Am guy johnson. Io saying no the worlds secondbiggest iron ore exporter has rejected an approach from glencore that wouldve crated the worlds biggest miner. Jesse, you guys have been working on this and watching it very carefully. He is a deal maker. He have done it through inquisitive deals over the past 15 or 20 years. He has been here for 10 years. In this instance, the big issue will come down to price was the what we know about glencore is they never overpay for anything. To get rio, it looks like it will have to be hostile now and would be a chunky premium. Is it the last deal he will do at the glencore if he does this . A good question. We know he is an ambitious guy. It will crate the Worlds Largest mining company. Perhaps, he is an ambitious guy and a deal maker and is the last one he could do at glencore. As i look at the lay of the land, it could honestly change it significantly. You kind of wonder how the people fit into the story as well. Exactly. It would create an enormous company, brand and huge iron ore. That is clearly the attraction. The price of iron ore stinks. Is it the bottom . That is the view. Well seen the market collapse under the weight and we have seen the markets collapse under the weight. To expand. Y expected why is it still and not another . Why this one . This one and not another . You cannot to get a bigger. If the glencore guess it is big, it struggles to do another megadeal. Why this one . What is it about rio that is attractive . They will probably be cheaper. Brio is still making huge markets. You are looking at 50 a ton. It is probably the best, if not the one of the best mining assets in the world in terms of profitability. Significant hurdles to this deal of being done. At of the way the share prices have risen a this morning in rio, the market is making the assumption this is runs theon burke shelf that you get the market, you get the idea. Is it what we are watching here . This is how he designed this . I am sure it came out. Is a glencore happy you have done this . That is a good question. The answer is probably, no. Look, it is clear that once it was rejected by rio, it is set in place and the start of a long and protected dance. The music had to start playing. It seemed to have started playing months ago. Quite surprising about the number of people who wouldve been involved. A great reporting. We should mention that the chairman of bloomberg lp is also a nonexecutive director of glencore. Well be talking about one of the guys running the numbers. Will be joining us later on and give us his take on whether this deal would happen, should happen. Onerun top stories of the the morning. Some song. The company is losing out. Company is the losing doubtful some when you look at the Market Reaction, the assumption seems to be it is as bad as it gets. They are looking optimistically to the next quarter. Will beave said it ugly. Ugly to the tune of 60 down in sales. Profits are heard at samsung. Why . Top andetition for the the bottom. Apple on feeling bigger screens. Unveiling bigger screens and that is where samsung always wpm on out. sey are selling less s5 because they are out to data. It does the prophet er profit insion we are seeing lowering the overall price is that you look noble and all of these new players in china coming up. Eating them from the bottom as a wellparticularly as particularly in china. The glass is half a full for the Fourth Quarter and they told us they have new products. The note 4. That was after the eastern conferenceet. They spent a that up and introduce it in china earlier than planned to sneak ahead of apple and the note edge and you can read your messages at anet and goal because you are the wraparound screen. Becausee you have the wraparound screen. What you saw in the last peas was chips. This company, about 1 3 of its much of apple guess is chips from samsung and they are investing big. It wants to diversify and they hot. The competition is a how do they keep growing . Look for your Automated Vehicles and chips driving your cars and pots and pans and thermal that and they want to provide those as well. Quite scared about my pots and pans being smart. Caroline hyde. Analyst will be joining us in a few minutes to give us his take, is it as bad as it gets. Become theurse has first person to contract ebola outside of was africa. The woman was part of the team that visited a spanish priest who died from the virus. Health officials said they are doing everything they can to contain the infection. Our guest joins us from the world health organization. Can i address what happened in spain . Do we have any understanding of how this nurse, who should have by thelly protected protocols that wouldve been an place, ended up contracting the virus . Good morning and thank you for inviting me. It is something to be looked at. Be anill probably exhaustive investigation about how the person contracted the disease but what is important now is to do exactly what you said and how authorities will look into all context contact this person had from the moment she developed symptoms. Contained and is it is really beginning and it has happened luckily in senegal and it seems it has been done and the u. S. When you have a first case, you quickly identify all People Living and colts contact close contact and monitor for 21 days and make sure these people do not develop symptoms and if they do, they are taking care of. The unitedident of states speaking yesterday and talking about the fact that other countries, not the United States needed to do more, needed to be better organized and have their protocols a little bit firmer to make sure that we do not get a spread. The u. S. Can do so much and we can only do so much and others have to pick up. Do you think the rest of the world outside of was africa is as organized as they should be . We hope so that all countries by now have in place a contingency measure in case there is a person from with ebola coming to the soil. You are seeing that the transmission and all he those three countries, and only those three countries, liberia, sierra leone and guinea and they will be managed that in the outbreak is contained. We have to focus on helping those in three countries. If we do not contain the outbreak in those countries, we will always live with the risk of virus traveling to other places. Is important that every country in the world have in place protocol and Health Workers are being prepared for the possibility and is still has to be helping those three countries, who are really struggling right now to try to come to the end of the apple at ebola outbreak. You have come back in the fact the countries are struggling. How would you characterize what is happening there right now . And the possibility the situation becomes more controlled within an the next few weeks . There is a talk of vaccines coming soon, but not soon enough. Where are we with could tame and strategies being applied . Are really in a the middle of this outbreak. What i have seen is it there are a lot of people being affected and people in their homes and communities in affecting other people because we do not have enough beds or facilities, sobered isolated these people and keep them with the necessary care. We are racing against time. We know what needs to be done. There are promising signs. We started Extensive Program of training Health Workers, so national Health Workers are toter prepared and equipped work in these centers. The u. S. Has committed to work with us and the ministry of health of liberia to build additional treatment centers. In sierra leone, i have seen amenities organizing themselves a using Community Health centers as a Holding Place for people who might have ebola, so they do not stay home. Response, but it is released burning in the community, so we have two [indiscernible] n. Appealed to all Member States who can help and agencies to step up. Thank you very much. Joining us from the world health organization. While more from the story. We will have more from the store. Else will we talk about . Samsung having a bit of a stumble. They get squeezed by apple. We will look at the smartphone wars when we come back. Welcome back. You are watching the pulse. Samsung posted is low was profits in at least five years. Its lowest profits in at least five years. I do not agree. I think the quarter potentially with new products, it might go slightly but i do not see a long term what hurts the most . They hurt equally as a much. There will still be treatment shipments and they will be the number one chipmaker and it is the profitability thats being squeezed. Also the customer and the new keyboards you can get on ios and samsung act of premium end is falling away and the india and Chinese Companies a you have and you have xaoimi and it is eating up their market share. A big company can invest a lot in terms of new products. Screen is really in iteration of a flexible screen. They could well produce a very flexible wristwatch or smartphone could well thrive and it could be very profitable, but i again, it is an arms race. Everything i am being told is the smartphone is the hub of all of the things we will where and it will live in my pocket. Do i need to have the big flat screen and all of those sort of things . Thet is becoming the hub, server for all of the devices i am wearing. That is the correct analogy. Wristwatchld be a and anything. That is absolutely the way we are moving. It is something that competitors are making inroads. To be able to invest in all of these items and it is worth noting that they invested or acquired last year a platform to products to speak to each other at least in the home. Samsung is thinking how they can create value and the internet era. It is how they talk to each other and the real value for the customer. A lot of business. The p l and they want to throw money at a lot of things. Lookingom line is squeezed. It does not summit a great investment takes. Marketing, the next couple of devices, they were have to do. It is not creating a premium brand about making sure they have the devices in the has of customers it is not a brand. It will really have to change. Because they do not control ios . There is a huge disadvantage. Theres nothing they can do. Differentiate, you will monetize. We are seeing that. We have seen it in many markets before. Is it a rerun of an old movie with a new name . It always is. The same they will play out again and again. Is worth keeping an mind of how things play out. It is true that apple were able to maintain and to play on the premier brands because they controlled the hardware and software. They needed to monetize . Is it what is this . If i look at a model and work technologyrame, seems to get smaller and smaller. To moree subject exponential growth and you cannot always look to the past and saying it is the same timeframe. The technology has penetrated the market more than any technology before in existence of humanity. The next thing that comes along, the smart watch, whether its a piece of clothing and it will grow as fast. A case to say you needed to be ready to meet of the market at the bottom before it flies off the charts. Chris and the destruction in between . Samsung will suffer. Lawrence, nice to see you. Lawrence lundy joining us. Will speed to carlos slim we will speak to carlos slim, the worlds second richest man. And we will talk to a chief economist. Of me show you live pictures parliament. Lawmakers are holding a hearing about the threat of ebola after a spanish and nurse was the first to contract it outside of was africa. Well get more. Good morning. Welcome back. You are watching the pulse. The markets. John farrell. Thank you. We will charge wrapping things up. Morning. En a busy the ftse down by 0. 6 . The dax in getting attention. More a week data out of germany. I will talk to me that. You abouttalk to that. Rio tinto down by 7 . Look at it today. Over 5 . By glencore wants to merge with rio. Rio rejected an approach in august. We are given the scope they are laying the groundwork for another deal next year. Price of rio tinto in here, it will look like this on the year and iron ore like this on the air. A big iron ore producer and why does glencore want a slice of a producer of a commodity that has been crushed . Bottomy is calling the this guy is calling the bottom of iron ore. Elsewhere in fx land, euro dollar. Back to the german data. Production data down 4 . What is the similarity . Both represent the biggest drop since 2009. The euro down by 0. 3 . Every body will look to the ecb to do more. Dollar yen. A little lower. The primus the shinzo abe is talking about the wiki yen hurting the weak yen hurting households and it is not recovered and the weakness. The weaker yen is not helping. I leave you with this. Maybe we should be careful what we wish for. Always careful what you wish for. Of things common goal. Ip data is about to come out and manufacturing data at 9 30. Also carrying on talking about the rio glencore transaction. And have pual paul gaits we will talk to him next. Welcome back. Youre watching the pulse. Lets move on it. We will look at the pound reaction later. Lets talk about the big story. When the top gainers, we now know the Company Rejected a murder merger back in august. It would have created the Worlds Largest mining company. Since then, radio silence. Is the deal off the table . Is just part of the game . Gates is on this potential deal. You think it is a winner . The logic is sound. It would create the most diversified mining company. Offer the number one status in the industry and become the must own stock. Worlds best the inr business with the most sophisticated Marketing Trading business. You would end and the two glencore. It would create the must own mining stock. The rating potential is significant. The strategic changes that a manager like ivan glaze and berg would make. Ivan has been adamant in the difficulties that the industry is facing. They are driven by supplyside issues that can be fixed. They just require a different approach to management. Is that it is more sophisticated. He is creating the cycle. Of havingle point this consolidation in these industries as you can create the cycle. You are not a victim of extraneous forces that will sweep you along. You are master of your own fate. 300 300ave million tons of iron ore in the market. On that kind of volume alone, you can dictate what happens to the iron requests. They have been shoveling the stuff. They are giving the stuff away for free. Ivan says why are you doing this . This is not smart. Take some of the extra volume off. Look what happened with the indonesians when they imposed and or band. There was a 35 rally. They have created far more value than any extra tons of the market would achieve. It makes you wonder why those managers are not drawing the same conclusion. There are three problems in the mining industry. There is too much iron ore. They dont know how to correct the assets are it why is that . If you take facebook of the world, what happens . Nothing. How is the case that this company can be so cheap . How can a trade on five pounds. This is ridiculous. They are presenting a vision on how to change that. Lets talk about ivan. Target forted this himself almost. This is a transaction that he needs to pull off. He climbs to the top of the mountain. He has of the top of everest and looking out across. There are no more mounds to cost conquer. This is like alexander weeping. This is a deal that is commensurate in scale with his ambition and sense of self. This is the deal that Anglo American isnt. An enterprise value approaches to and 50 billion. Anything else last of the mining space is going to be incremental. The only place you can look is in the going oil and gas industry. Hes got the trading business in oil and gas. This represents the summit, the very peak of what is achievable. He is a deal maker. He is not some and best synonymous with being a manager. Who was the guy who went to try and troubleshoot anaconda . People that the few understands both the technicality of the mining business and also what that implies about value created in the marketing side of things. Precedent about the danger in damage these massive aggressive technical risk projects actually encapsulate. The man that we see today. He understands valuations. Him say this happens and there are a lot of moving parts to make this happen how long would it take him to do what he needs to do to crystallize the value in the real assets . Rio assets. That moved faster than i think most people expected it to. It was able to put some impression of synergy numbers out there within a space of six months or a year. I would expect to see changes from day one. Have a 100 dayy plan in front of them if the deal were to go ahead. He would expect this to go through and the progress would be measured. I think we would be surprised at how quickly this would crystallize. This is in a mining context. We are talking about a couple of years in order to really see that pushed all the way through. Are the chinese going to want to pay more for their iron ore . They have a conundrum. They sat on it and push the point price of iron ore through the floor. They are upset with that position. They wanted more than that. Lets put this in the table. He gives them some money. Anyays that he doesnt have interest in these massive projects. He will gamble it will not be able to get this away in a country like any. Youre going to try. The price will be higher over the intervening. While you try to do it. I wont subsidize your steel ambitions. If you wanted, go and do it. Thank you very much. It was nice to see you. We should mention that the an executive director. Rocket skates are the latest futuristic trend in urban travel. Check this out. Well they take off with consumers . Well find out later on the program. Good morning. Welcome back. Youre watching the pulse. Business leaders are gathering each month to debate key issues and financial markets. Asset managers will be to challenge the ubs house view. Investment rocks strategist. Good morning. A lot of things are going on at the moment. A lot of geopolitical tensions that are very hard to map out an understand. Banks are hard to understand. Lets look at what you are taking to that meeting and the relevant things we should be thinking about right now. How concerned should i be about the next six months in europe . Ive got deals on the floor. The curve is flattening down. I get a central bank that is looking incredibly hemmed in. I have politicians that dont seem to have a grip on what to do next. This is a great cocktail. Expectations are low in terms of european growth. The german numbers set that pattern. , youthe next six months may need a microscope to do it, we wil