, at bloombergs European Headquarters in london. Manus ahead, we have two big interviews. In 10 minutes we speak to the ceo of italy secondlargest bank. Paolo. N francine then we are joined by continentale chief executive offers. Manus first, commodities are trading at their lowest in 13 years with oil, metals and crops being effective. Francine supply gluts and the slowdown in china and prospects of the yard the rise in u. S. Interest rates extending the rout. Us is the bloomberg managing editor for commodities. Been oversold are we are expecting bad news . That depends a lot on what happens in china, about how the story develops. We see data that shows a slowdown in the real economy. If you start to feel that, the bearish mood can continue. Links one of the biggest is between china and the producers. We have had everybody through the door. If we look at what the miners are doing and the china story, how does that balance . Will even at these prices, miners will still be making money. There is little incentive for them to reduce production. We might see them start to reduce capex spending that they will keep mining. Longerterm, compared with other commodities, there are reasons to be optimistic about copper. People feel at the world is running out of copper. Francine how difficult is it to predict stability in china . Is it almost impossible . Will you would have to ask a chinese economist. But people are always worried about the quality of the data. Far wet is true is so have not seen really big changes in chinese demand for commodities but that could change quickly if we do see a more dramatic slowdown. Manus when we talk about oil, brent in a bear market, below 50. Yesterday story about iran. I thought this was story. They said within a week we can produce half a billion francine they are ready. Manus locked and loaded. Within a month . Will this is one of the reasons why people are so bearish about oil. The iranians are talking a punch again about how quickly they can bring oil to the market. A marketwill come into that already has all this oil from saudi arabia and america. Very few reasons to be optimistic about the oil market. Francine we are expecting a lot of miners reported thursday and friday. Will i think you will see them maintain their dividends. That is true of the Oil Companies as well. The books balance as best at their able, youre likely to see cost cuts. People are likely to emphasize how they can cut spending on new mines and come down hard on operating costs. I would expect that would be the key message from rio tinto tomorrow. Manus in the headlines, fran was talking about platinum. But we also have got gold. The market has turned net short. Traders are betting against gold for the First Time Since records began. That is a pretty big bet. Will but when i think when you take everything together, the fundamentals of gold are horrible. Manus dont hold back. You on the physical side, have china which is a big consumer slowing down. Then there is the financial trade. With Interest Rates rising, that is horrible for the gold market. Manus thank you very much, our bloomberg managing editor for commodities. Francine heres a look at what else is on the radar. The u. K. Government has started to selloff it 78 percent stake in the royal bank of scotland. It raise 2. 1 billion pounds by offloading 5 of its shares and stock. George osborne is taking a looss as he tries to revive investor appetite in the bank. U. S. Federal prosecutors are investigating billions of dollars of trades made by Deutsche Bank on behalf of russian continents clients. That is according to people with knowledge of the situation. It is suggested that justice departments probe focuses on mirror trades, which may have allowed russian clients to move funds out of the country. Francine bmw, the worlds biggest maker of luxury cars, says a slowdown in chinese demand might leave its to rethink. That came as it announced a secondquarter profit fell 3 from the yearearlier. Sales decline cost the company its position as the worlds topselling automaker. Suspending shortselling in china after regulators propose new restrictions trying to stabilize the world ticket largest equity market. Investors who borrow shares in shanghai must now wait one day to pay back the loans. That should reduce fluctuations in prices caused by traders selling and buying back stocks all in the same day. In twitterhares slumped 5. 6 yesterday to 29. That is the lowest prices than companies floatation in. November 2013 or drop pushes them below market value of 20 billion. The company warned last week that it will be a while before it sends gets a slowdown in user growth. Manus president obama made his ideas to come back Climate Change. The new rules drew criticism even before they were announced. Wyoming and oklahoma have sued to block them. Speaking at the white house, the president said Climate Change posed the greatest threat to the human race. President obama we are the firs the impactn to feel of climate generation. We are the last generation that can do something about it. We only get one home. We only get one planet. B. Res no plan francine no plan b. He is talking about Climate Change but it feels like he is talking about greece. Found ubs trader has been guilty of libor rigging. Manus the first person to stand trial, hayes was sentenced to14 years in prison. The verdict underlies a point that bankers are subject to the same policy as the rest of us. Our investigations reporter joins us now. How would we judge this in terms of significance . It is substantial for the sfo . Culminationis the of seven years of investigation we have the first person to against the test of criminality and be found guilty. Of the first scandals that led to a number of others like fx and gold. Libor became the bog word by word for bad behavior. To be found guilty is significant. Francine 14 years seems harsh. It is not a judgment but if you look at the story and here and look at some of the quotes by hayes, there was one that you picked up. Manus the Mother Teresa quote. Francine he is basically saying that Mother Teresa wouldve manipulated markets. This goes to the crux of why he was sent as for a long time . The longestars is sentence we have seen in many years. He has two things going on. What is he tried to play the game. He went to cooperate with the going toand said he was plead guilty and six month later changed his mind. That did not pay off. Manus he argued that he cooperated with the sfo because he did not want to get extra grade extradited to the united states. He has not said anything to get himself out of this. If we think about what he was suggesting, which was that much more senior individuals than he knew were fully cognizant of his behaviors and toothers behaviors. This is a rather damning indictment of what is of Senior Management. this is the classic problem we have had throughout the crisis. These people did not act alone. They did not act without any direction. The evidence trail, senior managers do not put these things in an email. Secondly, as much as there may be called the ability culp ability from senior managers and does not excuse the fact that he was the one that decided to commit that behavior. Francine thank you so much. Bloombergs investigations and enforcement reports. Great title. We will speak to david green the director of the office which brought the case against tom hayes. Manus todays twitter question which i think is very assistant. There you go. The system or the individuals . Whose to blame for market abuse . The pulse. Join us. Tell us what you think. Francine and you can also tweet suzi. Up next, we speak to the ceo of italys second largest bank. Its a bloomberg exclusive. Keep it here. Francine welcome back to the pulse, streaming on bloomberg. Com, your tablet and your phone. Italys secondlargest bank increase inourfold profit last week as it set aside last money for bad loans and commissions jump to. The ceo says the country is pointing to an economic recovery. He joins us for a bloomberg exclusive interview. Great to have you on the program. Thank you for coming in. You have been in charge for a year and a half, and the shares have gone significantly up. This you must be pleased about but you feel extra pressure to deliver . Mr. Messina you have to consider that this has been the best semester in the story of intesa sao paolo. We succeeded in turning it into a european leader. That is the reason i am proud. Francine what comes next . We cansina i think maintain this momentum and increase the generation of net income. I am really proud of the results and i hope that we can deliver very good results. Francine you have been over delivering. But investors want to know what you increase the debate the dividend . If you continue surpassing targets, it seems logical. Mr. Messina that is the positive and the negative is you have pressure to give messages on dividend. It is clear that we delivered in six months the dividend that we promised for the full year. So now we can work with high degree of flexibility on the item of dividend. I can confirm you that there is my first priority. So it means if you continue on this path theres a likelihood. Mr. Messina i hope to be in the position to give good surprise to the market but we will see at the end of the year. Francine if you can give surprises, the dividends may follow . Mr. Messina they can be very happy on the results of the bank. My management style is to motivate people and reward. Motivational people is done. Reward is on the way. If you consider that my shareholder pays 40 to 60 , i have to maintain them happy to stay with my bank. Francine you have been on the show and talk to me about asset sales and restructuring the bank and looking at buying opportunities. Where are we at . Your silly assets and there are reports that you may be getting rid of Consumer Credit you are selling assets. Mr. Messina we are considering a disposal of 2 billion euros of loans originated by brokers. It is a process that is on the way and we will see it in the next future. Looking in the portfolio of oniness, we are very happy delivering, that we are doing on management. We have to consider world management. We are second in net inflows after blackrock. You think about ubs, but second is intesa sao paolo, not Deutsche Bank. We are delivering strong results organically. Then there can be options for roles in the future. Iron really committed to deliver on the organic growth. Apart from Consumer Credit, is there anything else you are looking at disposing . Mr. Messina we are considering to increase the recovery to our nonperforming loans. With reform in italy for next year, we will be in a position to consider a possible disposal of nonperforming loans but we will see in the next future, we are so solid and so strong that toneed to we dont need work for disposal. Now we want to maximize the prize. The price. Francine you told me you were not interested in consolidation. Is that still the case . Mr. Messina not at all interested in italy because we are so strong in our account we can deliver extra organic growth within our business unit. Francine i sometimes feel like im a broken disc, because every time you come on i ask about the fed and whether Interest Rates will go up soon. Are we near the time . And that can only be a positive for you. Mr. Messina the point of Interest Rate is absolutely an issue for financial markets. For the real economy, if there could be an increase in the fed Interest Rate, then in the future we can have a devaluation of the euro but the possibility of a decrease in net interest in our really counted. In the end, a strong bank like us could have a strong opportunity. I hope they will increase Interest Rates. Toncine leaving your bank one side, but i know that you have been firing on all cylinders. Are you more optimistic about the world economy, if you look at the possibility of raising Interest Rates . We have the possibility of a stronger u. S. Greece seems to be muddling through. A. Messina greece is not significant part, apart from the risk of contagion. I do not see any kind of problem in the economy coming from the greece situation. I think that china could be something that can be considered, but in the mediumterm, you have 1 trillion of people that, one billion, fory, that can be consumer goods. In the end, it will remain an option for growth for all the world. So im not concerned. I think we are in a unique phase in the cycle. So there could be only positive and not negative. Francine on china, are you worried about market volatility . Growth or the real economy seems to be insular. Between the exporter and return related demands. There is a phase in which you have an increase in the possibility of people to make consumption within the country. So it is typical that you have volatility. Do not forget that we have at Intesa San Paolo a 49 stake in the seventh asset manager in china. It is 79 billion euros total asset in china. We think that china could be an opportunity in assets under management in the next years. Francine thank you so much for the interview. Carlo messina, the ceo of Intesa San Paolo in a bloomberg exclusive. Putting on the brakes. Where details of bmws china warning. Stay with us on the pulse. Manus welcome back to the pulse, streaming on your tablet, phone and bloomberg. Com. As sharp tbmw says slowdown in chinese demand might leave it to rethinks rethink goals. Manus sales declined and cost his company its position as the worlds topselling automaker. Bmw, the numbers were very much in line but they warned substantially on china, didnt they . That is right. China is a concern from bmw and for all of the automakers. Saying if china continues to remain weak, they may have to cut their fullyear outlook. That comes after volkswagen and audi cut their full year global deliveries forecast on weak china sales. We are getting some flavor on bmws concerns on china at this hour. The bmw ceo is talking to reporters and he is talking about the fact that the normalization in the china market is quickening. Now, that may sound positive but what that means for bmw is that these high costs they used to have the height price the high price they were able to receive for vehicles in china, that is changing. Those high prices are coming down and that means that profitability in china is taking a hit. Francine we also had u. S. Auto sales last night. The market seems to be on full firing steam. Chad yeah, it is really a tale of two totally different markets. In a reversal from a few years ago when china was the Growth Engine and the u. S. Market was weak. Now the u. S. Market is firing on all cylinders and Analysts Expect that growth to continue next year. That is been helping the likes of toyota. Toyota outweighs their profit figures this morning. They beat estimates. The u. S. Is toyotas most important market. Toyota being helped considerably by the weak yen. Those profits coming back from the u. S. At a higher rate because of the weak yen versus the dollar. Manus thank you very much for running everything up for us this morning. Chad thomas in berlin. Francine up next, the u. K. Government offloads to me and pounds of rbs stock. Why is George Osborne willing to take a loss on sales . We discussed that after the break. Francine welcome back to the pulse, live fin london. Manus here are some of the top headlines. Platinum has sunk to a six year low and copper is nearing a bear market. Meanwhile gold is trading near a fiveyear low. Brent is below 50 a barrel. Francine the first person to stand trial for manipulative libor has been convicted. Tom hayes was found guilty of conspiracy to rig the benchmark rate. The judge set a message had to be sent to the banking world. Manus the u. K. Government has started to sell off its stake in the royal bank of scotland to it raised two point one billion pounds by offloading 5. 4 of its shares. George osborne is taking a loss as he tries to revive investor appetite in the bank seven years after became britains biggest casualty of the financial crisis. Francine now, lets get more on issuednd the rbs ceo has a statement saying i am please the government has started to sell down its stake. It is an important moment and reflects the progress we are making to become a stronger, simpler, and fairer bank. There is more work to be done but we are determined to determine to build a bank the country can be proud of. Manus this was something that was warned about by the chancellor a couple of weeks ago. Wes taking a loss. This is a bit of a gamble. Public opinion, yes. The chancellor does not seem to mind. The tried to lay groundwork. He said in june that he had adi cievice from mark carney and from rothschild which advised that sale now was the right thing to do. He is pushing ahead with that program. He wants to sell at a loss in share price rises in future and he can make more money on later sales. Francine how much does rbs need . Richard the bank will need to pounds tille billion 2019. Most of those costs are coming out. That is why we are seeing it post losses seven years on from its bailout by the state. We might not see any dividend until 2017 from the bank, that is what they said last week. Its expected to make a loss again this year. Manus it is just not going to happen, Investment Bank by 2017. What is going on at rbs. He has these huge unwanted assets. They got way ahead in terms of running nose down. Now is about compacting that down to virtually nothing. Richard back at the height of the crisis, rbs was one of the biggest banks in the world. With a Balance Sheet of 2 trillion pounds. They have cut that in half. That is a big disposal even for seven years. That is huge. Future isment bank in going to account for only 30 billion of riskweighted assets, 15 of the Balance Sheet. That is tiny and compared to what it once was. Dding a lot of people. That unit employs 18,000 people at the moment. The ceo has said there will be significant cuts. Hes refused to put a specific number on job losses. Francine thank you so much. Banking report. Appeared we have breaking news and the last couple minutes. This is construction pmi. It has fallen more than forecast at 57. 1. It had an impact on the pound. Manus lets have a look at sterling. Because it is moving