Good morning. Welcome. You are watching the pulse. Here in london. Im guy johnson. A greek rethink and a mission to moscow. Greeces finance minister and the finest mr. Returned home to jubilant progovernment protest. Are they protests . They are a sign of embracing the government. The antibailout plan received a cool welcome in berlin yesterday as they rethink their plans to revive the economy and protect their banks. What happens next . Angela merkel and the french president friends what hol Francoise Hollande heading to moscow to push put in for a ceasefire. Hollande is going back to moscow later this evening. He is now in paris. Lets go straight to moscow were Ryan Chilcote is on the ground. What is the timeline on these talks and how do we think they will unfold . The talks have gotten pushed back. They were scheduled for 5 00 p. M. Moscow time. They are now scheduled for 6 30 p. M. As you said, the leaders are in the respective capitals the for the come there. Their aides will sit down in an hours time and start trying to has out an hash out an agreement. Angela merkel and Francoise Hollande were in kiev yesterday. The french president saying they have a plan that would maintain ukraines territorial integrity and the fighting there. There is a lot of skepticism skepticism that we have seen many talks. I have been to several rounds of the talks in limmilan and minsk and normandy and geneva going back to last summer. None of those talks have yet to yield a lasting peace. Secretary john kerry was also in kiev yesterday to he is not coming to moscow. That says something 13 met with the ukrainian president after he expressed a little bit of his frustration. Have a listen. Ryan, i do not think we have that yeah. Effectively what he was saying is that the russian president has had plenty of off ramps up until now. And he has left them in the rearview mirror. So skepticism on this russian side. The leaders of germany and france after they met with the ukrainian president yesterday were saying that the minsk agreement, that is where the last seals fire seacease fire was reached should be the lots of skepticism. Lets say putin does not buy the idea that the americans are going to arm the ukrainians. And there are going to be further sanctions. What is next . If this is the carrot the stick is twofold. Yesterday the u. S. Secretary of state said that president obama is considering arming the Ukrainian Military, providing weapons, defensive we apons. It is something the president has been reluctant to do but it was interesting in the middle of last week or this week, the nominee for the secretary of defense sai that that is something he would be inclined to support. In addition to that, there is always the threat of more eu sanctions. We have the eu saying they are going to publish the names of 19 individuals and Nine Companies one of which is russian, and four individuals on m thato willn be subjectday. Get together on thursday. In brussels. There is no reason why they could not impose more sanctions. Su there has been a lot of talk that ther there has been a lot of talk that the greeks have water down the line was they took out the words restrictive measures which is code in the eu for centuries. It is possible of Angela Merkel and Francoise Hollande and upset enough that they could introduce further measures. Thanks osso much. Lets get more on the story ahead of this meeting taking place a little bit later on in moscow. We are joined by Standard Bank head of emerging markets research. Good morning to. You. Let me start with you. We have seen a series of these meetings, and at every single meeting we have ended up in a situation where progress has been limited. Is today going to be different . In terms of the specifics of the ukraine story, i guess the question is is putin going to get what he wants from the steel and what does he want . He wants some kind of control over your crazy once ukraine in his spirit of influence. He wants administration and kiev. And all those kinds of things about no nato. You could argue that his intervention in crimea and Eastern Ukraine has made life so difficult for the government in kiev that they are forced to concede. Frankly, i was in kiev spoke to 50 locals. No one one out of 50 would concede any of that. Very, very difficult ultimately to secure longterm settlement. There have been sanctions on russia. My sense is in the end it may be a military solution. One side figuring out they cannot impose their will on the other or ukraine securing defensive ability to stop the russians. What putin wants. What do europeans want . Are they trying to counter what the u. S. Might do . You can see some element of good cop, bad cop. The u. S. Has been talking about arming the rebels. Pretty much everybody understands if the u. S. Were to supply weapons to ukraine, then russia would probably reciprocate and increase weapons flows. The situation would get a whole lot worse. Therefore, that is the backtrack. They have got a couple of objectives. One is to tsstop this war getting worse. Secondly, you mentioned the greek position that makes eu politics more, tape it we are talking about more sanctions. It makes it more difficult to deal with other eu issues. Trying to contain the situation is important. Also in terms of the timing of this visit, they probably feel there is a wind of opportunity with president putin now. Russias economy is deteriorating significantly. We saw figures from the Statistics Service that showed 15 year on year inflation. We are expecting gdp to contract 5 this quarter. So, the oil prices has been the most damaging factor, but sanchez have twisted the knife. But sanctions have twisted the knife. This might be a good time to get a compromise from putin. This talk of compromise, we are going to be able to get a deal done here. If you look at the balance of probability of getting a deal done with putin, looking at the backdrop and looking at his geopolitical view of the world at the moment, ukraines one part of it. There are other parts. The oil prices down. What is there to encourage putin . What can we really do to satisfy his longterm ambitions and to ring fence him . We are going back to 1950s containment very. 1950s containment theory. Shortterm, i can imagine a ceasefire deal. That failed within days. Something temporary to buy time and hope that somehow a longerlasting peace can result. As you mentioned, this is big stuff for putin. This is about i would argue he feels the ewest has gone back on previous agreements. This is his backyard. He wants to rewrite the postsoviet security structure in europe. For me, ukraine is central stage. There has been lots of drivers for this conflict. The russian economy was not working before this. The Eurasian Union was a driver to that. Ukraine is central to that. Im reluctant to see a longlasting i do not see the americans or the europeans merkel bowing to putins desire for a new security structure. The ukrainians are in no mood to compromise on their fundamental right to determine their own future. What is your take . First a reaction on her want to ask you about the currency. Tim is right. It is about sovereignty and respect. It is about more than the Current Situation in ukraine. Ukraine is the line in the sand as far as putin is concerned. It goes back to what they see as the wests overriding russias interest. They talk about national sovereignty. In that sense, what would satisfy putin or russia would be if they are perceived that their legitimate interests are recognized or excepted. And means keeping the west encroachment nato away from its western border. We have shortterm issues but the Bigger Picture is, the west has got to say, we respect russias interest in its near aboard and that includes ukraine and we will not encroach. They redefined the border. They have taken a pencil and redrawn that. Lets talk about ukraine and the currency. Theyve loosened it. How close are we to a bailout . Very close. It may get extended next week the deadline. If the west is not willing to arm ukraine, the country is desperately in need of western bailout money. One of the problems is there is not enough money. We all except that. 15 billion. Theyre getting around to 12 billion. I sense this murder in the currency would further close the external financing gap to help the imf close the gap. It s it going to be easier to support ukraine financially than militarily . The numbers are enormous, but it is going to be easier, i suspect, for the europeans to do that. I agree. If there is no increase in military support for ukraine that will have a response from pressure and then youre into a broader, more dangerous unpredictable conflict with ru ssia. The Financial Solution is the way to go. My sense is that the willingness of europe to purchase a paid in that bailout is probably dependent on a calming of the situation. Do think that is what Angela Merkel and hollande will say to putin . We are really going to support this country. Putin seems clear about what he wants. What he said as he does not want to break up of ukraine. That russia does not want to have to financially adopt and take responsibility for east ukraine. But they clearly want some if you like independence or selfdetermination in the east with a promoscow policy and that buffer within ukraine. The eu or the west taking financial responsibility for ukraine certainly will soothe russia, provided that we can see to that buffer within ukraine. That obviously is because the ukrainian will the ukrainian people except that . They are in no mood. But if it comes as a condition for the bailout they need, then that compliments may be forced then that compromise may be forced. A federal solution was not enough for putin in russia. It means that difficult forces and he knows that. Ukraine is set against that. The issue is about what level of decentralization for these areas there will be no veto for these regions on the overall cost of the rest of the country. That is what putin wants. Putin wants i was going to say crimea. Does he want crimea or korea . Essentially, he once part of it. Now way. Ukraine is not going to be in nato. You get the sense that ukraine is the red line. No chance. That is the difficulty. If he does not get what he wants, is he going to escalate further . If he does not get that, then the situation will not get result. On that note, we have concluded the conversation where the red line is. That meeting is at 6 00 p. M. Thank you very much. That brings us to our twitter question of the day. A fairly simple one. Is the cold war back . Let us know what you think. We will take a break. Welcome back to the pulse. Live on bloomberg tv and radio and streaming on your tablet and phone. A strategy briefing after two less than fruitful discussions with germany and the European Central bank. He was unable to find Common Ground with his german counterpart on the new arrangement for greeces debt. Hans nichols is in berlin where the meeting took place. They cannot even agree to disagree, hans. I like that less than fruitful. They cannot agree on what they are arguing about. A shortterm extension, which is something that he wants. Get them towards may, so they can have a longer discussion about refinancing some of his debt. Clearly he wants to keep them in the bailout program. That ends at the end of this month. When he looks at the moves he had seen the new greek government undertake, he was less than impressed. In our conversation i could not conceal my skepticism that some of the measures the new government announced, but the colleague told me they are not decided yet, they dont go in the right direction in our view. In his opening remarks, he said that they agree to disagree, but the greek finance minister said he could not abide by that bit of dlipiplospeak. Hans, what options dido the greeks have for funding . Well, so yesterday afternoon, they reported there will be 60 billion in emergency liquidity assistance. We confirmed that around 59. 5 billion. This is for the greek central bank. This is just on the banking side. In terms of the governments ability to pay pensions and found themselves, we still do not quite know how they are going to do it if they leave the bailout and if they are not able to issue anymore t bills if they have run up against their 15 billion euro limit. So, what came of yesterday from the ecb is more to do with the banks or less to do with the government. Everything somewhat interconnected. But that had more to do with the banks and the government and we still do not know how they are going to fund themselves if they do leave this bailout program. Thanks so much. Hounds nichols with the latest hans nichols with the latest. Going wrong for now. Interesting to see how his view of the world looks this friday morning. They are doing laundry and figuring it out. They got home last night to rapturous applause. There was a party. Absolutely amazing to watch. Coming up, we will stay with greece. One company is so key to emphasize that singapore is no greece that it wrote a 29 page letter to standard poors. What is going on . Stay with us for more. Welcome back to the pulse live on bloomberg tv and radio. Company news. Statoil has deepened cost cuts and halted dividend growth. Its ceo spoke to bloomberg earlier today in his first interview since taking up the post. Here is what he had to say about the plunge in oil prices. In the shortterm, i am fundamentally uncertain as to what kind of price environment we will see. We will see a lot of volatility and we could see a low o il price environment for quite some time. Fundamentally, i think we are in a part of a cycle and we will see a rebound at some point. Whether there are some structural changes fundamental changes for the longer term, that is still too early to say. We do not see any changes in our fundamental belief in our commodity. Singapore is not greece. Temasek holdings have critiqued standard poors. It says singapore cannot get be put in the same way as riskier countries like greece. Moving on from the hack attack. Amy pascal is stepping down from her role as cochairman of sony pictures. Facin criticism after hackers made public jokes about president barack obama. She is said to start her own production venture. Coming up, we are live in moscow ahead of those meetings. And we will also talk rubles with a chief fx strategist. Shall we have a look at the markets . Ok. Interesting to hear the new ceo of statoil talk about the volatility in oil. That is where we are in the equity markets. The italian market is one of the few to be trading hig i want to show youher. Oil. Monday we are trading at 51. Today we are trading at 57. We have seen a 10 range for the price of crude this week. An economy based on oil prices, life is incredibly difficult. Volatility absolutely i watering in this contract. Jonathan ferro was talking about it popping around like a penny stock. On the week we are up 10 . Talking about penny stocks if you look at yield, they had volatility. Denmark cutting its deposit rate for the fourth time this year. It matches switzerlands rate of 075 . That has had a negative impact on yields. You can follow us on twitter. Remember our twitter question of the day . Is the cold war back . Let us know what you think. Welcome back to the pulse. Live from bloombergs European Headquarters here in london. Merkel and hollande traveled to moscow to propose a peace proposal to putin. Merkel and Francois Hollande met with john kerry. Kerry said america is working to change russias behavior. In greece, they failed to agree on a new plan to deal with debt. Meanwhile, the e. C. B. Said it will allow the Central Banks to provide as much as 60 billion euros in emergency funding for the countrys lenders. Denmarks Central Bank Cut its rate for the fourth time in a year. In an interview with bloomberg, the Danish Central Bank governor said the peg would not be abandoned. Euro and kronor are very close substitutes. But of course if anyone starts having doubt about the beg peg we will have an issue. We will do whatever it takes. There is no limit and we can go on forever. That is fascinating. Anyone who has doubts about the peg, then were going to have an issue. Well talk about that in a moment. Feels like a lot longer than that doesnt it . Jonathan ferro is here with more. Not a lot of movement in the numbers. No. Just over 3 billion. Could have been up by 100 billion. It gives you an idea how much they would have had to have spent to keep that cap. That is the reason were talking about denmark. The governor of the central bank sounding like draghi with well do whatever it takes. If somebody has a problem with it, then we have got a problem. Having to cut rates as aggressively as they are. I could be wrong about this but somebody maybe thinks the peg is a risk. Four rate cuts in a year. Reverse q. E. In some bizarre way. Trying to stop people from buying danish kronor assets. If im a bond trader now, im looking at their bonds saying ill have some of that. Do you think people are also trading on the renomination risk . That occurred to me last night as i was thinking about it. Part of the bids on the bonds, you just wonder whether there is a redenomination trade there. One was three years old. The other is predates the euro. It is about ability and willingness. I had this conversation with a bloomberg columnist. If you are pushing rates this negative and Start Building up to decemberic risk, that becomes a problem. What happened took everyone by surprise. It really did. Again, this can happen quickly. The s p is around 80 . Clearly the there is space to run in this game. It is happening really fast. It is happening really, really quickly. You have this morning issue. The banks are having a meeting with the Central Banks to talk about the issue of the mortgages. You have got a great deal of pressure. You wonder whether you have to link this to greece as well. I think you have a resolution from greece, i think it would make life a lot easier for the danes. That is two ends of the telescope you need to think about here. Trying to stop this capital flow into assets. What can they do about this. Were in a position now in denmark where yields are becoming so negative. The mortgage market, you can get paid to take out mortgages. A bizarre event. Youre telling me they can prevent the risk buildup off the back of this. That is a v