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Quest Means Business
U.S. Nominates Jim Yong Kim For World Bank President; Emerging Candidates; World Bank Voting Rights; US Campaign to Fix Youth Unemployment; Bungled Debut for BATS; European Stocks Up for the Day, Down for the Week; US Dollar Slides to Three-Week Low; "Hunger Games" Feeding Frenzy; Interview with Salmaan Keshavjee; Interview with Bill Killgallon; Fracking in South Africa; Interview with Bonang Mohale
Aired March 23, 2012 - 15:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
MAX FOSTER, HOST: In the bank. The U.S. names Jim Yong Kim as its candidate to lead the World Bank.
In a flap. BATS' first full day of trading goes badly wrong.
And the share price of Etch-a-Sketch is given a big shake. The CEO tells me how a presidential campaign gaffe has put him back in the picture.
I'm Max Foster, this is QUEST MEANS BUSINESS.
Hello to you. Well, he's got the resume, he's got the backing, and most importantly, he's got the right passport. Jim Yong Kim is the surprise new frontrunner for the World Bank presidency after he was nominated by US president Barack Obama.
Traditionally, the American candidate always gets the job. And with nominations closing in just three hours, he only has one other opponent.
No one has really mentioned Kim Jong-un (sic) -- Kim's name in the race, but he's currently the president of Dartmouth College, an Ivy League school in the United States. He was a senior official at the World Health Organization, too.
The only other name definitely in the hate is Nigeria's finance minister, Ngozi Okonjo-Iweala. Now, Angola, South Africa, and Nigeria are all supporting her, and she used to be the World Bank's managing director.
There's still an outside chance of Jose Antonio Ocampo getting involved. He's Colombia's first -- well, former finance minister, and Brazil wants to nominate him. Colombia apparently says it's not going to happen. He said he joined the race because he thought this time it would be different.
Supposing Antonio Ocampo is wrong and things stay true to form, than Jim Yong Kim is the first big favorite right now. Felicia Taylor is in New York. Is it a given that he's going to get it because he's got the American backing?
FELICIA TAYLOR, CNN INTERNATIONAL CORRESPONDENT: Pretty much. The Americans are the largest voting members of the World Bank, and traditionally, as you pointed out, it has always been an American.
The interesting part about this story is that this seen as somewhat of a compromise because Dr. Kim was born in South Korea, so that is perceived to be a little bit more appealing to some of the emerging market nations that were looking for a bit of a change in the mix-up here.
The other interesting part about Dr. Kim, obviously he is a physician trained at Brown and Harvard. He does not have a financial background, which is traditionally what World Bank presidents have had.
And that in particular was interesting for President Obama, who believes that the health care industry should be more of a focus for the World Bank and, therefore, his background in development as having held the top position in HIV and AIDS at the World Health Organization makes him the right candidate, according to the president. Take a listen.
(BEGIN VIDEO CLIP)
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: And ultimately, when a nation goes from poverty to prosperity, it makes the world stronger and more secure for everybody.
That's why the World Bank is so important, and that's why the leader of the World Bank should have a deep understanding of both the role that development plays in the world and the importance of creating conditions where assistance is no longer needed.
I believe that nobody is more qualified to carry out that mission than Dr. Jim Kim.
(END VIDEO CLIP)
TAYLOR: As I mentioned, traditionally the nominees for the World Bank president have had somewhat of a financial background. We had heard names like Senator Hillary Clinton, Larry Summers, Senator John Kerry, and even the CEO of Pepsico, Indra Nooyi as possible candidates. But again, that's why Dr. Kim was a bit of a surprise.
He himself has said that setting high standards and goals in his lifetime have paid off. Take a listen.
(BEGIN VIDEO CLIP)
JIM YONG KIM, WORLD BANK PRESIDENTIAL CANDIDATE: I found again and again in my career that when you set bold, ambitious goals, plenty of people will tell you that you're crazy or that it just can't be done.
That's what they told us at Partners in Health when we wanted to treat people suffering from multi-drug-resistant tuberculosis in the slums of Lima, Peru. It's what they told us at the World Health Organization when we wanted to treat 3 million people living with HIV in developing countries.
I'm happy to say that we didn't listen to the naysayers.
(END VIDEO CLIP)
TAYLOR: So, he stands to make a real difference when it comes to world health and development. Policy of the World Bank clearly setting high standards and goals have paid off for Dr. Kim.
This is not a done deal, though, Max. There are a number of weeks that will pass as the member organizations will vote on this, and as you mentioned, there is another candidate out there, although there is just a few hours left before anybody can make a nomination. Max?
FOSTER: Felicia, thank you so much, indeed, for that. Well, South Africa's finance minister says Ngozi Okonjo-Iweala is the best candidate, but he admits with the power of American interest, she might be better off looking to future contests. Pravin Gordhan told Robyn Curnow why he is backing his Nigerian counterpart.
(BEGIN VIDEOTAPE)
PRAVIN GORDHAN, SOUTH AFRICAN FINANCE MINISTER: We wish her well, because we think that she is a very competent person, has the right kind of experience and profile, and will be a very able and visionary leader of the World Bank.
ROBYN CURNOW, CNN INTERNATIONAL CORRESPONDENT: Do you, though, think it's likely that she'll ever get the job?
GORDHAN: So, we look with optimism, and at the same time have a fair sense of the realities of power within the global situation. But these contests, I think, are an important step towards future milestones that we want to work towards where there's a better balance in the world and there's a better voice representation in the world institutions, as well.
CURNOW: So, on a pragmatic level, you don't see the Americans saying, there we go, please have this very prestigious post?
GORDHAN: No, we understand that Americans have important policy interests and self-interest in this position, as well. And as long as we have a mature understanding about our respective interests, and run our campaigns in a mature and constructive way, and the outcome ultimately has legitimacy in the global community, we'll be satisfied.
CURNOW: So, this is about a message, isn't it? Is this a message the African countries are sending?
GORDHAN: It's more than just the African countries. I think the developing world as a whole for the past few years has been giving this message, which is that the economic and power balances in the globe are changing, give greater recognition to that. This should be reflected in quota reforms in the IMF and World Bank.
And, so this is part of a global transition to a world that we are yet to see, but a world that is giving glimpses to us of what it could look like.
CURNOW: And with six of the ten fastest-growing economies in the world here in Africa, Africa's voice is louder. It packs a bit more punch, doesn't it?
GORDHAN: For those who understand that the globe doesn't remain static, that history doesn't stand on one step alone, and that it keeps moving, they would understand that Africa 20 years from now is going to be very different. It's going to be a huge set of opportunities between now and then that'll be available both to Africans themselves and, indeed, to the world.
(END VIDEOTAPE)
FOSTER: Well, the final decision rests with the executive board of the World Bank, and that's made up of 25 directors. There's one for the US, there's one for the UK, France has one --
(AUDIO GAP)
FOSTER: -- one. Japan has one, and the rest of the world has 20 executive directors. Now, the overall voting rights are almost totally dominated with the US and the EU. It's weighted according to contributions, so the US has 16 percent, there. The EU has a combined 29 percent, and when you add Japan's 9 percent, more than half of all the votes are taken up by just three countries, as you can see.
Next, one Millennial's mission to solve youth unemployment. We speak to the driving force behind the Fix Young America campaign.
(COMMERCIAL BREAK)
FOSTER: Now, student loans in the US have topped a trillion dollars, and job prospects are poor. Many young Americans are facing a difficult start to their working lives. Scott Gerber is on a mission to turn things around with his Fix Young America campaign. It's strongly backed by Oregon senator Ron Wyden.
We're going to begin, though, with Scott. Thank you so much for joining us. You certainly hit some headlines with all of this, haven't you? What do you think it is you've tapped into which has grabbed the nation's consciousness over there?
SCOTT GERBER, FOUNDER, YOUNG ENTREPRENEUR COUNCIL: Well, Max, I think that we're in a moment right now where we've seen what came out of Occupy Wall Street, that frustration that is just pent up to such high degrees.
And now, we thought, well, let's try to take that frustration and turn it into tangible action. And so, we went around the country and tapped all the different decision-makers and leaders across all different spectrums, from academia to the government to the private sector, really to find the solutions that are out there.
And that's what people want to hear, the solutions, not just the rhetoric or the partisanship. So, I think that's the nerve we've struck, showing the truth that exists and pushing it.
FOSTER: Am I over-simplifying it to say that the solution is entrepreneurship as a legitimate alternative to going to college, right?
GERBER: Well, I will say that that is one of many possibilities. I don't think there's a one-size-fits-all strategy here. I think that we wanted to lay a foundation of what we know has worked. Our organization, the Young Entrepreneur Council, represents many of America's top young entrepreneurs under the age of 35 who've created tens of thousands of jobs.
And so, we think that by restructuring certain areas, like education, certain government policies in the private sector, we basically can create a paradigm shift towards entrepreneurship. But this is just the beginning of the conversation.
FOSTER: How much support have you got? Is the Occupy movement sort of backing you up, effectively, the people involved in that? I mean who are the people behind you, and how do you measure it?
GERBER: Sure. We have dozens of different organizations across the United States, organizations such as -- corporations like Legal Zoom and Dell. We have schools such as Cogswell College, which is the first entrepreneurship in the country, as well as Babson, the number one entrepreneurship-related undergraduate and graduate program in the country.
So, we also have a lot of different individual supporters and just incredible decision-makers and leaders like the senator and Congressman McHenry, who just spearheaded, along with his colleagues in the Congress, the JOBS Act.
So, we have a variety of different people coming together to support this, again because they just understand we really do need change. This can't be a rhetoric game anymore. This is too much at stake. There are too many people that basically are being lost. And if an entire generation is lost, we're in a lot of trouble.
FOSTER: And it's a pretty negative place, isn't it, the Western World? And you're coming in with this very positive message, and you're providing a solution, which is achievable. I guess a young guy comes along in Washington and actually shakes a few people around. You're giving a solution which is doable, is that what you're finding is attractive to Washington, as well?
GERBER: I think what we're seeing is is that there are just so many incredible people that really do wan to do great things. And often, we get clumped into the partisan politics of the day or whatever the 24 news cycle is.
But the fact of the matter is, in government and outside of it, there's a lot of great stuff going on, but against your point, if it bleeds, it leads, usually. So, if we can't get the good, positive messages out, well, that's problematic.
That's why so many people, I think, have come onboard this, because we're not saying who's to blame, we're not saying this is the problem. We're saying let's begin a tangible roadmap that we can put ourselves on a course of action that will lead us to success.
FOSTER: OK, Scott Gerber, thank you very much, indeed. We're going to cross from Washington, now, and speak to Oregon senator Ron Wyden. You're obviously not part of this campaign, but Washington's really taken to it, hasn't it?
SEN. RON WYDEN (D), OREGON: I'm very much a part of the campaign that Scott is waging, because the fact is, if you want an innovation economy, you've got to empower the innovators.
We have so many young people all across the country, we've seen it in Oregon with a wonderful breakthrough company called Urban Airship, where we've got young people who are just, for example, a couple of years out of school, they're really folks who are tech-savvy.
They've got a wonderful work ethic, they might be sleeping on a friend's couch, and they are thinking big and they're dreaming big, and they're in a position -- if the government just gets smart and sets up these new policies, we can have a lot of new entrepreneurs.
I wrote the law, for example, that let's some of the folks who are getting unemployment use those very same benefits, no extra money, those very same benefits, pool their dollars, and that's how we got Urban Airship off the ground. It's now one of the big draws for Silicon Valley with mobile apps.
FOSTER: Give us an example, another example, if you could, about how Washington is actually latching onto Fix Young America, a piece of legislation and actually with money behind it. Give us a good example of what's changing.
WYDEN: Well, I'm very pleased about what happened this week with the JOBS bill, where we showed support for crowd funding. I think this is a chance that, again, with modest amounts of capital, to use the opportunity to generate net-based businesses.
Recently, I introduced a major education bill called the Student Right to Know Before You Go Act, so in the future, parents and prospective students can know more about the kinds of careers that are going to pay good wages.
It's almost like you have a triangle, there. We ought to be reinventing these government programs, like the employment laws, to create opportunities for entrepreneurs.
Let's look at crowd funding changes to create opportunities for small amounts of capital to make an investment in innovation. And then, our Student Right to Know Before You Go Act will help us to get more for the education dollar.
FOSTER: Very broad, and Scott was very broad, as well. But is there a risk, here, that this becomes too big and people can't grasp what this is about? What's the defining thread to all of this, which can be sold to young people who are disillusioned in America right now?
WYDEN: Well, the defining thread is with approaches like I just outlined, crowd funding, changing the unemployment system to make it a springboard for new, innovative businesses.
What we're showing is that these government programs that have been kind of in a time warp that are just decades behind in terms of looking at the potential for young entrepreneurs.
Remember, a lot of these businesses, when you think about Google and Facebook and the like, were started by folks in their dorm rooms. There's a tremendous amount of energy and talent and innovative capacity out there with this generation.
I hear it at my town hall meetings, at open community meetings in each of Oregon counties. The young people come, they talk about their work ethic and the technology that they've mastered, and they're saying just change these government programs so I can become an entrepreneur, and that's what I've been able to do.
FOSTER: Senator Ron Wyden, thank you very much, indeed, for joining us from Washington.
The third-largest stock exchange in the U.S. is being forced to put its market debut on hold because of a series of bungled trades. BATS global markets was hit by a series of embarrassing errors when its shares went public today and stock market heavyweight Apple was also caught up in the confusion. Alison Kosik is at the New York Stock Exchange, and you watched it all unfold, Alison.
ALISON KOSIK, CNN BUSINESS CORRESPONDENT: Oh, yes, this is -- you know, it's some real strange in the moves in the market today, Max. Some technical glitches caused a 9 percent drop in shares of Apple this morning. The rapid fall triggered a circuit breaker, and Apple trading was halted for five minutes.
Now, the source of the glitch was traced back to BATS global markets, a high-frequency exchange platform. And BATS actually accounts for 10 percent to 12 percent of daily US equity trading, and so what we're talking about here is a pretty big player.
Now, the bad trades were canceled, and Apple reopened, recovered its losses, and right now is trading down about a half a percent.
But get this. Of all the days for this to happen to BATS, it happened on the very day of its initial public offering, its IPO. So, yes, BATS made its public debut this morning, but there were these technical glitches in those IPO trades, as well.
So, the trading in BATS stock -- in BATS stock, that has been halted until further notice. The SEC, the Securities and Exchange Commission, is looking into all this.
And of course, with all of this going on, it raises more and more questions about what the role of high-frequency trading is doing to the trade and how these computer glitches can really disrupt the entire market in so many strange ways, Max.
FOSTER: OK, Alison, thank you very much, indeed. Now, stock markets in Europe have just ended their worst week so far this year. There wasn't too much movement today. BT was the big gainer in London. Its shares soared nearly 5.5 percent on news it was going to harness pension deficit.
In Frankfurt, Commerzbank rose more than 3 percent. In Paris, Credit Agricole was the top performer there, up just over 3 percent. And Zurich's SMI broke the general trend. Drug-maker Actelion dropped more than 1.5 percent.
Now, it's when we look at the figures over the course of the week that it starts to look quite nasty. Worst week of the year so far.
Let the "Games" begin, meanwhile. From the look of these lines, the studio which made "The Hunger Games" is going to be a big winner this weekend.
Now, Friday's foreign exchange rates for you. The US dollar was weakened, sliding to a three-week low against the euro. The Australian dollar is recovering from this week's plunge, putting on more than half a percent as concerns over a slowdown in China in the eurozone ease.
(COMMERCIAL BREAK)
FOSTER: Now, "The Hunger Games" is already a huge hit, and it only opened today. The website Fandango says it's been selling ten tickets a second for the film, which has already made more than $15 million. Unbelievable figures.
Some analysts say its opening weekend in the US could rake in $80 million, and even that's starting to look a bit conservative. Maggie Lake joins us from a movie theater in New York's Lincoln Square. Maggie, an amazing event.
MAGGIE LAKE, CNN INTERNATIONAL CORRESPONDENT: Yes, Max, you're right, and that is looking conservative. The theater behind me shows 13 showings in the first half hour at midnight last night, all sold out.
You could say sort of the calm before the storm, now. There's been a steady stream of people trying to beat the lines and go in, some groups of schoolchildren who were thrilled. They absolutely loved this film, couldn't wait to get in and see it.
But we also caught up with some other people who are skipping out of work a little early to get a sneak peak and see what all the fuss is about. A lot of people fans of the book, and even those who aren't are coming in.
But interestingly, Max, we talked to a trend-watcher who said social media is really playing a very big role in this. Have a listen.
(BEGIN VIDEO CLIP)
CHRISTINA WARREN, MASHABLE.COM: Fans are expecting, especially younger audiences, especially girls, are expecting to share things online with their friends. They're expecting to find out about their news online.
So, if they can connect directly with the film online, learn about the stars, see how the stars are interacting, see maybe exclusive footage about the movie, get information about how, hey, you can see this early. They're going to be more inclined to share, and they're going to be more inclined to then want to talk about going to see it opening day.
(END VIDEO CLIP)
LAKE: And that's a real contrast, Max, to say, "John Carter," the big flop, which is not working out well at all. They did not capitalize on social media.
But when we're talking about really successful franchises the likes of "Harry Potter," you know it's all about the merchandise. Now, I don't know if you notice the particular shirt I have on, Max. This is actually on sale, it's the gear they wear when they are participating in the game.
And not only that, some really creative sports clubs in New York, New York Sports Club, has a workout session tailored around "The Hunger Games." When you're talking about creative marketing -- I don't know about you, it may be a little too extreme, check this out.
When you're in the class, Max, this is the kind of stuff that you're going to have to do if you want to build up those biceps, Max. Probably not an issue for you.
(LAUGHTER)
LAKE: A little bit difficult for me. I'm not sure that this is going to vault it up to the likes of "Harry Potter," but people seem to want anything they can get their hands on that's "Hunger Games."
FOSTER: I'm just glad you explained yourself, Maggie, because I thought you just popped by to do a live shot while cycling home.
(LAUGHTER)
FOSTER: Now you've explained your getup. Maggie, thank you very much, indeed. I look forward to seeing the film, now.
LAKE: Yes.
FOSTER: Now, the battle to lead the world bank. One candidate is got all the right moves. Yes, that really is Jim Yong Kim. We'll find out more about the man who could run the World Bank, next.
(VIDEO CLIP OF JIM YONG KIM IN RAP MUSIC VIDEO)
(COMMERCIAL BREAK)
FOSTER: Welcome back, I'm Max Foster, these are the main headlines this hour. A South Korean-born global health expert is the top candidate to lead the World Bank. US president Barack Obama nominated Dr. Kim Yong Kim -- Jim Yong Kim to lead the world finance institution when its current president steps down in June. Kim is the president of Dartmouth College and was a senior official at the World Health Organization.
Crowds gathered in Toulouse, France, on Friday to remember the victims of the deadly shooting attacks there. The city's mayor called for a rally against anti-Semitism and racism. Mohamed Merah was accused of killing three soldiers -- three children at a Jewish school and a rabbi. He was shot dead by special forces after a 31-hour siege.
The US soldier accused of massacring Afghan civilians in their homes has been formally charged. Army staff sergeant Robert Bales faces 17 counts of premeditated murder and 6 counts of attempted murder. The military says if Bales is convicted, he could face the death penalty.
Students at several high schools in the US state of Florida staged walkouts today calling for justice for an unarmed black teenager who was shot dead. US president Barack Obama called Trayvon Martin's death a tragedy.
Police in London say they're treating the shooting of a former Russian banker as attempted murder. German Gorbuntsov was shot several times as he entered flats in London's financial district on Tuesday evening. He's currently in a critical condition in hospital. Russian media say he previously owned banks in Russia and Moldova.
The next person to head the World Bank could be someone without a background in business or economics. Jim Yong Kim is the man U.S. President Obama has nominated to replace Robert Zoellick. And he's best known for his work fighting AIDS and other diseases in the developing world.
Salmaan Keshavjee is a professor at Harvard Medical School and a friend of Jim Yong Kim's.
And he joins us from Boston in Massachusetts.
Thank you so much for joining us.
We don't know much about him.
Give an insight --
SALMAAN KESHAVJEE, PROFESSOR, HARVARD MEDICAL SCHOOL: All right.
FOSTER: -- first of all, about character.
What sort of guy is he?
KESHAVJEE: Well, Jim is brilliant. He's a leader. He inspectors people. He's really driven. He's the kind of guy that looks at a problem and just thinks, OK, how -- you know, what do I need to do to solve this -- to solve this problem?
Who do I have to bring together to solve this problem?
He's also extremely funny. He's very humorous. He -- he's the kind of guy that he likes to do karaoke. He does a great barbecue. He is a basketball player, a football player. So he's really a -- a very -- a well-rounded leader in so many different ways.
FOSTER: Let's have a look at some of that character. We've got him performing at his college, a pretty spectacular performance.
He throws himself in, doesn't he?
This is going to be great, isn't it?
These often quite boring summits, we're going to have a character there, right?
KESHAVJEE: Well, he's definitely going to liven things up, Max.
FOSTER: What -- in terms of the performance side of him, what -- what does that say about him, do you think, in his work?
KESHAVJEE: Well, he generally is visionary. He -- and he's basically prepared his whole life to -- to really do work that helps move the lives of people forward, toward global development.
And I think President Obama, you know, today said things just right when he said that the World Bank is the premier development organization in the world. It's involved with global development.
And Jim Kim, all his life have been -- has been doing global development. He's worked with Partners in Health, you know, which he -- he was a founder, worked on the ground in Haiti, in Peru, in Russia, in Lesotho. So he has a lot of experience on the ground.
He -- he's taken what he's seen on the ground and really translated into into a -- into action at the global level.
And I'll give you a real example. You know, in -- in the mid-'90s, Jim found that there were -- Jim and -- and other people at Partners in Health found that there was an outbreak of drug-resistant tuberculosis. And at the time, even the World Health Organization was saying that this disease shouldn't be treated, even though it was airborne.
And Jim brought together, ultimately, a coalition to address this problem. And it led to com -- you know, complete -- a complete transformation of global policy. And it wasn't just any coalition. It was a coalition of the World Bank -- excuse me, a coalition of the World Health Organization, the United States Centers for Disease Control, Harvard University, different countries. It was funded by the Gates Foundation. It was the largest grant toward global policy at that time. It was one of the largest grants at -- at Harvard Medical School.
FOSTER: Right.
KESHAVJEE: So, you know, he's a -- he's a big thinker. He's very ambitious.
FOSTER: You can't argue with his record in health and health policy. But this is an economics, this is an often business job and he doesn't have a background in that. And he's going to be dealing with some -- the most complicated economics, macroeconomics, in the world.
How is he going to adjust and how is he going to cope?
How is he going to deal with that?
KESHAVJEE: You know, he's going to adjust perfectly and I'll tell you why. He -- when he -- when he came back from the World Health Organization to Harvard, he basically founded the new -- you know, a science of -- of global health delivery. And one of the things that he said is that, look, you can't solve these problems -- and I'm focusing on health because, you know, that what's I know and that's what his record has been in.
But he said you can't solve these problems if you don't bring in the right teams of people. And he started working with the business school, with engineering schools, with a lot of other people to bring the right team together, to address, I think, one of the biggest issues of our time, which is health.
And so the -- the World Bank has got a lot of economists, but it needs a visionary and it needs somebody who can bring together the right teams, whose problem -- you know, who -- who's driven to solve problems and really has the capacity to do it. And I think Jim has shown that, you know, both in the health field and in the way he has dealt with Dartmouth University. He was -- he was one of the people -- one of the first American university presidents to really bring the budget and -- and the situation at Dartmouth at -- at his university under control --
FOSTER: OK, Salmaan, thank you very much, indeed. We may well --
KESHAVJEE: -- in the financial crisis.
FOSTER: -- find out a lot more about him if the American nomination goes the way it's expected to go.
Now, next, political gains in the Republican primaries -- we'll look at why the Romney campaign's Etch A Sketch gaffe is breathing life into a toymakers' sluggish share price.
(COMMERCIAL BREAK)
FOSTER: Now, as the Republican presidential battle rages on, a clear winner is emerging and it's the makers of this little baby.
(BEGIN VIDEO CLIP)
ERIC FEHRNSTROM, ROMNEY CAMPAIGN SENIOR ADVISER: I think you hit a reset button for the fall campaign. Everything changes. So it's almost like an Etch A Sketch. You can kind of shake it up and we start all over again.
(END VIDEO CLIP)
FOSTER: Now, Mitt Romney's adviser there on resetting the campaign after the nomination has been announced.
Now, since he made that comment, shares in Etch A Sketch maker, Ohio Art, have gone through the roof.
Let's just take a look at this brilliant graphic here. Sketch out here, you can see Ohio Art's shares over the past year. And as you can see, the stock had pretty much flat-lined until this week. Check it out, that spike. And I never was good at this as a kid and I'm even worse at it now.
The share price more than doubled, to close at over $9 a share on Thursday, following those comments. They're current trading at $6 -- 60 pence on the NASDAQ Stock Exchange. This is a very thinly traded stock, so big moves in share prices aren't that unusual.
And there were actually only three trades yesterday. So far today, there have been 13. Let's just shake that out.
Anyway, Bill Killgallon is the CEO of Ohio Art.
He joins us now via Skype.
I mean this is great news for you.
But what do you make of the reaction?
BILL KILLGALLON, CEO, OHIO ART: Well, I -- I, frankly, have not followed the -- the financial part of this saga. I have been, as you can imagine, we've been overwhelmed with requests for media interviews and media comments. But we are delighted that our Etch A Sketch product is in the middle of the political debate here in America.
FOSTER: It could possibly sort of define -- it could be a defining image, couldn't it, of this part of the campaign. And it could grow as the politicians add to the story.
What are you hoping from it?
Because we all recognize it, but maybe we've forgotten about it in the past.
KILLGALLON: We're strategizing right now on how to turn this into a win-win situation not only for our Etch A Sketch product, but, also for the American electorate. We would hope that the -- somehow, whoever wins the Republican primary could use this American icon as a symbol of bringing us together by erasing our past difficulties and just shaking the American political landscape up so that we can solve our problems.
FOSTER: How many are you making at the moment?
How -- what's your capacity?
KILLGALLON: We sell between one million and two million Etch A Sketch products each year.
FOSTER: So if demand goes up, how -- you know, how -- how flexible is that?
KILLGALLON: We would be able to at least double capacity, because the toy business is a seasonal business and 75 to 80 percent of the -- of the products, including Etch A Sketch, are purchased between some time in late September and the Christmas selling season.
So we do not produce the Etch A Sketch at full capacity for the entire 12 months of the year. Well, if there is a --
FOSTER: OK, so it's flexible.
KILLGALLON: -- if there is a political demand, then -- then we can certainly ramp up real quickly.
FOSTER: OK.
KILLGALLON: And we have three or four different sizes of --
FOSTER: Yes, OK.
KILLGALLON: -- of Etch A Sketch products.
FOSTER: So you're braced.
Thank you very much enjoy -- indeed, for joining us with that.
It was a blast from the past for me.
Now we're going to have a look at the Weather Center now, because Jenny is there.
And she's got far more, you know, complicated equipment in there.
JENNY HARRISON, ATS METEOROLOGIST: I'll tell you what, I -- I never had noticed that much, Max. I was, yes, a deprived childhood. I always wanted one, never had one.
FOSTER: Deprived.
Really?
HARRISON: Yes. I always wanted one, never had one.
Now then, talking about the weather conditions, things have begun to get a little active across the Central Plains, the Midwest United States. Now, for the last few hours, there's just actually been this yellow box. That, of course, is severe thunderstorm watches in place. But we have had some reports of tornadoes. And I think we've got some pictures to -- to show you right now.
These are very, very recent pictures just into us. And I believe this is an area, actually, just to the north, at Louisville in Kentucky, or close to Louisville in Kentucky, remember, it was a couple of weeks ago that there was so much damage in this particular town due to tornadoes.
Now, remember, it's pretty early days to actually say for definitely it was a tornado and certainly, of course, to give you any idea of the power, the size of this tornado. But so far today, coming in from the northwest, they're reporting 12 tornadoes. And the majority of them have been in Southern Illinois.
This is the one reported, actually, in Kentucky; a couple in Alabama; and one in Missouri. But you can see the damage there. It's probably not widespread, but you can see the damage that has taken place is certainly pretty noticeable. But you'll notice this (INAUDIBLE), one house across from that one looks to be barely untouched.
Come back to me and let me just show you, as I say, what I mean by the warnings or the reports that have gone into place. A couple, as I say, down into Alabama. And then the majority of them in southern areas of Illinois. One across in Missouri. And that one, of course, in Kentucky.
Now, it's the heat that's really been triggering these thunderstorms yet again, because we've got this system coming through, cold air there, lots and lots of moisture. And then these really high temperatures, just staggeringly high. Records set left, right and center. Chicago, the nice day, with the temperatures around 28 degrees Celsius. Detroit in Michigan, 30 Celsius. The average is nine. And, in fact, that 30 Celsius breaks all records ever set for the high temperature in Detroit, certainly in the month of March.
So it will stay warm. It's been looking lovely. The blossom is just spectacular, a little bit early, but it is all certainly coming out because of this warm weather.
Chicago, as well, the next few days, temperatures above average. Getting a bit cooler on Monday, 12 Celsius. Still, a little bit above average, though, there.
Boston, as well, 17 degrees on Sunday. And that's pretty much the story of things across the central and the eastern areas. There is that low on its way eastward. We will be seeing more thunderstorms on the -- on the actual sort of tail end of that system as it moves through. But that rain is pretty welcome across most areas, it has to be said. Twenty-five in Atlanta on Saturday and 14 in New York. So it's still warm even in the wake of that system.
Things warming up, as well, across in Europe, the central, southern, eastern areas. High pressure once again has pretty much got its grip on Europe. So that means the temperatures will be on the rise. Look at this, London. (INAUDIBLE) Saturday, Max, 20 Celsius, sunny skies, 10 degrees above average.
So it's that time of year again for you, you know, get your -- your shorts out, get your knees out. I know you don't like to show them in public, but you will be.
FOSTER: Well, I certainly don't show them at work. So as far as everyone is watching is concerned, we don't have knees.
HARRISON: You don't.
FOSTER: Thank you very much, Jenny.
That's QUEST MEANS BUSINESS.
The news continues on CNN.
(COMMERCIAL BREAK)
ROBYN CURNOW, HOST: You're watching MARKETPLACE AFRICA.
I'm Robyn Curnow here at a petrol station in Johannesburg.
Now, from filling up your car to switching on your lights at night, people are thirsty for energy. Eighty percent of South Africa's power comes from coal.
Now, energy companies are looking at a very controversial drilling technique called fracking to help meet the country's energy needs.
But what worries many South Africans is that under these plans, fracking or drilling will take place in the Karoo, which is one of South Africa's most remote and beautiful areas.
(BEGIN VIDEOTAPE)
CURNOW (voice-over): It's caused controversy and protest around the globe. And in some countries, fracking has been banned altogether.
But here in South Africa's barren wilderness, plans are underway to begin drilling for natural gas contained in a rock called shale deep within the earth.
Several large energy companies have leased rights to begin fracking here and they're waiting for final approval from the government to begin drilling.
JONATHAN DEAL, CHAIRMAN, TREASURE KAROO ACTION GROUP: The landscape which we're looking at now, if fracking were to be licensed in this country and if there proved to be a shale gas deposit here under this landscape, there's no reason at all why you wouldn't see the drilling happening right here.
CURNOW: Jonathan Deal has written a book on the Karoo and is now leading the campaign against fracking in this area.
DEAL: Yes, it is a very special place. It's irreplaceable. And my concern is that we could make decisions chasing fossil fuels in this country, where this generation is making a decision that is going to affect unborn generations, who may not be too happy about it, where we should, perhaps, have been pursuing renewable energies or looking at different energy mixes.
CURNOW: Controversy surrounds the way the drilling is done -- down and sideways into the shale rock. Large quantities of water and other chemicals are injected. This fractures the rock, releasing natural gas trapped inside the shale.
The Karoo has a unique and delicate biodiversity that energy companies say they will protest, but campaigners believe fracking could kill wildlife and this area's limited water supply could be contaminated.
MUNA LAKHANI, EARTHLIFE AFRICA: Anywhere you go where you're drilling holes in the earth, the chances of damaging aquifers is very high. And South Africa is a water scarce country. And the Karoo happens to be the driest part of our country.
So to threaten our water supplies with a system that's comingled with toxic chemicals sounds like insanity of the first order.
CURNOW: The town of Sutherland (ph) is on the edge of the area that could be affected by fracking. The town has a big reputation, built on its astronomical observatory, but it's a small place. You can see from one side to the other and the streets are largely empty.
Jurgens Wagener runs a guest house in Sutherland. He acknowledges that the town needs jobs, but he's concerned about the long-term (AUDIO GAP).
JURGENS WAGENER, SMALL BUSINESS OWNER: The town needs jobs. There is a great need for that. If we look at it over the long-term (AUDIO GAP) and what will be the results over a very, very long period?
CURNOW: According to a recent report by a South African think tank funded by Shell, towns like this, and the country as a whole, could get an economic boost if fracking goes ahead.
ROB JEFFREY, ECONOMETRIX: The successful development of the shale gas reserves would result in approximately $11 billion to $30 billion contribution to the South African GDP.
By the same token, there would be a significant impact on employment.
CURNOW: But others believe the employment case for fracking has been exaggerated.
PEET DU PLODY, TRADE AND INTERNATIONAL POLICY STRATEGIES: Reports cite the number of 700,000 jobs, which is more jobs than the entire mining sector combined. It's -- it's -- I can understand the motivation to set such a high number, but I don't think it's realistic.
CURNOW: In America, the debate is just as fractured. In Ohio, there are accusations that fracking has caused earthquakes and the water was so contaminated, it could be ignited. In France, after widespread protests, the drilling technique has been banned altogether. Campaigners in South Africa believe that the lack of international and scientific consensus on the benefits and the environment impact of fracking means it should not be allowed to happen in the Karoo.
DEAL: But in 110 places around the world, at least 110 places, fracking is either completely banned or under some form of moratorium or a restriction. And whilst that's happening in the international community, as far as we're concerned, there is a very big question. South Africa is a place, at the moment, where we still have an opportunity to decide whether we're going to allow it into this country or not.
CURNOW: The South African government has stopped licensing while it studies all the arguments. The fate of this fragile landscape could be decided by the end of March.
(END VIDEO TAPE)
CURNOW: After the break, we speak to the chairman of Shell here in South Africa about why they're pushing ahead with plans to drill for natural gas in one of South Africa's most pristine natural environments.
(COMMERCIAL BREAK)
CURNOW: Now many countries around the world want to access natural gas that's trapped in shale rock deep underground. Many believe that this untapped resource has the potential to change the world's energy sector.
Well, despite immense country, Shell South Africa has been campaigning heavily to be allowed to begin fracking here in South Africa.
Well, for this week's FaceTime interview, I sat down with Bonang Mohale.
He is the chairman of Shell SA.
(BEGIN VIDEOTAPE)
CURNOW: Fracking -- it doesn't sound like a very polite word. And for many people, it is something that makes them very, very angry.
BONANG MOHALE, CHAIRMAN, SHELL SA ENERGY: We prefer to call it hydraulic fracturing. But colloquially, we also repair -- refer to it as - - as fracking.
I think it's one of the most amazing technologies to come into being probably in the last 60 years.
We have an amazing opportunity here, as a company, to create a brand new industry that can give the people of the Carew (ph), but also the 50 million South Africans, energy, environment and economic benefit.
It is possible to have responsible fracking with respect to the enough that the people of the Carew.
CURNOW: The Carew is very dry. It's a very water scarce environment.
Why put more pressure on the water environment in that part of the world?
MOHALE: We can say without any fear of retributions or reprisals that the cost -- this is a 60 -year-old technology. Shell has really become good at it. The risks to the environment are well understood, well articulated and I think they can be totally and absolutely mitigated.
CURNOW: Can you guarantee that the water will not be contaminated?
MOHALE: The -- the first commitment that we made was never to compete with the people of the Carew for their water needs in this pristine and ecologically sensitive area. So we, in the initial stages, certainly when we drill the first well, will bring in potable water from outside.
CURNOW: But there's still so many questions. There are more than 100 places around the world where fracking is either banned or there's a moratorium or there are restrictions.
What do you say to that?
MOHALE: There are instances where it has been banned. There are instances where there are concerns. But there are 1.1 million wells in North America alone. We probably drill more than 50,000 wells. We are only aware of no more than 21 jurisdictions in the U.S. of A where they are looking at this. Studies are ongoing. The interim results have been released. And by 20 -- by 2014, the ultimate result will then be -- be shared with the -- with the rest of the population.
CURNOW: This -- this image problem and the need to present your case couldn't have been very helpful when the South African Advertising Standards pulled adverts that you had put in newspapers saying that they had been misleading about -- about this whole fracking issue.
MOHALE: You see, the Advertising Standards Authority was presented with about eight complaints about the claims that we're making. It said the first four are absolutely legitimate,
(INAUDIBLE) and understood. The other four, they would like to see the evidence.
The Advertising Standards Authority did not come to the South Africans and said Shell is outright lying. It said for our market, for our conditions, these are not proven. And until and unless Shell can demonstrate to us, only then can we look at it.
And again, that's why the activities are called exploration, because we really don't know. Until you drill a hole and get to the bottom, you don't know whether there is, indeed, gas, does it flow in sufficient quantities to be economically viable?
But we suspect we will never know until we drill.
What we do know for sure is that if we are only to bring to production less than 10 percent of this gas, we can add into the GDP anything from 80 to 200 billion rands. We can employ 300,000 to 700,000 people and we can bring energy benefits to the populace. That we know for sure.
CURNOW: Do you agree with me, though, that Shell has an image problem because no matter what you say, many people are just not going to trust you?
MOHALE: We are up to solving the (AUDIO GAP) that South Africa has. And that challenge is that of the 50 million South Africans. Twenty percent of this population has absolutely no access to energy whatsoever. And we are seeing the case for gas is absolutely com -- compelling, because gas, it's much better, as far as the environment is concerned, like coal -- than coal-fired power stations. It is 40 percent more efficient. It is 50 to 70 percent less CO2 emitting. And it is acceptable. It is affordable and it is accessible to the majority of our people.
(END VIDEO TAPE)
CURNOW: OK, well, that's it for this week's show.
I'm Robyn Curnow in Johannesburg.
We're always online at CNN.com/marketplaceafrica.
There's a link to my Twitter page and to our Facebook page.
But until next week, goodbye.
END
