front of the parliament. Coming up, we will be talking greece and russia with Neil Williams of Hermes Investment management. Time for todays company news. Bernie ecclestone has won his battle to regain, retain control of formula one after paul walsh walked away from plans to become chairman of the board. That is according to reports. Walsh was said to be in a poor position in the position to replace peter brownback. He is known to be suffering from ill health and is expected to step down. Traders at citigroup will be spared the full impact of this years market slump. The yearend bonus pool for the banks trading business will be generally unchanged from last year, even though revenue has been sliding. That is according to a person briefed on the matter. It is not such good news for citigroups investment bankers. There are rewards will fall short of the divisional jump in revenue, although some could see increases of as much as 5 . Slumped inos stocks hong kong trading after reports of a crackdown on illicit money being channeled through the casinos. Entertainment fell by as much as 3. 5 , and wynn macau, 4. 3 after the story in the south China Morning post. Is also preparing for its first annual decline in casino revenue. Russian ruble hit a record low yesterday, and the followup to spreading through Global Markets. Lets bring in our next guest. Neil williams, thank you very much for joining us. Bloomberg has done a nice survey of economists who expect 70 billion to be spent by the russians on propping up their 6 of their fx reserves. Economistspose many have much intelligence on whether thats going to happen, but that is an assumption. Iphone 4s second youre going to say the economists have intelligence. I thought for a second you are going to say the economists have intelligence. Russia is back on the radar. Russia is important. It is a 2 trillion economy, which puts it on par with italy. It is not far behind the u. K. This takes us back to 1998 when they defaulted. I am concerned not just about the russian economy, which is big, but the spillover, especially as it depends back towards the eurozone and particularly germany, which increasingly is looking less bulletproof economically. Good tostage, it was see capital corp. Controls werent imposed. That doesnt smell just yet like 1998. Back then, oil hit a dollars a barrel. In real terms, oil is about four times higher than that. Same time, russia faced a huge spike in its bond redemptions that were due and couldnt afford them and therefore defaulted. Going back to your comment about the ruble, they also had a foreign currency pegged to defend. Theyve got more time this time to do something about it. Im also concerned about how that bends back into the eurozone at a time that is hardly troublefree. If you dont throw money at it, are currency controls the final option besides raising Interest Rates, which seemingly hasnt worked . Its currency control the final desperate solution . I think that is the ultimate game that will need to be played. It always risks increasing social unrest at home, especially at christmas, for those who want to buy consumer goods. Now, they are certainly more expensive. If the ruble fails to find a fall into next year when international sympathy is going to be low, capital controls seem to be the ultimate of the ultimate objective. All this talk of spillover into germany, which way does it play . Pitt plays to germany through more of the central and Eastern European economies, given that the biggest markets for german capital and intermediate goods is still the likes of poland, hungary, and countries to the east. By ann in this comfort zone re i still think a logical there is a symbiosis between germany and russia. Half of russias tax revenue comes solely from its exports of oil and gas to the eu, while as much as two thirds of germanys oil demand comes through russia. There is the case of knocking Heads Together and sorting this out, but clearly, its not going to happen in the shortterm. Neil williams come stay with us. We will continue our conversation about things on his mind, as we did with russia and greece. 6 21 here in london. Welcome back. Hermes Investment Management chief economist Neil Williams. I did enjoy reading your notes on the outlook for the next year. The word bazooka was in there, and i havent seen this word for a while. Is the bazooka going to be rolled out of the garage . Yes. Bazooka is very much in the shed and will be dusted off next year. The interesting thing is, what is the trigger for him to use it . Possibility linking it with e couldthat ive heard, q start to help greece stay in the system. That is not going to go down well with the core members of the eurozone. I wonder if its actually the opposite. Japan has been doing qe4 16 years. Thing it has really achieved is to keep bond yields lower for longer. Wifi or the final bullet now when bond deals are on the floor . Trigger could be if greece were to leave the system, and i dont think they will, bond yields would surely start to go up. If could have the irony that greece were to leave, maybe the ecb would do qe for the other countries. I think that has to be an incentive for whoever wins in greece to stay in the system. Lets look at the fed, because they are of course meeting this week, and a lot of attention will be given to the comments that come from janet yellen later on. Are we going to see any big change in language . Are we going to see any acknowledgment of the International Turmoil . International forces have strengthened, but i think we will have to look very hard to see any language changed today. Importantly, not so much the international scene, but the domestic scene in the u. S. Coupled with an oil slide, weve had dollar strength, and i think it will be interesting to see how the fed remarks upon the strength of the dollar. Economists like me are torn up have torn up half of their Inflation Forecasts for next year. I am knocks picking the u. S. To have zero inflation by summer of next year at current oil prices. In the u. K. , weve already got deflation at the goods price level. It is quite possible that next year we have no rate hikes at all in the u. S. Or u. K. Neil williams, chief economist at Hermes Investment management. For germany. Tion it centers on textbooks for inheriting a familys firm. We will be live in berlin after the break. You are watching countdown take a look at the Foreign Exchange markets. There is talking about. Yesterday, the ruble plummeted into a freefall. The dollar this week alone has risen by 31 against the ruble. 72 rubles. An intraday move pushed the ruble to 80 against the dollar. Through against the Financial System after this increase of failed to stem a run on the currency. The economy minister denied speculation that the government would turn to foreign restrictions, foreignexchange restrictions, to stop russia from converting money into dollars. It was quite an astonishing day. S Bloomberg News has spoken to suggest that the best way of stopping the rubles decline is to intervene in the currency markets. Have surveyed say up to 80 billion is available to do that next year. Other options are to raise rates again, which seemingly hasnt worked yet, or to implement capital controls, something that our last guest Neil Williams says is very much a possibility. It has been quite an astonishing 24 hours for the ruble. An internal intraday low of 80. I am anna edwards in london. The uks chancellor of the exchequer says he will target what he calls aggressive tax planning in his bid to reduce the uks budget deficit. George osborne told charlie rose that he would work toward eliminating the deficit. Britain is still carrying a 5 budget deficit. It was double digits. It was forte to be 11 forecast of the 11 . Weve got to eliminate that deficit principally by reducing government spending, dealing with costly welfare entitlements. Youve also got to make sure that wealthy people pay their taxes. We are unapologetic in dealing with aggressive tax planning. You can see the full interview with Central Banks<\/a> efforts to stem the route with its biggest Interest Rate<\/a> hike since 1998. There is the dollarruble over the last two days. It touched 80 yesterday, coming. Own to around 71. 75 today still, the russian Prime Minister<\/a> held an emergency , deciding not to consider currency controls. The economy minister insists the moves are not reflective of the countrys fundamentals. Of course, everything weve been talking about is on the stabilization of the ruble. Ratelieved its exchange does not correspond with the fundamental macroeconomic development. We see how it breaks away from the oil price movements. Lets bring our russian expert into the conversation, ryan chilcote. Tell us about this meeting that took place between ministers. First, the economy ministers announcement that they are not going to introduce capital controls really supported the ruble. We were at 80. It came down to 72. I think there is still probably a certain amount of the ruble value that is pinned to the prospect that there could be he said that they were discussing it. Obviously, not everyone is convinced as he is that hes being honest. That was one thing. The other thing is, from his ive focused on, he took a potshot at the governor of the central bank by saying that rates should have been hiked earlier. Ofis something the governor the central bank herself said later in the day. The economy minister there is the head of the Central Bank Rate<\/a> their the economy minister we just heard from is the deputy head of the central bank and was passed over for the job. This war of words we are getting now is getting louder, quite surprising to hear within suchs inner circle acrimonious discussions. Are questions about whether the Prime Minister<\/a> can hold his job, and there is an important debate going on between the former finance minister of russia you see on the left. He was the finance minister for 10 years, thought to be a liberal, and mr. Sechin, the ceo of rose left. Why . The day before yesterday, mr. Kudrin wrote that a bond sell t ross left had engaged in bruce left was seeding up the market. The fact that it wasnt transparent was also not helpful. Echin responded calling him a provocateur, saying that there needs to be in investigation to get to the bottom of whose interests he is pursuing. He threw him into the same category of people in the. Olitical opposition it just so happens that kudrin is one of the people rumored to replace the Prime Minister<\/a> of russia. Debate and argument publicly right now between two of the most important people in post crisis russia. Meanwhile, International Business<\/a> is trying to work out what to do with this, if theyve got dealings in russia. There is just chaos all over russia. Pple halted its online sales it is not a huge thing in terms of apple sales. They sold about 1. 5 million iphones out of 150 worldwide millionr, 150 worldwide last year, but yesterday they decided it was too complicated to keep up with the currency rate. Big macs went up. Carlsberg taking a hit. It has lost 2 billion of its market cap on the back of what is going on in russia. Thank you very much. We will return to this story many times. Getting some breaking news from philips, news of a takeover of the Dutch Company<\/a> lighting, health, consumer products. It is acquiring a u. S. Company volcano for 18 a share. The total transaction value is 1. 2 billion. That includes volcanoes cash and debt. Is a catheterbased Solutions Company<\/a> for cardiovascular applications. Philips, of course, is making a push into health, sports activity, nutrition, carving out the lighting business, which laid the companys foundation over 100 years ago. He is combining the health care and consumer lifestyle divisions into a new entity. That is further pushing that drive. As russias currency crisis ripples through the markets, a leading official at the bank of england is highlighting increased volatility in markets. Andrew bailey who is the banks Deputy Governor<\/a> for prudential regulation told bloomberg that geopolitical risks are having an impact. Upwe went through a period until this alltime where, to be frank, i think the low level of volatility in markets was a surprise. Someone kept saying, things are going on around us, and there is very little discernible reaction in the Financial Markets<\/a> to those events. That changed, and it changed in the early autumn of this year. It changed quite markedly in october. We have had some big movements. There are geopolitical risks going on. They are a much bigger part of the landscape now in terms of their potential impact on growth in the world economy. We will have more coverage of the bank of england later this morning. The minutes of the banks last Monetary Policy<\/a> Committee Meeting<\/a> of this year will be released at 9 30 london time. We will have analysis of that on bloomberg. When the greek government called a snap president ial stock market slumped. If lawmakers reject the governments nominee after three rounds, there will be a general election, which the auntie antiausterity party is seen to win. Why is greece being sucked back into crisis mode . Elliott gotkine reports. Just when greece thought they were out of their debt crisis, their politicians have pulled them back in. It begins with the revelation that the budget deficit is twice as big as previously thought. On austerity plan was announced. Four months later, greece formally requested a bailout. The s p downgraded the countrys debt to junk. Greece agreed to make 30 billion and cuts. Riots break out in the streets. Greece struggles on. A second figure bailout is approved to get through the worlds biggest that restructuring. Greeces Parliament Approves<\/a> a new bailout. Protests continue. Antonis samaras becomes the Prime Minister<\/a>. The real relief comes when ecb president mario draghi vows to defend the euro. 52014, the economy starts growing again, and for the first time in four years, greece sells bonds. Bigantiausterity party won in european elections. The government brings forward president ial elections. Will it work . Elliott gotkine is live in athens. All of the action tonight is going to be happening just behind you in parliament. Walk us through what to expect. Thats right. Good morning on a not so glorious day. Theust under 12 hours time, 300 members of the Greek Parliament<\/a> are set to gather in the parliamentary building across the street from me. The vote is due to start at 7 00 p. M. Local time. It is not greece, expected to start on time, sometime between 7 00 and 8 00. The committee will then call out the name of every single lawmaker. They will respond in one of two ways. If they saying nay, that is greek for yes. That means they will vote for Prime Minister<\/a> summer us president ial candidate. You cant actively vote against the president. You just abstain. The key number to look for is 101. Once you get to 101 abstentions, it becomes mathematically impossible for Prime Minister<\/a> samaris to get his president ial candidate through. Then we will move on to round two on december 23, and potentially run three on december 29, when he only needs the support of 180 lawmakers. Tonight, he needs to hundred. He already has 155 in his governing coalition. If he doesnt win on december 29, then Parliament Must<\/a> be dissolved. New general elections called within 10 days. They must be held within 21 days of that. Course, thes concern is if there is a general election, the antiausterity party could win and perhaps try to renegotiate terms with creditors. Yes. Polls,ng to the opinion they are still the most Popular Party<\/a> in greece, although its lead over the Prime Minister<\/a>s new Democracy Party<\/a> has closed a little bit, according to the latest poll. That said, investors are certainly fretting about a potential antiausterity party victory. Scenario, which perhaps prompted some to sell off their stocks or bonds in is thatast week, serious woodwind, and then on february 28 when the current sarasohngreement ends, would be unable to negotiate a followon agreement. Would spell trouble for its economy because it would no longer have a buffer for its thanks. Debt is rated as junk. It would also be able to run unable to access markets with borrowing costs above 9 . To july whenad us greece owes a big chunk of cash to the European Central<\/a> bank. It could become in theory the first country ever to default on paying its debt to its own central bank. The party has shown itself to be a little bit pragmatic. It simply wants a friendly renegotiation. 1 thank you very much indeed. We will have more from elliott threat the morning. At 10 30, he will speak with llamas retz off. He will tell us how these uncertainties surrounding the greek election could impact tourism in greece. You can join in the conversation on twitter. Theare you expecting from what are you expecting from the Greek Parliament<\/a> later today . You were listening. Taking notes, elliott. Crisis ainded me of a couple years ago. We have many shots in front of the parliament. Coming up, we will be talking greece and russia with Neil Williams<\/a> of Hermes Investment<\/a> management. Time for todays company news. Bernie ecclestone has won his battle to regain, retain control of formula one after paul walsh walked away from plans to become chairman of the board. That is according to reports. Walsh was said to be in a poor position in the position to replace peter brownback. He is known to be suffering from ill health and is expected to step down. Traders at citigroup will be spared the full impact of this years market slump. The yearend bonus pool for the banks trading business will be generally unchanged from last year, even though revenue has been sliding. That is according to a person briefed on the matter. It is not such good news for citigroups investment bankers. There are rewards will fall short of the divisional jump in revenue, although some could see increases of as much as 5 . Slumped inos stocks hong kong trading after reports of a crackdown on illicit money being channeled through the casinos. Entertainment fell by as much as 3. 5 , and wynn macau, 4. 3 after the story in the south China Morning<\/a> post. Is also preparing for its first annual decline in casino revenue. Russian ruble hit a record low yesterday, and the followup to spreading through Global Markets<\/a>. Lets bring in our next guest. Neil williams, thank you very much for joining us. Bloomberg has done a nice survey of economists who expect 70 billion to be spent by the russians on propping up their 6 of their fx reserves. Economistspose many have much intelligence on whether thats going to happen, but that is an assumption. Iphone 4s second youre going to say the economists have intelligence. I thought for a second you are going to say the economists have intelligence. Russia is back on the radar. Russia is important. It is a 2 trillion economy, which puts it on par with italy. It is not far behind the u. K. This takes us back to 1998 when they defaulted. I am concerned not just about the russian economy, which is big, but the spillover, especially as it depends back towards the eurozone and particularly germany, which increasingly is looking less bulletproof economically. Good tostage, it was see capital corp. Controls werent imposed. That doesnt smell just yet like 1998. Back then, oil hit a dollars a barrel. In real terms, oil is about four times higher than that. Same time, russia faced a huge spike in its bond redemptions that were due and couldnt afford them and therefore defaulted. Going back to your comment about the ruble, they also had a foreign currency pegged to defend. Theyve got more time this time to do something about it. Im also concerned about how that bends back into the eurozone at a time that is hardly troublefree. If you dont throw money at it, are currency controls the final option besides raising Interest Rate<\/a>s, which seemingly hasnt worked . Its currency control the final desperate solution . I think that is the ultimate game that will need to be played. It always risks increasing social unrest at home, especially at christmas, for those who want to buy consumer goods. Now, they are certainly more expensive. If the ruble fails to find a fall into next year when international sympathy is going to be low, capital controls seem to be the ultimate of the ultimate objective. All this talk of spillover into germany, which way does it play . Pitt plays to germany through more of the central and Eastern European<\/a> economies, given that the biggest markets for german capital and intermediate goods is still the likes of poland, hungary, and countries to the east. By ann in this comfort zone re i still think a logical there is a symbiosis between germany and russia. Half of russias tax revenue comes solely from its exports of oil and gas to the eu, while as much as two thirds of germanys oil demand comes through russia. There is the case of knocking Heads Together<\/a> and sorting this out, but clearly, its not going to happen in the shortterm. Neil williams come stay with us. We will continue our conversation about things on his mind, as we did with russia and greece. 6 21 here in london. Welcome back. Hermes Investment Management<\/a> chief economist Neil Williams<\/a>. I did enjoy reading your notes on the outlook for the next year. The word bazooka was in there, and i havent seen this word for a while. Is the bazooka going to be rolled out of the garage . Yes. Bazooka is very much in the shed and will be dusted off next year. The interesting thing is, what is the trigger for him to use it . Possibility linking it with e couldthat ive heard, q start to help greece stay in the system. That is not going to go down well with the core members of the eurozone. I wonder if its actually the opposite. Japan has been doing qe4 16 years. Thing it has really achieved is to keep bond yields lower for longer. Wifi or the final bullet now when bond deals are on the floor . Trigger could be if greece were to leave the system, and i dont think they will, bond yields would surely start to go up. If could have the irony that greece were to leave, maybe the ecb would do qe for the other countries. I think that has to be an incentive for whoever wins in greece to stay in the system. Lets look at the fed, because they are of course meeting this week, and a lot of attention will be given to the comments that come from janet yellen later on. Are we going to see any big change in language . Are we going to see any acknowledgment of the International Turmoil<\/a> . International forces have strengthened, but i think we will have to look very hard to see any language changed today. Importantly, not so much the international scene, but the domestic scene in the u. S. Coupled with an oil slide, weve had dollar strength, and i think it will be interesting to see how the fed remarks upon the strength of the dollar. Economists like me are torn up have torn up half of their Inflation Forecasts<\/a> for next year. I am knocks picking the u. S. To have zero inflation by summer of next year at current oil prices. In the u. K. , weve already got deflation at the goods price level. It is quite possible that next year we have no rate hikes at all in the u. S. Or u. K. Neil williams, chief economist at Hermes Investment<\/a> management. For germany. Tion it centers on textbooks for inheriting a familys firm. We will be live in berlin after the break. You are watching countdown take a look at the Foreign Exchange<\/a> markets. There is talking about. Yesterday, the ruble plummeted into a freefall. The dollar this week alone has risen by 31 against the ruble. 72 rubles. An intraday move pushed the ruble to 80 against the dollar. Through against the Financial System<\/a> after this increase of failed to stem a run on the currency. The economy minister denied speculation that the government would turn to foreign restrictions, foreignexchange restrictions, to stop russia from converting money into dollars. It was quite an astonishing day. S Bloomberg News<\/a> has spoken to suggest that the best way of stopping the rubles decline is to intervene in the currency markets. Have surveyed say up to 80 billion is available to do that next year. Other options are to raise rates again, which seemingly hasnt worked yet, or to implement capital controls, something that our last guest Neil Williams<\/a> says is very much a possibility. It has been quite an astonishing 24 hours for the ruble. An internal intraday low of 80. I am anna edwards in london. The uks chancellor of the exchequer says he will target what he calls aggressive tax planning in his bid to reduce the uks budget deficit. George osborne told charlie rose that he would work toward eliminating the deficit. Britain is still carrying a 5 budget deficit. It was double digits. It was forte to be 11 forecast of the 11 . Weve got to eliminate that deficit principally by reducing government spending, dealing with costly welfare entitlements. Youve also got to make sure that wealthy people pay their taxes. We are unapologetic in dealing with aggressive tax planning. You can see the full interview with George Osborne<\/a> on charlie rose at 10 00 this evening london time on bloomberg. Antonink Prime Minister<\/a> samaras take the First Step Towards<\/a> electing a new head of state today. Lawmakers in athens will hold the first of three possible maras needing 200 votes. He needs to secure the nomination to secure to avoid a snap election. The antiausterity party would win more seats in a general election, polls say. The fallout from russias currency crisis continues to have an impact in world markets. Facing mounting losses on its russian Bond Holdings<\/a>, while some Foreign Exchange<\/a> brokers in new york and london have told clients they are no longer taking ruble trades. Ruble sank below 80 to the dollar, a record low. A panic swept through russias Financial Markets<\/a>. The russian economy minister denied speculation that the government could impose currency restrictions. With joeget more weisenthal who breaks down everything you need to know about the buildup to the collapse and what it means, all in just two minutes. What is the ruble collapsing, and what does it mean . Basically two explanations. One of them is following oil prices, and the other is the sanctions. 50 of russias revenues come from oil and gas. If the price of a barrel of oil 60, itng from 110 to is a huge hit the countrys revenue. The second thing is the sanctions. You remember in february, russia invaded crimea, the russian flag was hoisted above the crimean parliament. President obama and other western leaders responded by imposing sanctions on the russian government and russian companies. We are making it clear that there are consequences for their actions. The central bank has two tools at its disposal. One, it could get into its massive pile of foreign cash and buy rubles to prop them up. However, they have done this a few times, and it hasnt worked. The second thing russia can do is dramatically hike Interest Rate<\/a>s. That is exactly what they did early tuesday morning. Is, if youdea increase Interest Rate<\/a>s, you increase the incentive people have to keep their money in rubles. That works for all of about 20 minutes. After that, the ruvell continued its violent downward spiral, losing 19 of its found you in 24 hours. Fear has taken over the russian markets. What is going to happen . The collapsing ruvell cause inflation to get worse, and the Interest Rate<\/a> hikes, which they need to stem the rubles decline, will only deepen the recession. The oneway putin could help himself is by dialing back the aggression in ukraine and hoping the sanctions get eased, but that seems unlikely. The provocations in ukraine are the things hes done this year that have been popular in russia. A disease or for putin to blame the west it is easier for putin to blame the west. Germanys high court will rule today on whether family owned businesses can pass from generation to generation without their heirs paying an inheritance tax. Our International Correspondent<\/a> hans nichols went Christmas Shopping<\/a> in a region that could be hit hard by an adverse ruling. Mixed withn tradition. That combination has powered small and medium familyowned , the engines of the German Economy<\/a> and employment. In this town, the handcrafted woodwork industry directly employs 2000 workers. Ringo guatemala who provides 40 jobs comes from a line of owners that survived two world wars and communism. The children always took over the business. This has happened for four generations. Constitutionals court may force familyowned businesses to pay inheritance taxes as high as 30 when they change hands, a direct challenge to the family legacy. You wish to be successful, hoping the next generation will be able to have an income. A High Court Ruling<\/a> could spark a fire sale among germanys 3 million small and medium businesses to settle their tax bill. It is not just villages like this one where small workshops dominate the economy but the entire german middle shunt, where the goal is to pass the business on from generation to generation, going round and round without paying caesar. More than 130,000 Family Businesses<\/a> with some 1. 6 million employees are set to change hands in 2018. Law, they can be bequeathed taxfree as long as the heirs keep the business for seven years without substantial layoffs. About 20 of these companies worry that in and to be taxexempt and would threaten their existence. Robes may wisemen and not bring good tidings to germans this christmas season. A new tax instead of frankincense and myrrh. Our International Correspondent<\/a> hans nichols joins us now. Can you tell us now more about the tax changes the german finance minister is considering . Schaeuble has a few options up his sleeve. Want to preserve the ability for these businesses to pass on from generation to generation. Over 92 of German Companies<\/a> are actually familyowned. In this space, there are potentially going to be 130,000 transfers in 2018. So much employment is derived from that. He has two options. One, they can abolish the entire inheritance tax for all assets, whether it is real estate, stocks, whatever. You only get about 5 billion euros per year from the inheritance tax. The other option is to introduce new legislation to give rebates to small and mediumsized Family Businesses<\/a>. They are working on some workarounds. Everyone is waiting on this decision from the high court. It lands at about 11 00 local, 10 00 your time. We will bring you the latest on that. We will speak to later. Hans nichols in berlin. You can join in our conversations on twitter. We have put out a few of our highlights with the conversation with the chief economist at hermes regarding russia, rates in the u k and the u. S. Neil williams said the ecb will wheel out the qe bazooka in 2015. You can find us on twitter. Coming up, could the fusion of hr and technology turned the traditional career path on its head . Reduced complexity and increased freedom and the workplace. It might sound look at dream come true, but our next guest says it is not as far off as you may think. We will be joined by workdays coo. He will be with us next. Time for todays company news. From the fallout of russias currency crisis. Apple has halted online sales of its products in russia because of fluctuations in the wrubel an apple spokesman said the apple. Store was unavailable while the company reviewed pricing. Russias problems have had an impact on carlsberg. Their values slumped more than 2 billion in less than a month. Carlsberg is the biggest beer maker in russia that generates about one third of its profit in the country. We have had breaking news from phillips this hour. It will buy the medical Devices Company<\/a> volcano for 18 a share. Phillips said the deal valued at 1. 2 billion. 6 43 in london. Be as simple as tapping it button on your smart phone . This way of working is one way the booming hr market could transform the professional world as we know it. Mike stankey is the president and ceo of workday. Thank you very much for joining us on one of your trips to europe. You are in europe because your business is becoming increasingly global, is it . It is. Not only do we have european customers, but our north american customers have extensive operations across the region. Give us a sense of what happening within the Hr Technology<\/a> market. You say it is undergoing a process, which will completely transform the professional world how is it doing that. . I think the last two decades, cfos have invested huge amounts of capital. The law of diminishing returns has kicked in. Now they are looking for new areas to gain efficiencies. The people side of their equation represents more than half of the total cost structure, and by bringing data and tools and putting them in the hands of mere mortals, we can greatly improve the efficiency of people spend at organizations. Give us some examples of how that really happens. Hr systems used to exist onsite or in a basement, and now that exist on the cloud managed by another party such as yourself. Why does that mean a material shift in the efficiency of the hr of a company . The efficiency comes from the easeofuse and access to data. Not only our servers and infrastructure located in the cloud, but the utilization of the systems themselves are migrating to mobile devices. Most systems on smartphones and tablets makes information more accessible to people. Is that one of the advantages to being a young business . I know there were a number of peoplesoft veterans who set up this business in the first place. What were you able to do as a newer business that you were not able to do as part of a big business like peoplesoft . Is it a something that is mobile from scratch . We were able to start over with contemporary technologies. We have a mobilefirst design philosophy. Our products simply look different from old legacy products. As we access data, we are able to employ some of the big Data Technologies<\/a> to get more interesting insights. s sap one of the old legacy products . When you read sap articles on you aremberg system, mentioned, salesforce is mentioned. They are making the transition to the cloud. Godzilla,ns when the the goliath that is sap, the worlds biggest Business Management<\/a> software company, what happens when it catches up on the innovative front, transferring its expertise onto the cloud . I think its an interesting question. Catching up is a difficult thing to do. They have the legacy of past technologies. They are attempting to stitch together this crazy quilt of multiple acquisitions they have made. I think they will be challenged to deliver a unified customer experience, deliver the easeofuse that workday is able to deliver. When you look at what is happening in the cloud and how businesses are using services in the cloud, do you see things becoming more specialized, or are things coalescing more . Your business is in hr. There are finance specialists. There are different businesses that seem to serve different parts of the enterprise. Are they all coalescing, coming together, or is there value in the specialism . We believe that the last 25 years has proved that the erp monolith is dead. As you point out, this is the era of specialist companies. We believe salesforce. Com has innovated ineffectively in the customer cloud. Applicationsilding in the administrative cloud. We believe google and microsoft are formidable players in the collaboration cloud. Most importantly, we think new players will emerge for operational systems like banking, patient care. To those whou say say that Cloud Computing<\/a> yes, its the future, but for now, its a bit of a money pit . If you look at your latest figures, yes, sales are up by 68 , 215 million, but on an adjusted basis, you are losing three cents per share. You are still losing money. Is it a money pit for players like you . Theou have to evaluate models. We take our costs up front on the revenues over time, which on a traditional accounting basis makes us look less attractive. The company is cash flow positive on an operating basis. Most importantly, we can create great products and have happy customers more effectively than legacy players. Give us an example of a business that is really software inhat hr the cloud can do for them. What isnt example of a business doing things at the cuttingedge using your software . If you take a look at company they have for many years the to gain a consolidated view of their workforce. Visibility ofthe all of their employees across the globe, and they can transform the business by moving into new industries and use the talent they have on staff, rather than dismissing and recruiting entire new workforces. Just getting everybody on one system is a big enough challenge for some of these big businesses. It shouldnt be that hard, but Many Organizations<\/a> start their workday project with 30100 hr systems. We asked you before you came on what percentage sales is in the u. S. He said roughly 80 . Europe is 10 . You are not in russia. Country you want . O be in the future how do you see russia as a place to do business in the future . I think russia is an important economy as we go forward. Russia is in our future. Mike, thank you for joining us, mike stankey, president and ceo of workday. As nasas curiosity rover new discoveries on mars, could there be life on mars . What better way to round out 2014 then a healthy were hearty italian lunch with some of europes corporate powerbrokers . Francine lacqua asked for their reflections on the year that was, what sahara, and why there are some parts of the job they cannot stand. Here is a quick look. I dont like dealing with politicians. That is the reason why we never do political advertising. [indiscernible] its another world. Another world. What world . A world where sincerity varies with the weather. The most important ingredient to success is sincerity. [indiscernible] francinescatch onversation coming up friday, december 19 at 5 00 u. K. Time. Childrens films are rife with murder and mayhem and can contain more violence than gory s such ashoot them up pulp fiction. Academics compared the top 45 grossing child films of all time to the dolphins. Adult films. Shocking. Bambi,e shootings in peter pan, stabbings in beauty and the beast, animal attacks in how to train your dragon, and finally come if you want a hasslefree, deathfree dalmatianslm, 101 or the jungle book. Good morning. What have you found . This is rather intriguing. This is in the wall street journal. Keep an eye out there. Rihanna has become the creative director of tumor. Puma. Ma had news yesterday that pu might be celled off. Now they are getting none other than one of my personal favorite person female celebrities. Be influencing the product design, and its going to be a multiyear deal. Im sure shes excited. Trainers will never look the same again. Theyne spikes or burps, are called. Not on countdown. Be evidence of life on mars. This is nasas curiosity rover. Astronomers are tremendously excited because it could be a sign of life, or they could just the unexplained geological processes. We will find out one day. If there are burps on countdown, it is not a sign of life. In thentdown continues next hour. We will be talking russia and greece. Russias currency crisis. Markets brace for more fallout from the rubles record low as moscow insists it is not considering capital control. Maras faces a test of support in a vote to nominate a new president. Breaking now, the first numbers from the newly formed dixons car phone since its merger in may. Welcome to countdown. I am mark barton. I am anna edwards. It is just past 7 00 in london. Talking tough on the deficit George Osborne<\/a> tells charlie rose that the u. K. Is a front runner in the world economy. Particularly in the u. K. , weve got a budget deficit that by half. Come down we need to get on these things. We need to show we want to be in the front rank of economic nations. Lets talk russia. It is the big story of the day. Ryan is here to talk us through it. Lets start with the markets. This is a crucial time in the morning. Moscow is starting to trade the ruble. The ruble is weakening again. It is at about 72 rubles to the dollar right now. It did strengthen yesterday on the back of those comments from minister saying they wouldnt introduce capital controls. They still have tools in the toolkit, if you will. Hey could hike rates today it hasnt worked. 650 basis points wasnt enough. The could use some of their 416 billion in reserves. Economists think they are going. O spend 70 billion capital controls i dont think there are too many people out there, despite the economy ministers statement, who are discounting that idea. Weve got to talk about stocks, as well. The miners didnt move much it doesntbut necessarily reflect nervousness, does it . A lot of the focus yesterday was on the rts index. A 12 decline yesterday. A 10 decline on monday. Through yesterday, it had fallen give me one second intraday loss, it was down 19 , the biggest loss ever. The biggest was since 2000 eight. Nine days of declines, the longest run since 2006. The stats just blow your head. How are people in russia reacting to this . Most important thing to say is that there is no run on the banks yet. We are seeing increased demand for fx. A got that yesterday from russian bank, saying they are seeing demand at three or four times the normal volume. There are lines out on the streets, but mostly outside of shops. They are going to raise prices on thursday. This is customers trying to get ahead of increase prices. Apple suspended their online sales of iphones. Got a huge hit for the company. Iphonesd 1. 5 million last year in russia, but it does show you exec we have difficult it is for International Companies<\/a> to keep up with the fluctuations in the ruble. Contagion. It is definitely a worry, and we are seeing some. If you look at the gauge of developing nations, we have a nation cudeveloping the lowestnd it is since 2003. The emerging market index down about 0. 5 , down 10 this month. Carlsberg this month has lost 2 billion of its market cap. It is down about 15 . They get about one third of their profits in russia. They sell hyundai, a lot of cars in russia. Pimco facing big losses on their bonds. They had Large Russian<\/a> Bond Holdings<\/a>. Even the price of wheat went up. A big issues food inflation, and bread is a big part. We talked to an economist earlier who was saying, you can find a contagion story that goes through emerging markets. You can also find the more direct contagion story through european businesses. That affects gauge, the Jpmorgan Emerging Markets<\/a> index is at a record low. Ryan, thank you very much. Lets get to breaking news. Hone has been one of the key british mergers, creating an Electronics Retail<\/a> champion. Now we get set for the first of earnings for dixons carphone. I cant say it. I will get used to it. Carphone seeing particularly strong secondquarter this is the fiscal first half of their year the Second Quarter<\/a> did accelerate. Why . They are not in competition anymore. Theyve pulled together basically the remaining retail giants of electronics. They pulled together dixons on one side, but youve also got Carphone Warehouse<\/a> on the other. Sales on the overall first half was up 5 on a like for like basis. It really did accelerate in the Second Quarter<\/a>. Ireland and unsurprisingly, that is where we saw a lack of competition. Also benefiting from the economic improvement. This merger is going [indiscernible] that was a key question. How long would it take for these synergies to be developed . 2016, 2017. A year ahead of schedule. Hoping they could amalgamate all the people that will be working for them. It is a phenomenal stamp on the u. K. 1200 shops. Our revenues have been 11 billion pounds. These juggernauts dominate in the u. K. They dominate in greece. They dominate in the nordics. People have been overexcited about the stock. It is up 37 . That is because the two have come together. There is an element, Southern Europe<\/a> not doing quite so well. Southern europe had a good half. They are still being a little bit cautious going ahead. Theyve still got to ride out how the economy goes forward. They say life is tougher for smaller eu from businesses, but clearly they say they are going well. The new ceo,es, says this is the moment in their history that theyve managed to release their firsthalf earnings, and they say they are encouraging. The greek government called a snap president ial election last week, and the stock market slumped. Lawmakers if the lawmakers reject the governments nominee, there will be a general election, in which the is expectedty party to win. Elliott gotkine reports. Just when greece thought they were out of their debt crisis, their politicians have pulled them back in. It begins with the revelation that the budget deficit is twice as big as previously thought. On austerity plan is announced. Four months later, greece formally requests a bailout. The s p downgrades of the countrys debt to junk. Greece agrees to make 30 billion. And cuts riots a breakout. A second even bigger bailout is approved ahead of the worlds biggest debt restructuring. In 2012, the greek Parliament Approves<\/a> in your bailout. In june, antenna summer rest becomes Prime Minister<\/a>. Real relief only comes when ecb president Mario Draghi Foust<\/a> to defend the euro. By 2014, the economy starts growing again. For the first time in clutter years, greece sells bonds. The antiausterity Party Wins Big<\/a> in european elections. To regain the initiative, the government brings forward president ial elections. Will it work . Gotkine is live for us in athens this morning. All of the action tonight is going to be happening just behind you in the parliament. Walk us through exactly what we need to keep an eye on. That is right. The 300 members of the Greek Parliament<\/a> will gather in that building behind me. It is set for 7 00 p. M. Local time. We will probably get going a little bit later, just under 12 hours time from now. Each member of parliament will have their names called out and will be asked whether they support the Prime Minister<\/a>s nomination for president , and if they do, they will say nay, which means yes in greek, or if they dont, they will say paron, which equates to an abstention. The Prime Minister<\/a> means 200 out of 300 votes to get his nominee through this around. Very few people think that is going to be possible. The key number where you know it is game over is on hundred one. Abstentions, it becomes mathematically to getble for samaras his candidate through. Most likely, we will have around two on the 23rd of december. The key one will be the 29th of december because he only needs 180 lawmakers. He already has 155 in his coalition. The mathematics become that much more achievable. If he doesnt win then, it means general elections will take place in greece. The concern among investors is if there is a general election, the antiausterity s could end up winning, and that could mean negotiations in terms with creditors. Talk us through that. Certainly come it could mean it sryza wins. If a general election is called wins and cannot renegotiate an agreement with creditors, then in the theory you could see greece struggling to refinance itself. You could get some kind of default if a renegotiation an agreement cannot be reached, and you could get some sort of default. Two big caveats. They are much more project pragmatic than many people realize. It once a friendly renegotiation. The other caveat, greeces economy is not what it was at the peak of the crisis in 2012 or at the start of it in 2009. The economy is growing 0. 7 this year. The deficit this year is less than a 2 . A back then, it was almost 16 . France would dream of having a deficit of less than 2 . Tourism is firing on all cylinders. Greece cost economy is in much better shape than it was back then. Perhaps it can withstand any issues or uncertainties that may arise from the Political Drama<\/a> that we are going to see playing out. Thank you very much, Elliott Gotkine<\/a> joining us live from athens. We will have more from elliott threat today. Dont miss his chat with the Hellenic Hotels<\/a> Federation President<\/a> , he will tell us how the uncertainty surrounding the greek election could impact tourism. Coming up, the rubles fallout is rippling through Global Markets<\/a>. We will talk all things ruble and fx with bnp paribas coming up next. Minister antonin samaras takes his First Step Towards<\/a> electing a new head of state. Many greeks are exhausted after five years of recession, tax hikes, and record unemployment. Bloomberg asks a senior taxi driver for his personal view of the economic crisis. If you dont see how many poor people there are the streets, you cant believe it. Because of my job, i travel all over athens. I see a lot of people having problems. Work as a taxi driver. I was a taxi driver before the crisis. I will continue. Isetimes, i think that there the crisis is like a scene on a. That the crisis is like a sunol me tsunami. Now you see no life for the future. [indiscernible] i want the communists. I think they can discuss again the terms of the loans. I think the terms of the loans, they are bad for the greek people. There is no possibility to get the votes. No possibility. Sryza, 100 . It is a sure bet. Thoughts on the situation in greece. Phyllis, things have been difficult for many people in greece for many years. You see perhaps the rise of syriza as a result of that. What the you think is going to happen in the near term . Tonight, there is a low probability that we will see the candidate approved by the Greek Parliament<\/a>. There is still Political Uncertainty<\/a> looming in greece, and its likely to continue for the next few weeks, certainly until the third round of voting. The good news is greece has exited recession. Even though weve seen a bump up in its yield, peripheral yields in europe on the whole remain contained. That then translates into little stress for the fx markets. It is not a huge risk at the moment. We had a guest on earlier who that the ecb would hold back implementing qe and use greece as an excuse, meaning greece, if you leave the eurozone, you are not going to get the benefits of qe. It is in your interest to stay within the eurozone. Hi could tie it to greece. Is that possible . Could he use greece as leverage in his whole qe episode . A very lowthere is probability that greece leaves the eurozone. There is no question they will stay in the eurozone, in our view. Qe is definitely in the cards. The euro zone economy needs it. They need an additional boost. We know financial conditions are. Ery tight and the eurozone low Interest Rate<\/a>s, even negative Interest Rate<\/a>s are not enough. Qe is coming in january, and our view. An announcement. More details. All of the tension we see in the markets, the chaos we see around russia could impact the eurozone further, couldnt it . Linkages, eastern europe, germany, all of that at the center of things for mario draghi. Think the volatility in Financial Markets<\/a> will certainly feature in their faking thinking. In russiaing idiosyncratic risks specific to russia given the drop in the oil prices. We are also seeing it more , Financial Market<\/a> instability, equity markets in general. Uncertainty around Business Confidence<\/a> in some countries. We are going to go to a breakthrough quickly, but im going to ask phyllis how low the ruble could go. Very few people are willing to answer it. They be phyllis is may be phyllis is. Stay with us. Welcome back to countdown we are back with our guest. Before the break, we were talking about the falloff from russia might we see some fallout in the fed. . Does that mean chaos in emerging markets . Not necessarily. The fed has flagged they want a normalization in policy. It is to some extent expected that they will change the language in their statement. The volatility in Financial Markets<\/a> could feature quite heavily in their deliberations this evening. You could see some fallout, but i dont think it will significantly impact the emerging markets. Raise ratesont here, no rate hikes in the u. K. Or in the u. S. Is this becoming a reality . There is definitely a discussion of keeping rates. 40 , peopleces down are most definitely talking about unchanged rates. The thing is, activity is picking up in some countries, and we are seeing slack narrow in a number of countries. Is a perfect example. We are seeing the Unemployment Rate<\/a> come down. Inflation, yesterdays number, was very low. Ultimately, we will see a bottoming out and inflation in a number of countries. Rethink rates will be normalized, will be taken higher in the u. S. And and the u. K. Are you still selling the euro and buying the pound . We are. We very much like short euro sterling. We dont have a recommendation on it at the moment, especially after yesterdays number, but those Monetary Policy<\/a> divergence trades are something we most certainly like for 2015. I did promise before the break i would ask you the question, which matters to me. How low will be ruble go . We are 69, 70 right now. Is it out of the question, 100 . It is not out of the question. I heard a level of 100 spoken about yesterday. Our emerging Market Strategist<\/a> certainly sees weakness ahead with the volatility continuing in russia. Capital controls yesterday, we are not there yet, but certainly if we see the currency weekend and we see Oil Prices Continue<\/a> at these levels, it will feed through to further instability in the ruble. This ande watching working out what happens next. Do you watch with the Oil Producers<\/a> are doing, or are you watching the commentary coming out of moscow . I think both. One thing that we are watching is the yields on the corporate bonds. They have been under distress for several days. Any sort of weakness on that front will be important. Have you changed any of your emerging market calls given what has happened . Not at the moment. It is all very uncertain. Phyllis, thank you very much. Up, out with the old, in with the new. We are talking blackberry. It is all about blackberry next. Welcome back. This is countdown. Time for your fx check. We are seeing some big movements in the dollar against the ruble, especially in the last four or five minutes. Already today, the dollar has been up 7 against the ruble. 1. 6 . s down this is a oneweek shot. You know the trend this week has been clear. , the volatility, that is why its so difficult for forecasters to make predictions on how low the ruble could go. Up by as much as 7 against the ruble today, and right now, it is down 1. 5 . Yesterday, the intraday level for the dollarruble was almost 80. That was the oneday move. For the a 23 rise dollar against the ruble, the biggest move since 1998. That was the year russia defaulted on its debt. Question forof the the ruble to fall to 100 against the dollar. It is very difficult to give levels, particularly with the oil price declining. The ruble is mirroring the decline in the oil price. Andcentral bank has raised restraints. Nothing seems to be stopping the rubles decline. Maybe the answer is further intervention. Economists we have spoken to say the central bank could spend up to 80 billion intervening in the currency market next year. Other options are further rate hikes or capital control. That seems to be the final option for the russian central bank. Wild swings and the rubledollar rate in the last five minutes. It is very much the currency to watch out for today, as it has been. These are our Bloomberg Top<\/a> headlines. The u. K. Chancellor of the exchequer says he will target what he calls aggressive tax planning in his bid to reduce the uks budget deficit. George osborne told charlie rose he would work towards eliminating the deficit. Britain is still carrying a 5 budget deficit. Digits when double i became chancellor. We want to eliminate the deficit. How . By reducingly government spending, dealing with costly welfare entitlements. Youve also got to make sure that wealthy people pay their taxes that are due. We are unapologetic in dealing with aggressive tax planning. You can see the full interview with chancellor george atorne on charlie rose 10 00 this evening london time. Antonin summer is takes his First Step Towards<\/a> electing a new Prime Minister<\/a> today. Ras needs the support of 200 members to confirm his nominee. He needs to secure the nomination to avoid a snap election. Polls suggest that the operation wants to rollhich back budget cuts would win more seats in an election. The followed from russias currency crisis continues to have an impact on world markets. Emco is facing mounting losses on its russian Bond Holdings<\/a> while some Foreign Exchange<\/a> brokers in new york and london have told clients they are no longer taking ruble trades. Russias economy minister denies speculation that the government would impose currency restrictions. Blackberry is bringing back some old features but with a classic smartphone. Can it help to compete with the likes of apple and samsung . ,ets bring in our guest lawrence lindsey. Blackberry return to former glory . Different fruit. To behink apple is going fine. When it comes to blackberry, no, quite frequent. I always consider it to be kind of irrelevant at this stage. It is around 0. 7 market share globally. In the u. K. , we all know and have found affections for the blackberry because we adopted it quite intensely. I dont think this is going to change much. It is a good strategy, nostalgia and suggesting, lets have a look at how good we used to be, but i dont think so. How quickly has it been losing its footing in the enterprise world with the whole bring your own device to work thing . That is the question. That is where they should be focusing their efforts. I. T. , procurement, make large part purchases. Blackberry had a good footing at one time. With a bring your own device, people want their own phones. That means there is no real need for a blackberry device. That kind of loosens their grip on the rest of the enterprise. I would be surprised if they continue to dominate like they used to. Lets broaden the conversation to its rivals. Huawei. What are the parallels . Huawei considered buying blackberry. Lenovo, that is very much an International Expansion<\/a> play. Motorola, they have a strong brand. E has plenty of money, engineeringi. They can expand and are expanding. Black berry has a strong brand but not so much else. There are good synergies. Whether or not they feel the need to acquire blackberry is up for discussion. How big are chinese manufacturers in western markets . Over the next few years, we are going to see a lot more of huawei. There are a lot of Patent Infringement<\/a> issues going on at the moment. Is a lot to be figured out. Over the next few years, think we wills or deceive the u. K. And european markets trade a lot more higher. See the u. K. And european markets trade a lot higher. Apple, samsung, blackberry. Give a very simple overview of the difference. This is good. At this stage, the market is mature. There is quite little difference. Everybody has been catching up to a level at which we have a standard that everybody understands. The specs are not that different. If you wanted to go and buy an htc, a sony ericsson or an they are slightly different, maybe little bit of extra sound or bigger, but generally, it is up to personal tastes. Do you believe in the Apple Ecosystem<\/a> . Do you want to buy an iwatch . Apple pay could be a differentiator. It is difficult for these manufacturers to say, this is different. People are saying, i will get a slightly bigger camera better camera. Tell us about this differentiator that is coming from apple. Now we start to see apple and google helping their on why would you buy an apple phone . For me, having apple pay, that is building in an ecosystem, and being able to make phone calls on your mac they are building an ecosystem. All of these Device Manufacturers<\/a> having other products so they can create an ecosystem. There is a reason why you would buy the device, because you own other devices, for example. Xiaomi are probably the best example. They are buying airconditioners. Are going to build a huge ecosystem. I think that is the strategy. This is energy companies, for example. Automotive companies. Big industrial manufacturers. Ge, siemens. Every symbol one of those companies, this is the next biggest growth market. It is impossible to say who would win. I personal view is that google and apple with their ecosystems, that customers know how to understand, it is much easier for an app developer to build for a nest because they have relationships with google, whereas with siemens and ge, theyre going to struggle to get developers. I am quite mobile, centric mobilecentric. Lawrence, thanks for joining us. Coming up, we continue coverage of russias currency crisis. Stay with us. Countdown. Barth shot. Ays is panic sweeping through russias Financial System<\/a> . It is a big question. Tuesday, december 16 is the day many will remember. It was the single worst day in russias ninemonthold financial crisis. Lets look at the ruble. At this is a chart from the beginning of june, the portion of the chart you want to be looking at. On tuesday, it plummeted into freefall after this surprise rate hike by the central bank failed to stem a run on the currency. The currency at one point on wednesday, 67 to the dollar, and at one point, it felt almost 80 of the dollar. That was an intraday move. 67. 91. Ed the day at that was a mere 6 rise for the dollar. The intraday decline on tuesday was its biggest since november 1998, the year russia defaulted and devalued the currency. It was to say, the ruble closed at a record low. It has dropped for eight consecutive days. This month the low, alone, the ruble has dropped 28 against the dollar, the biggest drop since 1998. This weeks drop is the largest since 1998. Since the end of june, which is the beginning of that chart, you can see the dollar has moved in one direction. The ruble has declined. 53 percent. That is the first chart. Lets look at the middle chart. The orange line is russias benchmark 10 year ruble bond. Just 3 , on tuesday, finishing the session at just over 16 . At the beginning of the session, 13 . At the beginning of december, the yield on the 10 year ruble 10. 57 . As low as it hasnt traded as high as 16 2007. At least lets move off to the bottom chart. Bond insurance. This is the fiveyear credit default swap, otherwise known as bond insurance. 2014. S back to june on tuesday, the cost, the annual cost of insuring against a debt 5. 75 . Climbing to that is the highest since 2009. That year, by the way, it reached as high as 764 basis points. In december alone, the cost of bond insurance has risen by 80 . An 80 increase in the bond insurance since the beginning of december. Facing question now russia is, what can they do to stem the panic and stop the rubles decline . Sayomists we have spoken to unlimited currency interventions to the most likely response the rubles freefall. Increases and the imposition of capital controls ,ank as the most likely probable policy outcomes after interventions. Bloomberg economists we have billion say up to 80 could be spent propping up that in 2015. Watch this space. More evidence of the fallout from russias currency crisis. Ofle has halted online sales its products in russia because of fluctuations in the ruble. An apple spokesman said the online store was unavailable while the company reviewed pricing. Russias problems have had an impact on carlsberg. Hasbrewers of value slumped more than 2 in less than a month. Carlsberg generates about one third of its profits in russia. We have had news this morning from philips. It will buy the medical Devices Company<\/a> volcano for 18 a share. Phillips says the deal is valued at 1. 2 billion. Germanys high court will rule whether the family owned can pass from generation to generation without heirs paying inheritance tax. Our International Correspondent<\/a> hans nichols went Christmas Shopping<\/a> in a region that could be hit hard by an adverse ruling. Precision mixed with tradition. That combination has powered small and medium familyowned , the engine of the German Economy<\/a> and employment. The handcrafted woodwork industry directly employs 2000 workers. Mueller who provides 40 jobs comes from a generation comes from a family that survived two generations of world wars and coming is him. Four generations. 115 years. The countrys Constitutional Court<\/a> may force familyowned businesses to pay inheritance taxes as high as 30 when they change hands, a direct challenge to family legacies. There is always a wish to be successful and that the next generation will be able to have an income. A High Court Ruling<\/a> could spark a fire sale among germanys 3 million small and medium businesses to settle their tax bill. It is not just villages like this one where small workshops that make christmas ornaments dominate the economy, but the middle shut where the goal is to pass the business on from generation to generation without paying caesar. More than 130,000 Family Businesses<\/a> with some 1. 6 million employees are set to change hands in 2018. Under current law, they can be bequeathed taxfree as long as the heirs keep the concern for several years without substantial layoffs. About 20 of these companies are worried that an end to the Tax Exemption<\/a> would threaten their very existence. Man in robes may not bring good tidings to the this season. Shut a new tax instead of frankincense and murder. Hans nichols, germany. Can join the conversation on twitter. Russia is trending. Interview, the sony film that has caused a stir in north korea. I am just about to tweet out of the world hotspots that youve never heard of that could ruin 2015. You are looking at a live shot of london. Markets are set to open in just 11 minutes time. We will be back after a short break. It looks pretty dark out there, doesnt it . She will talk more about russia and the ruble when we return. Welcome back to countdown. What better way to round out 2014 than with a hearty italian ch with some of europeans some of europes biggest powerbrokers . I dont like dealing with politicians. That is the reason why we never do political advertising. s politics too difficult, or is it because its another world . Another world. What world . A world where sincerity varies with the weather. The most important ingredient to success is sincerity. [laughter] francinescatch conversation on friday, december 19 at 5 00 p. M. U. K. Time. Back to the story weve been watching for you, russias currency in crisis, the economy unraveling. We have had some wild swings in the last hour. It has since been strengthening. Our russian expert is ryan chilcote. Big movement. We got that strengthening on the back of the central Bank Reporting<\/a> they spent about 2 billion intervening in the market yesterday. In addition to the night before rate hike of 650 basis points, they are on the market spending 2 billion. Many economists say that his way too little. One other thing they have in their toolbox is capital controls. We heard the economy minister saying they would not be proposing those now. Watch the reserves. We always find the day after, there is a oneday lag in the way you could the information about what the central bank is doing. 460 billion dollars in reserves. Economists weve talked to think they will spend 70 billion of that. I dont think you can rule out more rate action, though obviously it wasnt very effective. We are looking at stocks as well. European businesses increasingly having to plan for something that seems untenable. Unplannable. Russian stocks moved much let the ruble when they got that indication there would not be capital controls. Looking at european companies, carlsberg down 6. 5 , basically a proxy for the ruble. It gets about one third of its profit in russia. It has lost about 2 billion worth of its market cap. Bp, an interesting one to watch. This gets to the volatility we were talking about. ,p was up 3 like the ruble recovered a bit on the back of the announcement that there wouldnt be capital control. Roy own 20 of rows left seneft. Also stocked jen, unicredit we just heard from the ucb, one of the members saying he doesnt think russia is going to be a problem for european lenders. Brian, thank you very much. Ryan chilcote will be doing that for us. On the move is next. Stay tuned. Welcome to on the move. I am Jonathan Ferro<\/a> in the city of london. What a 24 hours we have just had. Its get straight to the morning brief. Political drama. The first round of greece president ial elections good trigger snap elections. The ruble remains at record lows after the central bank monster rate hike. Can they prevent a full crisis ripping to the russian economy . Will yellen reform Forward Guidance<\/a> and keep rates low for a considerable time even as russias financial dialin a continues to unearth Global Markets<\/a> . Those of the three things we will be watching this morning. U. S. Stocks 50 futures down 50 points. Dax futures down 100 points. Will we get another lower open . Brace yourself. What a roller coaster we had yesterday. 1. 3 e point we were down in europe but closed 1. 7 higher. Are we going to see that optimism . Unlikely. We are currently opening down 1. 3 in france. Up by. 5 in the 5100. Asiaing over from u. S. And trading. Both closed lower. 15 . 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