Return to Transcripts main page
Quest Means Business
Brexit Talks Falter at Last Minute; Dow Hits All-Time High After U.S. Tax Vote; "House of Cards" to End Without Spacey; Disagreement of Irish Border Stall Brexit Negotiations; Music Causing a Blue Christmas for Shoppers;
Aired December 04, 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: The closing bell on Wall Street, the Dow is just up 58 points. A rather feeble pathetic sort of gavel there.
Which perhaps justified when you look at how the marketed traded throughout the course of the day. We'll give you great analysis on what happened and
why. But the day is over. It is Monday, it's December the 4th.
Tonight, a Brexit break through that blows a pause. Talks in Brussels falter at the last minute. We'll be in Brussels and on Downing Street.
Wall Street gets a big payday from the tax vote. The Dow is at a record, barely and just. And the fall of the "House of Cards," Netflix announces
final season without Kevin Spacey.
I'm Richard Quest, tonight, live from the world financial capital, New York City, where I mean business
Good evening, we start tonight with Brexit and the negotiations that have stalled on the question of the Irish border. The day began with smiles,
handshakes and optimism a deal could be reached. That's Jean-Claude, the president of the commission and Teresa May the British Prime Minister.
After intense hours of negotiations those hopes were dashed. The PM and the Commissioner warned crucial issues remain unresolved.
(BEGIN VIDEO CLIP)
JEAN-CLAUDE JUNCKER, EUROPEAN COMMISSION PRESIDENT: Despite our best efforts and significant progress, we and our teams have made over the past
days on the agreement on issues, it was not possible to reach a complete agreement today.
THERESA MAY, BRITISH PRIME MINISTER: And it's clear crucially that we want to move forward together. But on a couple of issues, some differences do
remain, which require further negotiation and consultation. And those will continue, but we will reconvene before the end of the week. And I'm also
confident that we will conclude this positively.
(END VIDEO CLIP)
QUEST: Now the pound sterling tracked the ups and downs of the talks. Look how you see it spiked before lunchtime in Brussels. The word
seemingly good reports of a deal being done, and then it came crashing back down as Theresa May and Jean-Claude Juncker announced they had not made
sufficient progress.
So, let's update you with the issues. So, the big question, of course, the dates until the U.K. leaves the EU, 480 days, 1 hour 57 a minutes and 20
seconds. Everybody is obviously obsessed by that. But that really doesn't tell the whole story. Because the actual time to do a deal, then to get it
ratified by Parliaments and then to get it ratified by national governments. If some cases it has to be. Means that has actually a lot
less time than you would think.
So, negotiations that had to be resolved before the talks. OK, so the first thing is the sequencing of how things are going to be dealt with.
What needs to be dealt with, before you can get from this side of the chart to this side of the chart. And then you got the EU exit bill. So, there's
been substantial progress on the EU exit bill. It's believed that Theresa May is going to offer up to 50 billion pounds on the exit bill and that
should sort that out.
You've got the citizens' rights. There the snag has to do with the Court of Justice and who's going to be allowed in and who is not. The one thing
that's interesting is the Irish border, because it's the last hurdle and Juncker was confident of an agreement this week. The problem of course is,
that everybody had thought it was going to be -- it was sort of the hidden issue that's suddenly come back.
Now remember, they've got to get through all of this before they can start talking about trade, legal security, and the two-year, three-year, whatever
it is transition period. So, we're still firmly still stuck here. And the European counsel, which is December 14, that's when the British were hoping
to get the green light to start moving from this to that side. Keep an eye on this Irish border question, it's the one that's sticking at the moment.
We're covering it from both sides of the English Channel. Erin McLaughlin is in Brussels and Bianca Nobilo is in London. Start with you Erin the
issue of Northern Ireland and this weird phrase regulatory alignment. What finally caused or what stymied the talks from success today?
ERIN MCLAUGHLIN, CNN CORRESPONDENT: Well that is certainly the question of today, Richard, it's what people here in Brussels are asking. Here is what
we know in terms of how these events unfolded.
[16:05:00] At the beginning of the day, all signs pointed to there being a deal on the Northern Ireland issue, seen as one of, if not the most
contentious issue of these talks. We heard from the Irish Tea Shock saying that a was a deal in place between the EU, the U.K. and Ireland. Then
Theresa May arrived she met with the president of the European Commission, Jean-Claude Juncker, for a working lunch. At some point, according to
British and Irish media reports, during that lunch there was a phone call between Prime Minister May and the head of the DUP, Eileen Foster, that had
been as a critical --
QUEST: Let's pause there with that phone call because that phone call takes us across to London, picking up the story, Bianca, what was that
phone call about?
BIANCA NOBILO, CNN PRODUCER: Well, Arlene Foster who you just mentioned is the leader of the Democratic Unionist Party, the DUP. That's the biggest
party in Northern Ireland. That's the party that's propping up Theresa May's minority government in the U.K. So, the Prime Minister relies on
DUP's support to pass all of her crucial Brexit bills and other government bills of confidence which she needs in order to govern at all.
QUEST: Stay with you, Bianca. The DUP would not sign up to this deal that was being put together in Brussels. Is that right?
NOBILO: That is right. The DUP have always been firm on being pro-Brexit and pro-union. That's what they stand for. That they would never
countenance the idea of being treated differently from the rest of the U.K. with regards to Brexit. They didn't want to diverge from the rest of the
U.K. and be more like the Republic of Ireland. They want to be pro-union and with the rest of the U.K.
QUEST: Erin, If that is the situation and regulatory alignment is not possible, but they don't -- both sides say they don't want a hard border,
what happens next? Could Northern Ireland be the ultimate sticking point?
MCLAUGHLIN: Well, it certainly looks that way, Richard. From the EU's perspective, Theresa May needs to sort this out at home and then come back
with something along the same lines of the deal that was agreed in Brussels earlier today. That is what the Irish Tea Shock said. He said it's fine
if you change the wording, but the meaning has to stay the same. And that's a regulatory alignment essentially, which is according to the draft
document that leaked here in Brussels earlier today. Regulatory alignment for Northern Ireland, it has to essentially remain a part of the single
market as well as the customs union.
NOBILO: Richard, I would add as well, that it's not just the DUP that oppose this idea. It's also hard core Brexiteers within the Prime
Minister's own government and also within the Labour Party, they don't want to see any difference between Northern Ireland and the rest of the U.K.
either
QUEST: All right, Brussels, London, thank you, we'll see throughout the course of the week. Time is short in terms of what happened. The impasse
in Brussels did not dent European shares. Take a look at the numbers. It's strong gains in Germany and France. Very strong, up 1.5 percent in
Germany. The DAX was the driver there. Portugal's finance minister to become the new Euro Group president. That's interesting. Remember the
Eurogroup, that's the Eurozone, it deals with matters of the Eurozone, and the Eurogroup, Portugal now taking over.
The tax vote drove U.S. stocks higher, come and join me, at the trading post. Paul. good to see you.
PAUL R. LA MONICA, CNNMONEY CORRESPONDENT: Thank you, sir.
QUEST: We'll be with you in just a moment. Stay comfortable. Guru Paul La Monica will be giving us perspective on a variety of issues.
The Dow -- only the Dow is at a record. Now bear in mind they sort of hit intraday highs, but fell off late in the session. The Dow was up 300
points at one point, but by the end, it just ekes out a small gain. It's hardly worth -- it's an interesting one here because do we go green in the
wall or red in the wall? I think today, we have to go red in the wall. Because we had two of the major markets, the S&P 500, and the Nasdaq that
were lower, the Nasdaq sizably lower. It is artificial to say that it was a particularly good day just because the Dow gets up over to a record high,
even though it does get to a record high and the rotation continues. So, you get at that number -- Paul, would you agree with me, that we perhaps
have to call this a down day, even though I know people are getting very excited that the Dow was at a record.
LA MONICA: I think we do, the Dow, as the name implies, has 30 stocks in it. The S&P has only 500 -- has 500 companies.
[16:10:00] the Nasdaq has even more. This was a down day. You had a handful of stocks, banks in particular that did go up. But the tax
euphoria has already started to fade, because reality is setting in. Now the bills have to be reconciled. That may be easier said than said and
done, Richard.
QUEST: Even this morning, the Nasdaq didn't join in the rally, which I don't understand. Because Nasdaq big tech firms like Amazon and Apple
stand to gain by those provisions on lower corporate taxes and the repatriation of overseas profits.
LA MONICA: That is true. I think though that those companies have been beat up all year partly because of all the cash they have and the
expectation they might bring it back. Increased dividends, increased buy backs. Their fundamentals are healthy too. But the problem is everyone
knows that. Is it a secret that Facebook is one of the best run companies on the planet? Or that Apple and Amazon are? Not at all. The good news
here is that the overall market is not falling apart just because tech is starting to slide. And I think there were a lot of people worried. We had
gotten so heavy with those big five tech companies. Microsoft was one of the worst performers in the Dow today.
QUEST: The Fang+ Index, which is what we're going to start looking at more. That's Fang, plus Alibaba --
LA MONICA: Microsoft, others.
QUEST: That was down 2.5 percent today.
LA MONICA: Yes, there just is this general sense that the easy money, I think, has been made in technology and other areas of the market. Banks,
maybe energy stocks, are starting to look a little bit more attractive. And the good news is, we're not seeing as of yet, a fear that the whole
market is overvalued, because people are just fleeing sectors, not the entire market.
QUEST: The -- I can hear the view of being very concerned there. It looks as if -- I mean, is tech taking a break, or is tech taking a beating?
LA MONICA: I wouldn't go so far as to say they're taking a beating, given that all of these companies are still very, very dominant. Have strong
earnings growth expectations, a heck of a lot of cash. Having the pull back that we have seen today with Facebook Microsoft, Google. It's healthy
QUEST: Good to see you, sir.
LA MONICA: Thank you.
QUEST: Thank you very much.
Now have a listen to this. Now, the first time you hear it, oh, it's lovely makes you swell with holiday cheer and bright. The question is,
after you have heard it for the 1,500th time, what happens then?
(COMMERCIAL BREAK)
QUEST: So, there is the story of the day on Wall Street straight out of the gate, we open at a record. We go higher by 300 points, and it's all
because of the potential for a tax cut and taking that. But that evaporated as the day wore on towards the close. And by the close, we are
just up .25 of a percentage point at 58 points.
[16:15:06] Figure it got to nearly 24,290. The Dow was on track for another triple digit gain. And then it just sort of lost steam. Last week
the rally was interrupted by the Michael Flynn drama on Friday. Just look at that, Tuesday, Wednesday, Thursday, triple digit gains and you see what
happens on Friday. Mr. Trump said the markets will continue their momentum.
(BEGIN VIDEO CLIP)
DONALD TRUMP, PRESIDENT OF THE UNITED STATES: The stock market I think is going to have a very big day, based on the massive tax cuts that we're very
much in the process of getting approved. But based on the vote we had last week, the stock market has been reacting unbelievably well. With the only
thing that hurts it is the fake news, and there's plenty of that.
(END VIDEO CLIP)
QUEST: Stephen Moore helped draft Donald Trump's tax plan during the presidential campaign, he joins me now from Seattle. Good to see you, sir,
as always.
STEPHEN MOORE, CNN SENIOR ECONOMIC ANALYST: Hi, Richard.
QUEST: So, you've got the two competing plans now. You know, the reality is, I was looking at the differences between them. They're not huge. I
mean, arguably, the biggest difference is the number of tax brackets, the pass-through rule and the expiration of the individual part -- oh, and the
mandate aspect, the health care mandate. Can they be easily reconciled?
MOORE: Yes, yes, real easily. And look, the Republicans don't want to fail here. They know they can't fail, Richard. So, they're going to get
something -- by the way I'm hearing now that it will be Thursday or Friday that they start the reconciliation process between the two bills. Not sure
how long that's going to take, but it won't take more than three or four days. So, we should have a vote probably not this week, but next week on
the final passage of this.
One of the big issues of difference is what is going to happened to the small business tax rate. The Senate bill passes -- lowers that rate to
about 30 percent, where it's closer to about 35 percent in the House bill. But look, I think the big story is here, that this is pro-growth. You
mentioned the stock market, it's really been on a boom now for the last couple of months as investors have become more and more confident that this
tax bill is going to happen. Whether it's running a little bit ahead of itself, I can't say. I mean, there's a lot of exuberance out here. But
the real question is, is this going to translate into real gains for the economy next year. And I'm on the side that says that it will. That we're
going to see a good 2018 as a result of these were reduced tax rates.
QUEST: But Stephen, the issue of the longer-term deficit, when you have the Senate scoring says that the deficit goes up by over a trillion, and
you want to assume that -- the people who come up with that score are as familiar with the economic argument of trickle down as anybody else. Now I
know they don't include that directly. They don t account for the actual economic increase. Do you honestly believe that the increased economic
taxation will make up the deficit of a trillion?
MOORE: Well, that's a great question. First of all, the number one job that Donald Trump has is to get the economy moving again. We have been in
a 10-year ditch in the American economy. We haven't grown by more than 2 percent for ten years. The reason the debt grew so rapidly under Bush and
under Obama, was the economy just underperformed. That, Richard, you cannot -- I've looked at these numbers sideways, upside down, any way you
look at them, you're not going to make any progress in terms of reducing our debt until you get the economy moving. Now, Trump has done that big
time. I mean, we're up to 3 to 3.5 percent already. That's up from 1.5 percent in Obama's last year. That's a big, big increase. And I think we
can keep that growth going. And I would make the case -- if you get the economy moving faster at a sustained level, that debt burden is going to
fall. I'm not saying that those tax cuts are going to pay for themselves, I'm saying our ability to absorb the debt is much easier to, you know, to
pay off if you've got a growing in prosperous economy.
QUEST: I am confused in my weekend reading -- in my weekend reading I am confused because --
MOORE: I thought you said weakened reading -- weekend reading.
QUEST: On the one hand, you know, I read that the growth cannot be attributed to the president, it is the hangover legacy of eight years of
Yellen and Obama and the way in which they constructed the recovery. On the other hand, I have the president tell us at every turn it's all about
him. He's only been in office for six months, or nine months, ten months. This can't really be his recovery?
MOORE: Yes, sure it is. I think it's irrefutable that it is. And the evidence of that is look what happened to the stock market the day after
the election where the stocks went up by 700 points.
[16:20:00] That wasn't a coincidence. We have a pro-business president right now. There's no question about it. Obama was anti-business. This
is a president that who is pro-business. Some people think he's too pro- business, but there is no question, the reduction in the regulation. The anticipation of this tax cut has had a big effect. Now, Richard, you are a
smart guy, you are smart economic analyst. There's no way you can look at an economy that was slowing down in 2016, we only had 1.5 percent growth in
the year 2016. And then you see this curve go straight up after the Trump election. There's a Trump effect here, it's not just a Trump bounce. I
think it's a Trump moon bounce and I anticipate it to continue into 2018- 2019
QUEST: Stephen, when your next time you're in New York, we've got a seat for you here. Please come and join me. We'll have a chat.
MOORE: I would love to. Love your show.
QUEST: Good to see you Stephen.
MOORE: Every time I travel abroad, I watch your show.
QUEST: There we are then. Good, thank you. We like this robust discussion on economics. Which of course, is our part of our conversation.
And we'll continue that now with our next guest. A source is telling CNN, Netflix will resume production of the smash hit TV series, "House of Cards"
without Kevin Spacey as the U.S. president, Frank Underwood. The show's future has been uncertain. There are numerous allegations. You're all
familiar with that of miss conduct against the Hollywood star. Chloe is with me. Now hang on, I'm confused. I'm confused a lot tonight. What did
we know until today? We knew they were going to try and finish the current series.
CHLOE MELAS, CNN ENTERTAINMENT REPORTER: Right, well, no, this is not true, Richard Quest. Let me explain and let me unconfused you if I may.
So, "House of Cards" suspended production. Netflix, the company behind the show, Media Rights Capital, after the allegations of sexual misconduct on
set in my CNN report came forward, they suspended the show, leaving hundreds of people who work on "House of Cards" in limbo. They were paying
them the hiatus through the break, but their lives, their future, they show, fans at home, nobody knew.
QUEST: So, they suspended production to be shown when?
MELAS: They just suspended production of season six. They were in the middle of filming season six which was set to premier in 2018.
QUEST: Right. So now what are they going to do with season six?
MELAS: They're going to start filming again. And they're going to start filming after the new year. And so, that means that hundreds of people
have jobs. They can feed their families through Christmas and the holidays. This is a joyous occasion for the people who have spent so many
seasons telling the "House of Cards" stories. But it's been crazy, I can tell you, speaking to sources, for the writers. Having to rewrite this
that they spent months writing season six. And then they had to rewrite it in just a few weeks, so it's been a scramble writing out Kevin Spacey's
character --
QUEST: Without him -- I mean, it's now you see me, now you don't.
MELAS: Right.
QUEST: One episode he's there. Next episode he's not going to be there. And it's how you going to get rid of him between the two.
MELAS: Well, exactly. Now in the original series that this show is based on they kill off
Kevin Spacey's character. So, there's a chance that Kevin Spacey will be killed off in the first episode, or were not exactly sure how the writers
are going to frame it. But he will not be on anymore.
QUEST: Well, they've got to kill him off.
MELAS: Yes. We're not sure, maybe he goes away on a long-extended vacation somewhere. Rides off into the sunset.
QUEST: I have a year or two on you, and so I'm old enough to remember Dallas. I think it was Bobby Ewing, who came back after several months of
being in a sleep coma. We thought he was going to be truly killed off, so they managed to bring him back. So, they're going to get rid of him.
MELAS: Right.
QUEST: And this is the end of season six.
MELAS: Yes.
QUEST: What happens after that?
MELAS: We're not sure if the show -- the show is definitely not going to continue at all. So, Netflix had said that season six would be its last
season.
QUEST: And that's still the case?
MELAS: This is still the case, and Richard, I can tell you though, we have been waiting for a response from Kevin Spacey. You know, his team really
no longer exists, because everybody has dropped him in the wake of these allegations, with the exception of his attorney. You know, we don't know
where he is. We think that perhaps he might still be in rehab, which is the last we heard about a month ago. So, we haven't heard from him, his
thoughts on being ousted from this show that he's been a part of since the beginning.
QUEST: One can certainly say though that the audience for that particular episode, between the before and the after, will be fairly humongous, and
trying to keep a secret of what they've done with him is going to be very difficult?
MELAS: It's going to be difficult especially when you have reporters like myself who are always trying to break the scoop, so. I'll tell you, I'll
keep you posted.
QUEST: I was confused before, I am clear now.
MELAS: Great, wonderful.
QUEST: Good to see you. Thank you.
MELAS: Thanks
QUEST: Our show has a podcast, it's available from all the main providers. You can listen at CNN.com/podcast.
[16:25:00] Scotland, England, Ireland, Wales, all tied with monkey's tales. One of those tales is now the elephant in the room of Brexit negotiations.
(COMMERCIAL BREAK)
QUEST: Hello, I'm Richard Quest. There is more QUEST MEANS BUSINESS in just a moment. When Venezuelan President think cryptocurrencies can help
dig the company out of its economic hole. And Christmas comes once a year, thankfully. That music, unfortunately, does not more and more, yes, that
music, you're going to hear a great deal more of, to the point where you're going to --
Before all of that, this is CNN and on this network, the news always comes first.
Houthi rebels have killed the former Yemeni President, Ali Abdullah Saleh. The Houthi commander says Saleh was killed while fleeing his home in Sanaa.
Sanaa broke with Houthi's two days ago. We have to turn a page with the Saudi led coalition that are fighting the rebels.
Despite significant progress between Britain and the European Union, they fail to reach a deal on Brexit at least for now. The British Prime
Minister, Theresa May and the European Commission President, Jean-Claude Juncker weren't able to reach an agreement regarding the Irish border, and
several other issues. The two said they hope to bridge their differences by week's end.
President Trump's endorsing the embattled Republican Senate candidate, Roy Moore, in the eight days before a special election. Moore has been accused
of sexually harassing and assaulting women, including minors. Accusations he denies. Despite that, Mr. Trump says Moore is needed in the Senate to
help pass the Republicans massive tax cuts.
A new round of wargames is underway in South Korea. An Air Force official says U.S. and South Korean fighter jets are carrying out attacks on mock
North Korean missile sites. North Korean state media says the drills are creating a situation where, in their words, nuclear war may break out at
any moment.
The mayor of Jerusalem has now made a televised appeal to Donald Trump. Nir Barkat encouraged Mr. Trump to in his words, do the right thing and
recognize Jerusalem as the capital of Israel. He is also urging the president to bring the U.S. Embassy to Jerusalem.
And news to us at CNN just in, on the president's travel ban. The U.S. Supreme Court has granted a request from the government to allow Mr.
Trump's third version of the ban to go into effect pending the appeal. This is the first time the Supreme Court has allowed any version of the
controversy will ban to go forward in its entirety.
[16:30:00] The Turkish president now says he's not considering capital controls. It follows reports that President Erdogan had slammed Turkish
business leaders who take money out of the country as traitors. Now the president has reiterated Turks must take a national stance. And again,
allege there are international efforts underway to hurt the Turkish economy. The president is fuming after an Iranian/Turkish gold trader on
trial New York, accused the president of helping Iran launder money and subverting sanctions, which Mr. Erdogan vigorously denies. In a speech he
hit out at the foreign courts.
(BEGIN VIDEO CLIP)
RECEP TAYYIP ERDOGAN, TURKISH PRESIDENT (through translator): Some try to put my country on the trial by being tried themselves in fake courts.
Don't waste your time. Those fabricated virtual courts and the courts formed with a made up representatives of that trader faith though can never
convict my country.
(END VIDEO CLIP)
QUEST: Soner Cagaptay, is the director of the Turkish Research Program at the Washington Institute for Near East Policy. Let's begin on the issue of
capital controls. Do you spot this as being sort of a definitive view on this, you know, capital controls are not being introduced?
SONER CAGAPTAY, TURKISH RESEARCH PROGRAM DIRECTOR, WASHINGTON INSTITUTE FOR NEAR EAST POLICY: Clearly not. I think that the president, when he made
this comment, then corrected himself today, only a day after, as well as the deputy Prime Minister, who is a terrific guy -- knows the economy well
-- stepped in to say that the President of Turkey did not at all mean there would be limits on capital movements. But I think that was just an
unfortunate comment because despite all the bad news unfortunately coming out of Turkey, in terms of human rights violations as well as erosion of
democracy, one of Turkey's greatest accomplishments has been that it that it's a free market economy that provides for a large thriving, prosperous
middle class. Limitations and restrictions on capital movement will be the best way to kill that. So, I'm glad that the President clarified his
comments and walked back from that,
QUEST: That is the contradiction of the Turkish situation at the moment. Isn't it? Whilst there is widespread condemnation of many of the policies
of President Erdogan -- he obviously, justifies them as being necessary against the fight against terrorism and dissidents in that sense. The
economy booms on regardless?
CAGAPTAY: It does because Turkey attracts a lot of -- it used to attract rather a lot of foreign direct investment in the last decade. When it
started the accession talks with the European Union. And now lately it's been attracting a lot of hot money that comes into Istanbul's stock market.
As well as the fact that there's a pretty large real estate bubble because of a speculative market that's going on. And the government itself funds
megaprojects, which not only create employment, of course, creates demand and builds a support base for the government but also attracts investment.
So, I think, it's on the one hand Turkey's economy is a good story. It's always a good story. On the other hand, you're seeing these innate signs
of, I would say, anti-globalism within the government that tries to connect Turkey's problems to foreign actors. And I think this remark by the
President that he might limit capital movements is perhaps a symbol of this two sides of Turkey that you see within the administration and the country.
QUEST: When he talks about national purpose and investors must follow, you know, obviously what's good for the country, are you seen evidence of
capital flight?
CAGAPTAY: I'm not seeing a lot of it, but I think anecdote is not to put off data, but I'm hearing a lot of people who are thinking of getting out
of the country. Especially it wise educated people with many degrees, speak multiple languages. And I think that would be unfortunate. Turkish
President Erdogan, has made Turkey a middle-income economy. He has lifted many people out of poverty. Turkey's main export is now cars. But you
will become an advanced economy, Turkey has to become a hub for Google. Meaning it needs to attract talent and keep it. And Turkey won't get there
if educated Turks are leaving the country.
QUEST: And finally, these accusations that happened in the New York court, which I read about the president -- the accusation is that President
Erdogan has been helping Iran launder money and subvert U.S. sanctions. He talks about phony courts and foreign courts. Where should we look between
the accusation in the court, and the denial in Turkey?
CAGAPTAY: We have to wait to see the end of the case. Obviously, this Turkish/Iranian, dual citizen, businessman, Reza Zarrab, started to say --
confess in the courts that he was part of this sanctions busting scheme. Which he was running out of Turkish banks, that would be very unfortunate.
It would tarnish Turkey's image. And it would make a lot of difficulty in Washington because Turkey is already facing a very difficult period in its
relationship with the United States, and this would add one more pickle to this very tough period in the relationship.
[16:35:04] QUEST: Good to see you, sir, thank you.
CAGAPTAY: My pleasure, thank you.
QUEST: Come back again please.
In the top story tonight, the Irish border with the U.K. is 500 kilometers long. And it's now the crux of the Brexit negotiations. Take a look at
the map. You've got, obviously, the United Kingdom, Northern Ireland, Scotland, England and Wales. But look at that border that goes between
North and South Ireland and that is an open border, the common travel area, as it's known at the moment. And there are rumors that the Northern
Ireland could potentially remain aligned with certain EU trade rules, even after Brexit, in a way to keep that border open.
The first minister of Scotland says is a political opportunity. She hence that she would want to follow suit, saying, if one part of U.K. can remain
regulatory alignment, there's surely no good practical reason why others can't.
It's an argument picked up by the Mayor of London, who has tweeted similar support, laying the ground for such a scenario which believes could save
London thousands of jobs. But for the people of Northern Ireland, it's not a hypothetical question. Brexit uncertainties having very real
implications for businesses along the border. Nic Robertson is along that border.
(BEGIN VIDEOTAPE)
NIC ROBERTSON, CNN CORRESPONDENT (voice-over): Below is Middletown, a tiny, Northern Ireland village nestled against the river that tracks the
Irish border. It's home to about 300 people.
They go to church on Sundays, work hard during the week, and right now, they feel, well, stuck in the middle in a Brexit tussle.
(on camera): British Prime Minister Theresa May says the U.K. is leaving the EU customs union and single market, meaning the border on the edge of
Middletown here may get harder to cross.
TREVOR MAGILL, MANAGER, MIDDLETOWN POST OFFICE: The mood always was, this is a problem, but it would be sorted, and you know, the EU and the
governments would get this sorted.
ROBERTSON (voice-over): But now, Trevor McGill, whose family has run the village post office here for the past 40 years, worries his business and
the village could be harmed.
MAGILL: Most of my customers are from this South Ireland, probably 60 percent, 70 percent, and that is the way it helps supports the business for
the for this local area.
ROBERTSON: A few miles away at Linwood's food plant, boss John Woods tells me his business has boomed since the peace process opened up the border 20
years ago. His milk comes from the north. The plastic milk containers from the south. He sells on both sides, employs over 300 people. But if
Brexit brings border controls, all that could change.
JOHN WOODS, MANAGING DIRECTOR, LINWOODS: We would just have to abandon exports to the south on our dairy and on our bakery side.
The board just runs down the middle of that road.
ROBERTSON (on camera): The middle of the road.
(voice-over): It doesn't matter where I look here, people are struggling to make sense of Brexit.
ROBERTSON (on camera): Tell me when we're crossing over?
Woods: Yes, we're crossing over here now. This is the line.
ROBERTSON (voice-over): Fifth generation farmer, Francie Ward, lives just feet south of the border. Owns field on both sides.
WOODS: How do you divide it.
ROBERTSON (on camera): Well, that's going to happen in Brexit then. If the line is down the middle of the road?
WOODS: I don't know what's going to happen in Brexit
ROBERTSON: There are some 310 miles, about 500 kilometers of border, with between 300 to 400 border crossings. During Northern Ireland's 30 years of
sectarian violence -- known as the troubles -- many of those crossings like this one outside Francie Ward's farm were blocked by the police and the
army.
While few hear fear post Brexit border controls could trigger an immediate return to the troubles, many like John Woods worry about a possible longer
term economic impact on peace.
WOODS: Our success after the troubles has been not only the good work done by the peacemakers, but also by increasing employment, i.e., lower
unemployment. Lower unemployment pulls in people who might otherwise see themselves outside the system.
ROBERTSON (voice-over): Like the border, weaving its way betwixt town and trees, carrying with it a heavy troubled history. Solution for the current
Brexit impasse seems set to be anything but straight forward and just as laden with pitfalls. Nic Robertson, CNN, Middletown, Northern Ireland.
(END VIDEOTAPE)
[16:40:00] QUEST: Philippe Lamberts says certain Brexiteers have a problem with reality when it comes to border issues, he is the co-president of the
Greens and EFA group at the European Parliament joins me now from Brussels.
Good to see you, sir, thank you, we were just saying, while we were listening to Nic's report, there's no easy or obvious solution that
comports to the positions taken by both sides, I mean, a hard border and you can't have an open border, but the British may say well we'll let goods
go cross, but people can't go across so what is the answer?
PHILIPPE LAMBERTS, CO-PRESIDENT OF THE GREENS, EUROPEAN PARLIAMENT: Well, on the one hand, the United Kingdom government said, OK, we are getting out
of the single market and the customs union then you have Northern Ireland saying we are sticking with the United Kingdom. And if you want to keep
the good Friday agreement, you can have no border, so something has to give, the easy way out would be for the U.K. to reconsider and say that
after all, it will stay in the single market and customs union, but that of course would a U-turn for the government I mean --
QUEST: Well, you said, with respect, you say the easy thing is for the British to give in, but it's just as easy for the Irish or the EU side to
say, OK, we'll accept that Ireland remains a special case, that border can remain open, but the U.K., but Northern Ireland is still not part of the
customs union, that just happens to be a special case and we'll just let it be as it is.
LAMBERTS: That cannot be because if you are regulatory divergence between north and south, that creates a border de facto because you need to check
the goods and services that go over the border and people wherever they fit the conditions. That is the nature of democracy. So, something has to
give.
QUEST: You could check people coming across but not check goods and services, or you could check goods but say that which goes across that
particular border is tariff or trade free, I mean there are imaginative ways, you are painting that there's only one solution which is that the
British give way, the British are saying, no, the EU could give way.
LAMBERTS: No, I just want to get back to square one. Brexit created this contradiction when the referendum was passed, the interpretation that
Theresa May gave to that referendum and she was not obliged to take that conclusion, is that out of a single market, out of the customs union. I
respect that, but that creates a border, so you have to place that border someplace, either you place it on the island of Ireland and that isn't
compatible with the good Friday agreement.
Or you place it in the Irish Sea and that creates a problem for the Northern Irish Unionists which I understand. But this is a contradiction
created by the British government in the interpretation of Brexit, and how can we on the EU side solve it for them? It's up to them to make up their
minds, what part of reality they want to live in, but they have created contradictory versions of reality for them.
QUEST: If they say, OK, we'll go back to some form of hard border, that allows certain goods to cross backwards and forwards because that's the
best way to move forward. He would say that is not acceptable?
LAMBERTS: Well, I'm just saying this isn't compatible with the good Friday agreement which the U.K. signed for, the good Friday agreement was
basically supported by both Republic of the Ireland and the United Kingdom and that was easy because both were part of the European Union. Now we
have discovered, or we seem to have discovered that the fact that one of the two parties leaves the European Union creates a problem. But welcome
to reality. I mean the terms of that impossible equation I've been clear since day one of the negotiations.
QUEST: Do you believe they can settle it by week's end as Theresa May and President Juncker said?
LAMBERTS: Well, again, something will have to give and while I do not see the European side giving up on the integrity of the single market. So, we
have to give time to Theresa May to try to sort it out within her own majority and within the United Kingdom. If she can find a majority worthy
--
QUEST: Why not, sir, why not? You have spent the last few minutes telling me that something has to give, why shouldn't the European side give on the
position of the single market, thus allowing some form of halfway house that the U.K., for the sake of the good Friday agreement, the U.K. can stay
within the single market, but have restrictions on freedom of movement, surely that's a quid pro quo.
LAMBERTS: In those terms we made a proposal to the United Kingdom ahead of the U.K. referendum, that was not considered enough by the United Kingdom
government and by the United Kingdom citizens, I respect that.
[16:45:00] But then again, why is it so that it is not the EU 27 that has to give in, because it's not the EU 27 that kicked out the United Kingdom,
it's the United Kingdom that decided to leave the European Union, so they created the problem.
QUEST: Good to have you on the program, lovely, thank you
Now as we continue our program tonight, that music, that music that will not go away. But what effect does it have on shoppers?
(COMMERCIAL BREAK)
QUEST: Breaking news to bring you, the U.S. Supreme Court has decided to allow the third version of the travel ban to go into effect. So, the
significance of this means that the ban against the six countries will be allowed to come into place while the appeal is being heard, correct? Our
Supreme Court reporter Ariane de Vogue is on the line.
ARIANE DE VOGUE, CNN SUPREME COURT REPORTER: Right, this is a significant temporary victory for the government here the Supreme Court has allowed
that third version of the travel ban to go fully into effect, pending appeal, right? And it's the first time the Supreme Court Justices have let
any version of the ban go entirely into effect while the lower courts are considering the merits, and the reason that's significant is that it could
signal that a majority of the Supreme Court Justices think that this version might eventually pass legal muster, or certainly that some of them
think that this version is different than the other.
QUEST: This is -- if this is the case, do we know how the Supreme Court voted on this today, is it one of these things where it was just a signed
order?
DE VOGUE: They released the order and they said the government request is granted and only two of the liberal justices, that's Justice Ruth Bader
Ginsburg and Justice Sonia Sotomayor, chose to note that they would have denied the application. The Supreme Court, everyone doesn't have to know
the dissent but that sure seems like those two are the only ones that have a problem with this.
And keep in mind this version, it was released on the September 24 and it is a more tailored version of the travel ban, and only placed varying
levels of restrictions on foreign nationals from those eight countries. A remember the countries were Chad, Iran, Libya, North Korea, Syria,
Venezuela, Somalia and Yemen, so the government said to the Supreme Court this version is different. And it looks like, at least at this very
preliminary level, the Supreme Court decided to side against -- side with the Trump administration, while the cases still pending.
[16:50:00] QUEST: Good to have you was, thank you, Ariana.
You have heard the song "Silent Night" but a new survey says most British shoppers wish Christmas were little more silent. And when we come back,
oh, that music.
(COMMERCIAL BREAK)
QUEST: It is almost unavoidable at this time of the year, every store you enter, every tried and true Christmas song over and over again hark, is
that jingle bells I hear once more? A survey in the U.S. and the U.K. shows only half of shoppers actually enjoy it. A quarter of British
consumers actively dislike shopping in a winter wonderland, 20 percent of retail staff say it causes their Christmas spirit to melt away faster that
frosty the snowman.
The founder and chief executive of Soundtrack Your Brand, the streaming service who did the survey, joins us from Stockholm, can this be true, sir?
Can those who work in shops not like their Christmas music?
OLA SARS, FOUNDER AND CEO, SOUNDTRACK YOUR BRAND: Well, Richard, I used to work in a retail store when I was younger, and I'll tell you this. It
drove me crazy personally, you would have to spend six, seven days a week, working on the floor and hearing the same 20 tracks, so I promise you, I am
not shocked from the results of this study, no.
QUEST: This study showed what? It makes people feel down. Why does make them feel down and not uplift them with the Christmas spirit?
SARS: Not all people feel down obviously, the problem is that retail brands or retail in general are just too sloppy in their execution. You
can have a great Christmas spirit delivered through music, we all know that, but it can't be too repetitive, it has to be well thought through and
fit with the local market. For example, here in Stockholm, looking out at this silent night right now, actually there's a very local catalog of
Christmas music that we like here, there's a broad spectrum of music, it's just that retailers are not paying attention and not digging into it and
doing a proper job.
QUEST: Hark, is that that same piece of music that one hears yet again? One wonders, though, from the shoppers' point of view themselves, do they
like it, do shoppers enjoy hearing jingle bells for the 14th time?
SARS: Shoppers in general if you look at the numbers do appreciate Christmas and the Christmas spirit, but it's always trying to deliver the
right type of experience in the morning if you walk in, and the right type in the evening, they do like the Christmas spirit.
[16:55:00] But if they do hear the same track over and over again, they will leave the store. And as we all know, Christmas is critical for retail
and they need to get that sale done, so they need to think about that repetitiveness for sure.
QUEST: A very merry Christmas or whatever you may be celebrating at the festive season, sir, when it finally comes, thank you very much indeed.
SARS: Merry Christmas.
(COMMERCIAL BREAK)
QUEST: Tonight's Profitable Moment, the former British Prime Minister John Major talking about Northern Ireland once rebuked a reporter saying if
there were any easy solutions, don't you think we would have found them by now?
The same could certainly be true for Jean-Claude Juncker and Theresa May as they grapple with the final question over what to do over the northern-
southern Irish border, the issue is how to maintain the integrity from the south's point of view, but still have Brexit from the north's point of view
without a hard border.
It's not going to be easy make no bones about it but as you heard on this program tonight, it often seems as if one side wants the British to make
all the concessions, when actually the Europeans could simply say we will accept U.K. access to the single market under less favorable terms, but
they won't. Oh, no, because the Europeans firmly believe it has to be all pillars or no single market.
And the British think there has to be Brexit because Brexit means Brexit. Remember what I said. There are no easy solutions because if there were,
they would have found them by now, which means that this one is going to be tricky right until the end.
That is QUEST MEANS BUSINESS for tonight. I'm Richard Quest in New York, whatever you're up to in the hours ahead I hope it's profitable. I will
see you tomorrow.
END
