presents the budget. we are live in a mumbai. -- we are live in mumbai. good morning, hans. i think greece is back on the agenda, or should be back on the market's agenda. hans: it is the entire european union. there is a sense that angela merkel is living this suspended disbelief. a little bit of this came through in the public broadcast she did last night. president was released from prison after the tax evasion. two big stories dominating a german headlines this morning. guy: the pboc did not step up. we have a lot of data this week. plus, we have payroll numbers. so, we are 30 minutes away from the market open. . about the future. -- let's talk about the future. shanghai is down pretty hard. this is the wei function. ares like european equities down by around 1%, hans. hans: yeah, that is really the story overnight. the disappointing reaction in asia to what the g-20 did or did not do. we have the shanghai down, it looks like all most 3%. $1.13llar yen is in that level. and then, we have got brent. it is up just a little bit. that makes the story more of a brand story. let's get to bloomberg first world news with caroline had. -- with caroline hyde. caroline: ireland is based in the prospect of a grand alliance. the general election left no party with the majority. enda kenny is expected to finish ahead of the pack, that will have to negotiate with other parties. that includes fianna fail and sinn fein. voters are angry at spending cuts and tax hikes. ted cruz says donald trump may all but walk up the nomination if he wins big on super tuesday. meanwhile, hillary clinton won a landslide victory over bernie sanders on saturday. rejected thet has economic pessimism dominating the u.s. presidential campaign as dead wrong. in his annual letters, the 85-year-old meet a case for a bright future, focusing on an all-powerful productivity trend in the u.s. leonardo dicaprio has finally won an oscar. he won for best actor in "the revenant." isomberg first world news powered by journalists from 150 years bureau's around the world. hans: we all know that leonardo dicaprio deserved it for " gilbert grape." we have seen a little bit of market disappointment this morning. us in hong kong, edna . what is the general takeaway? edna: market expectations were ofr something to come out f the g-20, something tangible. abouthas been commentary a new shanghai accord to replace the old plaza accord. did turn around was, they think market volatility is not reflective of the ongoing fundamentals. while growth is slowing, we are not quite at the crisis stage. the market sentiment on china has been weak, as a result. hence, the sell off. guy: i am surprised a little bit by this everybody suspected this was going to be a big talking point. you listen to mark carney talking about currency roles and a "zero sum game." everybody is on different pages right now, when it comes to how to handle this story. >> that is one of the narratives that came out of this weekend. you are entirely correct. you've got to spend our money. you have to push through unpopular reforms to get things on the ground. that you have the german finance minister coming forth with his rebuke of a g-20 alliance. he pushed back the idea of anyone doing any increase spending. he was not alone. y conflictingan reviews. everyone has a different approach. there was one like consensus. needs that there always to be more in the area regarding structural reform. of course, really executing on the kind of a promise is going to be an awful ardor than it was to agreeing on it -- to be an awful lot harder that it was agreeing on it. guy: let's welcome investment manager james bevan. kind, it was said the g-20 of failed. we weren't anywhere close to a split. >> absolutely not. it was unreasonable to expect one. most bankers are doing a great deal to get the party going. to an extent, they are pushing on a piece of strong. fiscal policy will be required. we will see more government spending to make up the shortfall. we had good economic numbers from the night it states last week. if you look through the u.s. data, you can see plenty of ground for optimism. guy: it is still just the u.s., that is the problem. it is just the u.s. consumer. not it wonder whether or is still going to be enough to drive europe, where the data is not going in the right direction and asia, where the data is not going in the right direction, back on track. >> you are absolutely right that europe is not on track. i think the last thing they ehould do is add mor interest rates. you have to give the european investment break the opportunity to build infrastructure. that would be a smart move. hans: james, hans nichols here. we have got eurozone inflation coming out this morning and then payroll information on friday. which has a bigger possibility to move the euro-dollar? >> i don't expect any surprise from the jobs numbers in the states. i expect unemployment to remain where it is. however, is that is not confirmed, if there is a big shift up or down, that would have a big impact on currencies. it would speak to the challenges ahead. at the moment, i think the open market committee and the central reserve will change precisely nothing. it will be a very quiet meeting. in contrast to the inflation numbers coming out of europe, i would expect no inflation to come out this morning. that would not have any material impact on the euro-dollar rate, but i do think it would underline the reality that we had very low, growth at the moment. hans: who is more constrained to move? the fed or the ecb? >> i think the fed has plenty of room to maneuver. they ared says continuing to monitor developments, they will not be making any hasty decisions. i think that will be well taken by the markets and the economy guy: james, hold that thought. up next, we are going to talk oil as he was drillers cut the number of active rigs. that is up next year on "on the move." ♪ guy: 7:43 in london. let's get you caught up with what you need to know. here is caroline hyde. caroline: shares have surged by the most in seven years. the company announced plans to buy back $3.5 billion in stocks.. directors on the board are responding to a decline in the company's shares. sharp shares have fallen. the two companies work through the weekend, trying to salvage the proposed $6 billion deal. they delayed signing the agreement after learning of new sharp liabilities. isl and pharmaceuticals withdrawing its for mental forecasting and will delay releasing its fourth-quarter results. michael pearson faces questions about his business practices, strategy, and accounting, the stock is lost more than 2/3 of its value since august. it was scheduled to release its fourth-quarter results today. former deutsche bank ceo is joining online lenders social finance. he will begin as an advisor to the company after stepping down from his role at the german bank nine months ago. that is your bloomberg business flash. guy? guy: thank you very much indeed, caroline. reformists and moderate candidates have won all 30 parliamentary seats. the results follow a high turnout in the capital on friday. boost thising a morning as speculators raise net positions to the highest number since november. this is the lowest level since 2009. this comes amid an output freeze amongst major producers. despite that, oil is still on its longest losing streak in over a year. james, the market was very tied in to what is happeningwith oil. that seems to have broken down little bit. are you looking beyond oil now? oil did seem to be the primary metric the market was using. >> i would look next to china. we need to make sure they are deflating with care. i believe the authorities can deflate with care, but that is a risk. i still let correlation between oil prices and u.s. securities. there is a very high relationship between the two. where we to see a further selloff in the oil price, this would be bad news for equities. this is a result of capex. we have potentially, one million barrels coming from libya. that could be big. i have not taken my eye away from oil. hans: one does that take place? we can see some sort of divergence between the price of oil and equities in the states. is this correlation here tuesday? -- to say? >> i think the correlation will break down as soon as it becomes apparent the economy can grow, but also when oil can sustain a price above $30 a barrel. whenever it goes below $30, there is a real concern that week are seeing a reduction in sovereign wealth. also, there is a real risk that we can see real problems with the banks. guy: last year, the oil dividend did not seem to have a huge effect on consumers. this year to you think we will see a different outcome, particularly nin the states? >> if one look through the numbers, i would say we did have a sort of dividend from the oil price for those who wanted to spend. we will indeed see the consumption support. i think we have evidence from that from last friday's data, where we studies in consumption and income numbers for the u.s. james, you are staying with us. we are minutes away from the european open. up next, we look at the potential corporate rumors, including barclays. ♪ hans: it is 8:51 in berlin. equity markets open up in a few minutes time. let's get the latest with caroline hyde. caroline: all eyes are on barclays. they could be offloading their africa unit. barclays fell down 1% or 2% today. function for barclays. you can see what you get in terms of revenues. if i want to check out africa an amount would i if theyble to rev sold off this particular unit? they still have strong capital in this area. there is some key concern regarding its share price today. meanwhile, we are having a look at what this will do to barclays. a continue to evaluate the strategic options. keep an eye on barclays. keep an eye on the supermarkets. amazonnating tail of starting to eat the lunch of the grocery market. there is a deal being struck between morrison's to enter a pack with amazon. they will be supplying wholesales supplies to amazon. they cannot be accessed by amazon prime. cado said they will provide -- ocado will morrisons software for online orders. ocado, as you can see over the last five years, has been a story of real growth in 2015. they worry if they can sustain the juggernaut. had aile, morrisons has downward trajectory amid the ongoing price war. .esco is likely to fall today they are jumping the gun with the amazon deal. watch at the supermarket stocks as well today. guy: caroline, thank you. james, does that story worry ou ? orry you?h >> i think amazon will remain exceptionally destructive. i worry the loss of the old generation tech stocks. they will be 40 out by the new players. -- they will be thwarted out by the new players. have a great appetite for market shares. hans: james, a quick one from berlin. is it just amazon that will disrupt groceries in the u.k.? or other others as well? there is so much talk about amazon. they have been threatening this for some time. amazon has the distribution competency to do a great job in the u.k. there is far too much historic investment in the u.k. sellserage small store 2000 lines. they are much more able to price aggressively, therefore. guy: james will stay with us. we are four minutes away from the european market open and it looks like it will be a fairly negative one. markets are focusing on the lack of central-bank action coming out of the weekend. hans: that story might change when we get these inflation numbers. we could get more of an argument for the ecb to act. guy: the open is coming up next. a bright morning here in london, but a chilly start for european equities. ♪ . . . guy: good morning and welcome. you are watching "on the move." hans is over in berlin. moments away from the start of european trading. the shanghai side, shares tumbled. is the market still expecting too much from central banking? angela merkel says that it needs europe's help to keep the refugee crisis from plunging the country back into crisis. the indian prime minister kept with the plan to narrow the budget deficit. the finance minister presents the budget. we are live. hans: pretty much negative across the board with one exception. about 4%. negative by let's go to caroline hyde. caroline: just opening up on the equity markets. disappointment. coordinated effort from the g-20. there were just vague talks supporting the economy going forward. equally, some concerns about what japan has been doing in the afternoon. trying to push down the yen to no avail. sincen had its best month 2008, up 6.9%. it is all about risk aversion again. they had a rally in europe on friday. good news and bad news, gdp up too muchy. inflation a little bit high. we might see rate increases sooner than expected. ftse 100 is off i .6%. it is the banks that are bearing the brunt today. once again risk aversion pulls this back lower. all eyes on barclays. a.m., are we going to see stagnation once again? what will that mean at the ecb meeting next week? ago, oil pushing higher. we are seeing a disparity on the lower side. we did see a bit of an uptick in oil on friday because of that rig count in the united states. you have copper coming down 1.2% overall. i want you to keep in eye on g old. you see overall risk aversion. gold is invoked. -- en vogue. money is moving into gold. we have barclays. you saw the rest of the banking industry. holding in 63% barclays africa group. lining surrounding the overall regulatory clout. it is time to cash in and focus on the united states. glaxosmithkline flat essentially. there is talks over the weekend that they are looking for a new executive. it looks like they may start to head hunt for a new player. we are looking at a new player in that area. that is one we could see in terms of candidates. that was in the sunday press and the u.k. ocado down almost four percentage points. not good news when amazon is looking to construct deals with morrisons. ocado goes lower. look out for the same from tesco. guy: thank you very much. let me show you what is happening here. the market may be getting a little longer on oil and shorter on energy. it is getting a little bit firmer. you look at it now. it is at the top. financials are where we are seeing people. let's show you what the head looks like. the propertyt of market with mortgage approvals for january. that is the data for the day. eurozone inflation, that is all ahead of the jobs data on friday. chicago pmi at 2:4 5 p.m. big item we are watching today is all of those inflation figures. angela merkel is breaking with her comments. she see -- says that she needs europe to keep the immigration process -- crisis from plunging europe into chaos. problems that has many in the lurch. by more, we are joined michael. thank you very much for joining us. we have been bouncing this around all morning when we look at the risk with what is ly happening in greece. is it still premature for that? michael: i think it is premature if you look at german gdp and growth. we see some downside risk to gdp growth. they have been cutting their forecast for 2016 from 1.7% to 1.1%. it translates to a drop from last year's figure by a percentage point. there is some downside risk. these downside risks are coming from the external side. germany is highly dependent on exports. the risk of a global recession is having negative effects on the export side of things. jump in,i could just those are the outside risks. do you see any internal risks inside of germany with elections on march 13? at what point does this become a german story as well? big do not think we have negative factors from the internal side. i think that real income is increasing, also because of the drop in oil prices. at the same time, the oil market is doing quite fine. germany has increased its public spending. i think that is all quite good. the elections in march of course. problematic ifit the more nationalist party is gaining momentum in these elections. a negative.lso be guy: james, europe is let north, south. the eurozone is getting extremely inward looking and divisive at the moment. greece is sitting at one end of the spectrum. germany is desperate to help it out. are we underestimating the market underpricing the risk? buys: i see some real opportunities. lloyd's. buy on people say that we do not want to be anywhere close to the banks. i am a contrarian. guy: when i come back to you in germany, when you look at what is happening with the eurozone and the strength that exists, where are the opportunities there at the moment? you look at what the migration stories are doing. what stacks up right now as an opportunity? i think it is not a big opportunity to a certain degree. investors agree with me on this already. they can go even lower from this very low yield level. we would not entirely rule out yield levels for bonds. opportunities are in the coal markets. germand example is the lender market which is trading 30 basis points above bonds. you have a very strong guaranteed mechanism. it is very strong in 2016 compared to 2015. these are all very power -- positive factors. it is something where you can hedge yourself on a bumpier environment. at the same time, still within the core of the safer markets. hans: on that potential 10-year negative move for the bund, or you see that in march, april? what is your timeframe? michael: it depends on the ecb meeting in march. they cut 10 basis points from - 0.4%.o again positive and bullish for the market. go short, bonds could into the negative territory in march and april. in the longer term, talking about the end of 2016, we could see 10-year bonds at 0.5%. very low, very slow, very gradual increase. on a historical basis, this fits very low yield levels for a very long time. guy: what is the spread over treasuries? the bond treasury spread. if we are going to force back into this year. the data is getting a little bit better. the dollar is starting to price in some of those rate hikes. give me the strength differential. michael: we also changed our focus for the fed actions in 2016. cuts to justthree one cut. the market is also pricing further global recession risk. this should tighten spreads between 10-year treasuries and 10-year bonds. hans: thank you for joining us. i expect you'll have a busy march either way. and interest rate strategist. up next, berkshire hathaway shares soar. which investment pays off? we will discuss that next. ♪ guy: welcome back. you are watching "on the move." let me show you what is happening right now. we have a negative story. the dax is down .9%. it is leading the way down. the ftse and cac are down as well. ireland is facing the prospect of a so-called grand alliance after the general election with no party having a majority. the prime minister is expected to finish ahead of the pack, it will have to negotiate a coalition with other parties. the outgoing government suffered a huge loss of support. voters are angry at spending cuts and tax write offs. trumpuz said that donald at may all but lock up the presidential nomination if he wins big on super tuesday. a landslideton won victory over bernie sanders and now seems more likely to clench her party's nomination. the in ardo dicaprio has finally won an oscar. waswhile, "spotlight" crowned best picture. the conglomerate controlled by warren said that fourth-quarter profit climbed 32%. cap another record year for buffet. over the past five decades, he has built the empire into a sprawling enterprise worth more than $110 billion. with interests in manufacturing, media, and transportation. let's bring in james bevan. berkshire?a one off, when you look at what is happening in the world, do you have to have diversified risk? james: the one fly in the ointment if you look at the performance of sharp -- berks hire -- hans: when we look at what done over the long-term, they get a little nervous when their balance sheets get too heavy. at what point will they be out hunting again? james: they will be opportunistic. tey absolutely wait until the markets have inappropriately low valuation of a credit company. at which point, they pounce. this will be a classic turning point in market psychology. they came forward and they say that we dude not think you know how to value this country. that is a good turning point for market sentiment generally. the insurance, is that something that warren is looking at? the banking sector is really struggling. this is going to be a tough place to be. james: a proven case of adding value for the balance sheet. he will be a bigger participant in the insurance sector than he has ever had. more about worry what is happening in the financial sector? you are talking about some of the stocks earlier on saying it opportunity? why is it a buying opportunity when we have central banks going further into negative territory? james: i am being selective. the next interest rates are appalling for global banks, but also for global consumption. negative tryst rates have been -- interest rates have been co-associated. they want to increase the real value of that income. i certainly believe that european central bank will cut rates. many people are saying that will be well received i the market. i think the market will find that unjustifiable and difficult. hans: who is the baby and who is the bathwater? you might have a different view of germany. the baby is the interest rate environment at the bathwater is the banks. james: that is for sure. which banks in a pan-european environment would i be buying right now? i would be buying tessa and lloyds. a commitment to long-term dividend growth, strong cash flow underpinned by quality businesses. those are good picks to me. guy: standard chartered, should the chinese be buying standard chartered? should barclays reselling its africa business? there are a lot of moving parts. james: consolidation is a difficult story with current regulation. i want to become better focused. i worry that they will sell assets. it may turn out to be very low prices. in the case of barclays, everybody says that they want to be in africa. i look at the option analogy of growth over the next couple of decades. warning to not do that. you are looking at where growth is going to come from. it is not going to come from europe. the u.s. will be a tough place. africa could provide some upside. james: when i think about great banks, i think about wells fargo, which is bulletproof in terms of their balance sheets. are a long-term corporate holding within the sector. thank you, james. thank you for all of those insights. up next, we will look ahead to those euro-area inflation figures. investors wonder what to expect from the ecb next week. i am excited. i know you are as well. ♪ guy: welcome back. it you are watching "on the move ." we are 22 minutes into the session. it has firmed a little bit, not by much. i want to show you what is happening in terms of the sector rotation story. it is right down here. it is the banks and the financials down here that are really doing the damage this morning. they are all trading negatively to read the banking sector is once again off the pace. once again monday morning, this is where the focus is at. it was the material sector. the market remains squarely focused on what is happening with the banks. hans: that seems to be where all of the focus is. industrials are down in germany. of care is also down. caroline hyde has been looking at investor expectations. that is our chart of the day. caroline: the area of focus. a big fat zero is where we are looking at inflation to come out in the eurozone at 10:00 a.m. london time. overall, we are lucky to see that as it comes down, this is what i'm looking at. i am looking at five-year inflation rate. you can use any metric to see where investors think inflation is going. i can see the five-year inflation forward rate. we have not seen it this low since records began at bloomberg. -- it is showing that on thursday we got down to as low as 1.371%. that is the lowest level on a closing basis since 2004. the target is two cents. trajectory, we still will not hit a 2% target. we will still be at 1.37%. the concern is that we will not see inflation pickup anytime soon. guy: mario draghi is concerned about that. there are some weird things that go on when you start to get rates down as low as we do at the moment. the question is, will negative rates have any impact on those charts? that is what the markets are trying to grapple with at the moment. will it any impact on the banking sectors? a number of questions being asked about how that reacts to negative rates? caroline: it seems that when negative rates go further into negative territory, there is some backlash. not quite geeking out of the g-20 over and shanghai. a distortion in the markets. a have a limited amount of time to markets. they the can still be discussing where they see central-bank policy going. they have these all-important decisions next week. hans: you look at those friday numbers that came out of here from germany last week. they were not only below expectations, but it just was not oil. in a lot of ways, the german argument is all about inflation from oil. it is losing ground. i am curious to see whether the yen prevails. whether or not his opposition to doing more or lower rates is going to hold over what are some really disappointing numbers on the cpi. caroline: what is interesting is that you compare that to the fed, whattes, the they use, the overall consumer price picture, picked up more than expected. the good news seem to be bad news. what is the united states doing differently where it is seeing inflation gathering steam? guy: up next, going to take a look at india. the budget today. ♪ hey how's it going, hotcakes? hotcakes. this place has hotcakes. so why aren't they selling like hotcakes? with comcast business internet and wifi pro, they could be. just add a customized message to your wifi pro splash page and you'll reach your customers where their eyes are already - on their devices. order up. it's more than just wifi, it can help grow your business. you don't see that every day. introducing wifi pro, wifi that helps grow your business. comcast business. built for business. when it comes to the fithings you love,. you want more. love romance? get lost in every embrace. into sports? follow every pitch, every play and every win. change the way you experience tv with x1 from xfinity. guy: we are a half-hour into the trading session. to tell you how markets are shaping up. it is a bank, it is the financial banking sector that is doing the damage today. the stoxx 600 is down by .8%. the dax is down more than that. the ftse 100 is down by .7%. it is the likes of standard damageed who is seeing done to stock prices. once again, the focus is on the banking sector. let's get some of the stock stories in more detail. caroline hyde, what are you watching? caroline: i am doing post and -anal.st post -- post why is it doing so well? it is promising to return to dividends. though we could see them reenact giving back to shareholders, they are looking to improve their status in germany. impress,managing to the dividends are set to come up. up goes the share price and dividends. they struck a deal with amazon. wanting to be able to get into the grocery market, as if that wasn't an area of competition already in the united kingdom. despicable forny so many. -- painful for so many. cargotruck a deal with a which is going to be dealing with online presence. morsi --t that he and -- getting that grocery piece of the pie. you were talking about financial services. the worst performer today in terms of industry basis. it looked pretty good, it came up with results and earnings ahead of estimates. when it comes to assets. they are selling -- they are saying sell this stock today. back to you. guy: caroline, i'm going to pick up. i'm went to bring you the swedish q4 gdp number. 1.3%. that is the quarter on quarter number. that was an estimate of .7. let's slide in here what the stocky looks like now did this is the norwegian krone versus the swedish krona. this as we do, a big beat from the swedish economy that we do not expect. hans: is this an argument that is this an argument that the negative interest rates are having an effect backup you can boost your economy bringing it lower. let's go to another, even as a different set of challenges. the premise that is sticking with the plan to narrow his budget. the admin station has a target to bring the shortfall to 3.5% of gdp. indian bonds rallied, the most in nine months. the rupee declined. for more let's head out to mumbai to harsher subramanian. what are the key takeaways? harsha: hans, you got it right. this is the third budget of the year. it has done a fine balancing act. it has been pro forma. plan enhanced by the government in the last couple of years. it is stuck -- it has stuck to the consolidation plan. importantly, despite the global headwinds, india has grown you'd -- has grown. this budget has been about the former. -- about the farmer. scheme and soce on. the other focus of this budget has been about infrastructure. a large chunk has come from the low oil prices has been deployed into the low development sector. it prevents -- represents new roles, new airports and someone. the government is stuck in the plan of fiscal consolidation. the numbers don't get adult. -- don't yet add up. india has been stuck in this cycle, banks stuck with bad loans. minister a plan to recapitalize the banks that should get them out of this mess. it has been a budget that strikes a deal with a huge queue toward the farming sector. on where theyn are putting their money. -- do we have a sense of clarity where india is? we still need more? >> i don't think all of the details are there. the headlines suggest the budget is not as bad. they have stuck with the plan, 3.5% of gdp fiscal. they have said beyond that, they will actually reconsider the fiscal mechanism. is what is the quality of expenditures going to be? is from 3.9% to the .5%. what is the quality? here, i think there -- i think this is where the concern lies. you're seeing current expenditure. it was mentioned in terms of what happens with the specific commissions. that is a crucial part. what we do know, we have the got some of the details is capital expenditures is declining. they are spending more on the current account as opposed -- that is a problem. the economy is like like -- is less likely to grow. they are pandering to, not a --ly certain subsidies -- exactly certain subsidies. , not only in a year but south africa, this is across the board in emerging markets. hans: do we need to have a big cut? mechanisms of the the indian economy working better? bhanu: it has not worked out because banks have not passed on those rate cuts because they have been stacked with underperforming loans. helping the corporate sector, that is a stronger discussion. it is not doing well and not improving significantly in terms of doing business. the amount of registration details and the amount of paperwork and structural reform which the government has tried d of timer a long perio , but india being a democracy, things move slow. guy: you look at it right now, it is pretty weak. how much weaker can he get? what does it do for exports? the currency is weakening because the exports have been very weak. the rupee is still quite expensive. i do think the currency can move further. we think we can get to 70 by the end of this year. the risk would be for a weaker rupee. is one of the reasons we have tactically shortened the rupee. the market has been worried about the rupee. generally considered to be a strong story, but if you look at india's export volumes, they are among the poorest and the e.m. -- in the e.m. the central bank has its related a reasonable amount of reserves over the last several months which i am sure they will deploying to keep volatility limited. the currency needs to weaken. guy: 70 is the plateau then maybe we see strengthening exports taking some effects on it. or does it move beyond that? monaco -- bhanu: i think it moves beyond that. the details in the budget will be important, but the way it seems, if the are going for current expenditures than they are moving the demand curve, not the supply curve. that is the broad picture. that suggests the r.b.i. targets are likely to be target -- are likely to be copper mise. -- ugly to be compromised. the big debates is whether or not we are starting to see entry points? or you can make a move? plenty of others worried about it. bhanu: i don't think this is the bottom. i think we are in the second phase of the emerging market where -- a balance sheet selloff. i think you're good to enter if they've with the weakness in the corporate markets has not yet arrived in the end. it is likely to infect the financial markets. he is going to be a negative vortex. as it happens, the cost of capital expenses goes up. i don't think we are at the stage where there is to misspell you yet. guy: how does that phase work? long drawn out? how painful? walk me through the dynamics. bhanu: it is going to be more drawn out. eu's strength is that it is locally financed. we would've seen the capitulation. the reason we have not seen the capitulation, is because of the effects you have seen, your matching money markets misbehave immensely. that only begins to happen when you see credit weakness. that begins to happen when corporate infect financials. this is about a two-year positive before we see the actual capitulation. for all of the weakness in emerging markets, fixed income -- in the 1990's, we would've already blown up by now. today, i think we need to grow another two to three years. guy: what does that jewish look like? bhanu: 1997, it is of that scale. maybe we need to see a little less vulnerability. i think we will see fiscal problems. china is not going to be an issue. china will be a debt issue. it will manifest itself in a fiscal problem. guy: bono, thank you very much indeed. up next, ireland has for a grand alliance. what the elections inclusive outcome means for the country. ♪ guy: welcome back to -- hans: welcome back to "on the move." i am hans nichols. let's get the latest from nejra cehic. nejra: stocks shares have fallen. a possible revision of its takeover deal. the two companies worked over the deal try to salvage their proposed $6 billion deal. they delayed signing the agreement after they learned about liabilities that could exceed $2.6 billion. ceo faces as questions about his business practices, strategy and accounting as he returned to the drugmaker. the stock has lost more than two thirds of its value. former deutsche bank co-ceo is .oining online lender he will begin as an advisor for san francisco base company. he follows former morgan stanley ceo and ask city do -- and ex mode --p -- the u.k. -- that is your bloomberg business flash. guy? guy: let's talk about what is happening in sweden. if you look at any of the sweden -- sweetest crosses. the swedish currency really is firing on also wonders. is we havefor this seen a surprise uptick in the growth. it was only a few weeks back that the governor cast the repo 0.5.down to minus there is a real debate on how it is going on inside sweden. house pricing inflation absolutely rocky at the moment. the regulation is worried the sweetest consumer is so dear to even the smallest move in interest rates. you can see this it is working at a macro level but the potential for disaster being built up. hans: a lot of those loans in sweden are not on fixed terms. they had more volatility, more concerns. you are seeing the move there. that means the market is pricing in, maybe you're going to have a rate hike back there in sweden. i am not so certain. if this is empirical evidence that taking negative actually helps your economy, then what is the argument for raising and normalizing it? other than an adjustability guy: guy? than -- western to see a positive impact and starting to stabilize a little bit. england is targeting this 2% inflation. i think yes, gdp is picking up. yes, the currency is pricing in. pricing in the possibilities it will not go any further. you starting to see this inflation data picking up. i think that is probably the main messages. he made it -- the main metric for what he is doing. we will talk more about this. all eyes -- all eyes turning to the ecb. euro area inflation a problem for draghi. we going to go to frankfurt next, had -- frankfurt next, hounds and i. ♪ >> 50 minutes past the hour. i am guy johnson. it is a busy week ahead here we kick off with euro area inflation. one of the last pieces of data the ecb will get before it's march 10 decision. next, super tuesday. the primaries and caucuses, have the delegates are at stake. -- half of the delegates are at stake. on thursday, a group of 100 chinese politicians begins the tuesday meetings to a lay the groundwork for the national people's congress expected in march. we get some targets in terms of growth. friday, we get u.s. payroll numbers. economist i expect in the jobless rate to hold after an eight year low. hans? hans: let's get back to get inflation story. i've got a chart up. from france,es germany and spain. france was supposed to come in germany, -0.2. spain down to 0.9. that gives us the cpi estimate for euro coming in at zero. we are joined by paul gordon. he is the central bank editor did he is joining us from frankfurt. the numbers are going to drop. what are the various indications on how bad it is for the ecb? estimate, does that take into account the negative readings we got on friday? half the estimates on friday came and and after we got those, -- they made -- and may take some of that into account here it doesn't really matter because whichever way you cut it, inflation readings are coming in week -- weaker than expected. expectations on a downward trend as well. they are showing the same picture these are not the other gauges of inflation protection. they take into account the market volatility. the target is under 2%. falling prices and that is not good enough. -- go aheadask you guy guy: -- go ahead guy. guy: is this going to bleed into the ecb thinking. we are focused on inflation and worried about what is good to happen. the political risk is growing in our lesley. do you think draghi has to be thinking about this? paul: he has addressed this topic and it boils down to what we have been watching and the impact on oil prices effectively there are multiple impacts from the refugee influx, the migrant influx. one of which is positive. you get fiscal spending by governments. long-term, it could be positive if the migrants come into the workforce, as long as they are trained. there is concerned, the dampening of consumer confidence. these are factors we have to take into account. putting them into hard judgments about the macroeconomic outlook will be very difficult indeed. will see what line of questioning is taken. paul, figuring much indeed. let's take an rich jones -- let's take in richard jones. week on the back of that. your area seems to be growing. you had all of the stuff coming out of the g-20 over the weekend. the eurozone is doomed at the moment. what our desks talking about? how are they balancing the risks? richard: traders have come to the realization that we know the risk of the u.k. from the brexit debate. we have seen the pricing. the penny is starting to drop before we realize this is not great news for the euro area stays in, if the u.k. you are going to have other member states going hang on a second, we want to renegotiate our terms of -- our terms. if britain does leave, that is going to be negative across the board. impact on europe has not been fully priced. the euro sterling cross, we keep euro being impacted. hans: what are we going to get in march? are we going to hit zero in march? no way out, rich. richard: i would not be surprised if it went down to 0%. that is the thing that is interesting about the u.k. assets versus the european assets. you get your yields, tenure going down to 10%. you get a reasonable pick up of 120 basis points. i think investors might look at that and say i will take the u.k. over the eurozone, because this is not good news. hans: swedish economy coming out and surprising this morning. do you think people in favor of negative rates will look at that and say this is what we need to do? richard: people saying this is the wrong thing to do, this is not great. boj carney chastising their and the ecb. there is some possible dental good benefit here -- possible good benefit here. the swedish economy is so interested in interest rates, it is the goal to get out. guy: stay with bloomberg, it will be the pulse. i will present the that could francine is in new york. -- i will present that, francine will be in new york. ♪ >> fragile china. stocks tumbled 2015 month low after the pboc fails to step up stimulus. is it market expected to much from the central bankers? no plan b. the german chancellor wants that greece needs europe's help to deal with the influx of refugees. is this the next greece crisis in the making? zero down. zero zone inflation is expected to flatline in february. will this be the number that forces draghi to do more extra week? ♪