Good morning. You are watching the pulse. I am guy johnson. China stocks falling the most since 2008. The shanghai composite was down 7. 7 . Regulators crackdown on investors buying stocks with borrowed funds. David tweed is in hong kong. 63 higher in six months. A little bit of a bang at some point. It is a pretty eye watering number. The pace of games really concerning the chinese authorities, which is why they had to crack down on margin trading. 63 billion dollars, we can get an idea of what that means. That was the amount of money on margin loans in june last year. By december 174 billion. You can get some scope of the money that was being put into the equity markets. Largely Retail Investors. This is a Market Driven by Retail Investors, 80 is retail. This is what the chinese authorities are concerned about. They have brought in some measures the three largest brokerages have been told they cannot open up new margin trading accounts on behalf of the clients for three months. Other brokerages are being punished for opening up accounts for inexperienced investors. We have a very strong message coming from the Chinese Authority that they do not want to see the piece of gains continued to go up. Some people think that this is a halt in the momentum we are seeing in the Chinese Market given the fact that this the question is, will those Retail Investors heed the message that policymakers are giving a strong way . David, thank you so much. Lets get more on this story and shift the focus back to europe. The countdown to the biggest Monetary Policy meeting is thursday. For more, lets welcome the chief economist. We will talk about the ecb in the trouble we are seeing in europe. Give us an indication on how you read the china story. David tweed had his thumb on the pulse of it. We are looking at a change in Credit Conditions for investors. That is trading 101. I do not think it is repeatable. Fundamentals in china are quite good, we are at the low end of a protracted Business Cycle slow down. The figure we will get overnight tonight, gdp for the fourth quarter. The big story is the big flow of money out of china to the rest of the world. Another example of regulators Central Banks catching investors unawares. Increasingly unpredictable. Is that the world we live in . That is the world we have always lived in. Central bankers it is a volatile market. It has not been volatile. Central bankers have suppressed volatility massively over the last couple of years. When mr. Jordan at the Swiss National bank writes his memoirs, he will tell people that he did not anticipate the Market Reaction to what he did. Was it a mistake . It is too soon to tell whether it was a mistake or a good idea. Clearly, keeping the franc pegged to the euro was an unsustainable proposition. If you did not know that and you were just if you were dead wrong about it, it would be the wrong thing to do. It is a lesson the central bankers will learn. People are trying to figure out what the ecb is going to do later this week. Trying to communicate to the market has been tricky at the best of times. We are in an increasingly difficult world. Tensions are rising. How difficult is it going to be to get policy and policy communication right in 2015 . I like your use of the word tricky. For janet yellen, it is a lot easier. She has control of her committee. Mario draghi has a real tricky problem. He has issues related to being able to signal the Central Banks intentions. 19 Central Banks, all of the points of views, all of the political constraints. I think he has no choice but to be little bit less clear. He does not know what he will be able to do. It seems mario draghi has been very clear. He has preempted the ecb moves by being strong vocally. The markets have believed him so far. Read what he says carefully, lots of conditionality. If we review, we may reconsider. One of the things we may reconsider would be sovereign bonds. Only a certain amount of ways to get there. Whatever it takes. The strongest tool in his arsenal, given the political realities he faces is the ability to be able to scare the market down. What im expecting thursday is we will probably not get the huge purchase of bonds the market is looking for. That will remain dangling in the future as a possibility. We might see esf the we could see Foreign Exchange added to the mess. We will have plenty more on that. Thank you so much. Let me update you. Greece has entered the final week of campaigning. The general election takes place this coming sunday. Time is running out for the permit us to. We are speaking to a candidate for the tommy party, who is pulling in third place. Pulling in third place. There is a new volatility leader in town. Fluctuations in the front franc jumped to five times over the ruble. The swiss franc, volatility, two things you do not expect to have handinhand. We also talk tech. More details to come from the digital life designer. Let me talk to about her twitter question. Is tech going to save europe . Let us know what you think. Would we be better off spending that money on technology and Infrastructure Investment . We would like to get your take. Welcome back. You are watching the pulse. We are on your tablet, we are on your phone. This will be something of a theme that runs through this week. Everybody is talking about. The analysis has shifted towards whether the central bank will adopt fullscale qe. I wonder if we have made that migration yet. Lets get back to talking about this. Carl weinberg is still with us. Is everything nuance is everything and you have to figure out what is between the lines. Nobody knows whether or not this thursday will deliver sovereign buying from the ecb. Your sense is that, we are not quite there yet. If i were the president of the ecb i would not go to fullscale sovereign bond purchases right away. I think there will be some qe coming of this meeting, but it means printing money to buy something. They can buy sovereign bonds, corporate bonds, gold bars, Foreign Exchange they could buy iphones, little yellow bricks. As long as they print money to pay for them. They could buy dirt as long as they pay for it by printing money that is qe. Are they doing this because they do not have to deal with the tricky greed question . It is my opinion, first of all, that the ecb will do something. The market will be disappointed. It is the only thing we can say ahead of the event because we do not know what they are going to do. The Market Expectations are so high, if anything but that wont do we want to position ourselves for a bit of a retracement, no matter what they say. It is going to be a rough day on thursday. As far as the greek event is concerned my theory and it can only be a theory the ecb may want to open a facility because if the greeks demand a renegotiation of debt, those bonds will turn to dirt because 144 billion of them are back loans from greece. The ecb have in the facility to buy those bonds back would kill two birds with one stone. It would give them a stabilizing role in the market. How does mario draghi [inaudible] greece is a credit risk. How does he manage that credit risk if he has to go to to fullblown buying government bonds. It is not his job to do that. The ecb has to fix everything because they are the ecb. It is easy for us to do that because we are the only ones doing anything. Mario draghi complains that governments have to get their house in order. Some of them are structural, close down the barriers to entrepreneurship. Some of them are basic Government Support for governments like greece. Some of them are things like easing physical stamina easing fiscal stimulus to move an economy out of a depression. The ecb cannot do this on its own. Credit uroplasty stand together. Europe has to stand together. You cannot slam them down. They have taken the pain and they will get their. Get there. We have a problem and we are looking at from a number of different directions. We no longer have the fact. The ecb cannot fix what is wrong in europe. We are in the eighth year of a depression and there will be a ninth year and attempt here and prices will go down and 10th year and prices will go down. There is no way the ecb can fix this. If i am buying something is buying spanish debt risk free . Buying any debt should not be riskfree. There certainly is risk there. Is germany going to bail . Germany cant. There is risk. You look at greek government bonds. Not because they were safe but because people recognize them. Everybody believes that germany and other European Countries and suddenly they were safe. The fact is, they are not safe. You are intimating that whatever happens are we looking at a japanesestyle economy . Would you not go heavy on thursday . Japans problems are very different. The real problem of james japans problems, a massive debt growing faster than they can never be paid back. Japan has to labor under the burden of managing an evergrowing debt with ever shrinking. It is a finite problem and it is solvable in the different institutional setting. It looks like japan topically but in terms of its underlying root problems, it shows a different problem. We will wrap up the biggest bank losers following this was Central Banks decision to end the cap on the franc. Welcome back. Live from bloomberg tv and radio. Lets get some company news. John lang has announced plans for an ipo in london selling the business for 130 million pounds. The diverse range of products includes didions stadiums in australia. The mens fashion show for ferragamo took place yesterday. The ceo spoke to bloomberg about their strong finish in 2014. We closed with a very strong end of the year. Net worth in terms of revenue showing growth in all of the markets. Deutsche telekom plans to increase spending on that works in germany. 27 billion on projects in its home markets. 50,000 new jobs in europe this year alone, that is what uber sees as the potential growth in the eurozone. Hans nichols joins us. What of you been hearing on the ground . There is this traditional debate taking place the between innovators and the regulators. Last night, you tried you saw uber try to get in front of that debate. We want to make 2015 the year where we establish a new partnership with eu cities. We push for progressive regulations and ensure innovation and help build the smart cities of tomorrow. We will promote core city functions. We will provide massive economic benefit to cities and their economies. What is this mean at the end of 2015 . If we can make these partnerships happen, we create 50,000 new eu jobs. There are conversations taking place on progressive regulations, also talk about potential deals all around me. Quite a vibe around here. We have the ventures ceo, and we also have chris moody from twitter. Talking tech, talking deals, and maybe talking jobs. We have a great guest coming up. The ecb will announce a program this week. Will it be enough . Welcome back to the pulse i am francine lacqua. Chinese shares have fallen the most in six years, the shanghai composite has dropped 8 . Chinese regulators are tightening control over margin investing concerned that the 63 surge in stock prices may lead to instability. President obama will lay out proposals for new taxes on the wealthiest americans. He plans to increase the top rate of Capital Gains tax and taxes on asset transfers. Mario draghi is likely to announce a qe program this week. This will be his biggest push yet to tear the eurozone away from deflation. Anticipation growing that we will see a significant announcement from the ecb on thursday. Equity markets are trading higher. In asia, it has been a little bit of a bumpy day. Particularly, in china. This as the authorities make efforts to reduce the amount of money traded on margins. They have restricted the top three brokerages from opening new accounts. The shanghai composite results in the biggest drop. No u. S. Stock markets are closed today. A big week. A very big week. Uncharted territory, we are already there. You be taking another step into that uncharted territory. Lets talk to paul in frankfurt. The market is anticipating a lot. A lot is a subjective call. Earlier, we are looking out proposals the markets are saying the ecb needs to go further. Speculation that draghi will top the new expectations. And he might to. He is looking at a trillion euros to the ecb balance sheet. He has 200 billion euros to be repaid by the banks of the next few weeks. Current programs they really have not added a huge amount so far. He is going to have to go a long way. There will be out there saying, we would rather see more. The major haggling seems to be over allocating risks. Where the possible outcomes . Quite a few. There are some governors saying we need we do not like qe. For example, german taxpayers would take on the burden of potential losses from buying foreign debt. What he would achieve by doing that, by limiting the risk, would be ability to announce a bigger package. If he goes the simple route central bankers may say, we will limit the amount you can actually buy. What will be the structure of buying . Willoughby a monthly amount unlimited will it be a monthly amount unlimited . What is the risk associated with the balkanization of credit risk around europe . It will make it difficult to see the eurozone as the united front when that credit rate has been subbed out. Where will that leave the ecb . This is precisely the concern, the selling point. If you could come out which is very complicated. Some Central Banks logic of further you do have a balkanized therefore, you start to undermine your chances of success. That calls for a more dramatic program. Mario draghi will talk a good game he has always done that, but he needs to come up with Something Big and bold. Qs so much. Thank you so much. It is a big week in terms of coverage this week. That will not stop us from taking the Ecb Press Conference live. That is this thursday 1 30 p. M. U. K. Time. The ecb has now moved to six weeks. On thursday, i sit down with some of the most influential Business Leaders in the world. That is quite a good set up. We will carry on the conversation. Stay tuned for that story on the pulse. Being a producer, you know, the price differential a luxury goods of luxury goods it shows a sign. That was the impact of last weeks action on his business. The loss has been inflicted on some Financial Services companies. Here is caroline hyde. A number of Trading Companies have reached out for help. It is quite phenomenal, the damage that has been raked. Wreaked. Many out there in the market would. Some of these brokerage companies, they have Retail Investors excited about trading Foreign Exchange. How do they do that . Putting a small amount on the table to be able to take big positions. You could have two cents on a trade that was worth one dollar. You had a very small amount but you have to deposit at the brokerage company. Who will fill the gap . They said on friday they would have to look for going into insolvency. They said, no, we will not. They are looking for a buyer. It could be pepper stone from australia. We have the biggest u. S. Retail Foreign Exchange broker, a milliondollar lifeline they have been given. Banks . Banks are being hit hard. Deutsche bank 150 million they have lost. Barclays, slightly less than 100 million. We spoke to the european banking authority, the chairperson, and he tried to make clear that they have the strength in place to supply these. These shocks are always european banks have capital significantly. They are much more resilient now. They can survive a 40 to move. Volatile moves. One thing that is interesting, julius baer. We suffered no losses from the Swiss National bank move. They could manage to maneuver themselves within the volatility because they are so well capitalized. No losses. What about Capital Global . That is the hedged fund, 830 million is how much that hedge fund had under assets. They will have another 2 billion of funds, but they made the bet the wrong way. Caroline hyde, thank you so much. The World Economic forum comes back to job those with World Leaders comes back to that those i to davos. We take a look at one of the hotels. It is called the golden egg. Like a bond villain slayer built into a mountain, the intercontinental known as the e goldengg richard branson, bono john kerry stayed here last year. It is guarded by swiss soldiers. It may not be enough to protect it from bankruptcy. Where did it go wrong . Other than the week of the World Economic forum 216 hotel struggles to fill its bad fill its beds. Hard to believe it could fail. One of just a few credits these pumped 152 million into the site credit squeeze Credit Suisse pumped 152 million into the site. It is fully booked for the week of the forum, the problems facing Credit Suisse. We are not staying there. Going public, rumors about an ipo will not go away. We will take you straight to munich. A discussion with one of the companys earliest investors. That is coming up next. Good morning, everybody. You are watching the pulse. Aztec titans gathered as tech titans gathered in munich, he told her International Correspondent about the biggest trends thus far in 2015. The number one trend is something that is important to everyone. Content creation. Content marketing was this big frame of mind. We think content creation is the next big evolution. You are only as good at what you cana great example is nike. I might buy a pair of Running Shoes once a year but i am tuning into their nike tumbl