Good morning. You are watching the pulse. We are here in london. Im guy johnson. Francine is not here today. Fed up, frustrated, and fighting back. That is the line we are going with this morning. French unemployment is at a record high but the big as companies have launched a pr bonanza to hopefully restore the nations reputation as a good place to do business. French]lled [speaking which we think roughly translates as bank on france. Caroline connan has the details. Who is there, what are they talking about . As,ou can translate that lets bank on france. It is all about boosting the image of france when the French Economy has barely grown and is expected to grow by 0. 4 this year. Some comments a few months ago from the ceo, saying that france was finished. The idea here is to fight against these kind of comments, against what they call french bashing. The economy minister had a conference yesterday. We got a very bad unemployment number for the Third Quarter that came out at 10. 4 . I asked emmanuel make an what could be done about these jobless numbers in france. Have a listen. I never react to numbers. I have no reaction. I just have a strong willingness to fight, fight, fight to recover and create new jobs. The economy minister was supposed to present his new , inrm, the new activity law the next few days in france. That new activity law should which is not the case in many places in france. Included also deregulation of some services, such as pharmacies and legal professions. The question is, will that be enough to boost the French Economy . So we get deregulation. That probably will help. The other question is, innovation. Deregulation and innovation. He is talking deregulation. The ceos, what innovation are they talking about . As a symbol, this conference is being held in the grand palace, which is a beautiful iron and Glass Building where was held the universal exhibition in 1900. It is a very symbolic place. You have 200 startups here. They are showcasing their latest innovations. You have the airbus electric plane, you have new intelligence robots, you have 3d printers able to print bones. To takes of innovation the French Economy in a good direction. I talked to the orange ceo yesterday about entrepreneurs. He told me he was setting up a Venture Capital fund in order to help these young entrepreneurs. Have a listen. There are plenty of areas where young entrepreneurs from france can be very successful. They need of course to be a company. They need to be financed. We need more Venture Capital. We need probably more involvement of the Big Companies, including orange, in andr to help them to grow access the market. All these initiatives are very good for the image of france. The question is, will there be enough to boost the French Economy . The European Commission has given france and extra three months to fix its budget. The deficit is still expected to be above 4 next year. Back to you. Caroline connan in paris, thank you very much indeed. We have more later on. We will be speaking to Karine Berger, one of the socialist mps. We will talk to her later on. Caroline connan will be talking to the ceo of havas as well. Two great conversations coming up on the pulse. Lets go from france to france and germany. Apparently the most cozy alliance that we talk about so often, very much in the history books. Angela merkel has reportedly dropped Nicolas Sarkozy from addressing the annual convention. Hans nichols standing by. This is a breakdown in relations . That may be a little too far. Maybe this is just a matter of protocol. Back in november, wolfgang scheidler looked for the finance minister to welcome sarkozy to the Christian Democratic Union party summit. Now, what we have heard over the last couple days is that it was made explicitly clear to sarkozys party that they could send a representative, but they couldnt send sarkozy himself with the expectation that he would be at the podium. In light of all that, the latest sarkozysom office is that he does not plan to attend. They are saying he is meeting with senators back in france. , who spoke with sarkozy, called him to congratulate him after he became the head of his party again. In 20 12, she supported him over francois hollande. Whether this is a chilly relationship or a matter of protocol, difficult to see. It doesnt look like merkel and sarkozy are firing in the same way they were two years ago. There is by no means guarantee that mr. Sarkozy will be his partys candidate to challenge hollande in 2017. Is that part of this story . Is there of you in berlin that he is not the right man for the job . There is a view that juppe, the foreign minister for sarkozy in the previous government, may be the better candidate. This is merkel perhaps not wanting to get involved in intraconservative Party Politics. They still have to have a big reckoning on who the candidate is going to be, who the president ial candidate will be. It is no sure thing if that person will get through the second round. There are a lot of open questions. Im on the side that this is a protocol matter. At the same time, it does mark somewhat of a thawing. I dont want to say a chilling but it does mark a cooling of the relationship. Probably getting involved in internal Party Politics in another country is not the director and that merkel wants to go in. Always a pleasure, thank you very much indeed. What else is on our radar . The facebook founder and Ceo Mark Zuckerberg has been speaking to bloomberg. He explained the motivation behind his internet project which aims to get the entire world online. If we were focused on profit, the most reasonable thing for us to do would be to really focus on the first billion people using our product. The world isnt set up equally. The first billion people using facebook have way more money than the rest of the world combined. We will have more from that exclusive with Mark Zuckerberg. We will play it out later on. Another bloomberg exclusive now, rio tintos ceo has been speaking about why his company turned down a merger approach from glencore. We are totally different organizations. We are an organization focused on the long term. Expiration, in terms of longterm relationships with customers, in terms of our green project development. Is very shortterm. Trade and do a deal. That is a very different philosophy to us. Balfour beatty has turned down a one billion pound offer from john lang for its portfolio government backed project. Balfour said in a statement that the proposal fell short of its valuation of that portfolio. Balfour rejected a takeover bid from carillion back in august. Coming up, frustrated and fighting back. Evento frances biggest driven by companies. A pr bonanza designed to restore a nations wounded pride. Is france a safe bet for investors . We are going to find out. We are going to speak to Karine Berger. She is joining us next. Welcome back. You are watching the pulse. We are streaming on bloomberg. Com, on your tablet, on your phone. What is it going to take to put france back on the front foot . We have the nations Largest Companies taking a stand at a forum aimed at showcasing the strength of French Business underway in paris right now. Joining us now from france is the socialist mp, Karine Berger. Good morning to you. Are the french people, is the rest of the world, being too pessimistic about the French Economy right now . I think that unfortunately french people are a little too pessimistic for their own economy. Ownelieve that for our life, everything is going to be ok. We are too pessimistic. France certainly has a lot of things to reform but france has a huge economy. A bigountry, a country that is able to compete, and i believe that this kind of forum can demonstrate the strength of the French Economy right now. What needs to happen . The economy minister was saying can you still hear me . Was saying that the french need to stop lying to themselves. What truth needs to be told . What reality needs to be projected . The reality is very simple. We are the fifth economy in the world. Butre low growth right now, growth is low everywhere in the eurozone. Solutions find against the risk of deflation in the eurozone and find solutions in order to promote innovation and investment in france, to promote the ability of our country to invest in research. These two realities can be very byily taken into account members of parliament and i think it is going to be the in january. You talk about investment. Does europe need a massive Investment Program . That is what we are apparently getting from brussels. Do you think the investment that is being proposed by Jeanclaude Juncker is enough . There were a group of businessmen at the for him saying, no, not enough and not well targeted. What does france need in terms of investment . What help does it need from brussels . It is not france that is needing something, it is europe. What we want to do in europe, of course europe is dramatically needing Investment Plan. What mr. Juncker proposed two weeks ago is enough. We need much more to fight against the risk of deflation that we are seeing right now. It is not a question of france. France is able to take its responsibility to reduce its deficit and make reforms. What we need in europe is a big Investment Plan in order for , for customers to be tofident in the future, and stop the mechanism of deflation that we can see. And itvestment is needed is not enough. One of the reasons people may not invest in france is they fear for what the leadership will do next. Do you think people are not insting in france because your party doesnt have Strong Enough leadership, doesnt have good enough ideas to put france back on . They are worried about the politics, less worried about the economy. Investment is needed. We are still one of the countries at the highest level for investment. Investment has not stopped. The problem is very easy. Isre is only one thing that lacking in europe and france. It is growth. Back,n as growth is investment will be done everywhere in europe. Right now, we need all focus on growth. Growth both by reforms and by making policy. So it is not a politics problem here, it is not mr. Hollande that is the problem here. There is no specific situation of france in europe. There are unfortunately some countries that have growth even lower than ours, and some are doing better. , we cannot find solutions on our own. We need to find a global solution, a europe solution. On ourot find solutions own. We are all on the same boat and we need to find a solution that is taking into account all the situations of the countries in europe. Karine berger, once again, a pleasure to speak with you. Thank you once again. The socialist mp Karine Berger joining us from fronts. Coming up, no deal. Balfour beatty rejects john langs 1 billion offer as too low. We will talk about the portfolio at the center of this transaction. Stay with us to find out what is going on. Welcome back. You are watching the pulse. Thanks, but no thanks. That seems to be the response from Balfour Beatty and the owner of canary wharf group. Both announced that approaches for their assets are too low. Here with mark, caroline hyde. Lets talk Balfour Beatty. This is an acquisition for a portfolio of assets. Governmentrelated assets. Schools. Pitals, they have a portfolio that they, back in june, judged to be worth 1. 0 5 billion pounds. John lang looked at this and thought, maybe we will put in a bid. Probably lowballed it. Today, we got the response of Balfour Beatty. Say,ritish builder, they it falls significantly short of what we think it is now valued. Thinking, we are going to reassess how these how much these are worth. I think it may be higher. Funny that. One to watch there. We will wait for the orders to come back in. The share price is higher, probably. Precisely. Lets talk about canary wharf. The financial district is further east from here. It is canary wharf, which has made its business to grow and house the Financial Markets, but also is expanding. They have Financial Technology companies. They having to bidders bringing new people to canary wharf. They arent trying to build themselves up. The owner of canary wharf, 2. 6 billion pounds is how much the Qatari Investment Authority have pitched. It is the Second Time Around theyve made an offer. It is 350 pence per share. 9 lower than songbird had said it is worth back in november. Songbird saying, once again, you are not fully valuing this unique position of an asset. Facts they are not fully rejecting it, just saying it is not valued enough. We are not dismissing this out of hand. Doesnt seem to. They are writing a letter to shareholders saying, we do not recommend it. The reason songbird is rising in terms of share price. The u. K. And why Balfour Beatty is rising, everyone is thinking, could these players, back with a more juicy offer on the table . We will see what happens in a new year. Thank you very much indeed. Lets all caps on of the market news that we are watching. We are focusing on probably a twobase hit away. He is a yesterday to today in the context. Yesterday was the ecb. We saw equity market under pressure as the ecbs expectations for in place slashed expectations for inflation. We are going out feelings really there are differences with regard to the language. The market taking the view that if they cant agree on a language, we are talking about how much they can increase the Balance Sheet by, maybe they cant agree on the amount of qe or whether we get any qe at all. The euro went up. The stock markets dipped yesterday. They bounced back a little this morning. We are waiting now for the payroll number out of the United States. When we come back, we will talk about the clash of cultures. Rio and glencore. I spoke to the ceo of rio. I will bring you that interview. Welcome back. You are watching the pulse. Im guy johnson. Francine lacqua is back on monday. Let me talk you through the headlines. German factory orders rose more than forecast in november. Orders grew 2. 5 . The data shows signs that europes largest economy is continuing to recover. The beat, as the bund is Bank Bundesbank growth targets grew. Protesters have taken to the streets in the United States for a second night. This follows a grand jury decision not to indict a white new York City Police officer who was videotaped putting a black suspect in a choke hold. The man, eric gardner, later died. Nasa will make another attempt to launch its own ryan spacecraft. Orion spacecraft. Ofecasts show a 40 chance favorable weather conditions. This will be nasas first manned Space Shuttle program. Back on earth, lets talk about mining. Let me take you to my exclusive interview with sam walsh, the boss of rio tinto, telling bloomberg it is business as usual for now. This as the market continues to speculate over a revised offer for his business from glencore. At the end of the day, it is a decision for the board, not for me personally. This,y, when you consider there is a whole raft of things you look at in terms of how business in terms of our business and their business. You think they come back in april . I have no idea. It is a question to tony hayward, not to me. You are a man who likes to plan forward. Are you planning for that event . Are you putting this business on a footing where it needs to think about this . The most important thing is that we have a strategy. We have a game plan for how we are going to run the business. It is important that we stick to that game plan, that we dont get distracted or deviate or do something silly. That is not the way you run a business. , as is the board, that our strategy to deliver growth and to increase in thelder returns is very best interest of the shareholders. Rioslso asked about commitment to returning cash to shareholders. This is a big deal. People are paying attention to this. The company just raw down its debt. Does it now, given the iron ore drop, need to start to raise that debt to deliver on its dividend . Here is what he has to say. This surprised people in february. Traditionally, we made that decision in february. As i mentioned, i was not going to be distracted. Business has been incredibly well positioned. We have provided options to the board in relation to growth and shareholder returns. Of theed 4. 4 billion out cost, billion, not million. June 30,ur debt 2013 to june 30, 2014, 6 billion. We almost halved that capital. That puts us in a strong position. Sam walsh, the ceo of rio tinto speaking to me yesterday evening. Lets talk about the other company news we are focusing on. Jpmorgan has put another mortgage bond trader on leave according to people familiar with the matter. It is the latest in a string of suspensions. The traitor had worked for jpmorgan since 2008 after being previously employed with bear stearns. In 2008. Ught by jpm Fidelity Investments have cut their stake in takata as the airbag crisis escalates. The company sold 79 of its stake in the japanese airbag investor. At least eight investors have sold all their holdings amid the Global Crisis that has been linked to at least five deaths. Catching up with google is impossible. That is what the orange ceo told bloomberg in an exclusive interview. We spoke to him at the conference in pa