Im manus cranny. We have a great lineup for you throughout the next two hours. This hour we will speak to the former italian Prime Minister mary monty. Mario monti. Draghi downgraded the forecast, we speak to the former ecb president jeanclaude trischet. Then we have Russias DeputyPrime Minister who will join us at 10 00 a. M. For todaysharpen because it is jobs report in the United States. It is especially crucial because it is the last one before the feds september meeting where they may hike rates. Lets see how the markets are trading with caroline hyde. Caroline nervousness, riskave will, call it what you we are down when it comes to equities in europe. Three things unnerving investors. The first, it is jobs day. Will it be a bearish sentiment. ,he number is more than 217,000 does that mean a fed rate hike c ome september . But does it mean we will see a hike in september . If the number is below 217,000, does that shine a light on the poor Global Economy once again. Damned if you do, damned if you dont. Nervousness about u. S. Payrolls. And about german factory data. That was poor. Down 1. 4 . And third, chinese worries. We are looking at monday, looking at Government Support of their equities. We are looking at asia. A downward a of the markets. China was close last two days amid the parade. The hang seng up by half a percentage point. This market is having its worst month since Lehman Brothers collapse. Seven weeks we are seeing on the downward trajectory. Lets have a look at the dax. Technical indicators the dax off by 1. 3 . The 50 Day Moving Averages below the 200 Day Moving Average. Dax currently lord. That flight to safety going on the dax currently lower. I want to show what is happening in bond markets. Are. T to where the havens 1 30 p. M. U. K. Time, down and term of basis points. Ecb saying more potentially more bond buying is helping money flood into the bond market in europe. The yen, this is the yen strengthening. The dollar going lower. Yen doing particularly well. Copper and oil, continuing to see their downward spiral. It is a downward day. Manus thank you very much for setting the scene at the start of play on the pulse. Spains economy minister waited on a rate hike today. He spoke to Francine Lacqua in an exclusive interview. Francine are you apprehensive of the fed Interest Rate hike . No. I suppose that for Market Participants, i think the fed hike has been announced, has been discounted. I think that long time ago. But the data, i suppose it will create have confidence. Theres something we have to understand is that we have to normalize the situation. Francine are the markets ready . I know we have difficulties, that liquidity is very relevant. We have ample liquidity in the market. Well, we cannot get used to living with zero Interest Rates. Growth rates have to come from different variables than market Monetary Policy. Markets overreact. But they will accept that, well, we have to normalize the situation. And i think in terms of munication, the in terms of communication, the fed is doing a good job. What volatility means for markets and for the real economy. At the end of the day, there is a reality. Inflation rate is low. Expectations are tempered. You cannot live forever in a world of zero Interest Rates. Manus a bloomberg exclusive with my cohost Francine Lacqua, speaking as closely to the economy minister, luis de g uindos of spain. Which brings us to our twitter question. How strong does the u. S. Job numbers need to be for a september fed hike . Im seeing some responses on twitter. Saying it does not matter. It is down to wages. Some people are calling 250,000. How strong does the number need to be to push the hike over the line . Lets bring in one of her many experts. Globalns us from allianz investors. Lucy, always a big day for jobs day. Its a strong u. S. Economy, they should crack on and show us they are fit to normalize. Is that a fair statement . Lucy in part. Ofhas, um, its got signs strength in some areas and areoyment which we looking in detail today. Over the last few months, we have seen strengthening employment. We have seen some fall in the unappointed rate. They will be looking at longer than one month, august is quite dodgy for revisions. They will look at a longer period and seeing whether that really is an improvement. And it does look as if things have strengthened there. Theres a bit more strength in the housing markets. What has hit the u. S. Economy this year has been what is happened in the oi oil sector. The oil sector has taken up to 1 gdp growth. Capex coming down. Do we think that is going to be continuing . Probably not. We do not like forecasting me price, but will you get an impact next year . Probably not. Manus that is what the fed is going to do. They have to look through those numbers. Lucy yeah. So, will they put everything on whatever the number is see . The number is today . No. It could push some people one way or the other. If its really out of line of expectations, but it should not be. Manus september or december, still 2015 . Lucy 2015. It is 5050 between september and december. Some think they want to go now, earlier. Manus get it done now. Lucy make a start even if it is one and done. Manus get the noise over with so we can enjoy thanksgiving. Tell me this. Chinas slowing down. Weve had a couple of days off from minutia of volatility. Thats what it feels like. Talk to me about americas relationship to china. It is barely 1 of gdp. Expand into emerging markets, it is a more contagious issue. How does it fit into your perspective as a cio . Lucy how much does it affect their decisionmaking about their own economy . Probably more so than it did three month ago, i think. Transmission mechanism is really through the Financial Markets, because it is a small part of the economy. If Financial Markets are seeing outsize volatilities, as we have seen it, on balance, can change the timing of when the decision needs to be made, but it should not really change the u. S. Lying direction of the economy. We are expecting more volatility in these markets. Led by china. Manus lets flick back across. Great manhi, again, for rhetoric. Managed to shift the markets. Ready to do more if it all gets worse. We are going to downgradedhow important is that . What does it take to get them to do more . Lucy more than we have had so far is the answer to that. Gave cleare, he statements that their decisionmaking has been stopped before the latest volatility in markets. And so there is a suggestion that they are looking to the downside still on growth, on inflation and leaving themselves open to be able to do more. That was meant to be calling. Calming. Manus until dow gave up 200 points. Stay with me. Lucy mcdonald joining us from allianz. Here is a look at what else is on our radar. Unicredit is considering cutting another 10,000 jobs, which would affect staff in italy, germany, and austria. Unicredit is currently revising its Business Plan on the expectation that low Interest Rates will continue to hurt profitability in coming years. U. K. Prime minister David Cameron is expected to announce that britain will let thousands more refugees enter the country. This follows pressure from the european allies and domestically where more than 300,000 people have signed a petition pressing the u. K. To take more asylumseekers. Gazpromm have agreed to complete their swap deal. The German Companies will exit the gas trading business. That is in return for states in stakes in siberian gas fields. The transaction which was approved two years ago, will conclude by the end of this year and will be retrospective to april 1, 2013. Now still to come, a tense g20. We will head to ankara next to see what the finance ministers and central bankers are on edge about. On europesng recovery or lack there of. The former italian Prime Minister mario monti joins us. Then, of course, what does the former ecb president think of draghis performance . We will speak to jeanclaude trichet later in the show. Manus welcome back. Ons is the pulse liovve bloomberg tv, streaming on andmberg. Com, your tablet your phone. Politicians are monitoring the situation in china and its knock on effect on their economies, not least in spain. In a bloomberg is closer with Francine Lacqua, she spoke to spains economy minister about how the spanish economy is exposed and here is what he had to say. Luis my perception about china is that china has many sources of growth globally. To now, china is in a transition period. Growth was above 10 for a long time, and now they are converging towards in the area of 5 , 6 . This has to be sustainable over time, and china will make its contribution. But simultaneously we will not see the impact of tha 10 growth rate of the chinese economy. Francine 5 is not bad. We are not talking about 3 growth. Were not talking about things that are dark. Luis you have to bear in mind, also, that this is transition. The covers the action of public powers. Chinese authorities have taken the position to interfere economy,he private something that is evident with respect to stock markets. Something that will have an impact on the evolution of the Exchange Rate. And this is going to have spillover effects on the rest of emerging markets. The world all, in economy, you have to a transformational mode of such an important economy as the chinese economy, it will have an impact. In the short time, markets overreact. But in the mediumterm, that will be positive for the world growth and for world trade. Manus great bloomberg is close of their by Francine Lacqua with spains economy minister p. China is also one of the biggest topics in ankara where the g20 finance chiefs are meeting. Ryan chilcote is there. Good day to you. What is the mood on the ground . Does it appear in the draft communique . What are people talking about china . Ryan there is no mention of china. What it is certain a topic of discussion. We just heard from the Deputy Governor of Chinas Central Bank in an exquisite introducing the fundamentals are fine and that chinas currency is more or less stable. So, hes obviously seeking to on play some of the concerns that many of the g20 20 countries, china aside, share. That is a big issue. I also spoke with a former chairman of sinopec, a gentle man who is the head of two of chinas three biggest oil companies. And he was sort of singing from the same hymn sheet, saying the turbulence we have seen on the Chinese Market and what is going on with the real economy are two different things. Have a listen. Lasttually, especially the two weeks, you see a lot of things happen in china where made lots of people concerning about this. If you look into the details, the fundamentals of the economy have not changed much, but there are only two things either theing or scaring one is stock market performance. The second is the Exchange Rate. But actually see the fundamentals economics, especially the manufacturing, industry seems to not change much. The manus, you talk to finance ministers, central bankers, Business People and they are concerned. I spreak with a turkish billionaire who owns a Shopping Mall in china and he was saying that he is concerned about growth in the country. Have a listen. Im most concerned about creating employment as far as in the global context. Because europe is still not going. China growth is slowing down. What they said on television a couple days ago is that china is growing at 4 or 5 . This is the most important issue right now. Again, you talk to the chinese and they are sticking to their guns. Interview, he stuck to that 7 target for chinese growth for this year. Manus . Manus aside from china, and well done, those are interesting voices. But aside from china, how concerned are these countries about sort of the elephant in the room . The u. S. Starting to raise rates. Ryan i think they are very concerned. We got our hands on the draft communique yesterday. It might change but i bet this reference will stay in. There was a notsosubtle reference to the fed and the prospect of higher rates. That is a big concern for all the countries. The languages that there needs to be Clear Communication when countries tighten and there needs to be calibration. Make you think about the last time the g20 was discussing the prospect of the u. S. Raising rates. It was a big concern. We saw the rand plummet. A lot of emergingmarket currencies plummet on the back of that. So it is a big issue. Dollars strength is a big issue. And you see today again, they are in play. You look at the ruble. One of the emergingmarket currencies. Sure, the big story may be the price of oil. Sanctions. But also dollars strength. The ruble today around 68 to the dollar. Weakening again. I spoke to a russian billionaire close to 14 billion. An 80 stake in the countrys Third Largest steel maker. He was saying from a business perspective, these emerging markets that are commodities exporters, theyre clearly happy with dollars strength in the sense it is weakening their own currencies because that means more money for them. He says that is a good thing. So, watch what happens in that space. A lot of countries in the emergingmarket space, and we heard this from australia which is dependent on china, quietly happy to see their currencies depreciating. Manus . Manus great job in ankara there at the g20. Still with me lucy mcdonnell, chief Investment Officer at allianz. Lucy, i thought it was fascinating to hear the former weopec chairman saying that are getting strung out on stock market volatility. Fundamentals have not changed that much in terms of growth. Yes, lower in china. He has the nail on the head. Lucy fundamentals have not changed, but i think some people have not understood what the fundamentals were previously. That has been the change. That is i think the understanding of how weak the underlying economy has been is now better. Thats good. So, when you look at the real data that we can believe in china and its not much production, retail sales, you can get a better idea of where we are. And those are very weak. Retail sales are strongest. Companies exposed the consumer and china are probably better off than those devlin delving into manufacturing. But those figures have been weak for a while. So that is not news. I think they are still looking at the official numbers, the 7 to 5, and expecting that is when reality. That is reality. Manus part of your notes they our longterm view, that is what you deal in, it is not the daily machinations of markets, our longterm view is that we have debt deleveraging but youre beginning to look selectively into this weakness as opportunities. Where are the most obvious opportunities, because some people say it is like catching falling knives . Lot more trade opportunities. In the long term, we are expecting low growth and markets not to give you 20 returns every year, which we had for the last five years. That time has passed. Shortterm, you have much more interesting valuations than we have seen for over a year. That is a good starting point. Where is the most value and markets . Commodities,n clearly, but you still have downward momentum in the earnings sector. There are bit of falling knives there. Any stabilization in the oil price will be an interesting area to look. Weve seen a little bit more of that recently. I think that is interesting. Financials, i think, still thats a longerterm recovery story. Weve seen it in the u. S. We are seeing it now longerterm going through in europe and asia will probably take longer now. But that you can still see some value there. There is value in big technology. And if you look at apple after their selloff, its 12 times with a 3 . Manus interesting that you bring up apple because thats not hit up on the warning list of exposure to china. 30 . Investors are pulling money out of japan at the fastest rate since 2004. I did a bit of a double take when i read that, because i am assuming that third thereof abenomics and the lower currency would perpetuate that story. Value withine more europe and japan then you have elsewhere. Although you have a lot appearing in emerging and asia now. So, japan is, offers some structural and quite sort of interesting bottomup ideas. I think that is a good Hunting Ground again. There are some really worldclass companies with decent valuations. Manus always great to get your perspective on how the world looks. Chief Investment Officer at allianz. Coming up, first, former italian Prime Minister mario monti will join us. I want to leave you a very invigorating sho as we go to the end of summer in londont. Thes a shot of where takingtti forum is place. We are live next with the former italian Prime Minister. Manus welcome back to the pulse live in london. Im manus cranny. Top headlines. It is job stay in the United States, and we will get the nonfarm payroll data 1 30 p. M. London time the worlds biggest economy is estimated to have added 217,000 jobs. It is the final payroll report before the Federal Reserves hotly anticipated september 16 meeting. Nouriel roubini is weighing in on when the fed will pull the trigger. He says dont hold your breath for a september hike. Nouriel i do believe the fed is not going to hike Interest Rates in september but there will be a rate hike in december. I do not think they will wait until next year. Manus german factory orders fell more than expected in july. Signal of the recovery in germany is a bit bumpy. Over to spain now. O