European headquarters here in london. Im guy johnson. Im francine lacqua. David cameron will raise the prospect of britain leaving the European Union if he is not benefits resfraket or migrants. Anna . Thanks very much. In terms of those details, he mentioned some of them around qualifying for benefits if you have been here for four years and some for statehousing. No Unemployment Benefits for those people and being removed from the people if you havent found work within six months of arriving. This is very interesting. The focus up until now has been on migrants without work. Now it is on mige rapts who have jobs. This could then have an impact on british migrant who is have jobs. This could have an i pact on british citizens. If they are able to claim benefits that i go alongside their income. Immigration is going to be a key part of the negotiations into the e. U. He is also expected to say that today. It looks as though he is going step away from nixed quotas trying to take on brussels in that sense. That is something that will possibly go down quite well in germany and other parts of europe. He is goge to be stressing today according to people familiar going to be stressing today according to people familiar, to have control on the number of people coming into the country. Yeesd numbers obviously blew all pretense that the u. K. Has any ability to control immigration particularly from the e. U. Out of the water. He needed to respond those numbers quickly. Today is the response. Migration numbers. Ongterm arrivals. That was the latest figures. Of course David Cameron wanted to be talking about tens of thousands. That is clearly not in the same ballpark. That was in 2010 that he made that initial pledge. This is not the first time that he talked about immigration. He preeted it in 2011. He was talking about this number of tens of thousands and he said a promise buts, it is that we will be keeping. Then in 2013, as we know, as we saw the rise of the u. K. Independence party, right here in this building, David Cameron then made the announcement that he was going to renegotiate britains membership of the European Union and hold a referendum on leaving it. Immigration is going to play a key part in the negotiations that no now go on between the u. K. And the e. U. This is David Cameron chasing voters . It seems to be. When we saw the u. K. Victory where they got their second member of parliament, we spoke to a number of voices whether that is from academia. Many were stressing the need for Political Parties and they put distance between themselves. One of the thoughts is you cant out ukip. It seems like the agenda very much at the center of things. The most recent poll on what are the big issues facing Great Britain, immigration is there at number one. Politicians, even if they wanted to clearly feel they have to talk about it and we are going to hear from David Cameron in about 25 minutes from central england. Looking forward to that. We will take that speech live. Thank you very much indeed. Here is what else is on our radar this morning. European commission announces its judgment of Member States. France and italy are expected to escape immediate punishment over their budget proposals. They may face action in march if they do not follow through on pledges of cutting deficits and paying their economies more competitive. Countries are required to narrow deficits to within 3 of g. D. P. And reduce debt to 60 of g. D. P. One of those issues affects france and the other italy. Were watching the price of oil which touched a fouryear low after opec refrained from cutting output. They decided not cut production deit into the steepest slump of prices since the global recession. Voting on three initiatives. Polls indicate all three proposals could get rejects, the large number of undecided voters will prove decisive. Coming up up, camerons crackdown in a few minutes. Migrant welfare benefits. With the general elections oming, is getting tougher on immigration enough to keep ukip at bay . Good morning, everybody. Welcome back. Youre watching the pulse. Were on your tablet. Were on your phone. Lets get back to our top story. David cameron is getting tougher on e. U. Migration. Immigration the word of the morning. At 9 30 u. K. Time he is expected to outline regulations that restrict access to welfare payments for migrants and he is using the prospect of the u. K. Use leaving the e. U. As everage. Joining us now is the head of Economic Research in open europe. Good morning. What does the Prime Minister need to deliver . Everybody talks about him walking on a tight rope. He is balancing the views in europe and at home. At home he needs to show a strong line that he wants to address this immigration issue and address the concerns of the people. It is a top issue for most voters but he also has to find the right balance for europe. I want to make it fairer. I want to make it work better for all european countries. What does it mean from a business point of view . If this actually happens. Does it impact the bottom line of britain p. L. C. . Possibly. We have to accept on a whole migrants may have a positive impact when they come to work in britain. That being said, there are pocket s of problems. They have some pressure on local services, housing and scooling. Addressing those issues will help make things a bit more placid and help address the surgeons. On the hole whole, if this is combined with programs to retrain the british workforce and improve education and make sure we still have the competitive education of people coming into the workforce. Will he say if he doesnt get what he wants, he will campaign the side of an were he to gain a mandate in next years general election . Im not sure he will go that far. If i dont get anything on immigration then im out. That would be a tough line to take. He is not ruling it out. If he doesnt get his reform package as a whole. I dont think hell make it a complete red line. That would back him into a corner too much with europe. How tough a stance is he going to take . I think he will present the factors. If you look at the voting and the polling, this is a concern for british voters. If you dont have something a lot of people will feel not enough has been done to try and make the reforms in europe and that the issues have not really been addressed so it will actually increase the chance of the u. K. Leaving. It will just present that problem. This is an issue i need to address. I know people in your country as well see the rise in populist partieses across europe on these issues. A lot of people are concerned about it as well. He will get support for addressing that smument how will Angela Merkel if they dont want to start putting their forces into play to try and prevent the u. K. From leaving. It is too early. If they full trigger too early on this one, it starts to become a long, drawn out campaign. When does merkel start helping cameron out . Is there a danger goes too far in the meantime because of the upcoming election . Possibly. I think the a very difficult balance to strike. These types of reform in europe take time. It is a big negotiation between 28 countries. You need to get agreement from dwroverp make this go through. You do need to start having that discussion. I hope behind the scenes cameron will be saying need to lay out my policies. I understand negotiation also take place in 2015, 2016. There is a balance to strike there. If you look at the timeline, to get the reform through as significant as this, a year and a half, two years is not really a massive period. I think people understand how things work in europe and that they do take time. I know this is almost an impossible question but what are the chance s of the u. K. Leaving the e. U. . Is it 50 50 in your mind . Is it too early to say . If youre a business and youre listening to the speech a little bit later, do you worry . It is certainly a concern. We work on the probabilities, i would say anywhere between 10 and 20 risk of us leaving given the number of factors, whether conservative also win. How big the majority will be. If there will be a coalition. The Reform Program will go. 10 to 20 , if youre a business, that is not a minimum risk. It is something they have to consider. If these issues are not addressed, in the medium to longterm, it will continue in britain for europe. You may put it off for a few years if you dont talk about this business. The fact is we have decided on a referendum and i think these issues need to be addressed stand you continue to put them off, people will become more disenchanted with europe and the british approach to it. Kip point of view and clearly this is the driving force. Do you think that is the case . Before once cameron has moved does that create space for the other other parties . How does that shift the landscape . I dont think it will be necessarily ukip driven. They want us to leave the e. U. This is not a policy for them. This is a policy for the other 30 , 40 in the policy that say we have concerns about immigration. On benefits. How they impact our wages and public services. This is really for the majority. Not ukippers. The second point, how it will affect the broader picture. Certainly we see a lot of the parties already, we saw nick klegg coming in behind this proposal. We see labor. Generally there is an across Party Consensus on this issue. Will labor be forced into a position where they have to back a referendum as well . We have a party ahead if the polls saying it will not have an inout vote, do you think well end up in a situation where we will been forced to make that move . I think the pressure will be huge. Certainly there are concerns he needs to address. I think he also has to look at whats going on in europe. There are huge changes going on with the eurozone. They are still discussing their structures. The germans want change to address the eurozone concerns. I think it would be very naive of labor to say we dont have to deal with this issue at all. There are fundamental changes going on with the way the e. U. Works at the moment. Thanks for that. The u. K. Is not the only country grappling with immigration. Voters in switzerland will cast their ballots on three pro postals this week. Proposals this weekend. It is growing in big cities and eating into valuable countryside. That is a problem for the skiss. A nationwide vote could drastically reduce immigration and the output of some of their big businesses. Mountains, lakes and woods make up more than half of switzerland, but for the population almost doubling since the 1950s, the countryside has been rapidly urbanized. That may sound dramatic for some. New york has about the same number of People Living on an area 50 types smaller. One solution, planning immigration. 20 of the countrys 8 million nhabitants are foreigners. The government may cap the 9. 2 of om abroad to the countrys population. 0. 2 . Many say it is racist. Switzerland gets to participate in the e. U. s common markets although it is not a member. Freedom of movement on one of four keystones in the market, officials in brussels sate renegotiating immigration is not an option. Lets move to one of the other big stories were watching. Up next, crude keeps getting crushed. Here is a picture of brent this week. We have hit the lowest level since 2010. Well hear from one of opecs key players and more insight on why the group didnt cut output. Welcome back to the pulse. Live on Bloomberg Television and radio, also streaming on your tablet, phone and bloomberg. Com. Oil companies are taking a big hit today. They are the worst performers on the stoxx 600 after opec decide not to cut output. Ryan chilcote was on the ground in ve yena and caught up with the oil minister just after the decision. Can can you give us your view f if decision and a sense of a the deliberations in the room . Very serious. However it was felt that maintaining the levels would in fact help to stabilize the prices. Well watch and see what happens. What about venezuelas act argument that a cut is venezuelas asht that a cut is necessary . A number of economies do. We would always come to a consensus because that is the best thing for opec and for the world, the global oil market. Was there a sense that maybe at these levels, american crude producers can be shaken out of the market . Im not sure they can be shaken out now but over the next few months, supply and demand will come to some equilibrium they will or later share the burden. Next time around you reckon there will be a cut . It depends entirely on what happens the next few months. We have to share the burden. Ok. Lets talk about how the markets have been reacting to all of this. Lets show you oil first of all. This is the brent fiveyear. Let me show you this. It really encapsulates the degree to which oil prices have fallen and may continue to fall. Were at 71. 81. People talking about going as low as 60. This is a longterm positive for the eurozone. A shortterm negative for mario draghi. What this will continue to do is driver inflation down. The base effect is large here. That may change Inflation Expectations. That is why he has been talking about the need to raise inflation quickly so we dont get embedded into our consciousness the idea that prices fall. Sbrent a big, big part of that. Watch how the u. S. Reacts to this when it comes back to the field monday as well. Talking about e. C. B. Reaction and talking about whats going on here and talking about the inflation rates that were seeing around europe, remember, were going to get data on that at the top of the next hour as well. We continue to see Oil Prices Drive down equity markets but quity markets are watching carefully to see the balance here. Talking about further liquidity measures that may continue to drive equities higher. It could affect equity markets, which are down today. Bond markets are fascinating in all of this as well. The expectation continues to be built in. That we will see further action from the e. C. B. Yesterday, we saw the french go below 1 on the 10year. The italians were pushed lower. The germans went below 1. 7. This was amazing unchartered territory that were in now. The canary the coal mine continues to be greece. They have been trading higher over the last few days. It is not a oneway street when it comes to european bonds. Oil at the snr of it. Driving Inflation Expectations down. At the top of the next hour you going to get eurozone inflation data. People will be watching that number carefully. A breakup of google is unlikely to happen no matter what lawmakers say. That is the message from european ministers and officials and members of the e. U. Parliament yesterday voted on on unbundling their Search Engines from other services. They didnt mention google by name. The worlds second biggest miner delayed plans to delay an iron ore mine. It is seen as part of rios strategy after a merger with glencore. The e. Sumbings selling off spanish asset according to the wall street journal which identifies people familiar with he matter. The board will meet today to approve the deal. The british Prime Minister expected to introduce tough new ckurb immigration. You can follow us on twitter. Uy johnson tv and flacqua. We need to watch out for two things. First of all, what what kind of rhetoric and the message that he gives to the European Union, allow this or else or whether he is little bit soft a little bit softer. We will take that speech live here on the pulse. Well take a break. David camerons speech coming up very, very shortly. Welcome back to the pulse. Im francine lacqua. Im guy johnson. These are the Bloomberg Top headlines. France and italy escape media punishment over weaknesses in their present proposals. That is according to any you u official speaking on anonymity. They will have until march to follow through on cutting deficits or face possible sanctions. Retail salesman fell more than forecast. Cing increased, the whenalent of a 2. 9 gain the sales tax hike is excluded. The tax hike also impacted sales. Japanese prime and its or shinzo abe has ordered preparations for a stimulus package, another stimulus package, as he prepares for an early election next month. More bad news for japan. It has lost its position as the worlds secondlargest stock market to china. Chinas market capitalization climbed to 4. 48 trillion yesterday while japan slipped to 4. 46 troy and others. 46 trillion. Now, discounts are being offered across Department Stores today. We have even seen scuffles, got to love that word, breaking out in tesco stores. Alsobespoke businesses are plugging their own black friday deals. Diamond designer bobby white says the day always brings in new customers. Manus cranny went to meet him in the heart of londons diamond district. We have been working on a few pieces. This one is around 200,000. Made bobby white, londons very own diamond geezer. He is at the heart of the capitals diamond district. Enjoyable one was working with beyonce. Her and jayz . Two were my highlight. You are a master craftsman. That doesnt happen overnight. The skills involved in putting a 200,000 pound piece together, it is time and skill. It does take a long time. I am really passionate about making things perfect. It looks like the stone is floating. I have little back stairways and offices in the back. Streets with all the pretty shops, that is not really where i do my business. It is all upstairs, basements, that sort of design, service and master craftsmanship. All the elements that go into creating the perfect piece. America. Quite like andcustomers might start buy things online, then they want to meet us. The budgets can be i watering. Canary yellow diamond, 200,000 pounds. Bobbys signature compression ring, 25,000 pounds. Perhaps maybe even a little bit too bling for me. They are more standout pieces. I dont think i can. That is not me. In his element. What a great fun package to do. We are standing by for the speech from prime and cameron on immigration. It is due to start any minute. All eyes on that. It is the story of the day if not the year. We are watching for that to come through from the midlands. As soon as we have it, we are looking at transmission. We will be back. We will bring you that speech live. Welcome back to the pulse. Company news for you now. Hsbc coming under fire in argentina. Authorities say they have found