Up in the u. S. I am mannus cranny. Lets start with the one and only event, if youre waking up and possibly have a hangover. If you are german, you might be a little good. Bitou might be a little distracted. Ceo and he boeing said he does not see it slowing down and activity. Fora new suite of airplanes a wide body. Has aitor, anna edwards, very special interview for us. Thank you very much. Good morning to you. We talked about commercial aviation space and less about the defense industry. That is a theme. 35 was opposed to make a debut. It was not here today. Leahy. Joined by patrick will beupset the f35 flying today . We are not sure. We are strongly supporting the thatnment decisionmakers are doing the evaluations. You do not know what the future brings. Is a good shape. Over 100 jets. Pfaff over 17,000 flight hours. One jet last month did want did more than 1000 flight hours. We are confident you will see the f35 in the future. The three engine that started this a grounding. As there have been other problems and in the program in years past. It has been a long time coming. Can you bring us up to date . Will there be nothing but good news . It is a Developmental Program. It is really knows a surprise as we go through the flight to test the regime, we will find certain things that have to be resolved. We have two or three more years before we finish the full development. Theres a series of flight lifts , Software Loads were flying the one that is operational with the marine corps next year. Flight version in the development and flying on some test jets. We are making solid progress. It is a Developmental Program and will have certain issues. The bottom line, we think it is a good shape. Some governments reevaluate how much they will buy. Issues around the project. Are you confident all of the deliveries that are in place will be kept up tp . Wouldve made Good Progress in the past couple of years and each government have to make their own decision. There is governmental spending and Airport Infrastructure thomas something they have to infrastructure, something that have to make an afghan make decisions. We have israel and japan and south korea have announced. Some will be coming on. Wille pretty confident it progress and maybe not exactly as it was viewed but will go successfully. At you at some of your partners are investing more money to save more money. We have a blueprint for affordability and we are focused. It was announced earlier this week. Are cost competitive. This object is going to be essentially the very competitive with the what we call a generation. As you probably know, more sophisticated, integrated sensors designed so we have a pretty good perspective that this thing is going to be a costeffective. You mentioned some of the tight budgets we see especially and was the government, the u. S. Is one of how much will be spent on a defense. Run us through where we are on your reliance of the u. S. The government and International Market and where you see it going and in the future. 8Lockheed Martin does billion outside of the u. S. Most people may not realize we have this broad portfolio through Information Technology and global services. About 7000 people outside of the United States and 3300 in the u. K. Alone. When we deliver all of our services and through the governments that are looking propositions money for everything from defensive to security needs, we have a real Growth Opportunity and that is how Lockheed Martin will go forward. , the backdrop to this airshow being a much talk about, russia and attention at least over ukraine. Over the south china sea. This kind of environment, does it offer opportunity or make a tough environment . World is not getting safer. As you indicated, Eastern Europe , europe has not seen this type of situation where it is unstable and uncertain for probably 15, 20 years. Governments need to them to spend the money they spent for their security and have a deliver the best value. Lockheed martin in particular because of the portfolio and capabilities, to offer that value for money that governments need whatever the solution is required. Because of this because of the stations plays all russia and particular sanctions applied dore there countries you business with that are getting shorter at the moment . Not really. We do business in over 70 countries. Quite frankly, we have some business relations with russia as you probably know at a maid at a press a couple of months ago. We deliver the r80. Couple made the press a of months ago. We do business where business it makes sense. Where they allow us to do that. In general, the Business Environment has not drastically changed. What technologies do you have on display here . We are doing good cyber demonstrations in addition to f35. We have cyber demonstrations and capabilities. Integrated network systems. Thats what we are pushing. And joining us. From Lockheed Martin. Things are getting noisy. Plenty a displays. Day one. Number off with pretty of announcements. F35re information on the which everybody is keeping up with. She will be back later with john harris. Mosts move over to the watched sporting event. If you have not heard about it, germany won the world cup title. They beat argentina, 1nil. Hans nichols braved the night away. Ryan chilcote watched the game. You come in from berlin. Too dangerous to be there. Too many fireworks. It is dangerous. They do celebrate. They like the pyrotechnics. Storys is a remarkable for germany. A feelgood moment. An economic boom afterward. We pretend that stock markets correlate. One thing that is correlated is adidas is up 3 . If they are the sponsor. Let us talk about beer consumption. For beer iser pretty important. Consumption up for you . No personal matters. [laughter] biggest up for one the the south. Who knows if these numbers are true. No one is checking the breweries. Probably. Y, a beer is important when it homes to russia. What they have taken from infrastructure, get it right. Russia did not need to learn from a brazil. The russians will build 12 stadiums in 11 cities in a district. They have a lot to do. Ofreve already built three the stadiums. One was built for the olympics in sochi and one in moscow and will be for the football club. Another has been done. It is something the russians are beyond and they want to make sure they get it right. It is the first time they will hold a world cup. As for beer, theres a crackdown on alcohol. Huge exposure to russia. Carlsberg andfor all the breweries and people like to drink beer, it will be advertised during the world cup which it currently is not allowed not to happen. It should be good for beer sells. Is another one of the companies who did well. Hadne of the guests we early, the ability to be text areas in terms of what you xeterous is what you show. Lets talk about maria goetze mario goetze. He will be worth what . Goldenmessi got the boot. No said he should not have we know who he is. Knownis perhaps the best footballer. Should he have gotten the best of man, messi . He was perhaps the best man out there. One said he should not. And the marketers wanted him to get it because a made sense. Messi did i think so, he was crying. He did not get what he really wanted and that was the world cup. I am not going to weigh into that. A heros welcome. He has the hearts and minds of the germans. Pretty proud of themselves coming together. A young group of guys. The average age is 26 and they will be back. Young and they will be very, very what is the word . Rich. Still to come. A bloomberg exclusive. We are live with the former bank vice president. Later in the hour, will talk to a ceo. We will be live at in the Worlds Largest air show. Welcome back to the pulse. Check of theick currency markets. We are seeing a little bit of a willful. Last week, what you saw was one of the biggest the most in dollar in almost year five years. It is common off of lows because the janet yellen. More dovish. An opportunity to sell into the dollar yen. Lets keep an eye on the dollar yen. Currency is on the move. Citigroup coming out. There are norwegian krone which is very interesting. I was going to talk about euro against the norwegian krone. Well keep an eye. Indeed as the rates cut. Lets talk about pharmaceuticals. Up. E, the stock is they said today are willing to recommend an offer at the revised terms from abbvie. They had previously refused several bids. Matt campbell and Caroline Hyde are here. Where are we on the price . Get to it is not a done deal. 55 pounds 20 per share. 31 billion pounds for shire. That is 35 higher than the very first offer dated they put i n. Why it is so attractive to abbvie is the Corporate Tax rate. They have money abroad. It is a diversification at the moment, abbvie gets half of his revenue from procedures for treatment of rheumatoid arthritis. Once they diversify, what do they get for shire and disease and treatment . Wasdrugs for hyperactivity a it is a winwin situation. That is why they keep upping the deal. Shire has been brought to the table and it looks like the board will back it. Vehement heas very wanted to stay independent and be given the opportunity and here we are. They could capitulate cash. As they are in it for the money clearly. What else . The dam did burst last week over the weekend. The latticed in the latest offer seems to have gotten shire shareholders to put pressure to table. The they should in a new york on thursday and friday and over the weekends. Understanding. They opened up in new york on thursday and friday and over the weekend. They have got to do this deal , i understand by friday. They do have to do it by friday. The deadline can be extended with the consent of both parties. If they are both at the table, it is a good idea they would extend. Usually these teams, down to the wire. It has been a disappointing lack of trauma. It is interesting at the moment, shire is for tax purposes dublinbased and is moving their address to you came they u. K. It is such a trend. We are here and they want more power. These foreign takeovers. Is it difficult very scene to define. I heard you with the pfizer asterisk deal it will be more doable. If you do not stand by your deal, we will charge you. Fts, whethero cra they did so are not, go back on commitments they made into the u. K. Government. What theyre talking about is enshrine theseo into stone. I remember that the deal being done and levied in our minds i. Trust, do you of think this is politicking, caroline . Putore clearly he wants to forward we will do what is in the best interest of the u. K. And more of these deals are set to come. Especially in the pharma space. Invert u. S. Company can abroad. It will change one day. It takes time to get it through. It will be a very long time. It could be the next big trend with report about. The way we go, we could see reverse takeovers. The train always reverses the correction. Hyde. Ampbell and caroline stay with us and we will take a quick a quick break. New york is waking up and victor, germany is the in the world cup. Stay with us. Welcome back to the pulse. On your ipad and bloomberg. Com. It is time for new energy headlines. China. At least 30 of new government vessels will be powered by alternative fuel sources by 2030. The latest efforts to combat their smog problems. The new cars will be electric. Will trading, but he Trading Company will build a power station. Construction will begin in august. Nearly 200 million plant will be running by 2017. Facebook, walmart and other major u. S. Companies are having an easier process for buying alternative energy. The Companies Say there is difficulty in vetting cost competitive options and face complex contracts for buying or investing in renewables. I know you been waiting for it. This is the number. 300,000 euros. That is the reward given to each german player for winning the world cup. Germany beat argentina in case you have been asleep and missed it, it was 1nil. It is the fourth world cup for the unified nation. They narrowly avoided the penalty shootout. 1990. Last away and was in also against argentina. 1990. Ir last win was in a lot of celebration in germany. Will beo goetze welcomed home a hero. Welcome back to the pulse. It is time for the top headlines. Addresses the European Parliament today, the First Time Since the elections in may. You could discuss the central bank socalled key program, denying to semantic european economy. A Bloomberg Survey shows economist forecasts he measures will hand thanks more than 700 billion euros in funding. Israel shot down a drone flying from gaza this morning. Its assault on rocket firing its seventhtered day. About 170 palestinians have been killed. Will rise toat medically if israel goes for a ground invasion. Rise dramatically if israel goes for a ground invasion. Russia and germany are calling for new crisis talks on ukraine. In a meeting yesterday, president Vladimir Putin and chancellor Angela Merkel agreed they should meet as soon as possible to secure a ceasefire in ukraine. Clashes between the nations government and prorussian rebels have intensified since president poroshenko called off a ceasefire at the beginning of the month. Global headlines. Lets get to global markets. Start at the week across some of the major benchmarks. Concerns last to over some of the portuguese banks. The questions remain for the eurozone financial system. , a big mover of the day takeover. Could we finally get a deal . Backing a 31. 4 billion pound takeover. Is a tax rate down to 50 . That tax rate comes with a price, and theyre willing to pay it it seems. That djokovic the biggest farm and dio outside the u. S. This year. That joe could be the biggest pharma deal outside the u. S. This year. They are willing to stay patient. Janet yellen speaks tomorrow. They say it is doubtful you will get that carney moment from her. You will get a push up in the dollar and a push down in that eurodollar. The dollar has to get stronger. The fed has or at least janet have to signal. Lets go to new york. Surveillance at the top of the hour. We have Big Bank Earnings this week and you have scholars, i believe, from cornell on the show. We will get an update as we begin to think about back to school. We will talk to them about immigration. He is front and center on that debate. Citigroup come out at 8 00 this morning, scarlet fu will give us an update. And from capital markets, he is written on the acceleration of earnings. We will talk to him about that. And also the enthusiasms and mergers and acquisitions. A lot like in the shire transaction this morning. You look at that jill and eventually, what i love, all institutional shareholders capitulate eventually, dont they. How soon do you think the americans will say, enough, we need to change this tax legislation . I see no indication that will and. It goes on and on. I think the best one for people to understand is what Apple Computer is doing, where they essentially generate debt to repay that use of cash are broad and do not bring the cash home. That is just the beginning of the process for the billions, trillions, that are abroad. Were you happy to see germany wind . The best thing about it was it was a great goal. Fabulous goal. We have to leave it there. See you soon. Well, atina suffered close but crushing loss during the world cup final. Now the wary nation must turn its focus to the economy and the looming july 31st deadline. The argentine Government Court ordered to pay back its debt holders by that date. The former governor of the bank of argentina joins us from exclusive interview on how the country can deal with that painful date. Welcome to the pulse. Great to have you with us this morning. You watched the game. How do you feel . What was the atmosphere with your compadres . I am disappointed, but im also quite proud of the performance of the team. The team performed very well. We got second. The end, it turned out to be a matter of luck. What do you think of messis game . Many said he was tired. He was not at his best, but he is the best player of the championship. It shows what the real argentina is. A lot of will power. Maybe you dont get to the big prize. Lets talk about the reason we are be here today, Cristina Kirchner has got to do a deal by the end of the month. Do you think she will do a deal with the barn hold and avoid on hold and avoid default . Will beconvinced it successful. It will be successful in they will find a solution. The government has been quite itsrmined to normalize inclusion of the capital market. The International Capital market. Do you feel assured they wont fall over that date . Therem absolutely certain will be no technical default. If we dont have a technical seeult, how soon could we what does it mean . Talk me through the Immediate Impact for argentina and for to kirschner. I believe it will lead to a deal. Most of the problems of argentina will be solved. There are still some decisions with the imf that also must be normalized. I believe there probably will be. To think lagarde is supportive . I think so. What will happen . At atina will recover reasonable price. The cost is very high. It will be possible to get financing. The country will need less of an adjustment for a while. They will be able to get out of a situation like today where a recession is paramount. Charybdis levels of inflation. I know were moving toward a more honest level of that, but what can be done . What is realistically achievable for the government if they avoid this default in terms of weve had one to valuation so far this year. To you expect another . Depends. It could be possible to finance the payments on the date and so on. It is necessary to have an adjustment in the rate. The size of the valuation, the amount of feedback on the economy will be much less. Very tight fiscal adjustment now in the middle of a recession. What is reasonable price to go back into bond markets . First of all, it has to be one digit. Singledigit. Yes. Probably if they could borrow a percent that would be acceptable. Lets put it on the table. It is not only the fi