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I called Google technical support and they found a solution for me.
-In your Nexus 4, go to parameters/Applications/All/Bluetooth
-Here: erase cache, data and updates.
-Resart your phone.
-Tada !

Dude I know how to fix this problem. But I don't know if this works for you all too. First shut down your phone then turn it back on. Shut it down entirely don't turn it off only. Then when your bluetooth turns on, quickly connect to another BT device. Reboot isa temporary cure so it's useless but instead, shut it down entirely.I've had this issue for a while now.
Bluetooth won't turn on using any method.
Using the stock widget or accessing iugh settings doesn't work.
The only fix is a reboot.
When I press or drag the Bluetooth toggle switch it just springs back immediately to the "off" position.
Does anyone else have this problem?
If so could you please comment on this page to make Google aware of the problem...the more voices the better. Issue 42255 - android - Sometimes bluetooth not activatable in Android 4.2.1 Nexus 4 - Android - An Open Handset Alliance Project - Google Project Hosting
Nexus 4 running 4.2.1 (bought on Dec 4th)![]()