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QUEST MEANS BUSINESS
Apple Splashes Out on Shazam; Bitcoin Rallies After Futures Debut; Saudi Arabia Lifts Movie Theatre Ban; Facebook VP on Female Empowerment. Aired 4-5p ET
Aired December 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: Closing Bell ringing on Wall Street. The Dow and the S&P 500 are both at record highs. It was a sort of quiet
day, but there was definite impetus toward upstairs throughout the session. Small number on the -- Oh, dear. Oh, for goodness sakes, sir. That is the
wimpiest gavel we have seen probably this year. Thank goodness, it's brought trading to an end on Monday December the 11th.
Tonight, name that tune, Apple buys Shazam in one of its biggest ever deals. Bitcoins mainstream moment begins in Chicago. You'll hear from the
market now offering bitcoin futures.
And coming soon to a Saudi cinema near you. As the theatre ban is lifted, I'll speak to the movie chain that's ready to move in.
I'm Richard Quest, live from the world's financial capital, New York City, where I mean business.
Good evening, tonight the sound of music is the sound of deal making. Apple is buying the music ID service Shazam for $401 million. It's Apple's
biggest deal since the acquisition of Beats three years ago. Shazam -- do you remember Shazam? It helped you identify music first, by sending you a
text. And now course, on the net. Well, the $401 million works out at 8 billion nickels, and if I put the nickel in the machine for that, let's see
what Apple gets.
Streaming, getting Shazam streaming, "Islands in the Stream" by Kenny Rogers. Taking on Spotify. Spotify also has close links with Shazam.
You're starting to see how it comes together, maybe Shazam, Spotify and Apple do something together. And then you've also got pure music. That's
by Madonna. Now Siri already uses Shazam to identify music.
But finally, of course, let's never forget the third season, social media. More my cup of tea, "Rhythm is a Dancer." Now Snap is reportedly also
interested in buying Shazam. It's a bit late for that for Snap. But Snap's share price today, was up some 7 percent in the market. This is a
fascinating by of a little company that's done remarkably well. Talking of little things doing remarkably well, CNN's Samuel Burke is with me in
London. The festive cheers arrive so soon, Samuel. I went through streaming music identification, social media, but at the end of the day,
all Shazam does is tell me the name of the song by listening it. How does Apple use that?
SAMUEL BURKE, CNN TECH, TECHNOLOGY AND BUSINESS CORRESPONDENT: Oh, Richard, that's all it does right now on a mobile phone and if you have
been a loyal QUEST MEANS BUSINESS viewer, Richard and I have been telling you for years it's all about mobile. But actually, in this case, the
reason why so many companies including Apple were so interested in this because it's all about these. Smart speakers that so many of us have in
our homes, and they listen to you. Something that Shazam has been doing for ages. Apple will have their own home pod. It's delayed, it was
supposed to be out this year. And nobody doubts that it will have this technology from Shazam, and that they wanted to have it. They wanted to
make sure that competitors like Amazon, like Snap didn't have this. This next year is going to be even more about this listening technology. I'm
listening -- Richard.
QUEST: Well that's a first. Samuel, am I missing the point here? Which wouldn't be the first time. That this has got nothing to do with Shazam's
existing niche of the garden of identifying music. Apple doesn't need that. I mean, The SoundHound, there's a variety of other things that it
could incorporate into its own software?
[16:05:04] BURKE: The business story of what Shazam was is fascinating. Because it used to make a little kind of money when you listened to a song
like music by Madonna and then you went and bought it, they got a cut. But with streaming now, nobody is buying music. Everybody has already paid for
their music. So, they stopped making money that way. Apple doesn't need that. What Apple wants to do is use the brain power, their employees here
in the U.K., keep in mind, this was a British unicorn once worth $1 billion. They want to take all of that listening power, all of those years
since 1999, Shazam has been around in listening, and pass that into a speaker. So, no matter where you are in your house, that Apple's new home
pod will be able to use this technology to listen, not just for songs, but to listen to Richard Quest at the other end of the house shouting
something. And it wants to make sure it gets it right when Richard Quest says it.
QUEST: Absolutely. So, are you surprised that Shazam has lasted as long as it has? I remember the first time I was back in the U.K. in 2000, or
whatever, and I heard this and I tried it out at a pub and a piece of music was on the jukebox. Oh, what's the name of that? In those days you dial
the number and it sent you a text. But are you surprised that somebody hasn't come up with something that has taken Shazam's crown?
BURKE: A lot of people have tried and there are competitors out there, but I think that relationship with Apple has kept them very strong, I've always
been intrigued by this company, because Carlos Slim, the Mexican billionaire invested $4o million in it back in 2013. He'll probably be
very happy with how it's turning out here. But I think this company may not have survived if it wasn't for this all of a sudden resurrection of
radio type technology. I mean, this device is changing everything. And I have a feeling that this acquisition is going to the tone for 2018.
But if these devices weren't around, I think Shazam could have gone by the wayside. Though it is interesting, it was once worth $1 billion as I just
mentioned, selling for 400 million. Some people saying maybe it's that post-Brexit price. Easier to get things with the pound weaker. But a lot
of companies they just are not keeping those valuation we saw a few years ago in the tech world.
QUEST: As always, good to have you, sir, on the program putting that into perspective. Thank you. Samuel joins us from London.
Bitcoin prices surged after an historic milestone for the digital currency. Just look at that, well, it's up 18, 19 percent, up to 2,500. Remember it
fell back late on Friday, but it's still at $17,000 and for the first time, bitcoin futures have officially begun trading in Chicago. If you're not
familiar with futures, it means you're essentially betting what a particular asset or stock is going to cost at some point in the future.
It's unusual for things that aren't physical to be traded this way. Not into, of course, are unique, I mean you have VIX futures, you have S&P
futures, you have Dow futures, in that sort of sense.
Remember, bitcoin only exists on computer servers, and some online shops accept them as currencies. Others just want to buy and sell them to make a
profit. The only way to get hold of a bitcoin is taking part of the online clearance system that verifies every bitcoin transaction. That is if you
want the hardline way of getting it, the mining way. Of course, if you're selling goods and services, you get bitcoin just as you would for cash. Ed
Tilly is chief exec of Cboe Global Markets speaking to Maggie Lake. He said the new futures of trading was going smoothly.
ED TILLY, CEO CBOE GLOBAL MARKETS: The system operated beautifully overnight. Volumes have come in pretty much as we expected, just shy of
3,000 contracts in the global trading session, preparing for the open of the regular session this morning. A little volatility overnight, which we
expected as well. Markets built, traded through that volatility, and couldn't be more pleased with the way we began trading bitcoin futures.
MAGGIE LAKE, CNNMONEY CORRESPONDENT: You know, this is such new territory for so many people, we know that there has been volatility. A lot of
people worry about the fact that there may be a lot of speculation built into this. And you know, I have heard from people that the entrance of
your exchange is going to be included and wider next week as well, kind of gives a validity to these new cryptocurrencies. Does that were you at all
that that stamp of approval may mean more than you intended to?
TILLY: No, I don't think so. I think it's exactly what we intended. There's been an incredible interest around the globe in exposure to crypto
in general and specifically to bitcoin. So, moving this onto a regulated market, full transparency, oversight from the CFTC, oversight from our own
internal regulation, that is what we're bringing from the marketplace. And it is answering that demand that we've seen from our customers. So, no, I
really like the process. I stand behind any time an exchange can light up a market in a transparent way. That's good for those looking for exposure
in any underlying commodity or security.
[16:10:00] LAKE: I think that's true, that is sort of the basis of fair trade. What we depend on you for. Is there the same oversight and
transparency surrounding bitcoin right now as there is your other commodities?
TILLY: Great question. So, it's the exact same process and regulation and oversight that we have on our futures exchange today, so VIX futures are
traded on the CFE. Bitcoin futures are traded on the CFTC. Our own internal regulation overlooks that process. We have information sharing
with our partners at Gemini, and then ultimately, we are responsible to the CFTC. So, the process is very similar.
QUEST: We need good expert analysis now. Jordan Belfort calls bitcoin a fraud. The real life "Wolf of Wall Street." You'll remember, Leonardo
DiCaprio played the man. Here he's seen learning exactly what Jordan and I are going to talk about, the true value of stocks. Have a watch.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE, SCENE FROM MOVIE "WOLF OF WALL STREET": You know what a fugazi is?
UNIDENTIFIED MALE: No. Fugazi, it a fake.
UNIDENTIFIED MALE: It's fugazi, fugazi, it's a wazi it's a woozy, it's fairy dust, it doesn't exist. It's never landed. it is no matter, it's
not on the elemental chart.
(END VIDEO CLIP)
QUEST: And that really is the truth of it, the real-life story ended with Jordan Belfort serving time. But he now joins me from Los Angeles. Why,
sir, do you believe that it is a fraud, when there are real transactions taking place, we come to the fact of the volatility in the price in a
moment. But real people are using bitcoins for real transactions.
JORDAN BELFORT, AUTHOR, "THE WOLF OF WALL STREET": Well, I think the label bitcoin as a fraud, like put an umbrella over the whole thing is not what I
said. What I said is that the problem I have with the technology, block chain technology, the technology is great, but the people who are getting
involved with it right now. So, bitcoin has already had its big run up to where it is right now. What's happening is that all these copycat
cryptocurrencies that are going out there, and there is no regulation on the actual level of bitcoin itself. You have this futures regulation, but
the underlying asset is completely unregulated, it's a dark market, and there's people right now who are using the success of bitcoin to create
these massive pump and dumps with these other cryptocurrencies.
So, I think it's a huge danger right now that people looking at this like it's the next great thing. It's a bubble for sure. And this is the next
stage. It's very common that threat. The future is now stage three. So, next stage is now you'll see really skyrockets, there will be a short
squeeze and it will go even higher, and eventually though it's going to come caving in. It's almost a guarantee.
QUEST: And the fascinating part about this -- I think you would agree with me -- is that a cryptocurrency, whether it be bitcoin or one of the others,
they are coming, and they will be reputable, and they will be part of the economic landscape of the future. But if I understand you correctly,
you're saying this wild west early days is the problem?
BELFORT: Yes, well, I think there's a couple of problems. Number one, right now with bitcoin, what you have here is two parts of manipulation.
The first part is you have to create demand, massive demand. That's happening right now, versus the social media. Every day I get random e-
mails, Randy knows, buy bit coin, become a millionaire with these crazy promotional ads to generate interest. But at the same time, there's a
There's really not that much bitcoin that's out there. So, what's happening you have a very limited supply. I know they mentioned a cap on
the markups, but how much is actually trading out there in the marketplace. How much does it take for bitcoin to go up, not that much? And that's why
it's shooting up so quickly. And what happens is this, at a certain point it has to reverse itself. And it will be short -- once the futures start,
people will short it. They'll be a squeeze because you can't deliver it. And then it's just going to literally -- it's going to crater, and the
average investor is the one who's going to lose the money, not the professionals.
QUEST: Right, now you talk about the short squeeze as a result of the futures market. If that's right -- and I don't doubt you are right. Then
the futures market has performed exactly the role that the CBOE and others say it will perform, which is to -- to create a market mechanism of
regulation to the transparency of the price.
BELFORT: To be frank, their goal was they saw an opportunity to make money off a new thing and you know, give it to smart people with degrees.
They'll come up with a way to trade and secure that's anything. Look what happened with the mortgage market. They had some newfangled way to take
what was crap -- these subpar mortgages -- and wrap them up in something and say it's great. Then will trade futures and futures on futures. So,
you're at that stage right now where -- it's not that there is anything wrong with trading futures, but here's the bottom line is that is going to
be very hard to short these things for a long time. So, when you short you eventually have to buy back, right, and that creates more buying.
[16:15:00] So, you have the skyrocketing demand, very little supply. But then at a certain point something will happen. They'll be either a
regulation will pass. Something will go wrong and all of a sudden, the second it will change and it's going to drop so hard and fast. So, that's
on bitcoin. The bigger danger I think personally, is that every day I see three or four new offerings of bitcoin number three. This will be better
than bitcoin. You'll get rich overnight.
And just today in the CNN makeup room the person, very nice lady, she's talking about bitcoin. So, this is a classic example like it's 2007 when
you were doing the mortgage market. Your haircutter was also a mortgage broker all of a sudden. So, everybody's jumping on the bandwagon.
QUEST: I'm standing in front of the screen here, and we see, you know, in that 20 minutes I've been on air, it's already put on another 500 bucks.
It's up 19 percent. It's very difficult for me, for everybody who sees this and thinks, this is a way for me some -- all right, I'm going to say
it, Jordan. This is a way for me to make quick easy money.
BELFORT: Listen, here's the bottom line. If you were the most disciplined person and you can really have the discipline to get in and get out,
there's probably a window, a short window to make some money. But that's not human nature. It's not psychology. People will get in and they make
some money and they want to make more money. And people have a tendency -- tulip bubble. Right? Remember, in the tulip bubble the beginning of the
end was when they started trading futures on tulips. That's how it started to -- and they had another move up and then all of a sudden, bam, it
collapses and it's all over.
QUEST: I hope it's not over with you coming back again and talking to us again in the future. We love having you on the program.
BELFORT: Thank you very much.
QUEST: Jordon, great to see you from Los Angeles.
As we continue tonight, let's go back to Europe where the European finance minister says, the U.S. tax bill is an America first tax bill. And they
say European companies will be the big losers. It is QUEST MEANS BUSINESS live from New York.
QUEST: QUEST MEANS BUSINESS, live from New York. In this city New York police are questioning a suspect after what officials are calling an
attempted terror attack at New York's main city bus terminal, the Port Authority. The authorities say the suspect has pledged allegiance to ISIS.
Now, a close circuit television caught the moment that the device went off. You can see it here. They say a man wearing a homemade pipe bomb detonated
his explosive in a narrow walkway at the Port Authority bus terminal near Manhattan's Times Square. And he did so during the rush hour this morning.
Three people were hurt. The suspect has been identified as a 27-year-old, Akayed Ullah, who was also injured.
(BEGIN VIDEO CLIP)
BILL DE BLASIO, NEW YORK MAYOR: At this point in time all we know of is one individual who think God was unsuccessful in his aims. There are also
nope credible and specific threats against New York City at this time. But we will give you more information, of course, as the investigation unfolds.
(END VIDEO CLIP)
[16:20:00] QUEST: CNN's Brynn Gingras is at the scene for us. Let's take this point by point. The suspect who is now in custody is believed to have
muttered pro-ISIS comments. Tell us more.
BRYNN GINGRAS, CNN U.S. CORRESPONDENT: Yes, these are all coming from the detective's interrogations of him from his hospital bed. He did plead
allegiance to ISIS, according to a law enforcement source that I've spoken to. He also mentioned that part of his motivation was the Israeli actions
-- recent Israeli actions happening in Gaza. Now, of course, Richard, the next thing that's going to happen is that investigators are going to take
some of this information and then go further investigate to see if it's actually credible. This all just coming from what he said was his
We also know a little bit more about that bomb. He told investigators that he made it at his home. It's possible he was also putting it together at
his work. It's unclear exactly where he worked. We do know he was doing some electrical work with his brother around this area of Port Authority
recently. And before that we also know that he was a cabdriver. I also, since you did show that video to your viewers, Richard, I wanted to mention
that I've learned from a source that there were also screws found inside that narrow passageway here at the Port Authority.
So, we do believe that it was part of this pipe bomb that didn't detonate according to plan. And we looked at some video, Richard, a little bit
clearer video than what you had showed your viewers. If it had gone according to plan, this could have been a lot worse of a situation then
what we experience today --
QUEST: So, viewers watching -- we always have to remember that viewers watching around the world, planning trips to New York, holiday season, New
Year's Eve Times Square, they are naturally going to question the safety in this city.
GINGRAS: Certainly, I mean, this is a time that is the most busiest for New York City, being the holiday season. And at that hour, 7:30 in the
morning, at the Port Authority, this is an area where busses are coming in from outside states like New Jersey, and also just commuters are going back
and forth through the subway system. And that passageway -- I know we talked about this earlier, Richard -- it's very narrow. And as I said, I
saw that video, the clearer version of the video from a source, and literally I can see when the explosion happened. And to the right of him,
Akayed Ullah, there is no one that passed next to him. If there was just one person, it is very likely that that person would have been killed
because of that explosion.
QUEST: Brynn, thank you. Bring us more when there is more to report on the story. I appreciate it.
The explosion pushed down futures briefly before the market opened. Join me at the training post. You'll see that the markets, which was primarily
to a certain extent, technology, like the FANG+ for example, was up 1.2 percent, energy and tech shares were also higher. But we have a record on
the Dow. We have a record on the S&P 500, which means I need to just update these. Which should make it on the right side of here. So that's
59 and 66. There we go. I should have got a white board, so we didn't have to put up with the screeching sound. You have got 66 on the Dow, 59
on the S&P, 70 on Nasdaq. The Nasdaq also gained as well, but not enough to eke out a record. And thank you then for the greens, because greens
everywhere today. Paul La Monica is with me.
PAUL R. LA MONICA, CNNMONEY CORRESPONDENT: Thank you, sir.
QUEST: What moved this market so decisively toward the green?
LA MONICA: Yes, I think you pointed out, we had energy stocks. They were big winners today, with oil prices moving back towards $60 a barrel, that
was clearly one of the trends today. And also, tech stocks, you really can't keep them down. It was just a week ago where we were wondering, oh,
is this the end for the big FANG stocks, plus Microsoft.
QUEST: FANG was up 1.2 percent.
LA MONICA: That's what I'm saying. They are clearly still doing well. A lot of people feel that their earnings growth is extremely strong. Their
balance sheets are fantastic. So, why bet against them just because they have had a great run.
QUEST: We're coming into that difficult time of the year when book squaring, profit taking, tax equalization, you know, if you've got capital
gains that you want to lock in or get rid of, so we should expect a few rogue trading sessions?
LA MONICA: Yes, I think we could have some portfolio shifting at the end of this year, ahead of next year. It's always a time where people start to
wonder, is this going to be where we have a shift tech, who were such huge winners this year.
[16:25:02] Are people going to dump them and start looking at other areas like banks, like energy? It could happen but it's hard to bet against the
tech company when their earnings are so solid.
QUEST: Good to see you, sir. I appreciate it.
House and Senate leaders are meeting this week as the conciliation or the reconciliation of the two bills between the House and the Senate on the
final tax bill. Finance ministers from Germany, France, Italy and Spain, and the U.K. all sent a letter to the U.S. Treasury Secretary, Mnuchin.
They say the bill as it now sands violates international trade rules and discriminates against overseas companies doing business with the U.S. It is
important, they write, that the U.S. Government's rights over domestic tax policy be exercised in a way that adheres with international obligations.
It's an extremely technical and complex point that they raise in their letter. Ken Rogoff joins me now. The Harvard professor. We're not going
to get into the weeds of this tax issue, because, maybe because I don't understand it and it pretty complex stuff.
KEN ROGOFF, PROFESSOR, HARVARD UNIVERSITY: Indeed.
QUEST: The reality is, this tax bill is going to become law?
ROGOFF: Some tax bill seems like it's going to become law. But everything seems up for grabs still at the moment as they try to reconcile the
differences between the House and the Senate, horse trading. They don't know if they'll get enough votes in the Senate. So, we don't really know
the final shape yet.
QUEST: And on this question -- I mean, people talking about the strength of the economy -- I need to grab this nettle on how much of the current
strength in the U.S. Economy can be laid at the door of Donald Trump and his policies and the confidence from his election, or was this a cake that
was already baked?
ROGOFF: Well, I think the best you can say for Donald Trump's policies is what he didn't do because he hasn't done much. He certainly has scaled
back regulation that's been a help. But this tax bill will be the first thing that gets passed, that significant economic legislation. So, I think
we had a financial crisis. It's ten years ago. Eventually they end, and I think the U.S. is going to be growing well no matter what for a while
simply from recovery from this financial crisis, gaining back some of the ground we lost.
QUEST: Except the growth in the last days of the Obama administration, which was still some years after the crisis was in the 1.5 percent to 2
percent, maybe up to 2.5 percent, but this 3 percent to 3.5 percent, has really only come about in a meaningful sense post-election. So, can we say
that Donald Trump does, or at least the confidence that his election brought can be part of the reason why?
ROGOFF: I just wouldn't read too much into it. I mean I think the U.S. economy is a very complex operation, but it's a very good one, and it was
due to recover. Productivity has been slow for a long time. We're catching up from that. So, all in all, no, on the other hand, I think
there were people that were concerned that if Hillary Clinton got elected, regulation would have gotten worse, so there is something of that. They
feared the taxes would have gone up. So, there's a lot that didn't happen. But I don't know that that's driving the economy. I think mostly it's
still long, slow recovery from the depths of the financial crisis. And I think things will be pretty good for a long time if the Trump
administration doesn't mess it up.
QUEST: And when Donald Trump talked about perhaps growth up to 6 percent. We are nearly at 4 percent. He said he wouldn't say 6 percent because
people would laugh.
ROGOFF: I'm laughing, I mean I hadn't heard that one. Population growth is barely over. 5 percent, so, getting 3 percent growth is pretty
spectacular. I think we will get that for a while. You know, 6 percent? Anything's possible in a quarter, but no, the U.S. Economy is not going to
grow at 6 percent, China maybe, India maybe, not the U.S.
QUEST: And professor the last question, because again, these are questions that viewers send me all the time. Which I don't necessarily always know
the answers to. But the idea that the stock market is a reflection of the economy, and if the stock market is at record levels, then that it is a
reflection of the wider economy?
ROGOFF: Well it is to some extent. Global growth has been great. U.S. corporations get profit from around the world. But I think it's also a
reflection of people just don't know when interest rates are going to go up in a significant way. And so what else do we invest in? I think a big
part of what's happened to stock is a very low interest rate expected for a Long time.
QUEST: Good to see you, as always, Ken, thank you.
[16:30:00] ROGOFF: Pleasure.
QUEST: As we continue in Europe, to the stock market there, mostly lower. Tech was weak, bank stocks had a good day. The FTSE buck the trend. It
rose almost 1 percent, obviously on the back of Brexit optimism, according to Theresa May. In fact, the South African retailer, Steinhoff, Rose 24
percent after heavy losses last week due to its accounting mess. When we come back, Saudi makes a landmark move as it lifts a decades old band on
cinemas. I'll ask the chief executive of AMC theaters about this cultural shift.
QUEST: Hello, I'm Richard Quest. There's more QUEST MEANS BUSINESS in just a moment. When regulators across the world are trying to detain the
bitcoin beast. I'll speak to one new exchange that's just starting up in the United States. Facebook's head of social good tells us why diversity
means strength in any workplace.
As we continue our program tonight, this is CNN, and on this network, the facts always come first.
Authorities in New York say the suspect in this morning's bomb blast in the city has pledged allegiance to ISIS. Police say a man wearing a homemade
pipe bomb detonated the explosion at the Port Authority bus terminal during the Monday morning rush-hour, three people were hurt.
Israeli Prime Minister Benjamin Netanyahu says he believes European countries will follow President Donald Trump's example and move their
embassies to Jerusalem. A top EU official says the block will continue to respect the international consensus on Jerusalem.
The Russian President, Vladimir Putin has now ordered a partial withdrawal of Russian troops from Syria. The announcement came during a visit to the
country. Mr. Putin is quoted as saying that Russian forces have defeated, in his words, the most lethal group of international terrorists over a two-
Several of the 15 women who have accused President Trump of sexual assault prior to his presidency, went on camera on Monday to detail their accounts.
The women are calling for Congress to investigate the claims. The White House said President Trump address the claims directly and denied all the
The Golden Globe nominations are out and there's a big question over who got selected. Not one woman has been nominated in the best director
category. Elsewhere, in the acting categories Kevin Spacey's replacement Christopher Plummer has been nominated for "All the Money in the World."
[16:35:00] Chloe Melas, CNN entertainment reporter, is here with me now, tell me what you have noticed when you look at the nominations? What is
CHLOE MELAS, CNN ENTERTAINMENT REPORTER: Women in the best director category. Richard, this is a huge problem, and I'm going to tell you why
it's a problem. You had three movies that were directed by women that were hailed.
You had "Wonder Woman" by Patty Jenkins. You had Greta Gerwig's "Lady Bird." And you have Sofia Coppola's "Beguiled." All of these movies,
especially when you're talking about "Wonder Woman," which broke box office records for a female director, the highest grossing amount of people --
money was made for her film.
Then you have Greta Gerwig's film that has been hailed and it was also nominated at the Golden Globes this year in the best picture category. But
why are these women not being recognized? I will tell you something, I have seen two out of three of these movies, I have seen every single one of
the movies nominated in this best director category and there's no reason why Patty Jenkins or Greta Gerwig or Sofia Coppola was not nominated. I
don't get it.
QUEST: Or at least one of them.
MELAS: At least one of them.
QUEST: Why do you think it is? What do you think the Foreign Press Association which runs the Golden Globes nomination, what do they say?
MELAS: I'm not on the voting committee for the Hollywood Foreign Press, but I can tell you this to me signals that they are behind the times. We
are living in an age where the "Time" magazine covers are the silence breakers. This is a time when women's voices are more powerful than ever,
and I'm telling you there is a direct correlation, this is showing that the Hollywood Foreign Press is overlooking women. Last year we had the Academy
Awards which had a big race issue, and this year they finally nominated, more African-American people in those categories. This is just as
QUEST: I don't deny that, what my point to you would be, having seen what had happened with the academy last year over race, and having seen the fuss
and furor and anger, over sexual harassment in the workplace, do you think they might not have been a little more elegant or sophisticated, they must
have realized that there wasn't a woman in the best director category. They can't have been so openly sexist to have done this.
MELAS: There's women that are nominated in all of the other categories, but I think it's incredibly unfair in my personal opinion, and there's a
lot of people sounding off on social media who think it is unfair because these women are all talented and they're just as talented, if not more in
my opinion as these men that were nominated in the best director category. I think it's outrageous, and if you're only going to have five spots, I do
think it is important that things need to be fair and balanced and this to me is an imbalance and I don't think it's OK.
QUEST: Thank you.
MELAS: No problem.
QUEST: As we continue tonight, after a 35-year ban, commercial cinemas will soon be granted licenses in Saudi Arabia. The Saudi culture minister
is calling it a watershed moment for the cultural economy. It is part of an economic overall and division 2030, Saudi Arabia's blueprint less
dependent on oil.
Last month when this program was in Riyadh, the chief executive of AMC Theatres told me the country was ready for this note to take place.
(BEGIN VIDEO CLIP)
ADAM ARON, CEO, AMC Theatres: Fully half of their population now is under 25 years of age. The Crown Prince himself is 32. I think they are
thirsting for this liberalization in the country. I think they're very excited about it.
(END VIDEO CLIP)
QUEST: Adam it is with me again, Adam joins me live from Kansas City, Missouri where you knew this was coming along and you were ready for it.
And how quickly are you going to have your first movie theater open, do you think?
ARON: Well, I would like -- well, let me start by saying we do have to get approval from the government of Saudi Arabia and we don't take that step
lightly. But AMC entertainment is the largest movie theater chain in the world. We had very good meetings when I was in Riyadh a few months ago.
We are quite optimistic that our future is lucrative and bright in Saudi Arabia, let's say end of 2018 for a brand-new theater from scratch, how's
QUEST: How far are you prepared to go to accommodate regulation within the country, in terms of what movies you will be allowed to show?
ARON: Movies are a big business in the Middle East right now. They play in the United Arab Emirates for example and Bahrain, many Saudi citizens go
to Dubai and go to Bahrain and watch movies there.
[16:40:00] So we're expecting that a similar film product that is currently showing in the Middle East will find its way into the kingdom of Saudi
QUEST: So, you don't expect to be more restrictive in that sense? Obviously, it's going to be a process, you're not all of a suddenly going
to open the floodgates and have some racy scantily clad movies in there?
QUEST: Do you get the impression that movie studios will be prepared for re-cuts, re-edits, specific versions for that market?
Aron: The 35-year ban on movie theaters in Saudi Arabia was only lifted this morning, so it's a little early for us to be speculating on how
exactly the movie theater business will be developing in Saudi Arabia. I can tell you that I have already spoken with studios, and they're very
excited about the opening of the Saudi market. It's more than 30 million people, they love movies right now, we estimate this is going to be a
billion-dollar market that does not exist today on the globe, and should be in full swing during 2018. This is a big step for the kingdom of Saudi
Arabia, this is a big step for AMC, it's a big step for movie theaters and the movie industry and studios and we expect to be a major player in the
QUEST: You rightly point this out to me and remind me, I mean, in an industry as mature in many ways as the theater, the movie theater industry,
to suddenly have an entire new wealthy sophisticated educated market, and wealthy perhaps being the operative word in many cases, it's extraordinary.
ARON: You can see that as you talked I was nodding my head up and down, the answer is yes, yes, yes, yes, yes and yes. There are 30 million Saudi
citizens, they enjoy movies now, not always at home, but when they travel, they see them for sure, and we think that the expansion of entertainment
options for Saudi citizens, which is a major goal of the government under the leadership of his Royal Highness the Crown Prince, this is a
spectacular advance for the average Saudi citizen? We are in business. Right? So, it's good for us too. We're very happy to find a new market of
30 million avid movie goers that could be a billion dollars in size.
QUEST: Do you actually see most of the movies? Do you see a lot of movies?
ARON: I see a lot of movies, I can't say I see most of the movies, because the last I checked, AMC shows about 400 movies in the U.S. And another 400
or 500 outside the U.S. in foreign language. But I see a lot of movies and there are a lot of great movies out right now and coming out right now.
The next few months, for movie going, leading off of with "Star Wars" this week is going to be huge.
QUEST: One final question, just going to pump this question to you, take it or plead the fifth, you may have heard my previous discussion with
Chloe, no women directors nominated by the Golden Globes for next year by the FPA. Do you spot that as a mistake, as a row brewing?
ARON: Well, let just say I loved "Wonder Woman" it was a great movie, it grossed a lot of money, a lot of people saw it, a lot of people praised
that movie, but I have made it a practice to stay out of the award business, so I'll stay out. But there were some great movies made by women
this year and that's about as far as I can go.
QUEST: A diplomat, and that, sir, is how you've managed to get ahead, to get in front of the queue at Saudi Arabia when they announced they were
opening up. Good to see you, nice to have you on the program tonight.
ARON: Thank you. Richard.
QUEST: As we continue tonight, central bankers are concerned they could be blamed if the unregulated bitcoin market crashes. I will be talking about
that in the cryptocurrency push for legitimacy.
[16:45:00] (COMMERCIAL BREAK)
QUEST: Bitcoin traders are facing new threats of regulation in markets right across the world. An ECB official says that EU bitcoin may need EU
regulation when trading within the union. South Korea is planning regulations, Seoul has banned raising money through all forms of virtual
currency. The bank of Russia is planning restrictions on cryptocurrency sites.
Bartek Ringwelski, the U.S. chief operating officer of bitFlyer, the world's largest bitcoin exchange joining us live from San Francisco in
California. What for you is necessary regulation to ensure the integrity, not of bitcoin per se, because that really is an unregulated market, but in
terms of bitcoin trading?
BARTEK RINGWELSKI, THE U.S. CHIEF OPERATING OFFICER, BITFLYER: Yes, so people often say that bitcoin is a totally unregulated market. That is
actually a misnomer. For example, in the U.S. while we only launched two weeks ago, we have actually been working on licensure, working with
regulators over a year and 1/2 prior to launch.
And as of launch, we were in 42 states, and each state in the United States has its own requirements for letting a virtual currency exchange like the
QUEST: But at the end of the day, I suppose we can -- we had this argument or discussion with a CBO, which every way we cut this cake up, at the end
of the day, your bitcoin exists nowhere. It is only backed by the idea that bitcoin survives in its own rite, correct?
RINGWELSKI: Correct, but that applies to more than just bitcoin, if you look at gold, the same potential criticism apply to it as well. So, it is
the collective belief that it has value perpetuates its value, and it has the characteristics of other assets that have value. So, it can't exist in
two places at once
QUEST: No, with respect, there's a difference with gold, I agree with you that it only has value because people think it has value, but at the end of
the day, you can't put it in a shoe box at the end of the day under the bed or in a vault in at bank, bitcoin is completely virtual.
RINGWELSKI: Making the distinction between virtual and physical is I think is sort of a shortsighted way of looking at it. It's ultimately an asset,
one is a physical asset, one is a virtual asset. But it sure is the characteristics of things that have value. The same person -- two people
can't have the same bitcoin, much like two people can't have the same bar of gold. And so, the advantage that bitcoin has over assets, such as gold
other commodity it can be instantly transferable anywhere in the world with very few and very low costs.
QUEST: I agree with what we learned from Madoff and other scandals is that you can have all the regulation in the world and somebody can still make
off with your money if they are so minded. But if we take for example the VIX index or the Dow futures index, or an S&P index, there's always the
feeling that you're dealing with a reputable body. How important is it, the aspect of integrity that goes with the exchange?
[16:50:00] You're not a fly by night that's here today gone tomorrow and likely to leave everybody wondering what was that all about?
RINGWELSKI: No, it's absolutely right. And as you mentioned, bitFlyer is the world's largest virtual currency exchange and it's also a leader in
block chain technology, year to date, just through September of this year, we have done $100 billion in trading volume, which is the largest in the
world. Having that level of experience and having that level of transaction volume, gives us a lot more legitimacy and safety than
potentially a ne its w player in the space, but reputation matters, and that's one reason why I think bitFlyer has a huge advantage over other
players in the world.
QUEST: Delighted you came in to talk. We will talk more about this, as you can gather, many of us, myself included are relatively new to the
bitcoin world, it's fascinating to learn about it from people like you. Thank you, sir.
Now news just in, Boeing is announcing about $18 billion stock buyback and raising its dividend by 20 percent. Think about this, Boeing is among the
best performing stocks of the Dow this year, up almost 82 percent to date. Boeing stock shares jumped 1 percent in afterhours trading, admittedly it
had been down during the course of the day. But you have to ask, why is Boeing whose stock price has risen so sharply, returning money to investors
in this way, when certainly it doesn't need to do a share support operation.
Still ahead, when the Facebook's very first employees, and now speaking out about female empowerment.
QUEST: The ongoing sexual harassment scandals are pointing to a terrible truth. There are still too few women in positions of power in the global
workplace. The vice president of social good for Facebook says now is finally the time to treat women as equals in the business. She was talking
to Poppy Harlow.
NAOMI GLEIT, VP OF SOCIAL GOOD, FACEBOOK: We need more women in power, we need parity and, you know, it would be awesome if women run the world. But
let's start with parity. As you said, we have a long way to go. Six percent of Fortune 500 companies are run by women. 20 percent of congress
is female. 13 countries out of 195 are run by women. These numbers need to increase in order for there to be parity.
POPPY HARLOW. CNN HOST: Make the business case for someone who would listen to this and say, why do you need parity? Why can't it just be about
the person who's most qualified on paper, best for the job, without looking at their gender, make the business argument for this?
GLEIT: When we talk about diversity, it's not just about gender, it's about race, backgrounds and different perspectives. Diverse teams perform
better. Especially because we are building a product for 2 billion people around the world. Our team needs to reflect that diversity.
[16:55:00] HARLOW: What about diversity in terms of racial diversity?
HARLOW: What do you do to get the numbers up? How much of is about active recruitment?
GLEIT: Yes, so I think it's complex. And I don't know what the answers are. But I do know what we're doing at Facebook, obviously Sheryl is a
huge champion of diversity, gender, race, underrepresented minorities, and so there are a lot of things that we do in terms of every step of the
funnel. So, we need to start young. One thing that we know is that Sheryl actually wrote about in this "Popular Mechanics," three in four women in
middle school, girls in middle school express an interest in STEM, science, engineering and math, but they don't do it.
So, something is happening between middle school and college that is discouraging them from pursuing their interests.
HARLOW: Did you pursue that in high school?
GLEIT: I did not. It is a great question. I think that is a real regret that I have, is that I am not technical, and I did not pursue, I was
interested in it, but I think, you know, I didn't think I could do it. And so, we have initiatives with young people, young girls, but also young
people of color, trying to get them to pursue their interests and not being discouraged.
(END OF VIDEO TAPE)
QUEST: News that I must bring deal. President Trump's just released a statement on today's bomb blast in New York. The president says, once
again it highlights the urgent need immigration reform in the United States. Profitable Moment next.
QUEST: Tonight's Profitable Moment, Shazam goes to Apple. I have always loved Shazam as I have said earlier in the program. It just seemed a very
clever idea. What's that? Just Shazam it, it's even become a verb in its own right, just Shazam that piece of music. I hope Apple does something
decent with it, I have no doubt that Samuel Burke is right that there are many grander things in store, but it's the simple things that just seem to
work so well. Like Shazam.
And that's QUEST MEANS BUSINESS for tonight. I'm Richard Quest in New York. Whatever you are up to in the hours ahead, I hope it is profitable.
I will see you tomorrow, please.