Transcripts For BLOOMBERG The Pulse 20150216

Japan crawls out of recession with growth slower than expected. How convincing is japans exit from recession . A lot of economists saying that this is a disappointing figure and yet it shows a slight improvement. It shows a slight improvement, but in many ways, what this number is about is the evils of raising taxes in a deflationary environment. Most economists would agree that raising sale taxes in april of last year was a poorly timed move. In many ways, consumer demand has never quite recovered. When you look at the enthusiasm toward abenomics, you dont see a lot of it here in japan. A lot of it is investors overseas who are looking at the different plans the Prime Minister has put together. When you talk to households here, Corporate Executives there is a lot of concern about economic headwinds that are increasing, not decreasing. In many ways, this economic number is not terrible news, but it is a reminder that japan is limping out of recession at best. How much progress are we seeing in the deflation battle . Certainly, we are seeing some progress. That is probably the best thing you can say about abenomics. The problem, however, is that deflation is not japans big problem. Deflation is a symptom of japans big problem. Households dont believe that five to 10 years from now Living Standards will be higher. In many ways, that is the problem. Deflation is part of the bigger malaise, if you will. We are seeing prices rise. You could argue that that is hurting consumption because households are not seeing wages rise in a commence a red fashion. When you go to the supermarket, when you buy airline tickets, things are going up. Wages are not. That is becoming a head wind as well. I was looking at some of the charts looking at what we heard today from japan. It seems that wage growth is actually on the rise. If you were to step back and give us a sense of whether abenomics is going to work for or against . Im actually an abenomics skeptic. Ive been so all along. The problem is that abenomics is nothing new or exciting. The problem that we are having is that abenomics is really kurodanomics. We havent seen a lot of restructuring, a lot of the regulation from the Prime Minister which is the most important element of abenomics. What we are seeing at the moment is a big injection of liquidity from the bank of japan but it is not enough. Investors are waiting for the socalled third arrow. Weve seen very little of that. Abe had this election to win a new mandate, and two months later, the word economy is barely mentioned. The focus is on national security. I think the economy is now going on the back back back burner. Im paid in yen, so i certainly want the yen to rise. All right, thank you so much for all your analysis. You can follow willie on bloomberg view. As greek finance minister Yanis Varoufakis heads back to brussels, germany sounds the alarm over greece. Wolfgang schaeuble said this morning that he is skeptical about the prospects for a deal. Lets go straight to hans nichols in berlin. He has been following the story. Are the finance ministers other than varoufakis on the same page . That is the emerging message. All the finance ministers aside from greece say that this is going to be difficult. A successful completion of negotiation is no sure thing. Heres what mr. Schaeuble told german radio this morning. Im very skeptical but we will get a report today and then we will see. A little note of optimism. He also went on to say that the new greek government was behaving quite irresponsibly, and the problem has been that greece is living beyond its means. We have mr. Sapin talking about how there could be a huge danger for greece if they leave the eurozone, explicitly raising the prospect. The situation in greece over the weekend we had that ugly cartoon depicting mr. Schaeuble as a nazi. He said that personal sensitivities shouldnt play into this. Mr. Tsipras, the Prime Minister of greece, has condemned that cartoon. Heading into this meeting, it does look like the greeks are perhaps the most optimistic. Here is what mr. Tsipras said over the weekend. We are looking at difficult negotiations on monday. Nevertheless, i am full of confidence. That is the line out of greece. They just have to have their meeting. I will be getting on a plane shortly. Covering everything from the ground. In the meantime, it looks like varoufakis and tsipras have a stronghold. The germans are very skeptical. You can look at the 20,000 crowds last night in one of two ways. One, it is holding their feet to the fire. Or two that might put them in a better position to cut a deal and go back on some of their campaign promises. But francine, whatever gets agreed to, if there is an agreement a reshuffling or longerterm maturity, or some sort of new bailout program, it has to pass every individual parliament. Thats why you may be hearing some tough talk from schaeuble. Whatever he comes back with, hes going to need to sell to the german public. That seems very difficult at this point. Thank you so much, hans nichols in berlin heading over to brussels for those talks. For more on the challenges, we welcome bloomberg chief economist. Great to have you on the program. We were hearing from hans nichols. Once the germans find an agreement, they have to sell it back home. Are we going to get any kind of agreement today or at the end of the week . There is a chance we get an agreement by the end of the week, but greece would have to back down a lot and really a lot. The greek situation is desperate. The economy, the Banking System, and tax revenues all seem to be heading down. The longer greece waits, it basically has to continue the policies of the old government, the weaker the greek starting position is. Greece is short of money. It is short of time. The 18 finance ministers of the other eurozone states know that time is against greece. I do expect them to clearly tell the greeks, there are facesaving cover mise is, but you cannot afford electoral promises. When you say the greek have to back down what is of course. A lot of it is game. , isnt it . You can call it game theory. The other players are not in a weak position. I hope the finance minister is not going to play this like a game theory. The news over the weekend suggests that indeed the greek optimism that a deal could be struck and the pervasive pessimism anywhere else does suggest the greeks are the ones starting to realize that they have to back it up. Greece agreed to the bailout. It cannot just say, we are no longer bound by previous commitments. The entire European Union is based on previous commitments. They think they have that mandate and there has been antiausterity sentiment across all of europe. Is there not an assumption that austerity had been imposed and just doesnt work . Look at spain, portugal, ireland. The policy does work. Serious mistakes were made on greece, but the policy mix does work. You can of course negotiate about changes, but you have to negotiate on the basis of the treaties as they are, of the accords as they are. Europe is good at facesaving compromises. Europe will go the extra mile to accommodate the greeks. But greece is basically promising things which are impossible. Basically promising to spend other peoples money. You are suggesting that europe could live without greece. Im not necessarily disagreeing, but the counterargument would be, we dont know what a run on the banks in greece would do to the rest of the Banking System in europe. Would it not be a Lehman Brothers moment . It definitely would not be. The euro crisis has always been about containing contagion risks. We have the European Central bank starting to buy italian bonds in a couple weeks anyway. The point from europe is greece , this is mostly your problem. We are ready to help, but you have to behave. You cannot simply repudiate the previous agreements. We can amend it. We can make it better. But you cannot simply repudiate the common basis of what is the eurozone and the entire European Union. How concerned are you about a run on the banks in greece . Is there a chance we see capital controls before that . Im concerned about the state of the greek economy, the state of the greek banks, the state of public finances. Ever since the rise of syriza, all seem to have been heading down. Again, i do think theres a pretty good chance of compromise , hopefully by the end of the week. Greece will likely stay in the euro but it will be greece having to do most of the backing down. Thank you so much, holger schmieding. Coming up, a ceasefire under attack. Standoff puts the truce between russia and ukraine at risk of unraveling. And, online bank robbery. Hackers steal as much as 1 billion from banks and Financial Institutions. That brings us to todays twitter question. Do you think your bank account is at risk of being hacked . You can tweet me and ill see you in a couple minutes. Time for bloombergs top stories. The danish capital of copenhagen is in shock after saturdays attack. Two people were shot dead and five Police Officers wounded in a shooting thats being investigated as a terrorist attack. Security services gunned down the suspect on sunday. Two bank of england policymakers said inflation will be temporary and indicated that more stimulus chances remains low. The boe rate rise could come sooner than expected. The next move by the central bank will likely be to raise interest rates. Hsbcs ceo has offered apologies following fresh details of how the banks swiss units helped customers evade taxes. In advertisements, he said the bank has been completely overhauled since 2008, and internal controls tough and. A fragile truce in ukraine is under threat as kiev and russian militants accuse one another of violations. For more, lets get to bloombergs ksenya in moscow. What is the status of this truce . While the truce is largely respected by both sides, there are significant violations in the area of a key rail junction between donetsk and luhansk, both towns and areas controlled by the rebels. It is a pocket of governmentcontrolled territory. There is skepticism and speculation that the rebels will at some point stop respecting the truce and continue trying to force themselves in, because it is a key transportation area something that we have to keep a close eye on. Thank you so much, Ksenia Galouchko in moscow. As we look at ukraines ceasefire lets get back to holger schmieding. It seems that on one hand, the eu as ratcheted up sanctions on russian individuals and russia is struggling more to cope with the lower oil prices. Russia is militarily very strong. It can advance as far as it wants to. There is nothing the ukrainians can do to stop them on the ground. However, russia is economically weak, and getting weaker. Over time, the russian economy looks likely to almost collapse if russia does not stop the spiral of war. On the ground, they can win. The bigger picture, they will almost certainly lose. Winning the hot war, but losing the cold war. We had that before with the soviet union. Russia is on the way down. The data are bad. High inflation, serious crunch in Living Standards. Russia will probably stay in a multiyear recession. It cannot afford this war for much longer. It seems that markets are a little more complacent than they should be on what is happening. Is that fair . Complacent, that is one way of putting it. I think that this will probably not turn into a dramatic disruption for western markets. Because probably the russian aim seems to be to secure a little extra territory. But the russian desire doesnt seem to be to go much further. That would be much more expensive. If the markets are right, this is a fight about a limited chunk of territory. Then probably, western markets are right to be complacent. Russias future is dark. When you talk about changing it is changing borders laterally. I dont understand why the markets arent taking this much more seriously, especially when you talk about the economics of russia. In russia, we could easily see a bigger selloff. The russian economy is on the way down. In western markets, as we know russia is losing its ability to wage a bigger war on the ground. Western markets are probably right in betting that russia will not go very much further, and not be economically disruptive to the west, which is very different from the russian side of this. The russian economy is on the way down, and with every day it is more likely the russian economy will continue to tank well into next year. You worry more about the situation in greece and negotiations with the eurozone or about what russia will do . I think the bigger risk for europe and Global Markets is russia. If russia really were to be completely irrational and go on the ground all the way to crimea all the way to kiev, that would be a dramatic disruption of the Global Political order. That would have serious consequences for the nearterm outlook for the Business Cycle in europe. Ultimately, having a nucleararmed superpower overturning supposed european order of peace is a much bigger threat than a small country having elected and he responsible Prime Minister who need some time to back down from electoral promises which he cannot afford. Russia is the big thing to watch indeed as it was last year when russia starting the war in ukraine did stop the german economic upswing for half a year. If you are an investor, how do you deal with that . Do you just stay away from russia . Do you try and position yourself outside of the russian economy . We speak to luxury ceos and consumer ceos and they say, i have no choice but to stay in russia because i think things will get better. As a company, you may want to stay in russia for the long haul, but it is highly likely that the next you years will be very rough and there is a risk of political unrest in russia. So the outlook for russia is uncertain. Focus on the much more promising markets almost everywhere else in the world. Very quickly because you are one of our experts in german politics, what do you make of the vote in hamburg that saw Angela Merkel defeated . It was also a vote for the incumbent. Germany is in excellent shape. The incumbent at the moment has the advantage. I dont think that merkel needs to be very afraid on the national level. Thank you so much for all that. Holger schmieding. Coming up, is sorry good enough . Hsbc offers sincerest apologies following fresh details that implicate the bank in tax evasion. Is an apology enough to revamp its reputation . Welcome back to the pulse live on Bloomberg Television and radio. Norway has built their dreams on houses by borrowing against future oil riches area Bloomberg Business has a great piece on how those dreams are slipping away as the oil price slides. Check out scandinavias richest millenials might be in trouble. Just a reminder, you can follow me on twitter. Join the conversation today. Do you think your bank account is at risk of being hacked . That is our twitter question of the day. We have some amazing reporting on our bloomberg website today about the fact that theres a lot of attackers that could have stolen up to 1 billion. Coming up is sorry good enough . Hsbc offers sincerest apologies following fresh details that implicate the banks in tax evasion. That story is coming up. We have plenty coming your way. We are talking about japan. We are also talking about day two of the ceasefire in ukraine. There are greek talks starting in brussels shortly. We heard from the german finance minister, saying that he is very skeptical of a greek deal in brussels. Plenty more after a short break. Welcome to the pulse. I am francine lacqua. Here on bloombergs top headlines. Japans economy expanded less of an economist estimated. Less event economists less ativan economists estimated. [indiscernible] greeces euro area lenders voiced skepticism. Discussion fa to make sufficientiled progress. ; negotiations will continue in brussels. Ukraines truce with russia is at a risk of unraveling. The government of kiev and prorussian separatists accuse each other of several violations. The town on the road that connects donetsk and the standoff near the town is emerging as the biggest threat. Hsbc ceo is offering his apology about how the bankrupt customer evade taxes. They have no appetite to do business with clients who are evading their taxes. Manus cranny joins us with the latest. Does a very hot political potato. We are couple of months this is a very hot political potato. We are a couple of months away from an election. How hsbc handled from a stream of names handed over. Christine lagarde, we could blame her, she was on the list. An individual basically what it is last week we had the labor leader accusing the tories of not really looking over the quality of where their money comes from an hsbc back into the spotlight. I opened the papers, gulliver saying we have structurally change. Out of the key names and the british press, 106 do not do business with us anymore. And fundamentally changed how it is run. I employ 7000 people for compliance. In terms of Private Banking and he has had it to come forward and say i have change things so much. What an amazing thing to put a public lender in sunday newspapers. I cannot remember the last time. Apologize for doing business it is a last time i can remember, you are right. Very interesting public relations. Maybe it is unfair of me to say its public relations. These are advisors. You have to tell the public this is something you change. A reputation risk and at lengths, the tory party. Correct. Last week, one of the major people in the tory party we saw which was lord fink. What i love up after this weekend, we have the shadow chancellor really taking a go at cameron and his decisionmaking. Cameron appointed Stephen Green as a trade minister anna 2011, just arrived at the same time as the treasury. Sunday morning, attack. Hsbc had 1000 individuals whether evading taxes, breaking the law and what happens is the guy in charge was a minister. They become and charge osborne didnt answer the questions asking the questions. Obviously, what ed balls is doing is making political hay in term of the process of vetting people. But perhaps, how they vet and all of their contributions to the party that the tory party saying things needed to change in terms of where the money is coming from, it is a political version. That is quite interesting. This story is going to rumble on. Oliver, the ceo, and Douglas Flint are going in front of the parliamentary here and with the unfair. When that tax revenue came. This is not going to go away. We are in the runup to the election and the weekend newspapers, i love them. I love the hubris of british politics. Ed miliband the property he bought and how long he lived and how many taxes he paid. That is all press. A good speculation. I find it amazing that you have some leading figures in certain Political Parties everybody used to evade tax. Lord fink came out and said what he did very vanilla. A very vanilla i would love to be in a position to be very vanilla. I got my taxes done at the other day. I cannot afford or evade, not that i would. A good place. Thank you so much, manus cranny with the latest on hsbc. The overhaul of tesco, 10,000 jobs are to go. With an update of the changes is Caroline Hyde and the changes and the new ceo has come in abba, clearer. Drastic cuts, he promised to save 250 Million Pounds per year and cutting expenses some 30 . Of course, how do you do that . Jobs have to go. As the reported in the telegraph, 10,000 jobs have to go. Some are perhaps expected to the closure related to the closure of head offices and 43 store closures. An additional 4000 jobs are to go and what seems to be a real change of management at tesco. They are removing an entire label of management and stripping out current employees that exist in a between store manager and shop assistant. We understand those who will be losing their jobs we do not know if they will be on the same basis in terms of pay. All of this, in tandem with consultation period that they kicked off in january when we started to hear the outline by of course the man dubbed a drastic day. He made cuts sweeping cuts at unilever in terms of products and people. Having to do the same at tesco. The stresses of the industry in general. We have seen jobs and the thousands from the likes of morrisons and last year, more than 1000 jobs to go. So, because of the competition that is so right among these Companies Across the industry of course, tesco having to make big cuts. In context, their workforce. A big cuts but only 2 . Rather a lot on your plate. Richard broadbent is to go, the chairman. The seven on the hunt for a new one. We have heard more about the names. The board is on the hunt for a new one. He had to step down after the the fact we have had profit warnings and a black hole. John allen is one. He was formally at the dixons. And archie norman, a former conservative party lawmaker, his name has been thrown into the mix. Interesting things happening at tesco but to battling with the investigation going on and the grocery adjudicator. I losing my voice. I will send it back to you. Thank you and grab some water. Coming up billiondollar Bank Robberies that no one saw. The hack attack that targeted 100 banks. Coming up. Welcome back to the pulse. Time for top stories. The owner of a gaming website has agreed to enter merger talks. 888s shares fell on the news this morning. Companies such as amazon, google, and alibaba are facing when it comes to drawing deliveries. It could produce 100 million according to the obama administration. The faa concluded for the time being, drones must be within sight of an operator for safety reasons. Apple to compete with test the tesla . They are saying to be building an electric car. Apple executives have long to austria to meet with contract manufacturers according to reports by the wall street journal. Xiaomi is taking his first step to the u. S. Market but not at the smartphone. They announced plans to open a website that over the next few months, carry other products like power chargers and headphones. Joining us now to discuss the strategy is hic technology analyst. Thank you for coming in. Xiaomi is somewhat an obsession because there is a chance they may become the First Chinese handset producer to conquer the rest of the world essentially. Will it happen . And a very well made. Xiaomi has a following in china and has built a strong user base and strong user loyalty. That is the first step and beginning to build the brand and put the name out there and engage with consumers. That is the key of what xiaomi does. Constantly customizing what it does in response to community suggestion. That is what makes xiaomi so unique. I remember seeing are they going after the apple market . Is there a chance they could when you talk about Brand Awareness apple is Brand Recognition and people want to be associated with it. Is it an exercise for xiaomi to do the same . In a way, yes. In San Francisco it was comparing itself to apple in on every metric. It puts itself against apple. All of the devices are much more price competitive, lets put it that way. Much more downscale and really pushes it down the price and competitiveness. It works operational differences, the constantly ticking clock in germany. There are substantial differences between how the Companies Operate that could attract different audiences. Daniel, we hear xiaomi have recruited warming brown to become warren brown to become more friendly, could we see 2015 as the year where there will be a big push from the asian makers to try and attract more recognition but also sells from western markets . In consumer goods, the likes of xiaomi that are more consumer focused and quality focused that Many Chinese Companies in the past. And other companies that have allegations of being close to the chinese military, who are trying to open and show the western companies and markets as they are more open and more out of there for business and are really making a strong effort to do that. What are the barriers to entry from the asian producers . They tend to be aimed a little bit more at the price conscious mid to low end of the market. The quality is very much a getting their, aided by qualcomms design which gives everybody a stander platform to build on. The main thing they are doing, xiaomi, and the likes of lenovo they are building their own Software Platform and making something unique. Because Google Services are not really a thing in china, and lots of the companies have to build other on custom software. A lot more customization to allow these Chinese Brands which make it uniquely differs from samsung they might see. If they get launched for example in the u k and western europe and the u. S. , if they come to the market is it a trouble of them getting market share . Qualcomm has strong positions in several markets in europe. Tcl owns a brand that is strong in france and latin america. So, you already have these Chinese Brands really pushing and driving hard into western markets. Huawei interdigital a bit partnership to push on is brand entered into a partnership to push out is brand. Where does it to lead . We hear they are entering into the car market. Would you be surprised if they end up rivaling one of the electric carmakers or even doing different applications that have nothing to do with their bread and butter right now . Apple is in a really nice position, sitting on a mountain of cash. They have to spend in some way are do something with it. Is it able to take time to explore . Theres also been an apple tv that has been rumored for five or six years that has not seen the light of day. Just because of the news of an apple car doesnt mean it will happen anytime in the next five or six years especially when you take into how long it takes to be in car markets. And of course apple lots of benefits for apple in investigating and going further. A lot more technology being put into cars. Apple already has a persons and partnership with several brands to be part of it. It has business to lose by moving into this and would only do this if it is absolutely certain it has something very different a very unique and very profitable to offer people. Interesting. Thank you, daniel gleeson. Cyber security is back in focus after a firm said hackers have told in more than 1 billion for banks and Financial Institutions across 30 countries in a series of raids. With more, Caroline Hyde. It is being called an us unprecedented robbery. How on earth has it been going on since 2013 . It has been put in to the Public Domain up russian Antivirus Software. They have said they are working with interpol, europe whole and of authorities to uncover this plot, a gang called and they work for russia to ukraine and other parts of europe and have managed to steal up to 1 billion and raided banks, e payment systems. This is happening in the united states, china, europe since 2013. They were able to take away up to 10 million per time in the raids. Quite how did they tack the institute how did they attack the institutions . They infiltrated bank workers computers and allows them to mimic employees activities and take an pocket of the extra funds. Most amazing flick deborah able to take control, seize control of atm most amazingly, they were able to take control, seize control of atms. They saw this happening. They were not present any buttons. They had other banks approaching them, this Russian Company. It is a whole network of issues going on. Fascinating and still active francine. That is pretty incredible. Do you think your bank account is active risk of being hacked . We are back in a couple of minutes. The king of chocolate died at age 89 leaving iconic brand nutt ella and kinder. With the names like prada and ferragamo how did the unknown name get to the top . One of the classic stories. A family business. The kind of business and that the other italians are very proud of, it was started in the 1940s by his parents and he inherited the business in 1950. He has been running it since then. They are an extremely streak and if family. Data secretive family. They never spoke to the media. The brother invited the press in for the first time to visit the company in over 50 years. And that is amazing. The history, you walk into the village which in they make a lot of it and it is like of the nutella smell 247. The history is as they started to branch out. What was the first product . Chocolate mixed with hazelnuts. It was during the world war and there was a chocolate ration. It was very tasty and caught on. Giovanni ferrero miceles brother, build a network. They were famous. They built a nationwide network which expanded internationally. Always italys richest person now . It is a tricky response now. I received a statement from the company and they say it is more complicated than giovanni who owns the business. There are nephews and uncles we have not figured out how it breaks down. Giovanna ferrero is in charge. Thank you. For those listening on bloomberg radio, first word is up next and as second hour of the pulse is coming up. We are back in 2. Inching out a recession japan, the economy expanded lecithin economy is expected. The german finance minister is skeptical. Ukraine and prorussia accuse each other of several violations on day two of the ceasefire. A good morning for our viewers in your a good evening for those in asia and good morning for those waking up in the united states. I am francine lacqua. The greek finance minister heads back to brussels. He said he is very skeptical of the prospects of a deal. Lets go to athens. Marcus how likely is it we get a final deal today . All of it is coming from various finance ministers and a lot are expressing skepticism we will get one. Positively more positive from the greek side. The greek side, some are saying you know, it is possible we do not get the deal today. The last meeting of finance ministers last week produced statements so ultimately what kind of outcome you get. I mean, the question, if you have a complete breakdown of talks or something you can build on and move on. Negotiations over the weekend not to really negotiations, more about fleshing out details that were missing last week in terms of the two positions and points of convergence. We have papers now apparently, technical theme might be formulated some the skepticisms, and may be seeing the position as too far apart to reach a final resolution today. If we do not get a final deal today, what happens next . Well a lot of people were highlighting the importance of today because it is scheduled for this month and last chance and the financing situation gets a very, very tight the closer we get to the end of the month. A lot of challenges agrees is facing. The disco situation and financial situation. The fiscal situation and financial situation and needs to be renewed on wednesday. The Ecb Governing Council will be looking to see some kind of progress in some kind of deal at the very least. It would make a big difference if you saw some kind of statement emerging from the day, saying we have the fdis and we see a deal insight that would probably relax other people. Probably looking at extraordinary European Group to finish the thing off. You would need something positive. A lot of people are saying the finance ministers and leaders that may end up meeting at the end of the week something we do not knows, speculation. What kind of deal are we looking at . We spent a lot of investors and economists and they say the problem with the greek cabinet at the moment is they are bolstered by the popularity back home but the other members will not take it. If they need to stick to the deal at least for the basic part of it. We probably have probably different objectives from the two sides in this sense was in the greek government has been asking for is time to deal with most of the points and negotiate it of the points of disagreement. There do not want an expansion to the original program. They want a Bridge Program something new. They do not want to meet the commitments right now. On the other hand though, all of these finance ministers from around europe saying we cannot start everything from scratch as soon as a new government is elected head. We already have this bailout program. You guys, you want to talk about other stuff but you have to expand this program. And commit to you know, various points, varies red lines within the program. A lot from the discussion we were getting last week and some calls to the semantics of what comes next in the Bridge Program or expansion and so on. Thank you so much in advance. Ukraine is under directed to ask kia and russian militants accusing each other of lets get more of the story. Henry, what is the situation on the ground since the ceasefire started yesterday . Yesterday, violations reported around a strategic transport junction which the rebels have encircled and between the 2 main rebel areas. And the violation has its celebrated according has its celebrated according to the ministry and have reported the first deaths since the ceasefire tame at midnight on sunday. Five ukrainian soldiers reported to have been killed. Another strategic location in a port city under Ukrainian Government control and close to the front line. It is a very dangerous moment as at this time. So henry, is the ceasefire in danger of collapsing . I would say it is. You cannot write it off. The first of and reported since it came into effect. No doubt there will be ever knew about a diplomacy, extremely important. It was negotiated over 16 hours of american talks in minsk last week and both sides of the european side and leaders Angela Merkel and Francois Hollande negotiated and owned the russian side, vladimir putin, they have a lot invested. What we have seen is the European Union imposed new sanctions that added additional names and individuals in the eu will follow that up if the ceasefire does indeed collapse russia facing further sanctions. A lot is at stake. Thank you so much. Coming up, ceasefire under attack. A standoff in a town post russia a ukraine at risk of unraveling. An online bank robbery, hacker still as much as 1 billion for banks and Financial Institutions. That brings us to todays twitter question. Join the conversation today. Do you think your bank account is at risk of being hacked . That is our twitter question. I will be back in a couple of minutes. Welcome to the pulse. Time for todays top stories. To policymakers said weaker inflation will be temporary and indicated that more stimulus remains. One said the rate to rise could be sooner. And if the next move by centralbank will likely be to raise interest. The danish capital of copenhagen in a state of shock after saturdays attacks. Two people were shot dead and Police Officers and wounded in an act being investigated as terrorism. In ukraine, the truce with russia after one do you ceasefire, the government a kiev and prorussian separatists accusing each other of violations. The town is a key rail junction. The standoff near the town is emerging as the biggest threat to the deal. Several more of the big geopolitical storms in europe greece. Lets bring in our guest. Thank you so much for joining us today. We have, i guess 2 main political fronts that are so difficult to see it end up. Lets kick it off with greece. How do expect the finance ministers, theres a lot of skepticism they will get a deal. Are we even going to get a deal . Something is possible, definitely a disagreement on the process. What the framework should lower like and where the negotiations should take lace. As well as substance. Should take place. And germans insisting this government have to abide by. There are outstanding questions on process and substance and i doubt we will get agreement today. By the end of the moment, a fair chance will get resolution on the questions. There seems to be two sides could not be further apart. One is saying we are not renegotiating at all with the existing bailout and European Partners saying, no way, you sign the agreement and we are happy to get a little closer but we are not going to give it all. The greeks are moving closer and the point is the germans are adamant and not moving. Merkel is under significant pressure a yesterday in hamburg a crushing defeat to Regional Elections and you have populist movement, watching developments very closely and merkel is very worried that concessions to act as will create global and have implemented reforms. She is constrained and i do not see her being very flexible. The greeks are moving and as has the finance minister. Merkel wants 95 and is closing the gap. If the greeks get into what the germans want they will be able to honor any of their political commitments which got a them into power. Right. It is preelection. And a lot of it is postelection rhetoric. Again the next two weeks or five months . Ultimately when we get to the 20th of february and there is no agreement, greece will be continually will be completely naked and the market and that could create funding challenges. Every more problematic. The greeks are inching toward an agreement and they are very much to their guns. And what kind of concessions do you inc. They will give on . I deftly think they are looking for a number of concessions with the humanitarian impact of the crisis. A number of measures that are neutral because the government is looking to implement that will help mitigate. Such as minimum income or a number of issues. These are not designed to have an impact on the budget. At the same time, allow the government of the preelection manifesto. Going after High Net Worth individuals from the eurogroup. Then there are other things the europeans have been concerned about, rolling that privatization and collective wage bargaining and of course, the rhetoric around debt relief. This is the more difficult stuff that has to come in before an agreement can be reached. What you think will happen today . Nothing today . Nothing today, probably another meeting at the end of the week or beginning of next. And watch at which point, i expect the greek government to request a european recognition european mechanism. If we are going to save the greek government, what do the germans need to do . And the rest of the eurozone to make sure theyre convinced it is the only way to survive . But i do not think the germans will have to do anything. They have been hungry and there are no allies. I think tsipras is hoping to build alliances. France wants to remain associated, very concerned about being part of the weak economic south. I dont see any allies for greece, completely allied and they have a funding challenge that will at the end of the month and moving toward march. They do not have that much leverage. Varoufakis probably did not win any allies. Thank you, mujtaba rahman. Well talk about ukraines shaky truce next. Hsbc offers its sincerest apologies about fresh applications about eve aiding and details on that next. Welcome back to the pulse. Lets quickly check on the markets. This is just a couple of hours on till we see the finance ministers arriving in brussels for the talks on greece. This is what the indices are doing. The cac 40 is pretty much unchanged. They are Still Holding near a sevenyear high except for the falloff we are seeing today. Still a lot of investors are hoping we will get a breakthrough in a seems i greek equities are falling as creditors are voicing skepticism that a deal will be reach over the nations financing. This is what we have been talking with with our guest. For the shaky ceasefire, lets bring in head of research. Great to have your the program, thank you for sticking around. When we look at the crisis, we have concerns the ceasefire will not be upheld, that is your concern as well . And there are number of problems to the agreement reached last week. The lines of contact they were clearly subjective and the dispute and the runup to the agreement and subject to stress now. One of the big questions. Theres a big role in terms of oversight but we know it has not been particularly under previous agreements and even gaining access to the crash site in the aftermath of that incident. A big question about implementation and oversight in just in terms of political balance, the deal leaves much more on the ukrainian poroshenko than the pressure and creates large, internal liabilities and large amounts of autonomy for the region. If the deal is implemented as drawn on friday. Given all of this, what is the chance the ceasefire stays put . Attribute in a 55 likelihood that ultimately it will break down. The broader framework will break down over the course of the next few months. What happens after next . A response from the west, europe more sanctions. We could add to the sectors and sectors that have already been targeted. And then i think the debate in the states is going to very quickly turn into lethal aid because there is a strong believe within congress and elements of the administration that we needed to complement economic with a more military minded. Whats your take on this . When we had the agreement last week, lots of commentators were saying we have to stop putin before the ukrainians get armed because it would get even more messy and more difficult to handle. If you see the ceasefire collapsing and increase of a chance of the u. S. Arming the ukrainians what is the endgame . The situation of a comes up more dyer and i think thats the way the europeans and people like Angela Merkel are thinking about it concerned about a pretext, at least ukraine could create a pretext for russia to come in and justify a full scale invasion. When will this get a better . It is just going to get a whole lot worse and will stabilize at what point when russia comes forward . Because of economic capacity . The economics are going to determine in combination with the level and the sanctions and there is a timeline between when their implemented and impacted the sectors in question. And a combination of the constraining, which is explaining why the russian offensive was so aggressive in the previous weeks as putin looks to move into a conflict and assets that allow these regions to be more selfsustaining and less of a burden. The way i have seen it is the more putin gets hacked into a corner and a lesser the economy is doing well the more aggressive he wants to be. Is there not a danger that it escalates quickly if we way to longer to put extra sanctions and he feels cornered . On the question, a lot of concern and very unpredictable in the context of weapons flowing across the border and maybe even more unpredictable. At the same time, why utah to policymakers and the u. K. And they do not want economic collapse because it go make bruton wore unpredictable. There are three bottom lines between russia and ukraine. One is own decision was a and clearly decentralization and question of nato membership russians looking for a guarantee, that is not been resolved and will be an open question. And the third is the free trade agreement, between ukraine and russia has been problems because they believe it impacts the integrity of the supply chain between russia and the ukraine. The latter 2, they could find a resolution. To why so much, mujtaba rahman. Just a reminder, you can follow me on twitter and find guy johnson. We can talk ukraine and greece and about the massive 1 billion hack of the bank. We are back in 2 and we have plenty more coming to your way. Welcome to the pulse. The japanese economy grew less than forecast. The rebound shows the Prime Minister is challenged to revive the economy from two decades of stagnation. The german finance minister told a Radio Station that discussions failed to make an impasse with greece and international creditors. The winner of the Economics Nobel Prize said its a creative proposal. They have a creative solution. I dont know if therell be enough support. If greece winds up defaulting it will be very dangerous for the eurozone as a whole. I think the eurozone participants would see that as well. Rollsroyce has then accused of bribery to obtain a contact contract. They paid rides through an agent brides through an agent. They will not tolerate improper business conduct and will take all the actions to make sure compliance. Lets check in with the markets. All eyes are on the greek deal that may not happen today. To real topdown things to look at. The other thing is the finance ministers meeting in brussels. The german finance minister is sitting the ball bar pretty low for that. Equity markets stand flat across much of the eurozone. We have a 10th of 1 in london it. There is some pretty impressive levels closing at alltime highs on the german equity index on friday. Some of the levels we are hitting our significant given all the political noise. In japan, no different. I will go to the asian map. It is closing above 18,000 points for the First Time Since 2007. Gdp came in weaker than expected. Japan crawls out of recession. I see something interesting. Unemployment is approaching 3 . The jobs to applicant ratio is rising. That is a sign of a stronger labor market. What does that mean for the inflation story . I will take you to the bond market. We will look at japan. The yield is 0. 44 . This seems very low. The thing is, that yield has doubled in a month. What is going on with the bond market in japan . I am going to take you further south into the southern hemisphere. It hit a record low this morning. You can see the drop off. The reserve bank of australia is starting the aging process. Will the new zealand centralbank responded . Australia is winning this battle in a race to the bottom. Thanks so much. That is the latest on the bond yields and some the currency news we are seeing today. The overhaul is continuing. Here is an update of changes at one of the biggest retailers. Back in january a new chief executive took over. There they had to spell out how they would overhaul tesco. They were talking about cuts of 30 . How do you get that question mark you do that by cutting jobs. 10,000 jobs are to go. That is only about 2 of their overall headcount. We can relate to some of the announcements. That offices are going to be slim down. They are going to close 43 stores. It seems like an entire level of management is going to be stripped out. 4000 jobs are going to go in that respect. It looks like they are going to be cut out. We dont know if they will be offered other jobs or if they will be put on to shortterm not fulltime jobs. Big promises and it does mean big costs. At the same time, they are looking for a chairman. This is a company that is facing a backlash. Not only is the competition rife out there, there is another round of price cuts. They have this accounting black hole. The chairman did take it on the chin. He was going to be leaving the company. Interesting names are coming out over the weekend. The job cuts were reported by the telegraph and the sunday press. They are talking about john allen he could be in the running to be chairman. It could be archie norman. Interesting names in the next. When you are a company that is trying to get the code to duty cater cojudy cater coming in, there is a lot. Coming up, a company out of shortage is named one of the top 25 Tech Startups to watch by forbes. We have one of the founders up next. Welcome back to the pulse pickup people can scan the market and led through a number of site area here with more is the cofounder and managing director read it is great to have you on the program. For viewers that are less familiar with what you do, you have a sense of what happens . I have 300,000 to invest. What are my options . If you can imagine a normal crowdfunding site we are only interested in one side of the final. We are invested in the investors. They might have different accounts or different platforms and we give that consolidated view. We help them save time and find things more easily. Its all about the investors and the lenders. I get the best deal. You look at the various possibilities. Is it like algorithms . Its like a supermarket in that there is a lot to choose from. We take the deals that are available on existing crowd sourcing sites and we have all of them centralized in one account. You are in the business of data. Is that an accurate way of boiling it down . Not exactly. You may find something you like and get referred, this is where people actually transact. They can maintain their portfolio with things they like the look of. Its like amazon but in a crowdfunding context. A big part of it is the actual data. We give the power and information to people and thats quite where people make money at the moment. What is your biggest challenge . Is it attracting talent . How do you scale . Scaling is the biggest thing. A normal crowdfunding site is going to find users and people who need the money in the first place. In our instance, we already have a site full of things or people to choose from. We have to get our name out there and let people know there is a solution. We are looking to get funding that is unique to the offering. We are working with some of the banks and big lenders to help bring some of their existing loans to the crowds. Apart from Brand Recognition or getting your name out there, are you focused on finding funding for yourselves . Are you attracting u. S. Leads . What is your biggest concern . We are raising money at the moment. We need a final seed round. That will help run the business itself. We have been fortunate enough in the past couple of months to build up a profile pretty rapidly. We been very lucky there. That is where we are. How much money you need . We have a lot of these conversations. It seems that the americans take more risk. They see a start up and they splash cash. If it doesnt work, it doesnt work. If it does, they are in a much better position than many europeans. This is a big opportunity for investors. This has huge opportunity scale. We are raising 650,000. That would be no problem in the u. S. British investors are more conservative. They like to see immediate demonstration of cash flow. Twitter and facebook would have difficulty being funded in the u. K. Would you prefer the u. S. Model . Twitter and facebook had it u. S. Backers. They were able to scale up immensely. Somebody duplicated what you are trying to do, you would be a couple. Of people come in behind us and get heavily funded, theyve got a lot of problems to work their way through. I know people are already trying to do this they are a long way behind we keep tabs on them. It does help to have u. S. Backers who can help you scale that business very quickly. The small amount helps us get Product Market fit. We most likely will be looking at the u. S. For investment further down the road. Would you ever think about moving to the u. S. . We would be silly to ignore it. That is where crowdfunding is heading. Thats where the game is. Good length you. Time for some of our other top stories. And advertisement published in several earnest newspapers, he said it was a painful experience and the bank has been overhauled since 2008. Apple to complete with tesla . They are building automotive experts to buy an electric caller. Car. Apple executives have flown to austria to meet with contract manufacturers of highend cars. The gaming website is merging with the largest bookmaker. Shares fell 17 on the news. William hill gained 1 . Cyber security is back in focus today after Computer Security firms said hackers have stolen 1 billion from banks and Financial Institutions across 30 countries over several years. Caroline hyde has more. Its seems like an unprecedented cyber offering. X this is been going on since 2013. It only dawned on investigators that its linked to a Russian Company. A Russian Company has come forward with this information. Theyve been working with interpol and other institutions to try and understand what this gang have been doing. They are from russia, china ukraine europe they have been able to steal 1 billion in a series of raids sometimes up to 10 million across 30 countries. These are each Payment Companies , Financial Institutions at have been targeted. Had they attacked these institutions . Thats what make this so fascinating. They are using Malicious Software to get into the network. They infect Bank Employee software. They are able to video the employees. They are able to mimic the things that they do. They inflate balances to be able to siphon off the extra money. It didnt ring alarm bells that quickly. It was a slower process of raising suspicion. What most fascinated me is they control the network of atms as well. A gang member could walk past an atm and it would spew out cash. That got caught on camera. They saw meant collecting cash but he hadnt typed anything in. How . How are they doing this . This Russian Company said that many banks are trying to uncover what was going on. They pieced it together. Im just trying to figure this out in my head. If someone were to hank hack into the bank, they would be able to control atm networks at specific times. Imagine if you werent a gang member. You would be happy. This is coming from this one source at the moment. They are themselves and Antivirus Software company area. Ask why dont we know about this more . There is a reputation question. The twitter question is are you worthy your bank will get hacked. The banks dont want this information to get out. That is a novel way. I guess you can in australia and new zealand. This is it. I think its a question of not if but when. Everybody knows these attacks are happening. British police made arrests last year of people because 50 cash machines were infected with Malicious Software. They got 1. 6 Million Pounds. The united eric arab emirates and imam worked targeted. We think these hackers take data. Jpmorgan comes to mind. They are robbing us as well. That is what people will be concerned about. Thank you. That was Caroline Hyde on this cyber attack. That brings us to the twitter question. How concerned are you that your bank account is at risk . You can tweet us. Coming up, the greek science minister has another meeting with his european counterpart. We will bring the breakdown of what to watch. Welcome back to the pulse. Lets get a check on the markets. We are a couple of hours away from the eurogroup meeting. You can see the stocks on the downside. They are still nearing sevenyear highs. That index is down 4 . Euro area creditors voiced skepticism. They voiced at the schism that a breakthrough was in reach over financing. That is having a big impact over in athens. We are joined by jonathan ferro. We are looking at yields and these stock indices. The risk is never been bigger. We had to guests on today saying the only choices for the greek government is to do a uturn. Its been pretty volatile anyway. Greek stocks are lower in yields are at a threeyear low. We think about the trigger points. The bond market moves dont mean much. Over 80 of Government Debt is imf. They are not borrowing these rates anyway. That wont push them over the line. What will is running out of money or what happens with the banks, if there is a bank run. Right now there is not a big trigger point. Why would they come to any agreement today . How much did you hear over the weekend . It was eerily quiet. There have been a couple of voices from greece saying they are going to listen more to the eurozone finance industry. They tried to muster support in the have not gotten it at all. If you listen to the conclusion of the last meeting, you are just setting out what you want. The negotiations have not then started yet. When they do, the noise and the leaks we will hear are going to escalate. Why would you make a deal today with the deadline is the end of the month . There are rumors about them meeting at the end of the week. If you go out to the last hour that may trigger a bank run. We know what youre is going to meet again. I would like to know how many finance minister meetings he will have between now and the end of the month. If there is a bank run, then there is a huge concern. Im sure they dont want to make that decision. They have increased emergency lending for now. They are the ones who have got their figure finger on the trigger. There are rules of the ecb has made of themselves. That and illegally abide by those rules. Europe is good meeting. What if somebody says im too busy this thursday. You know they will be up all night eating. But its just sandwiches. In accomack much money in that. Thats it for the pulse. U. S. Markets are closed for president s day. Tonight on titans at the table, we talk football and the big apple. There will be a coin toss right here. With the man who is bringing it all together. Jonathan tisch, cochairman of the Loews Corporation and coowner of the new york giants. Tisch was born and raised in a new york family. In 1959, his family branched out and bought loews theaters. Today, the Loews Corporation has 80 billion in assets that generate 15 billion in annual revenue with interest from everything in hotels, insurance, to oil and gas. Jonathan tisch runs the company