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American Morning

How Will Euro Fare Across Europe?

Aired January 02, 2002 - 07:17   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
LEON HARRIS, CNN ANCHOR: Well, that new currency, the euro, debuted across Europe yesterday. But a real test is coming today because today is the first business day of the new year.

Our unflappable Richard Quest is tracking the euro's news from Frankfurt, Germany for us this morning. We check in with him now to see how things are shaping up over across the pond.

Good morning and happy new year to you, Richard.

RICHARD QUEST, CNN CORRESPONDENT: Happy new year to you, Leon.

I've got the dangerous assignment. I may be unflappable in a studio on me own, but I'm in the January sales in Frankfurt with the new euro and it's not that easy. Luckily, though, I've got Mrs. Gock (ph) here, who's going to help me.

Good afternoon to you. Happy new year.

MRS. GOCK: Thank you. A happy new year to you, too.

QUEST: Now, have you been spending the euro yet?

MRS. GOCK: No, I couldn't spend it because I was at my bank, I was at the subsidiary of my bank and it was overcrowded for about 80 people were standing in the room. And so I went away and then in the city and now I am paying in D-marks.

QUEST: So you're paying in the old money?

MRS. GOCK: Yes, in the old money, in D-marks. So until tomorrow morning I go again to the bank, to my subsidiary, and I hope it will not be overcrowded and I can get the euro.

QUEST: Oh, we call it the euro. You say the euro.

MRS. GOCK: We say euro.

QUEST: Euro.

MRS. GOCK: Euro and cent.

QUEST: All right, euro and cent. What do you think about the euro and cent? Do you like the idea? MRS. GOCK: I think it will be very successful for in, especially the startup is very successful, very, everybody enjoys this new money and they want to feel it and to see it. And a few days ago we could buy a starter kit for 20 marks.

QUEST: But are you worried the prices are going to go up?

MRS. GOCK: I think a little bit, yes. I think so, that a little bit the prices went up, that the coufoys (ph)...

QUEST: Oh, well, don't worry about that. Never mind the coufoys.

MRS. GOCK: The department stores, so I think the department stores will have taken the opportunity to raise the prices.

QUEST: Right.

MRS. GOCK: Was that correct?

QUEST: Yes, that was perfect. Listen, it's better than my German and certainly better than Leo's German. Mrs. Gock, many thanks, indeed.

MRS. GOCK: Yes.

QUEST: Go to the sales. There are still some bargains in ladies wear over there. You can get a good bargain.

MRS. GOCK: Yes. I wish you luck.

QUEST: Thank you very much.

Leon, so, the coufoys in Amerslager (ph) has not been putting up its prices. They have been converting them. But I'm sure that you'll be quite well familiar with the problem of rounding up. That's what everybody seems to be saying here. It's the real problem, that prices when they convert from the old to the new -- my breakfast, I've been on about my breakfast for hours. In the old money it was 38 German marks. In the new money it should have been 19 euros. Guess what? I ended up paying 22 euros. That's about $19 for breakfast. It was a good one -- Leon.

HARRIS: I hope it was a good one at that price.

Richard, are retailers there expecting, I guess, a big rush of people who want to get out and be there spending on the first day, spending this new currency? Are they expecting a big up tick in economically there because of this?

QUEST: Well, Germany, as you may know, is in recession. It's the largest economy in Europe. Where Germany goes economically, the rest of the euro zone will follow. So clearly anything that gets Germans spending more money will be regarded as a good thing across the continent. Just look behind me, though. These are the lines at this store, Amerslager. People are taking advantage of the bargains and the sales. They're not too concerned at the moment about the rounding up. That will happen in the weeks ahead as people get familiar with it.

The fear is that people will be scared off from spending the new money, that they just won't know what the money means. And that could, of course, make the recession worse. But I have to say from everything I've seen so far, most people are good old-fashioned common sense, except, of course, for the person who bought a bottle of water, paid twice the amount of money for it and we wonder whatever happened to the change.

HARRIS: Well, let me ask you this. What I find absolutely fascinating, Richard, is the prospect here of a complete and, you know, a complete rollout of this new currency without a single hitch. We're talking 300 million people chancing currencies within a very short period of time. Have there been any hiccups at all in security or anything at all with this? Because if not, it would be, that's pretty phenomenal.

QUEST: Yes, there have obviously been problems. Let me go through some of the most notable ones.

Before the euro was introduced, there was various security thefts. Money had been stolen. There are people -- the security in the banking industry is worried about moving the sheer vast numbers of bank notes and coins across the continent. They have been reported of strikes in Germany, in Italy over that particular issue.

The main problem has been do cash machines work? Do tills break down? Do -- my hotel's computers had a few problems. They couldn't quite work out the various amounts. And, of course, the rounding up.

But if you take a plan, you give it three years to gestate. You have a multi-million euro campaign to inform people. And -- and this is the most important thing -- euro or euro, as they say here, is about money and people tend to take an interest when it comes to their own pocketbook.

So people are not just, it's not like some minor thing happening. They're interested, they're following and they see it as their future -- Leon.

HARRIS: All right, good deal.

Richard Quest, thank you very much. Next time don't tell me about breakfast. Tell me how much a good stein of a pilsner there is going to cost me in euros, all right?

You be careful and take care. We'll check back with you later.

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