I am an edwards. Edwards. We will show you the worlds most expensive cigar. Story. Et back to our top the bank of england will publish the minutes from its latest policy meeting later this hour. Investors will be searching for any hint of dissent among the members of the Monetary Policy o committee. I think there is every possibility you could get dissent. Conversations we have had todays conversations, the bank of montreal would say carney has done a fairly good job. It might leave them a little bit of room. What about the inflation data yesterday . We are dealing with a retrospective. My gosh, we are not sure whether wages will rise. Underestimated the amount of slack in the economy. It is really, really difficult. Declining, inflation is declining, wages are not rising. A lot of elements which are going to give the dogs the upper hand in the vote. They thought they could be the dissenters. 5050. The timing of all of this is interesting because these minutes predate the inflation number of last week. If we saw no dissenters in these minutes and then you add on the dovish nice of the inflation number we saw earlier this week, it suggests no one was going to turn more hawkish as a result of just the inflation data. Just far out do we have to go to see in interestrate hike . There is an article i referred to it yesterday. Nobody wants to break out of the cycle. That is an interesting analogy. Mark carney tried to step right. I think you try to test the waters i think you try to test the waters and it was a pretty vicious response that he got. At the end of the day, it will come down to janet yellen. They had a reduced level of inflation coming through yesterday. Nervousness. Of and weguage of slack have moved to a wide range of views. Carney said that when the time comes, when things are finally balanced, we are united on the gradual approach in terms of raising rates. Mark would disagree with me on this. One should stop using expensive language guarding the market. Guarding the market. I think it is a pipe dream. None of this is ever a promise. Dependent. Ata it is not a promise. England minutes out soon. Shares of the u. K. Biggest builders are falling. U. K. Comes ahead of the Takeover Panel deadline to put up or shut up by friday. Here with morris caroline hyde. Brilliant has been karelian has been knocked back. What is the latest . Valuation,ion pound not good enough. Third time was not so lucky. The two helped build britain. You have the likes of Balfour Beatty helping to build the channel. History. Together im a they would be the biggest builder in the u. K. , but the merger is not going ahead largely because of the u. S. Unit of Balfour Beatty. Todoes not make sense for us dispose of them. Theyre very close to a deal to sell off their u. S. Unit. It is an Engineering Consulting unit, 700 Million Pounds there close to gaining by selling this unit. 200 million of that would go to the shareholders. Worried about retrenching after the u. K. , they seem to think by teaming up, they would be removing themselves out of u. K. Construction at a time we are area. Excitement in the why back down from it now . From builders to be her. O beer. Be our International Correspondent hans nichols joins us now from berlin. What does beer tell us . Is a consumerere slowdown. You see this with carlsberg most radically, a get a third of their profits from russia. They have issued a profit warning. They expect profits to come in less than expected. Before they were talking about single too high digit growth. At heineken, it is a different story. Heineken does not have as much exposure to russia. They have seen strong growth in western europe. When we spoke with the ceo, he said it was about gaining market share. World cup helps and good weather helps in europe. The most important is that we are winning market share everywhere in europe. Rate has been booming at 7 of revenues. We are doing fine and strong. You onll interrogate market share. Do you drink carlsberg or heineken . Ale am not and drinker. More of the grape variety for me. What kind of world cup do we see world cup affect the receipt . Affect do we see . The world cup effect, maybe around 3 increase when you combine that with good weather. One other interesting factor, easter fell later in the year this year and because of that, you have a long Holiday Weekend for the weather was nicer, more people consume beer. Household. Ot in your thank you. We will be speaking to Carlsberg Ceo in his first interview of the day coming up very soon on this program. Lets head over to germany. That is for Jonathan Ferro joins us. You have a special guest for us after the break . I do. 19 nobel Prize Winners in tonomics and i get to speak a Nobel Prize Winner who needs no introduction. We will talk about the situation in the eurozone. Welcome back to the pulse. Former has resigned Steve Ballmer has resigned from microsofts board. It marks the end of a career with the Worlds LargestSoftware Maker that lasted more than three decades. He remains the top individual shareholder. Apple stock closed at an alltime high in the u. S. Trading on tuesday. Shares rose to 100. 53 as investors looked ahead to new products. Analysts are forecasting record sales for the next batch of iphones. Glencore has announced a Share Buyback of up to a billion dollars over the next six months. The mining giant announced firsthalf adjusted half it that beat analysts estimates. For a bloomberg exclusive interview, Jonathan Ferro is in germany where he is mixing with the brightest minds in the world of economics. He joins us now with a guest. What is going on . Thank you very much. I do not have to give this man intro. Everybody knows who he is, it is joseph stiglitz. Professor, thank you for joining us this morning. Since 2012, we look at market spreads have collapsed. Now you seem to have the eurozone in a race to recession. Italy back to recession. France on the cusp. Do think we need a change of approach . I have thought that for several years. People said about a year and a half ago that it showed that the policies were working because europe was emerging from recession. Thatsponse was, the fact the growth was so low had only changed the aspirations that the very low growth was proof that the policy was not working, that the high Unemployment Rate, 12 average, 25 Unemployment Rate in spain, 50 youth unemployment really was proof that the austerity policy was a dismal failure and should be recognized as such. What would you like to see happen now . Eurozone. E in the countries,ividual but the banking union. The pace is too slow. They are focusing on supervision, and depositing , depositing. Mmon depositing procedures. The policies have led to divergence. You need some kind of fiscal union, some way of borrowing with the strength of europe as a whole of solidarity. If europe could borrow as a whole, it could borrow Interest Rates comparable that is a pipe dream. Could you first see Angela Merkel and the germans thinking that we could do Something Like that . Debt . The political realities seem to be against it. At some point, reality strikes. The economic reality the economic rally pushes us over that hurdle. Enormous price that europe is pain. Is paying. Trent,is 20 below that you are wasting trillions of dollars and the prospects Going Forward are bleaker. Hopefully the reality of this policy will be realized and people will say lets try Something Else. All over the world have seen this set of policies has not worked in their other policies that have the hope of working. What about the Monetary Policy side of things . Do need a more aggressive ecb . Everybody was saying, the ecb has got to do more. Is that something we will see . A good chance, that some of the politics are against that. Monetary policy cannot really be a substitute for these other policies. Monetary policy helped in the United States, but the u. S. Economy is still weak, stronger than europe, but no one would describe the u. S. As in a good position. I do not think the hope that qe,anged Monetary Policy, a would substitute for dealing with the fundamental problems posed by austerity. That would be a mistake. Lets talk about inequality. You were on a group of economic advisers for an independent scotland. You think independent scotland can tackle inequality better. Why is that . I was advising them on the issue of if they become independent, what with the kinds of economic frames, policies that would make it work . Underlying drive of this is that the approach to success of reducing inequality within scotland is a more sociodemocratic approach which emphasizes University Education for everybody, a more social thatarity, programs continue to get access to health care for everybody. Those policies are working. That is a very different view from the cameron conservative policies and england were they are raising tuition. Theyre moving in very different directions. Doesnt independent scotland pay higher taxes . Some of the funding comes from changing priorities. Scotland be involved in the war in iraq . Afghanistan . These take resources and the question is, this is the best use of resources . Did the United States spending trillions of dollars six seed in securing peace in the least . Many americans think this was spent. Was money not well i do not think they are wasting money on the scale the u. S. Military does. In terms of priorities, priorities have to be established and there is a different sense of priorities. What is left from the currency question . The u. K. Government making a lot of noise about scotland not having the pound. What is plan b . The question of what the position of u. K. Today or england today is is a bargaining to change the politics of the electoral process. Once they get independence, if that happens, i think there will be a very different position. Countries can work with many different monetary arrangements. The concern here is can they achieve a stable transition . I think that can be accomplished. Do we need to reframe a the question . Question fundamental the scotland would use their say. Is when you are political entity the reality is that the voices of the larger countries are heard much more strongly. Final question. Dozens of scotland issue speed to the wider question of the eurozone doesnt the scotland issue speak to the wider question of the eurozone . The question of whether a collectivity of countries can Work Together in a monetary zone, different from a union which has lots of regulatory things in common, but a Monetary Union has much higher demands. One of my colleagues at columbia road a very influential paper wrote a very influential paper. Urope is not satisfied having formed a currency union, the question is, splitting apart will be costly. Professor, we have to leave it there. Q i very much for joining us this morning thank you very much for joining us this morning. The co across berg joins us the co of carlsberg joins us. Welcome back to the pulse. We are just getting some breaking news coming through from the bank of england. Interestrate vote was 72. The bond purchase vote was 90. That would have been a surprise to many, even those who were expecting to see some dissent at the bank of england. If we have a look at what is happening to the currency markets, we might see that being expressed. These minutes looking a bit more hawkish than people expected. Since the minutes of this meeting were taken, we have had some dovish inflation data out of the u. K. Coming in lower than expected. Interesting to see how the pound lets talk to mark gilbert. 72, mark. That is quite a surprise. That was the one that everyone was expecting. Is thishink it tells us is not so much about the economic backdrop. It is trying to have a twoway market and Interest Rates expectations. You do not want consumers and businesses to stay at Interest Rates at record low forever. Forward guidance was about giving people some certainty. The certainty that rates will rise after some point and if you think dr. The Inflation Report think back to the Inflation Report, does this policy mean if you will stay lower for longer, you might need to move sooner than the economic actor out tells you. He looked very shifty. Those expectations that have been taken off the table for rate increase this year, he might start to see some of those come back on. What about the conversation around wages . For some members of the mpc, that lack of it is not enough. Views on theof mpc. They will want to see the combination of wages moving in the right direction and slow inflation. They said there will not be a target for wage increases that would be the threshold after which they would be willing to raise Interest Rates. I think they will have to move sooner than people expect. An interesting comment coming through on the subject. The bank minority saying an early rate rise would allow for gradual tightening. Maybe that is the thinking amongst some. Slack was becoming less useful as a policy guide. We have seen this evolution of guidance had away from the bank of england evolution of guidance from the bank of england. Boyfriendeliable seemed a little unfair. Think back to the central bank. Banks do not like leaving policies on hold for a long time because it introduces complacency. There is a willingness on the part of Central Banks to move quickly and you change those expectations. They want to get in early, this nonsense about some deal is nonsense. There is no quite agreement not to raise Interest Rates. Resign mark carney would on the spot. Thank you for joining us. The latest on the bank of england. Shares of callers work are under pressure called Berg Carlsberg are under pressure this morning. Joining us from copenhagen is the Carlsberg Ceo. Thank you very much for coming to talk to us. Back in may, you had to bring down expectations of what you can achieve because of what is happening. Youve got to that once again. End in terms of bringing down Market Expectations . So. E believe it is challenging, uncertain. Sanctions being put in place that recent events. It is still important to and bear in mind that our russian business has very strong performance. It still delivers very profitable results. Western europe very strong, the same out in asia. You might be delivering a profit in russia, but you are losing market share. Losingit because you are is a Consumer Preference that is hurting you in russia . I do not believe it is anything to do with our portfolio. We have the strongest for folio in russia. Our market share is performing a lot better than our market share in volume. We have chosen to avoid price increases on some of our products, we have chosen to take out liquid. What about the sanctions environment . Are you having conversations with governments, with regulators about the sanctions . What kind of conversations are you having . You always have to have. Onversations we do that in all of our markets. Keepkeep doing not doing that. What has an impact on our business is negative outlook for the russian economy and the russian consumer and we think they will purchase less in the second half than in the first half. It is much more about the consumer. That will have a negative impact on many categories. Heavy change the way you are doing business have you changed the way you are doing business at all . Are you adapting to this changing environment . Yes, we are. We have been adapting for years. We keep doing it. You greato change how the tensions we see over russia, does that speed up your diversification plan or does it hinder it . Our Acquisition Strategy has not changed compared to what it was a year ago. We will look for attractive opportunities. Important to find out that russia is a very important beer market. We have a very strong business delivering very Strong Financial results. If it is all about Profit Growth and expansion, [inaudible] disappointingn growth figures for the eurozone. How are you competing in that kind of market . It has been a very good first half, very strong results. We are gaining market share in a number of the key markets. We have bet on volume. Erformance it is still a tough environment, our product. Ortfolio, brand investment i am english so ive been trying to forget the world cup. Spell out for us where you saw that affecting your business. It does affect the business because more people watching football and you get together with friends see go down to the local pub and watch some football. Even if england or denmark is not playing, you still go out to watch the games. In the markets where you have teams still playing, more positive impact. Thank you very much for joining us. Ceo of carlsberg. We will bring you and his collusive interview with heinekens chief advertising officer. Welcome back. The sharpest minds in economics are gathering today in germany. Jonathan ferro joins us with another guest. I bring you a very special guest. A different perspective on the unemployment situation in the United States. There seems to be an obsession with wage growth, or the lack of wage growth right now. Maker,k at a decision are people just more willing to accept the job in wagers are not an issue for them right now . Start,less secure job the less p