9 00 in london. Where live. Guy johnson. Lets look at the markets. Oil front and center. Unsurprising given the story that bloomberg has received. Oil moving lower. The saudi is only interested in physics apply if the iranians are on board. Moving back below that 114 level. The telco sector being battered. That doesnt do it justice. I will say the french stocks in a few minutes here and the stoxx 600 flat this morning. Stocks are going to be focused later on this week. The markets are just kind of waking up and taking action. Heres the bloomberg first word news with near chance. Nejra saudi arabia is is having its biggest shakeup since the founding of the kingdom. Deputy crown went crown prince said the measures include more taxes and accelerated subsidy cuts would raise an extra 100 billion a year by 2020. That as the country and to spread the burden of Lower Crude Oil prices among its population. A late linked files from a panama shall firm shows criminals and celebrities have used banks to hide their finances. That is according to a series of reports. One report says at least 2 billion in transactions involved people and Companies Allegedly tied to russian president vladimir putin. Brussels airport is accelerating activity today after starting services yesterday. Flights resumed to new york city, africa and the six major european cities in the wake of last months deadly terror attacks. The heightened security will restrict plant outbound flights to 800 passengers per hour. Global news, 24 hours a day, powered by 2400 journalists in more than 150 news bureaus around the world. You can find more stories on the bloomberg at top. Guy International Monetary fund, Christine Lagarde has said it is a good distance away from agreeing additional loans for greece. Concerned over imf officials handling negotiations. We are joined by the silly as weminus just basileus have intrigue, the rustic we have domestic politics, Global Politics weird what are the mechanics we are seeing . Politics. What are the mechanics of what we are seeing . Global politics. They were close to a staff level agreement. Now saying we are far away from a deal. The fiscal targets which are set forth from the bailout. Tsipras the ethical going once more. It has to do with greeces polling votes. Es you have the Main Opposition Party up by a percentage points. That has a lot to do have that has a lot to do now with how see brisk indicates. How tsipras communicates. He is not going to call another if he hasntcause learned anything, guy the imf is being vigilant with its strategy thus far. We got two Different Stores surrounding greece. It is interesting to see how they are overlapping, the migration story. It is now underway in the islands. How do these two stories interact . How are they going . How does it feed back into the financial crisis . Youve had more than one billion immigrants coming over to the greek islands over the past 15 months. It is a huge number. Sending the regular immigrants back to turkey, this is a huge task. At the moment we have not had any balance any violent eruptions on a very rough scale. Greek Government Official has said that is something that we will be expecting. We have to see how the greek authorities will deal with that. The islamic crises, it is not the easiest task that greece has to face, given the fact that maybe some people say that tsipras will use that to get some sort of debt relief. It is unclear at the moment. I would like to see how they go through this week. Then we can have a more clear picture on how this story will go down in the future. Guy thank you very much indeed. Updating us out of athens about two stories affecting us and greece. Chris wyllie, good morning to you. Is the impact of another greek crisis going to be significant lee less desk significantly less significantly less. Storyopher the greek gradually losing its power. Whole said that, this kicking the can down the road which has gone on since 2010 surely must be reaching some sort of endgame. Particularly at this point about the imf which is already been on the side saying they are a reluctant to spend in this program and they would like to see that relief. Just see debt relief. See debt relief. This could be that moment. Maybe this is this moment where we cannot dodge that big question any longer and with the overlay of the immigration policy of greece, it puts a lot of pressure back on the germans to say is this the moment where they come out and say we are going to have some debt relief . Guy if you were to get greek would the imf be putting of the hand is saying we want a bit of that as well . Chris that is what they have been wanting to avoid all along. Greece is a special case. Guy it is not a private sector. Chris debt has already been nationalized. The numbers speak for themselves. There is no other case like greece in terms of sheer unsustainability of the debt. Guy the second question, you talk about the ability to shock. We have a summary which the eu is going to be in focus, one of which is what is happening with greece, its membership in the euro. We have the issue of the brexit. You put those two stories together in the middle of the summer, and you are looking at a difficult combination for the market to manage. Chris absolutely. They would not want any key decisions being made before a u. K. Referendum. I think that is a huge risk factor around the british referendum is the news flare and the few weeks running up to the vote in the few weeks running up to the vote. Get it passed that point it could have a significant it looks as if the result is going to be they have been pretty inaccurate, but it is all that weve got to go on. It is a bit closer. Guy you just go i dont want any of this. I am a u. S. Investor, im going to go i dont want any of this. Chris the risk premium on europe has gone up. The big issue for europe at the moment, the big issue is currency. The currency has gone absolutely the wrong way. 113 1. 13 this morning. Deteriorating, but weve got this Major Economic problem which is euro is back at the levels where at the past euro trade weighted early 2013. The ecb trying to jawbone it lower. Talking about qe to get it down. They just got out of this got out their big bazooka got out their big zynga. Their big bazooka. It doesnt look great for your. Guy youre not a fan of negative rates. We will talk about that. Stay with the pulse as well. Coming up, kurodas monetary program. As the end closes off, it looks like japan is looking for a celebration relating back to the euro story. Were going to turn the spotlight on stimulus in spring. Stay for the emerging markets, Goldman Sachs says the agency has maybe picked out. Has peaked out. Saudi arabia is 100 billion flat. 100 billion plan that is what we are talking about surrounding saudi arabia. A lot of politics. We will talk about that. Ftse 100 up. We will be back next. Guy 14 minutes past the hour. Temporary nationalization stress that he does not see nationalization as the answer and is competent that he can find a buyer for the business is confident that he can find a buyer for the business. I dont think nationalization is the solution. Goodo think it would not to rule anything out. I do feel for lots of reasons after talking to many others involved that there will be enough time to find the one buyer working and be able to take it forward. Guy lets talk to a potential buyer for half of the business. Signs a group that joins us from our paris bureau. Thank you for joining us. Have you talked to the British Government about these assets . Yes, we have had some contact and continued the dialogue. Guy what is the nature of that conversation . Everybodytuation took by surprise. It is the beginning of a dialogue did how the dialogue progresses will become clear. Guy what is the tone youre getting from london guy london . What kind of compromise are they prepared to make . Committedernment is to finding a solution to this problem. What that means is not clear. In, you are interested which bit of the business are you interested in . Give us the circumstances because youre not going to give me the details of how you could be interested . Let me explain the difference between the rest. Slabs. Urnaces make steel if enrolled in the product which is rolled into downstream product. If we divide the problem into two, we talk about the mills which roles it into product and all of the downstream businesses which is galvanizing, color coding. All of those businesses are more easy to solve because you can import slabs from countries which have cheaper slabs. You can make all of the steel production. All the steel product which is made big made, and even more. Business is the solvable. It has been done before. We have done it in the midlands. That is already a proven strategy that it can be done under the right management and with the right model. What is more difficult is the blast furnaces which is the liquid. This is quite simple. It is not difficult to understand if you apply your mind. That was not the case. These plans were set up on domestic raw material. We import iron ore from brazil or australia, africa and so on. We import three tons per year. When we compete against producers, we are not going to be competitive. This is much more of a challenge to sustain. There are two solutions to this problem. One that we import slabs from suppliers from brazil, russia. Or theres a homegrown solution which is tougher. Which is we use the mystically available slabs. We use domestically available slabs. Instead of making steel from iron or we could make melting local scrap and making a longterm Sustainable Business model. It is tougher which means we have to close down furnaces. It will be a transition that will take several years. Erect newt and furnaces. It would be tougher but it is a sustainable solution. Guy would you be interested in the second part . It seems like you have experience in the first part of those two problems. It is the second part that people are questioning. You just laid out very neatly with that problem is. Isnt that a part of the business that you would be eresting in acquiring interested in acquiring . And under what terms . That is what we need to look at. There is a model that we transition overtime. It will sustain all jobs. It will mean large retraining but it will restate it will sustain all jobs. T is a bigger undertaking it is something we need to discuss with the government and stakeholders and work out what the plan would be. When he talks about a temporary nationalization, do to cover that process that you have to work toward to getting the business, train the people, do you think how long would that take . Guest i dont think it is necessary. He is a responsible seller. Whoever else tries to do this, i think it can be carved out within the time scale. I dont think it is necessary for the government to step in. Maybe the government can step in to negotiate a deal as the Scottish Government did for us. I dont see any need for the government to have a period of time. If there was enough time. Guy it is a duration. It is about getting the deal done rather than the industrial process . Guest if it can be done, it can be done. This is a week old. It needs a lot of work. It is a massive undertaking. When that is something that needs a lot of work. It is something that needs to be worked out. It can be done. If there is going to be deal, there is time. If it isnt, there isnt. Guy one final question, how much would it cost to make that transition . What kind of cost of capital do you think any buyer would have to work with . Do you think that scenario that the government could work with a potential buyer to lower the cost of capital to make that happen . Guest how much it will cost is something to be looked at it it depends at what speed you do it. Whether you do it one at a time or both together. It needs proper analysis. Outcost has to be worked and yes the potential the government could play a role in assisting with that. Guy great to have you on the program this morning. We will look forward to hearing from you again. Japans monitor policy turns three. Is it working . We have charts that maybe call that into question. Next. Guy 24 minutes past the hour here it is been three years since every ito since kuroda announced his plan for growth. Yen had one of its best quarters since 2009. Overs building questions the limits of monetary policy. You definitely see limits. Negative rates, negative. We discovered that in the last couple of months because the two Central Banks and negative rates, first japan and europe, both immediately so a rebellion from markets and driving up the currencies rather than going down. People have figured out that negative rates will kill the Banking Sector which is the mechanism for the economy here that is the reason white rates have reached something close to their endpoint. Than being seen as the next go to policy, people see the policy people see the hurdle. Mario draghi told us. Guy wasnt the timing bad . Chris call chris there is both going on. There is a wider syndrome of a riskoff environment. I dont think anyone has been convinced that the Global Growth efficiency has been solved. Assets why we are seeing still quite buoyant. That is the japanese yen, the euro, there is a risk off currency. We are seeing other bond yields still extremely low. It is all a part of that bigger context. When we look to the future, then probably what mario draghi is hoping his we will get those rate rises from the fed to take the pressure off the euro. For chris wyllie thank you joining us this morning. Up next,. Guy welcome back, you are watching the pulse live from Bloomberg European headquarters. I am guy johnson. Lets get a bloomberg fire speaking on the bbcs andrew marsh show, they do not see naturalization as the answer. I do not think toionalization is a solution this. Even for a few weeks or a few months. I also think it will not be prudent to roll things out. Ofo feel that after a lot reasons that there will be working with the government and being able to take it forward. Nehra orange has abandoned its attempt to buy the phone business. That would have eased competition and one of europes toughest market. Bleak shares in both companies are trading lower this morning. Goldman sachs says it is time to sell asian currencies after that monthly rally the best monthly rally and more than seven years. Currencies will resume their declined with further easing in china and japan. That is your Bloomberg Business flash. Guy thank you very much indeed. Companies saytish brexit is the biggest risk their businesses face. The 120 cfos polled say it would be favorable for the u. K. To remain in the european union. Delight chief economist told bloomberg a short while ago that uncertainty is there a key concern. Offrom the bar assumption having a referendum and renegotiating and having another referendum joining wto. You are talking about a period of two years where there would be a lot of uncertainty in the nature of britains relationship with the world. Guy lets talk about how david thomas is here. Business good morning, david. What are your members telling you. David it has been very interesting because we have that two surveys of our members, one directly and we had over 1000 responses from individual businesses, and the second one is being done through our members with the chamber of commerce around europe. They have all pretty much unanimously stated they all recognize the eu is a work in progress and therefore there still has to be quite a bit of work done to improve the situation, which is actually a reinforcement of our evolving Europe Survey that we did about four months ago. Muchhey also showed very that despite that, it would be such a major negative impact on European Business with brexit that they very much hope that the vote will go for actually staying in the eu. Guy let me just delve into the detail a little bit more. When they say there will be such a negative impact, that negative impact outweighs what . Is it a europe as it is now or a formed europe . Most businesses seem to talk about that but it is kind of, currencyaling with a eu, a reformed a formed eu . David one of the big things they were bringing out in the survey is they do not believe the eu what reform much if the u. K. Left. Their plea really is for the u. K. To stay in europe to actually force reform because they see the u. K. As the major catalyst for reform in the way that the eu works. Guy that is a slightly different spin on what we are talking about. Youre not saying theyre worried about written departing, they are worried about what will be left behind. David they also believe that britain inside the eu will take you much further and develop the eu to a much higher level, and make it a much more competitive. Lock within the Global Economy and probably a more competitive block than the two powers working separately. Of what about the impact dealing less with reform and what would happen in or out, what about the actual impact of britain leaving . David they see it as a direct negative impact on their business. We did not ask them to quantify it. I think it is very difficult to put statistics on it but they very much believe there is going to be a significant negative impact on their business going forward. It ishe 7. 1 that say better for the u. K. To withdraw from the eu, what is their rationale . Able to am not really say that, one, because we did not ask them for their rationale. We just wanted to pull their members and garner their opinions, and present that back to us. To be frank, i have not got that answer. I did not ask them either. Guy i am just curious to know what the argument on the flipside is. Just more broadly, when you talk to your members, when you get an idea of what is going on, in a scale of the problems that they face right now, how does this stack up . Low Global Growth, problems with manufacturing around the world, issues with the chinese economy. Their i think one of priority problems, number one or in the first division, and they are having to plan and make contingency plans one way or another. Guy do you think there is a lot of contingency plan happening . Avid i think it is beginning i do not think there is a very large amount being done. I think everyone is sitting there hoping that it is not going to be required. They in more recent times are going to do more serious work. Guy we will wrap it up there. In other central bank news, reader pratt is giving a speech in rome. He s