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QUEST MEANS BUSINESS
Stock Markets Swing After Trump Jr. E-mails; Olympic Hopefuls Each Set to Win Games; Snap Shares Tumble below IPO Price; Amazon: Prime Day Sales "At Record Levels"; Russia, OPEC Try to Limit Global Oil Glut. Aired 4-5p ET
Aired July 11, 2017 - 16:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[16:00:00] RICHARD QUEST, CNN HOST: Dow Jones Industrial markets closed and it actually closes up just a short amount. Up four on most
extraordinary day that we saw in the market. We will delve deep and dark into it. But trading is over on Tuesday. It's the 11th of July.
Tonight, stock markets they are left spinning as Donald Trump Jr. released his Russian e-mails. How those e-mails nearly dented the bull.
Everyone's a winner when it comes to Paris, Los Angeles and the Olympic Games, but which one will get which. And snap back to reality. Snapchat's
shareholder value is disappearing.
I'm Richard Quest, live in New York, of course, where I mean business.
Good evening, tonight, it was the case of a tweet, an e-mail chain and a bombshell revelation and it jolted the New York markets. President Trump's
elder son Donald Trump Jr. released e-mail showing he agreed to meet with someone described as a Russian government attorney who was promising dirt
on Hillary Clinton last summer. Now, the e-mails released -- well, it's best just to look at the chart. It will show better than anything else
exactly how the day unfolded.
The morning is pretty boring not much is happening. And then at 11:00 a.m. the e-mails are released. And within 20 minutes or so the Dow falls
sharply. By 11:30 all the gains have gone and the Dow is off by 152 points. Now to be sure and fair, the Dow has recovered by noon. So, what
is it about these e-mails? Well, the e-mails explicitly say the information that was being offered was, and the quote goes, part of Russia
and its government support for Mr. Trump. Donald Trump Jr. agrees to sit down with so-called Russian government attorney. And as you can see here
it's quite clear the Russian government attorney is who he knew he was meeting.
The rest of the e-mails are really just about housekeeping. But he also says when told that he could be receiving information that will be very
damaging to Hillary Clinton, and it says what you say. He replies, I love it.
Evan Perez is in Washington for us. Evan, we need to sift between what is significant and what is merely titillating. Now the fact that somebody
receives bad information about a political opponent, as Donald Trump Jr. says, that's normal. That would be expected. So, what is it in these e-
mails that you focused on?
EVAN PEREZ, CNN U.S. JUSTICE CORRESPONDENT: Well, the extraordinary line that you read just a little bit earlier, it's an e-mail obviously, from Rob
Goldstone, who's this entertainment publicist that apparently goes way back with the Trump family for some years. And has deep ties to people in
Russia. And he said -- that you read it earlier -- that this is part of Russia and its government's support for Mr. Trump.
Now that's an extraordinary sentence to be written by somebody who we don't really know much about. And certainly, didn't seem to faze at all Donald
Trump Jr. Who as you said earlier, response, if it's what you say, I love it. So, in other words he's welcoming this help from the Russian
government. And is the first time, Richard, the first time that we've seen any proof of what has been talked about for the better part of the year.
Which is whether or not the Russian government was explicitly trying to help Donald Trump's campaign. Trying to hurt Hillary Clinton's campaign.
This is something the Trump campaign has repeatedly denied. Donald Trump Jr. has repeatedly said that they did not have any contacts with Russians.
And certainly, had no contacts about coordinating or colluding with the Russians.
QUEST: Donald Trump Jr.'s story about this meeting, what he was expecting, what he knew, who we thought he was meeting, the circumstances. It's
changed numerous times. On Saturday, we got one version. On Sunday, we got another version. And now we've got the latest version. But how do
they explain away the quote that you and I have referred to which is clear that he was being told that Russia was supporting his father's candidacy.
[16:05:00] PEREZ: They don't really explain it. The tweet today from Donald Trump Jr. is sort of a statement that he issued, says simply that he
thought he was getting opposition research on his father's opponent in the general election. And he thought that it was completely normal and there
is nothing wrong with it. And he sort of right in the sense of its normal to get dirt on your opponent. It's frankly, a big industry here in
Washington to do that kind of thing.
What is not normal is for you to be explicitly told that you're getting it from a foreign government, an adversarial foreign government by the way,
and that that foreign government essentially is trying to help your campaign and hurt your opponent. And Richard, in the intervening year that
we've now had this investigation ongoing, they've repeatedly denied that any of this was happening. It only came out because "The New York Times"
was about to reported it. That's the reason why Donald Trump Jr. decided to tweet out pictures of this e-mail exchange.
QUEST: Briefly, Evan, I saw Tim Kaine basically saying, if true, this is treasonable.
PEREZ: You know, I don't know that it reaches that. But certainly, I think the FBI is going to be very, very interested to know who these people
were. Who these cast of characters that they were associating with and why they thought the Russian government was invested in this campaign?
QUEST: Good to see you, Evan. Thank you.
PEREZ: Thank you.
QUEST: You made it nice and clear as could be. Thank you very much indeed, we appreciate it.
The response on Wall Street underscores how much investors are paying attention to the revelations from Washington. The S&P 500 is up more than
8 percent so far, this year. But the Dow Jones, which is what we're going to talk about here, took a very serious tumble.
Good to see you. Good to see you.
When we spoke, Alan Valdes, on "Quest Express" on the floor of the Exchange, you blamed the computer trading. You blamed high frequencies.
ALAN VALDES, SENIOR PARTNER, SILVERBEAR CAPITAL: Yes, I mean that moved happen so rapidly it's shows you how the ETX and the high-frequency trader
-- they take a few words out of an of an ALGO and this was Russians and Trump and they just sold off. And they wanted to be the first out of the
door. And they sold off immediately. Then when the digested the news, we saw the market right back up.
PAUL R. LA MONICA, CNNMONEY CORRESPONDENT: Yes, it is amazing that the market didn't seem to care once, as you pointed out, the grownups came back
from lunch and put trade places, turn the machines back on. They finally realize that this was nothing to see here from market standpoint even
though it's, of course, a huge political story.
QUEST: Right, let me just go there. Gentlemen, give me the common tree as you will, Alan. So, when were at this point here -- this is the computers
doing all the trading.
VALDES: Correct. Now that's the computers doing all the trading. But we also looked at the dollar moved very little, did not move. And bonds were
basically flat. Maybe a little moving the bonds. So that told us it was just equities and because it's light volume, no human intervention at that
time. Sell them off.
LA MONICA: But we know that is the middle of the summer right now, volume is light and the stock market is far more emotional and dare I say it, not
always as rational as the bond market and currencies.
QUEST: But Paul, if I understand what you're saying, the gravamen of what was being said, the actual allegation within it is not of interest to the
stock market, which is evidence by the recovery and by the fact we ended the day up.
LA MONICA: Yes, for the time being Wall Street I think still does not believe that there is a legitimate chance that the Trump presidency ends in
scandal. That there's going to be impeachment, 25th amendment. And even if there is I know a lot of people who are so blase about politics in
general that they feel like, Ok, will get Mike Pence instead and maybe he's not a kinder gentler Trump, buddies a less emotionally volatile one.
VALDES: I think at the end of the day the traders will aggravate that it takes away from taxes, it takes away from healthcare. Just more chatter on
the Russians that doesn't seem to go away. You think that Trump should at least get rid of that twitter account at this point.
QUEST: But the one view is though that the market took notice at the political --
VALDES: The computers took notice. The humans didn't take notice. Because even when it was trading down. They couldn't really digested it.
It came so fast if you look at that. I mean that's happening --
QUEST: Right --
LA MONICA: One hundred and fifty points in the matter of a half-hour there is not going to be some great big HBO documentary five years from now
about, remember the great market crash on July 11.
QUEST: No, but this was the same --
LA MONICA: This isn't even a flash crash.
QUEST: No, it's not even a flash crash, but this is the same as the Comey revelation. When Comey was giving evidence and we saw the market falling
very sharply then as well.
LA MONICA: Yes. That was Comey giving testimony. Comey actually talking to Congress, I think there was a big difference between that and computer
ALGOs getting a sense that Donald Trump Jr. tweeted something about Russia.
[16:10:04] QUEST: So, to conclude, is it your considered assessment, gentlemen, the fact that these allegations that Russia may have been
supporting Donald Trump, so far does not factor in the markets movements.
VALDES: For the time being.
LA MONICA: I agree.
LA MONICA: It may eventually, but we need a real groundswell of calls for impeachment.
QUEST: And the volatility that we see, the VIX index did not jump just a touch or two. But the volatility that we see this is the norm.
LA MONICA: It'll be interesting to see if this had happened in a couple of weeks from now on a day were a lot of companies were reporting earnings and
there was more volume and more news flow in general. We had Pepsi earnings this morning and then Crickets. This was a very quiet day on Wall Street,
VALDES: Tomorrow the same until Thursday when the banks come out with their earnings.
LA MONICA: Friday, yes, the only one. Thursday, you have Delta Airlines. Friday, you got the big banks.
QUEST: Good. Will be covering it all. Actually, no, we won't talk about Crickets. I'm off on Thursday and Friday. Enjoy the weekend. Thank you.
Good to see you.
Hillary Clinton's former running mate, Tim Kaine, you heard me refer to that in my question to Evan Perez. Says that Donald Trump Jr. may have
committed treason. And lawmakers on both sides of the aisle tells CNN that serious questions need to be answered.
(BEGIN VIDEO CLIP)
SEN. TIM KAINE (D), VIRGINIA: This question of collusion, which essentially starts to transition us into potentially a treason
investigation. When he was approached with this idea he should have turned it over to law enforcement immediately. That's what anybody should have
done. So, very serious, but I think the Senate Intel committees and special prosecutor now have a lot more work to do.
UNIDENTIFIED MALE: Do you think this is treason?
Kaine: The investigation -- nothing is proven yet. But we're now beyond obstruction of justice into what's being investigated.
(END VIDEO CLIP)
QUEST: David Chalian is with me. CNN's political director. Help me understand the significance of today.
DAVID CHALIAN, CNN POLITICAL DIRECTOR: Here's the significance of today. For the first time, we now know in black-and-white, the e-mail that Donald
Trump Jr. put out himself, that he accepted a meeting with someone that he believed to be doing the business of the Russian government to offer help
to his father's campaign and do damage to Hillary Clinton. That is what Donald Trump Jr. is reporting from his own e-mail chain.
We also know that he forwarded that e-mail to Jared Kushner and Paul Manafort, the two people he brought into the meeting -- this is the most
upper echelon of the Trump campaign -- to join in this meeting. What we don't know is, did they read the full chain and also know that this was
somebody who was suggesting that they were from, you know, information that the Russian government was trying to give to the Trump campaign.
And here's why significant. Because for the better part of the year every time Donald Trump is been asked about this or people around him, it has
been dismissed as completely ridiculous, a fabrication of the Democrats, a fabrication of the fake news media. Well, nobody saying that today. Not
the White House, not the president, not Republicans on Capitol Hill, because we have it in black-and-white in this e-mail from Donald Trump Jr.
QUEST: Has an offense been committed?
CHALIAN: Well, I'm no lawyer, so I'm knocking to try to play one. I don't think that's what today is about though. I don't think this is about the
conclusion of this. This is as Richard Burr, the Senate Republican chairman of the Senate Intelligence Committee, he said, this is still the
beginning of the process that we've got a long way to go here.
QUEST: Right, but this process that you're talking about, which obviously relates to Mueller's investigation. I mean that is in many ways the best
hope of getting the whole dirty truth out, isn't it? Because he can go in any way he wants, backwards, upside down, inside out, however he sees it.
CHALIAN: No doubt about that. And we have a history of looking at special counsel's and prosecutors, independent counsels, when that law
existed here in this country. That they end up nowhere where they began. Because they can go in every direction. Monica Lewinsky was a perfect
example of that. I mean, Ken Starr --
QUEST: It's somebody to have him here.
CHALIAN: Well, we don't know. We're going to see where --
QUEST: Sorry --
CHALIAN: Remember, it's not just Bob Mueller, it is also the Senate Intelligence Committee, Senate Judiciary Committee, the House Intelligence
Committee, all of these investigations are going forward right now. So, it is not just the one. Bob Mueller is one that holds the most cards, because
as you're saying, he has this power to be able to go anywhere. But all of these witnesses are being brought before all of these folks and their
stories -- Donald Trump Jr. had three different stories in the last three days. That's not going to fly when he goes before Bob Mueller.
[16:15:00] QUEST: So, now do or do we know at this point, David, whether the American people care about this. Is it so down a rabbit warren of
complexity that they all say, look, we knew there was something weird. We knew the Russians were involved and we don't care if Donald Trump manages
to get the U.S. economy firing on also wonders again.
CHALIAN: Right, do they care about this more than they care about their job, their healthcare, their children's education, no. I don't think so
and I don't think there are many issues that get brought up in day-to-day political combat that Americans care about more than those pocketbook
issues. But I will say this, the President's approval rating is hovering somewhere between 35 and 40 percent. The American people certainly, are
not giving him good grades in terms of being a productive President, getting stuff done, reputation on the world stage. Whatever it is, he's
not getting resounding reviews from anyone beyond his base of course supporters. That is largely due to this massive distraction that is
dominating his presidency day in and day out.
QUEST: Finally, I just want to refer to something I saw out of the corner of my eye. Forgive me, I'm talking about something that I haven't
discussed with you. I'm going to talk about but I'm sure you've seen. There is a lot of talk or gossip coming out of the G20. ABC Australia had
a very strong report about it that basically Donald Trump was a very lonely man at the G20 and was seemingly well and truly out of his depth.
CHALIAN: They call it the G19 now. He was sort of stepped apart there. Listen, the administration certainly clearly doesn't see it that way. I
wasn't in Hamburg to observe everyone there. But there is no doubt that what the administration will say now is you don't lead by following. You
sometimes have to lead by carving out a separate space. Whether or not the European Community and others at the G20 by that line of argument, I think
remains to be seen. We'll see him side-by-side with the French leader later this week, Macron, in Paris. They're going to have a news
conference. So, they're both going to take questions. This will be the first opportunity that will see him side-by-side with a European leader on
the world stage since all of these new revelations about his son.
QUEST: Really grateful that you made it so understandable for us tonight.
CHALIAN: Thank you.
QUEST: Thank you very much indeed.
Let's talk about and stay in Europe. Whether it's Paris or Los Angeles battling to host the 2024 Olympics. Now, don't worry if you lose one there
is a consolation prize four years later. You get the other one. I'll explain after the break.
QUEST: Paris and Los Angeles are going head-to-head in the battle for the 2024 Olympics. And the losing team this year will get more than just the
participation treatment. The IOC, international Olympic Committee, has already voted today to break with tradition and award the 2024 and 28 games
at the same time. Now the two cities will decide who should host in which year between themselves. It all seems rather civilized.
[16:20:05] They get to choose while you have -- you have -- no you have. No after you, please I insist. If they can't reach an agreement the IOC
will pick one of them in September and then open up bids for the 2028 games to other cities. Fascinating. Last night we showed you the Paris bid.
Tonight, Paul Vercammen is in Los Angeles. Good to see you, Paul. Does Los Angeles -- I was reading some interesting notes on this. Does Los
Angeles have a preference if push comes to shove whether 24 or 28?
PAUL VERCAMMEN, CNN CORRESPONDENT: Well Richard, for what I understand, yes, they have a preference. They'd like to go earlier, but it's not can
happen. Because all the pundits here in the U.S. are telling me and you get a sense from Olympic members who toured Los Angeles, that they want to
award Paris 2024, because that would be the hundredth anniversary of the 1924 games, the centenary. So, what they'll do is -- all pungent saying --
they'll give Paris those games. LA gets 2028 and very important to the Olympic movement, they have two viable candidates. Both with great
infrastructure and the ability to put on these games and not be yet a horrific white elephant putting a huge economic drag on their respective
cities. So that's how I think this is going to go down, Richard.
QUEST: And Los Angeles where you are has really made it quite clear, I mean not literally, but if the games were held next month they could do it
in terms of the facilities, it in terms of it would not go over budget. And if we remember 1984 -- and yes, I am old enough to remember those
games. I didn't quite cover them. But Peter Ueberroth, who led those games, they broke even. Might even have made a profit.
VERCAMMEN: No, they made way better than breaking even, Richard. You're absolutely right. They stunned the world by going from these games that
were discounted and thought to be in huge trouble, to making $225 million. It may not sound like a lot right now, back then it was. So, Ueberroth
with the help of many savvy people in Los Angeles, including Lew Wasserman, the man who ran the kingdom of Universal MCA, Universal Studios and the
rest. They took that money and they invested it smartly. And to this day 130,000 poor children in Los Angeles get free recreational and sports
programs because of that well invested surplus.
But there's a link here, Richard. Casey Wasserman is Lew Wasserman's grandson. He's the chairman of the LA group. He thinks that they can very
easily sort of replicate the smarts that his grandfather and Ueberroth demonstrated. And LA's feeling extremely confident in putting on games
that will not hurt this city in any way financially.
QUEST: Now that's the fascinating part, isn't it? Because they are aiming to repeat history.
VERCAMMEN: That is the fascinating part. And they have the infrastructure. There are so many stadia here already in Los Angeles.
They have UCLA and USC for the dormitories for the athletes and for the media. They are building still more complexes. In fact, the new football
soccer stadium going right next to the very Coliseum where they would have the opening and closing ceremonies. And I should add also, in Paris, Paris
is also very rich in infrastructure as well. What the Olympic Committee is glad about his they are not dealing with a situation where they have to
worry now for eight years about who in the world could step up financially and host the games.
QUEST: Beautifully put, Paul. Thank you so much for joining us from Los Angeles. That decision to award to games at once is only possible because
all the other cities withdrew. Now you had Hamburg, Budapest, and Rome, they all fell out because the fear of the cost was too high. The CNN
sports analyst, Christine Brennan, his in New Jersey and joins me. How worried has the Olympic movement been? The winter games, again, it was
toss a coin, because it was only two and everybody else dropped out. The summer games is like it is. How worried are they in Lucerne?
CHRISTINE BRENNAN, CNN SPORTS ANALYST: Oh, Richard, they're very worried. I mean you look at places like Norway that said basically go jump in the
lake to the IOC. And that's why the 2022 Winter games are in Beijing. As you said, look at what's left for 2024, that's at least what the city was
supposed to be that they're looking at, the 2024 games. It's LA or Paris. Now these are two heavyweights. These are two behemoths and the last thing
the IOC wants to do is to start running the world trying to find anyone who's willing to take on this incredible financial burden to hosted an
Olympics after Rio and the fiasco that Rio had after others.
[16:25:01] They've got both LA and Paris. They don't want to lose either one, which is why they did this deal.
QUEST: Has there been a shift in the balance of power with this between cities and IOC? IOC has always ruled the day. They turn up. They tell
you how much to spend or whatever they need. And the city is left with the bill. But with Paris and Los Angeles these two cities can turn around and
say, we'll do it on our terms.
BRENNAN: Absolutely, Richard. You have nailed it. We are seeing a sea change here. The cities are taking control. Now having said that, the IOC
is the last of the old boys network. Full royalty, some real royalty, they want the Mercedes-Benz and the Rolls-Royce and the five-star hotel or
whatever star hotel and the restaurant. And there still going to demand that. But reality is intruding. It's 2017 and I will bet that when we see
this deal being made between LA and Paris -- and they will get along and they'll figure it out -- and my guess is as Paul said, it'll be Paris in
2024 and LA in 2028. And that's a win-win for all of them.
My sense is that these cities are going to say, wait a minute, we can control this. Because the IOC has basically, I think Richard, been out of
control for years. Demanding things from cities that just don't have the wear with all and the resources to do it. Montreal paid off its debt I
think just a few years ago, all the way back to '76 and I think it's time that there's a bit of a reality check in the Olympic world. And I think
that's exactly what we're seeing here.
QUEST: So, when is the next opportunity for all of this to be put to the test? Because if you're right, and I suspect you are, that is going to be
Paris and then Los Angeles. The next bidding for the summer will not be for another five or six years. It will be after the Paris games when will
be looking at the '32. Where I'll probably be well into dotage and not be worried about it too much who wins. But the winter games after Beijing
will be an opportunity to have another game.
BRENNAN: Absolutely, that will be 2026. You're going to see a lot of cities -- they already are talking about it. Will they come back to North
America? Will they come back to Europe? Obviously, we got the next three games in Asia. South Korea in 2018 and of course Tokyo summer games in
2020. Then Beijing and a very strange choice in 2022 for the winter games. And my guess is we will see them in either Europe or North America and I
think we will see some of that. Especially again, keep in mind, Richard, Norway and what they did.
The IOC thought it had Norway in the bag for 2022. Norwegians of all people said forget it, we don't want any part of the game playing and all
the nonsense and all the demands that you are making on us. They said that to the IOC and they laughed. And that shock the IOC. And I think Thomas
Bach for all his foibles, I think he is a modern man who understands the modern times better than anyone before him. Better than anyone before him
better than anyone before him.
QUEST: Really grateful you put it into such clear perspective for us, thank you. Much appreciate it. Christine Brennan joining us from New
As we continue tonight, Russian and Saudi Arabia are leading the charge to stabilize oil prices. U.S. shale rebound may hamper their efforts.
Russia's energy minister after the break. It is QUEST MEANS BUSINESS on a Tuesday.
[16:30:43] QUEST: Hello, I'm Richard Quest. There's more QUEST MEANS BUSINESS in just a moment. When Amazon's claiming a record-breaking Prime
Day. And Russia's energy minister tells us all options are on the table to boost the price of oil. As we continue, this is CNN, and on this network
the news always comes first.
President Donald Trump says he applauds his son's transparency after Donald Trump Junior released e-mails shedding a new light on a meeting from last
June. The e-mails between Trump Junior and a publicist show that the younger Trump was promised information that would incriminate Hillary
Clinton and that was part of Russia's support of his father. Trump Junior released e-mails only because they were about to be published by "The New
The U.S. and Qatar have signed a memorandum of understanding to fight terrorism funding around the world. U.S. Secretary of State Rex Tillerson
and his Qatari counterpart signed the agreement in Doha. Sec. Tiller's and says it might help resolve a month-long dispute between Qatar and its
Investigators are trying to determine the cause of a fatal crash of a U.S. Marine Corps plane in the state of Mississippi. The plane was on a
training flight and it was moving personnel and equipment when it disappeared from air traffic control radar, 15 Marines and a Navy corpsman
U.S. Federal Aviation Administration is also looking into near collision on Friday at San Francisco's International Airport. An Air Canada flight
approached for landing on a taxiway that was crowded with planes. Investigators say the pilots inadvertently headed for the taxiway instead
of the runway that is parallel. The plane landed safely on a second approach.
It looks like the host cities for the 2024 and 2028 Olympic Games have been set, Paris and Los Angeles are the choices. It is unclear which city will
host which year. The IOC broke with tradition by awarding two games at once.
Oil prices jumped nearly 2 percent on Tuesday following reports that crude stockpiles fell in Europe, that is good news for Russia and Saudi Arabia.
They have been trying to rein in a global oil glut. Russia's energy minister says they are not opposed to finding other ways of dealing with
falling oil prices.
(BEGIN VIDEO CLIP)
ALEXANDER NOVAK, RUSSIAN ENERGY MINISTER (through translator): The door is open and we need to understand whether any further actions are actually
needed. For that we need to monitor, we need to analyze we need to look at the market.
JOHN DEFTERIOS, CNN MONEY EMERGING MARKETS EDITOR: Let's be blunt, shouldn't OPEC and non-OPEC members take a different strategy when it comes
to U.S. shale? Some would suggest that it is particularly resilient, and U.S. production is over 9.3 million barrels a day. They are survivors.
NOVAK: No, I don't think we need a different strategy. I believe that the decisions taken back in December last year during the Vienna Accord, the
initiative launched by OPEC and non-OPEC countries, was the right choice in that situation. And I believe that the extension for nine months was also
the right choice based on the information we have. One should not be afraid of rebounds in shale production. When we have been gathering
together with our partners from other countries, we understood very well that there would be a rebound, that there would be some recovery. All
signs, all the fundamentals they point towards this. So, we were ready that part of the cost would be taken by U.S. shale recovery.
(END VIDEO CLIP)
QUEST: And so, to the markets in Europe, and all the main markets in Europe closed lower. In London, shares of the media group Pearson fell
after sold a 22 percent stake in the book publisher Penguin Random House. Investors were cautious ahead of Janet Yellen's semiannual testimony before
Congress on Wednesday.
As we continue, prime opportunity for Amazon, customers around the world are clicking by at record rates. The item they are most likely to do it is
there sales strategy.
[16:35:00] (COMMERCIAL BREAK)
QUEST: Welcome to the living room, Amazon says shoppers have been spending at record levels a few hours into what is called, Prime Day. What is Prime
Day? Is a 30-hour opportunity for Amazon to sell its Prime subscriptions. And in doing so it shows Amazon's dominance in every area that it touches,
and has done so since the day the company began.
Back that of course, it was all about books, thank you. Everything that you could read was sold by Amazon, everything from A to Z. And then it
went one stage further when it decided to use its spare computing capacity, think of all the servers it's got for all its members and all its sales,
and it created Amazon Web services. In doing so we created -- it absolutely crushed Microsoft and Google.
So not only books and computers, now Amazon makes its own content for example. Oh look, it's the "Grand Tour," Jeremy Clarkson. So, whichever
way you look at it, you can watch it, you can read it, and Amazon original series, you've got Kindle TV media players, and you've got the Amazon Echo
2. So, with all of these things that you got to assemble, Amazon has also announced an installation service which will help you put the whole thing
together. And it has announced its own launch of its own clothing line, putting it together with Amazon, you've got groceries that are being
delivered with Amazon Fresh. And you've got the whole thing with Amazon Fresh now with Whole Foods.
The Amazon ecosystem is simply vast. And as it moves further into different areas, Clare Sebastian explains the significance of Prime Day
CLARE SEBASTIAN, CNN MONEY CORRESPONDENT: Yes, Richard is going pretty well, according to Amazon. They say there is already record sales. They
made $1 billion last year and they are on track to beat that this year. It is interesting you call it the ecosystem because it is kind of a play on
words, they are not just selling stuff. This year they are selling their own stuff. And the Echo, they ask people to shop through that as well, so
it's not just the money they are making from selling the Echo, it is the money they make from people shopping on the Echo. And people who are using
those devices that use Alexa that virtual assistant, were able to get deals early and were able to get even bigger deals. Five days in advance.
QUEST: But I bought an air conditioner on Amazon, I mentioned it on the air before, last week. And I need to buy another air conditioner. There
were no deals on that one, I was looking a short while ago.
SEBASTIAN: They are bringing on new ones all day, there is apparently a new deal every five minutes. But they do and when stocks run out, so I
have been looking as well at various things I can't afford. Like 65-inch televisions on Amazon.
[16:40:00] And you can see that things are counting on all day.
QUEST: This is a totally manufactured event.
SEBASTIAN: Absolutely, it is made up completely by Amazon. It is like Alibaba singles day, but they work, Alibaba made $18 billion in singles day
last year, completely dwarfing this event. This is about Amazon's dominance as you said.
QUEST: I understand it is all about selling Prime memberships. Samuel Burke earlier was telling me about the evidence, those who've got Prime
spend more in the future. Is that right?
SEBASTIAN: Absolutely, because you get free shipping with Prime. And the psychological impact of spending $100 on a Prime membership means that you
feel you should get your money's worth out of it. But other companies are getting in on this too, this isn't just Amazon doing this now. We found
this in the newspaper today from Macy's, they are calling a black Friday in July, a rather old-fashioned way of advertising in there. The JC Penney
are doing it as well, there are calling it cyber in July, scissors are calling it their summer splash. And these are the companies that have been
most hurt by the rise of e-commerce in particular.
QUEST: Prices so low, it is like black Friday in July, seven days of specials.
SEBASTIAN: Right, we will have to see if they come into place with the kind of sales that Amazon is looking at today.
QUEST: One sale, one stock that seems to be on sale at the moment, Snap shares have literally fallen, the bottoms fallen out of them. The
psychological blow to investors. A warning has been given, it has been delivered by the lead underwriter of the IPO about Snape's future
prospects. The shares are now below the IPO price, they are down 9%. The high point was hit right after the IPO which I think is when I bought them.
Morgan Stanley has now cut its price target to 16 downgraded the stock.
SEBASTIAN: Yes, I mean it is kind of two indignities in the space of the last two days, when I first they dip below the IPO price, that
psychological barrier of $17. And now their lead underwriter has cut their target and made it even worse by what they said in this report here which
was, we have been wrong about Snap's ability to innovate and improve its ad products this year. So, we have one problem which is advertising where
basically investors and analysts feel that they are not keeping up with the others like Facebook in terms of innovation like Google. But the other
problem is of course also with Facebook is they keep copying everything that Snapchat is doing from their filters to stories, which Facebook has
not only ruled out an Instagram which it owns, and on WhatsApp messenger and on Facebook's main app itself. So, there is real --
QUEST: Is Snap in trouble?
SEBASTIAN: I mean there is clearly something that needs to change, this is what this report from Morgan Stanley says, all is not lost, there is still
room for improvement but they need to innovate and they need to do faster than other people can copy them. This is the key. So, they need to
broaden their ad offerings, they need to make it easier for people to advertise. And they need to do more features and improve user engagement.
QUEST: Finally, pull all the strands of the circle together to mix my metaphors. Amazon is a behemoth, $1000 a share price. And yet there are
those who are very concerned that, you know, when I say the evil emperor I don't mean literally, but there are those who believe that this is
something that is ultimately not going to be a force for good.
SEBASTIAN: Well, I think that remains to be seen but certainly we live in a world where you have these giant tech companies the likes of Amazon, the
likes of Facebook who seem to be eating everyone else's lunch. And how that shakes out we don't know yet. Maybe we'll get a series of giants and
then the niche so for example in social media Facebook and then the more niche networks like Twitter, where there is about 300 million users
compared to Facebook's 2 billion. Maybe it will be the same with shopping, the others will survive but in a much smaller form.
QUEST: Thank you very much. Look, a vacuum cleaner. Shark vacuum cleaner for $79.99. Claire Sebastian, do you need a vacuum cleaner?
SEBASTIAN: I might. Yes.
QUEST: As we continue tonight, Donald Trump Jr.'s e-mails reveal a web of connections stretching from Moscow to New York to Washington includes
campaign officials, a popstar, in a beauty pageant organizer. In a moment.
[16:45:00] (COMMERCIAL BREAK)
QUEST: Today President Trump called his eldest son a high-quality person and says he applauds his transparency. It follows Donald Trump Jr.
releasing the e-mails that show he welcomed help from a Russian government attorney during his father's run for the White House.
CNN's Ivan Watson now introduces us to the cast of characters involved in this very strange e-mail exchange.
IVAN WATSON, CNN SENIOR INTERNATIONAL CORRESPONDENT (voice-over): Believe it or not this pop music video is at the center of a political controversy
that is riling Washington. A Russian popstar, Miss Universe contestants and a celebrity cameo.
Give Russian popstar Emin is now one of the colorful collection of Trump Associates linked to a controversial meeting between Donald Trump Jr. and
the Russian lawyer. Trump Jr. says he met the lawyer Natalia Veselnitskaya, on June 9, 2016 in New York. She spent years lobbying
against the Magnitsky Act, U.S. legislation that punishes Russians implicated in human rights abuses and corruption.
She promoted this documentary film aimed at undermining the law. Natalia Veselnitskaya's meeting with Trump Jr. organized by Rob Goldstone, a
British PR agent in the music industry. And once a judge on a Trump owned to Miss USA beauty pageant. Goldstone told CNN, Natalia Veselnitskaya,
stated she quote, had some information regarding illegal campaign contributions to the DNC which he believed that Mr. Trump Jr. might find
In an interview Tuesday, Veselnitskaya denied working for the Russian government. Goldstone says he set up the meeting at the request of his
client the singer named Emin.
Emin partnered with Trump and hosting the Miss Universe beauty pageant in Moscow in 2013. A year later Trump sent Emin a video message on his
DONALD TRUMP, PRESIDENT OF THE UNITED STATES: When you are a winner, you're a champ, your great at real estate, and boy, can you entertain.
WATSON: Having boasted of his close ties to the Trump's last year on Russian state TV.
EMIN, RUSSIAN POP STAR: His daughter Ivanka was in this office two years ago when we discussed the Trump Tower project. I met many times with the
sons, Eric and Donald, we message each other constantly.
WATSON: In addition to music, Emin is an executive at Crocus Group run by his billionaire father, Aras Agalarov. The patriarch is an associate of
Trump. This Trump tweet in 2013 suggests they had plans to build a Trump Tower in Moscow. The billionaire Russian businessman also has ties to the
Kremlin. In 2013, he received a medal of honor from Vladimir Putin.
In e-mails published by Trump Jr., Goldstone wrote that the father met with a Russian prosecutor and wanted to share sensitive information to help
Trump's campaign. Now these alleged attempts to meddle in U.S. politics may have landed these Russian businessmen in hot water. Ivan Watson, CNN,
QUEST: Thomas Pickering served in the 1990s as U.S. ambassador to Russia, he joins me from Washington tonight. Ambassador, I think you would have to
agree this is a right royal mess. What if you make of these developments in these revelations had Donald Trump Jr. very likely did know that the
Russians are actively assisting his father's campaign?
[16:50:00] THOMAS PICKERING, FORMER U.S. AMBASSADOR TO RUSSIA: Richard, it is good to be with you again, and a right royal mess is what we have been
cooking up here for months. And so, in effect, this may be the latest, most daring step in a right royal mess. But in any event, it is exactly
what you say it is, I disqualify myself from making legal judgments on this particular case.
But one wonders in fact whether a foreign country pledged in the U.N. charter not to interfere in the internal affairs of another state should in
fact be leading on opposition politicians in the United States in an election race to believe that they had something really juicy to offer.
And of course, I think that is the central substance of what we are dealing with here tonight. We are not sure where it will end up but it looks like
it is one more layer on this very highly multilayered cake of problems that you called the right royal mess.
QUEST: OK, so, now let's throw another dollop onto it, you had the weekend G20 where you had the first meeting between the U.S. president and Vladimir
Putin. You had some sort of arguing about whether there was any interference. But you have this strange business of a cyber commission, a
cyber council that Donald Trump says they have agreed. And then changes his mind afterwards.
PICKERING: You know, President Trump is not I think the first time that he is made a suggestion or two that he is later reconsidered and thought not
to be the greatest thing in the world. And so, we are seeing that. I do not know what provoked this notion that we would have this ironclad
partnership in cyber. And the fact is of course that Russian and Russian hacking has been one of our principal cyber problems. So, do we have a
reason here to expect that somehow Mr. Putin wants to go straight on this issue are not? Or is this merely just another come on? We will have to
wait and see.
QUEST: As an experienced diplomat, at the highest levels, give us your assessment, Ambassador, how damaging is this for U.S. diplomacy and other
U.S. ambassadors going about the business worldwide?
PICKERING: Well, we have seen over the last months with clearly great certainty a set of actions and activities which if you believe the polling
data, and it is all consistent is running the United States down in the estimation of peoples around the world, and from my chats with diplomats
here from various countries in the estimation of foreign leaders. And so, one only has to look at that kind of salient bit of evidence, where did Mr.
Trump stand in the G20 photo when normally the American president stood within two shoulder-lengths of whoever was running show.
These are the kinds of things that obviously worry us Americans, because we wonder in fact is this something that we can recover from or is this
something that is going to be a permanent world condition? I hope that it isn't because in fact the world still tends to look at the U.S. whether we
do silly things or not at least to find out where we are coming out.
QUEST: Is it dangerous, and I think of course of North Korea here where you can arguably get mixed messages coming -- or actually not mixed,
confused or seemingly obscure messages coming from Washington which can be misinterpreted deliberately by actors like Kim in North Korea for their own
PICKERING: Well, that is one scenario and there are many, but those who hold nuclear weapons I think have a special obligation of responsibility to
the world community to say and do nothing that would in any way create the kind of inadvertent accident which could lead to conflict which might lead
to their use. And I think that is a burden that has been borne particularly by the two nuclear powers ever since the Cuban mess up back in
the 60s, where we had in fact the opportunity or the challenge of looking down the barrel of a nuclear gun so to speak, and not finding it very
appetizing. So, this is something that is serious. North Korea is one place but there are other places as well. I think there are other players
as well we shouldn't discount. I recently participated in a report that looked at Korea.
[16:55:00] That looked at U.S.-Russia, that looked at South Asia, Pakistan and India, and looked at the US and China with varying degrees of deep
concern that they could be the kind of places where loose talk and unbridled energy could take us deeply into conflict.
QUEST: Ambassador, wonderful to have you on the program tonight. Think he was always.
PICKERING: Thank you, Richard very much. Nice to be with you.
QUEST: We will take a Profitable Moment after the break.
QUEST: Tonight's Profitable Moment, you have got to hand it to Amazon Prime, like Alibaba's single days, a totally manufactured event that is
solely designed in the case of Amazon to increase membership for its Prime subscriptions. And it is going to work, people around the world are buying
in the billions. You cannot blame them for doing this, but you have to question why we all take part in it.
Is it any different than Black Thursday after Thanksgiving? Probably not. But put it all together and I just can't help feeling we have all been
suckered in the something that didn't need to happen. Now I've got the check what bargains might be available to me.
And that is QUEST MEANS BUSINESS for tonight, I am Richard Quest in New York. Whatever you are buying or up to in the hours ahead, I hope it is
profitable. I will see you tomorrow.