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Dow Closes Higher; U.S. Threatens U.N. Over Jerusalem Vote; Ryanair on Eve of First Ever Pilot Strike; Las Vegas Prepares for Lady Gaga Residency; Bitcoin Mania Entices Penny Stocks to pivot. Aired 4-5p ET

Aired December 21, 2017 - 16:00   ET


[16:00:00] RICHARD QUEST, CNN HOST: Good lord, sir. Closing bell ringing on Wall Street. Hitting the gavel early. A bit of anarchy at the stock

exchange. But the bell is ringing. No records on the Dow Jones Industrials. There we go. You don't see that very often. A bit of an

early gavel, but they were charitable about it. Sometimes they boo at the Exchange. But not today. It's nearly Christmas. It is Thursday, December

the 21st.

Tonight, the Santa rally resumes four days before Christmas. Stocks in New York are higher, and London closes at a new record. We'll show you that in

the trading post.

Critics of Donald Trump's Jerusalem plan say we won't be bought as the U.S. threatens to pull aid.

Ryanair faces its first pilot strike in history. You're going to hear from both sides on this program tonight.

I'm Richard Quest, live in the world's financial capital on the first day of winter, where I mean business.

Good evening stocks have risen, as U.S. businesses are cheering the Republican tax bill, and the fastest economic growth two years. After two

sessions of losses, United States market notched up good, solid gains. No records, but join me at the trading post, and you'll see exactly what's

happened so far.

These are the closing numbers. The Dow Jones Industrial is up, S&P up, Nasdaq up. Green on the board. Will have greens all around, me thinks.

However, no change from the 70, 62 and 72. Broad gains in energy and financials that were particularly strong.

In Europe, there was, interestingly, one record. The FTSE hits a record. Now, we haven't seen records in Europe for some time. So, it's quite nice

just to be able to add one. There you are. The FTSE has a record. You can still see, though, European bosses lagging behind in terms of the

number overall. So, President Trump called a tax bill a gift for America. And some companies already passing on those benefits join me in the QUEST


Spending some $300 million. Boeing, first of all, is going to be spending the money on worker training, upgrading facilities, and machine and

matching employee charitable contributions. Remember, Boeing, of course, is heavily involved at the moment in the dispute with Bombardier and needs

the US government support.

Wells Fargo, the beleaguered bank, raising the minimum wage to $15 from $13.50 at the moment, and increasing charitable giving. And Comcast is

paying $1,000 holiday bonus also announcing a $50 billion investment in broadband, theme parks, TV and film. Add to all of this AT&T, which is

also hoping to buy Time Warner, our parent company, and you get an idea that Christmas might have arrived a little bit early with these bonuses.

But do these bonuses make sense? Julia Coronado, we need to have you. How lovely to have you joining us.


QUEST: Good to see you

CORONADO: Lovely to be here.

QUEST: Now, president and founder of MacroPolicy Perspectives joins me. So, first of all, this idea of bonuses on the back of the tax plan. Is

this what it was all about?

CORONADO: I mean, certainly it's very good headlines, and I think it also reflects the fact that the labor market is pretty tight. So, they may have

paid out these bonuses anyway. So, it's good news for workers. And it's good publicity for these companies. We'll see.

QUEST: But these companies are going to get huge benefits. Some with large overseas operations --


QUEST: -- will be able to repatriate many billions of dollars. Others will -- well, they'll all benefit from the lower tax rate of 35 to 21


CORONADO: Exactly. So, it's a great deal for the U.S. corporate sector and they're all feeling pretty good about that, and it's been driving --

helping fuel the market all year, in anticipation of this. And now the moment has arrived.

[16:05:00] QUEST: So, on the question of whether tax cuts -- these tax cuts will generate the faster economic growth, people like Gary Cohn have

been claiming. 4 percent, 5 percent, Donald Trump even mentioned 6 percent. What is the consensus of independent economists?

CORONADO: Well, we economists seem to be a lot more conservative. That's I think more of a marketing estimate than an actual point forecast. Keep

in mind, Richard, that growth has been pretty strong even before this tax cut takes effect. So, the numbers this morning confirmed growth above 3

percent in the third quarter, year-to-date it's about 2.5. That reflects a global backdrop that's been much improved. You cited the London stock

exchange reaching a new record, this is not just a U.S. phenomenon. Globally growth has gotten stronger. It's Asia, it's Europe, it's U.S.

And that's the backdrop against which we're layering on a tax cut.

QUEST: But, I mean, a tax cut would normally be inflationary in the sense that -- or at least expansionary.


QUEST: And yet I've seen numbers that suggest this tax cut will add may be .8, maybe up to 1.2 percent of GDP.

CORONADO: Right. And that's in the first year and thereafter it sort of levels off in terms of its growth impact. And so, you know, we have lots

of experience with tax cuts. Corporate tax cuts in particular have the lowest multiplier effect. That is, a lot more of it goes into profits and

valuations than cap-X and hiring.

QUEST: But if corporations -- let's slay this once and for all. If corporations, choose to do it to give back -- obviously some do wages --

but the rest do dividends or share buybacks. Surely that money does eventually have a wealth creation effect. As 401(k)s and pension funds


CORONADO: Sure, absolutely. There is a positive wealth effect. Consumers do feel better and you can see this in the sentiment indicators. They're

feeling better about their personal financial situation, in part reflecting the stock market gains. But the wealth effect is about 1.5, 2 cents on the

dollar. Consumers very prudently save a lot of this for the longer run. They don't spend it all in the next year.

QUEST: Well, we're delighted to have you back here, Julia. It really is a treat and a Christmas present for us. What's your forecast for next year?

CORONADO: My forecast is for just about 2 percent growth.

QUEST: Really?


QUEST: You're not even going to go to three.

CORONADO: Well, because for me, it's a mix between a better stimulus from the fiscal side, but I think the global economy might kind of moderate a

bit from a very torrid pace in 2017.

QUEST: I hope we can invite you back.

CORONADO: Thank you very much.

QUEST: Thank you very much indeed. Good to see you, thank you.

The United States is warning, there will be consequences after a humiliating defeat of the United Nations over Jerusalem. An overwhelming

majority of the general assembly voted against Washington in its decision to recognize the city as the Israeli capital. The Trump administration

sent a threatening tone, saying there will be a financial price to pay for those who defy the U.S. government.


NIKKI HALEY, US AMBASSADOR TO THE UNITED NATIONS: The United States will remember this day in which it was singled out for attack in the General

Assembly for the very act of exercising our right as a sovereign nation. We will remember it when we are called upon to once again make the world's

largest contribution to the United Nations. And we will remember it, when so many countries come calling on us as they so often do to pay even more

and to use our influence for their benefit.


QUEST: Now, those threats ultimately fell on deaf ears even though many foreign governments do benefit from American tax dollars. Here are the top

five recipients in order. You have, obviously, Iraq. You have Afghanistan, Israel, Egypt and Jordan. And it totals the bill is nearly

$16 billion for the aid that they receive. Obviously, Israel was the only country amongst that lot that all voted with the United States. Earlier,

the Turkish president said his vote wasn't for sale.


RECEP TAYYIP ERDOGAN, TURKISH PRESIDENT (through translator): What do the call U.S.? The cradle of democracy. The cradle of democracy is looking

for wills that can be purchased with dollars. Mr. Trump, you cannot buy Turkey's democratic will with your dollars. This is our decision.


QUEST: CNN's diplomatic analyst is John Kirby. He is in Washington. Good to see you as always John. Thank you. Here's the interesting point. Yes,

Donald Trump and Nikki Haley made a threat. And they said, we'll take names like teachers at school. However, Donald Trump also said, we don't

care. Do your worst. Vote your will. We don't care.

JOHN KIRBY, CNN DIPLOMATIC ANALYST: Yes, they knew that this was going to be happening. They knew this was an unpopular decision when they announced

it. Moving the -- their embassy to Jerusalem, declaring Jerusalem the capital. And they very well knew which way the votes were going to go

today, despite Israeli efforts to try to get people to abstain or oppose it.

[16:10:00] So, this was, I think, his way of inoculating himself and his administration from the blow that they actually took today. But it was an

infantile approach. It didn't -- it was a crisis of their own making. And I actually think, Richard, that there is a part of this administration that

enjoys the sense of victimhood that goes along with this kind of harping and complaining.

QUEST: Now comes the difficult part, John. If you make a threat, you had better be prepared to carry it out. So, to those countries' close allies

like the United Kingdom, enemies -- not enemies, less friendly countries, maybe that voted, they have to feel the price, don't they? Or Donald Trump

becomes a toothless tiger.

CORONADO: Yes. So, the State Department in their briefing today already kind of softened a little bit of this threat when their spokesman, Heather

Newhart, said look, this vote in the UN today is one of many factors we're going to factor into our decisions on foreign aid and assistance and

foreign relations. So, they're already kind of starting to soften this a little bit.

Those countries you laid out on that map, Afghanistan, Iraq, Egypt, there is no way that they are going to significantly affect aid and assistance

whether it's military or otherwise, to those three countries. Because we, the United States, have such a huge stake in these countries' abilities to

succeed in securing their own people, their own populous and their own security.

So, I really don't think he's going to do a whole lot. I do suspect they'll make good in some way, but I think it will be more of a token way

than anything real significant. And this is the thing, Richard, that most Americans need to understand. Foreign aid and assistance, military or

otherwise, is not charity. It's not charitable giving. It is actually in our best interest. And so, the administration needs to be careful they

aren't cutting off their nose to spite their face here. This is a self- defeating thing to try to say, well I'm going to cut everything -- everybody that voted against me. Because you're going to hurt yourself in

the long run.

QUEST: But then there are countries like the United Kingdom, maybe I'm obviously being British so I'm more sensitive to that side of it. But

there are countries like the U.K. that are going to want a favorable post- Brexit trade deal, sooner rather than later. And is it likely that a Donald Trump, Macron, or to a Merkel will say basically you weren't with

me, I'm not with you?

CORONADO: It's possible I don't think we can rule that out, Richard. I don't think that would suit anybody, really, going forward. I mean, these

are alliances and relationships that are deeply, deeply rooted in history, economics and politics. I don't see a major impact on those kinds of

relationships going forward. Again, it will be self-defeating for us in the United States as well. And I think Mr. Trump will come to realize


The other thing to remember is that much of foreign trade is also controlled or impacted by the legislature, by Congress. And so, the

president doesn't have absolute power here in every regard.

QUEST: John, good to see you. All the best to you and yours for the festive holiday season, whatever you may be celebrating.

CORONADO: And you to, Richard. Thank you.

QUEST: Good to see you, and thank you.

As we continue tonight after the break, Catalonian voters are the outcome of today's election. It was called after the controversy over vote on

independence. The turnout was higher. We need to analyze what that means for the likely result. QUEST MEANS BUSINESS.


QUEST: Votes are being counted in the Spanish region of Catalonia. Voting was brisk, because turnout was 82 percent, an increase from the ballot two

years ago. Voters have been selecting new leaders after Spain fired the regional government. In October, the Catalan parliament declared

independence an unauthorized referendum. Isa Soares is in London. What did - going into this -- I mean, the issue is what? Let us remind

ourselves. You have the so-called illegal referendum. You had the Spanish government then ousting Catalonian government. And then you had these

regional elections. And then you had these regional elections. What's the result likely to be?

ISA SOARES, CNN CORRESPONDENT: It's the regional election, Richard, that we all know is an independence referendum known all but name, isn't it?

And that's exactly what people are turning out in such high numbers. I was just looking at the numbers, and the numbers are coming in much quicker, 50

percent or so of the vote coming in. What we have is two parties really neck and neck. And the party of Carles Puigdemont, that is the former

president of Catalonia who is in self-imposed exile in Belgium. And he's neck and neck with an anti-independence, pro unity party.

What does that mean for our viewers? That means that it's going to be a very long night, and possibly a very protracted kind of few months to try

and form a coalition. Now, the anti-independence, pro unity party perhaps may not have enough, Richard, to get a coalition in place and to get these

68 seats. But the anti-independence -- the pro -- the anti-independence parties may do. And if that is the case, then that really is a huge blow

for the Prime Minister, Mariano Rajoy, of course, who actually called the selection as a gamble. And as his deputy said was hoping to decapitate,

were his words, the independence movement.

QUEST: So, help me understand. How me understand, Isa. Following up from what you said, if the independence coalition or groups or whatever way it

falls down, if they do really well tonight, how -- it doesn't lie in the mouth of the Prime Minister to say, you can't have a full independence

referendum, does it?

SOARES: Well, it shouldn't do, but he's already said it, Richard, that he won't recognize a referendum. It is unconstitutional. It won't happen.

So, all the parties that we have heard thus far that are pro-independence, Richard. And it's important to point out to our viewers, they're not

calling for a second referendum on independence. But they are saying their fight for independence will continue. So, this idea of the Prime Minister

Mariano Rajoy trying to nip the anti-independence fever in the bud, well, that's not going to happen. And no doubt, if they do win, well, he should

be spitting feathers when we hear from him in the early hours of tomorrow - - Richard.

QUEST: All of which should make for interesting listening. Apparently, it's the lottery tomorrow in Spain.


QUEST: Where they boil the children, pull out numbers and sing out the numbers. Goes on for hours and hours and hours. But there is a huge

jackpot, I believe.

SOARES: Like this election -- Richard.

QUEST: Yes, your quite right. Thank you, Isa, don't go too far away. Come back when there is more to report on these results. Thank you.

Despite the political uncertainty, stocks in Madrid closed today high, the IBEX gaining nearly 1 percent at the end of the session. Even better gains

as you saw for London's FTSE and Zurich's SMI index. All good gains.

Ryanair is facing its first pilot strike in the airline's 32-year history. It's calling tomorrow's threatened walkout in Germany unnecessary. Urges

travelers to turn up as normal. Ilja Schulz is the president of the Vereinigung Cockpit Union. Joins me from Frankfurt. Sir, good to have

you. Thank you. Ryanair has agreed to talk to unions and councils made up of Ryanair pilots. Why isn't that good enough for you in terms of stopping

the strike?

ILJA SCHULZ, PRESIDENT, VEREINIGUNG COCKPIT (VC) UNION: Good evening Richard. And thank you for having me here. What Ryanair does is, they put

it on the meteor and say they will talk to the union and accept unions. But this is clearly just a publicity stunt.

[16:20:00] Because what they are trying to do behind closed doors is telling the unions who they accept as negotiators and who they accept to

talk to. And it is clearly not acceptable to us as a union, that Ryanair dictates who will be on our side and talk to Ryanair.

QUEST: Ryanair says, of course that it won't negotiate with pilots who are working for competitive airlines.

SCHULZ: Well, we did not bring any competitive airline pilot in there, and I have never heard that term before in 40 years, that the department is

doing collective agreements. It's clearly just a Ryanair term. But what they are doing is, we have one company council member who has dismissed

from his contract just two days after his name was made public to Ryanair as being on the company council. If people follow what Ryanair is doing

right here, it's just a question how long would it take until they dismiss more people, and we would not have company council anymore? Because

Ryanair just says we don't accept the people anymore? But he is going for an unfair dismissal before court.

QUEST: OK what is it that this strike is over, besides union recognition? What is it that you want from Ryanair besides formal union recognition?

SCHULZ: The strike is not at all about recognition. This strike is about collective labor agreements for payment and condition and terMs. But we

could not even start the negotiations, because Ryanair withdrew. So, for the date that was set up to have the meeting, Ryanair showed up and when

they saw who was sitting at our table they just left the room. So, there were no negotiations. So, they have a chance to bring them back to the

negotiation just by forcing them to do so.

QUEST: You are aware, of course -- I mean for goodness sake, a strike three day before Christmas. With more strikes in the offering. Even a

four-hour strike in the middle of the day or whatever. I mean, this is the nuclear option.

SCHULZ: Well, I don't think it's a nuclear option, because for good reason, we only called for four hours just two days before Christmas. So,

the disruption for the passengers is not too big. What we call it is a warning strike. It's a clear warning to Ryanair and to show them that the

pilots are just fed up the way they are treated by Ryanair. And that Ryanair has any chance to agree on open discussions, on even level with us,

if they don't dictate who will be sitting at our table, then at any time we can start negotiations and we'd end strikes.

QUEST: And finally, if they don't, and, you know -- I've had some experience of covering industrial action over the years. If they don't,

you're saying there will be more industrial action.

SCHULZ: Well, if they don't -- if we cannot get into a negotiation, into open negotiations for CLAs with Ryanair, we don't have another choice in

going for more industrial actions. But we clearly stated that for the Christmas spirit, until the 26th midnight we will not have any strike.

QUEST: Sir, good to see you. Thank you for talking to us at short notice. I appreciate it.

Both sides, of course, on QUEST MEANS BUSINESS. Let's hear from Ryanair. The chief operating officer, is Peter Bellew, he's on the phone now. Good

evening, peter. Can you hear me?

PETER BELLEW, CHIEF OPERATING OFFICER, RYANAIR (via phone): Perfectly. Good evening, Richard. Merry Christmas to you and your viewers.

QUEST: Thank you, Peter. So, you heard what the unions are saying. Ryanair cannot dictate who will be sitting on the opposite side of the

table. That's fair enough, isn't it? You can't dictate who the union choose to use as their negotiator.

BELLEW: Well, we're sorry for any disruption to passengers tomorrow. Although I think it will be quite limited. And we're planning to operate

our schedule as normal. And we don't think there will be that much disruption sadly, there's a bit of a fiction from the previous interview.

We never left any table. We actually had a very good meeting with three officials from the union themselves. We shook hands at the end of the

meeting in a very amicable way. We said we would all meet on the 5th of January. They turned up yesterday with four of our Ryanair employed pilots

and there was one other person who is currently in litigation against Ryanair.

As you know, in Europe and U.K. and Ireland you're not going to negotiate with somebody who is part of a legal action against you, because that would

prejudice case. And nevertheless, we had a very good meeting, very constructive. We wrote in this morning, asking them to continue the

discussions on the 5th of January in Frankfurt. As we had said last night. And I hope you will still do that. But it's a totally unnecessary strike.

It's putting undue stress on our customers, and I think it's a pretty mean thing to do just before Christmas.

QUEST: Peter, you heard what he said. I mean, the fundamental allegation against Ryanair -- besides the terms and conditions and all of these things

-- is that your offer to negotiate or your offer for union recognition is a ruse. It's a scam. That Ryanair has no intention actually once the threat

of this industrial action has gone away, no intention of recognizing unions.

[16:25:00] BELLEW: We are completely and utterly sincere and serious about doing this. There was a deal and poor decision, a management decision last

week. We crossed a massive Rubicon for Ryanair. We've had very, very good discussions with the Irish union impact over here, who called off any

threat of strikes today and welcomed the cooperation and recognition, likewise, with the Portuguese. And something happened when they got back

to Germany today that they changed their minds from shaking our hands last night. I don't know what that was about. It's not a ruse. We are

completely sincere.

I think this is evolution of the business model for Ryanair. It will open up great opportunities for the company in the future. We want to make this

a tremendous place to work. We want to recognize the unions, work with them. And we want to give more money to our pilots in Germany. And we

want to improve their terms and conditions and we hoped to do that through the VC and it's absolutely sincere

QUEST: Hell of a way to come back to a new job, Peter, as you've just come back from Malaysia. You have come back to a new job and you face the first

strike in three decades.

BELLEW: Yes, Richard. You know, looking for a nice, quiet posting after Malaysia. But it's not turning out like that. And I send my best wishes

over to the people of Malaysia, but Ryanair is a tremendous company. I do believe we'll be carrying 220 million people by 2024. Be pretty much the

largest airline in the world. And we'll move on from this. I think we've had great meetings with other unions. Meetings set up with unions in the

U.K., Italy, Spain, and France and Denmark shortly after, and I'm sure we'll make this work.

QUEST: Peter, to you and your family, as indeed to all, a very merry Christmas, and season's greetings, such as it will be if you are facing

industrial action, sir. Have a good one.

As we continue now, this time of the year, it's a solemn day in the world of aviation and since we've just been talking about aviation, it is worth

remembering, today is the anniversary of the 1988 Lockerbie bombing. The U.S. attorney general says the U.S. government continues to pursue justice.

At a memorial service at Arlington Cemetery, Attorney General, Sessions, said investigators continue to gather witnesses and recover evidence from


29 years ago, Pan Am flight 103 exploded above the Scottish town, 270 people on board, and on the ground, were killed. The Libyan, Mohmed al-

Megrahi, was found guilty in 2001. He died in 2012. The only person ever convicted of the atrocity. Jeff Sessions said the case is far from closed.


JEFF SESSIONS, U.S. ATTORNEY GENERAL: I want to assure you that your loved ones are not forgotten, and neither are you. Our investigators and

prosecutors meet regularly in the United States, in Scotland and elsewhere to advance the case and bring those responsible to justice. They continue

their efforts to gather witnesses and recover evidence from Libya, despite challenging conditions. They are engaged with Libyan prosecutors and

officials, and will continue their work as long as it takes.




[00:30:40] QUEST: Hello, I'm Richard Quest. There's more QUEST MEANS BUSINESS in just a moment. Las Vegas prepares for little monsters as Lady

Gaga announces her first residency.

And the Long Island Ice Tea Corporation has an announcement to make up to make really bitcoin business. And on this network, the facts always come


The U.S. Vice President, Mike Pence it was on a trip to Afghanistan. The visit was not announced in advance, and is the first time he's been to the

country as vice president. He is to meet top Afghan officials and rally U.S. troops these are live pictures coming to us from the air base there.

The United Nations has voted in force to condemn U.S. President Donald Trump's decision to recognize Jerusalem as Israel's capital. 128 countries

supported the nonbinding resolution. Nine countries opposed it and 35 nations abstained. The U.S. ambassador says Washington will put its

embassy in Jerusalem anyway.

Pope Francis is facing a backlash for taking part in the funeral of a cardinal who became a symbol of the catholic church's sex abuse scandal.

Bernard Law died Wednesday. A "Boston Globe" investigation years old revealed Law covered up child abuse by priests in the Boston archdiocese.

Kensington Palace just released these official engagement photos of Prince Harry and Meghan Markle. The images were shot by the celebrity

photographer, Alexi Lobromiski known for taking photographs of Nicole Kidman, Julia Roberts and Kate Winslet. It's not just the betrothed couple

that sparkles in the black-and-white photos, Ms. Markle's engagement ring is prominent as well.

Apple has admitted to deliberately slowing down older iPhones, and offering a rare explanation. Apple does it through software updates through the I

phone 6, 6s and even early models of the 7. And that model was only released last year. Shelly Palmer is the chief executive of the Palmer

group, joins me here in the studio good to see you.

SHELLY PALMER, CEO, PALMER GROUP: Good to see you, Richard.

QUEST: So, what do you hope this announcement? Why are they doing it?

PALMER: First of all, there is no way to win the conversation we're about to have. Because certain people are going to tell us that their experience

is that every time they update software on older phones, the phones slow down to a crawl and their life is miserable. There are other people who

are going to say, hey look, Apple has this fabulous software and when the battery is acting up and might make the phone shut look how wonderful they

are. They process the phone and, yummy, my battery won't die. And let me tell you something, I've been out hard and long on this all day, hundreds

of e-mails from people telling me it's terrible. Apple is like the worst people in the world. And then I've had people say you got to say the whole

story, Apple is awesome.

QUEST: But they didn't say.


QUEST: They didn't say. That's the problem in the 55 million-page released document, it doesn't say, oh, by the way, when you download this

update, we're also going to put a bit of software in that will slow your phone down to protect your phone.

PALMER: To protective phone, protect your processor. It's true. They weren't as transparent as they should be. Truthfully, what you should do,

there is a free app called battery life you can get at the app store, and I'm not shilling for it, but it actually works. Put it in the phone and

able to leave the health of your battery.

If you need a new battery, batteries are anywhere from $50-$75. If you have an old phone and the battery needs to be replaced, replace it. And if

you're mad at me for yelling at Apple, sorry. But Apple didn't do exactly the right job this time, Richard. They should have told everybody, hey,

we're going to throttle your phone's performance in order to protect it.

QUEST: Stay exactly where you are. Stay where you are, young man. I want you to hear this next story I want your thoughts on this.

PALMER: All right.

QUEST: An iced tea company from Long Island is changing its name to Long Block Chain and its shares gained nearly 200 percent. The latest company

to rebrand itself in order to jump on the bitcoin band wagon, there is a potential for wild market volatility.

[16:35:00] Stocks in the biotech firm Bioptyx more than doubled after it changed its name to Riot Blockchain and fell 25 percent today. Shares in a

Chinese fruit juice company soared 200 percent after it branded itself Future Fintech Group. And the mobile payments firm, Net Element soared 300

percent after announcing a blockchain deal. Shelly Palmer. Palmer Blockchain.

PALMER: Yes, we were going to put out shelly coin, absolutely because doing your own ICO is all the rage. There are 1,400 cryptocurrencies out

there, Richard and blockchain is the underlying technology behind all of it. So, people are blockchain crazy. What's sad is blockchain is an

incredibly important technology and is probably going to change the world but everyone is jumping on it for silly reasons and it's got very bubbly.

QUEST: We know it's going to be here, whether bitcoin or something else, we know

cryptocurrency is going to arrive with integrity do you believe -- how far along that road do you believe we are?

PALMER: So, cryptocurrency started out as an actual currency you might be able to spend, and it's become something that you speculate on right now,

so it is unclear you're ever going to be able to trade using blockchain technology the way that you can trade regular money. Because the clearance

of a transaction just takes too long the more people who get on it the worst that is going to become.

What is important, though, is the underlying technology blockchain actually has tremendous use in industry, supply-side, enterprise resource planning.

That is a world-changing technology, whether cryptocurrencies are going to be important or not. Let's see what happens to quantum computing and the

cryptography in the next 36 months.

QUEST: I know you don't trade or buy or sell. You have made that clear. And you probably have got no idea how to buy a bitcoin.

PALMER: Oh, no, we used to mine bitcoins. You mine and many more you need to belong to a mining pool. Not only do I know about this, we have had bit

coins over the years and we have been buying and trading them. You go on coin base, go any place you want to go. Buyer beware. Be careful,

Richard. Don't get into this unless you know what you're getting into.

QUEST: Too late! As this report makes clear. We've already been out. You need to understand bitcoin. We needed to show you how. So, we dipped our

toes, and we're showing you, as we will follow for the next few months, thousands of others have done what we did.


QUEST: The goal here is very simple. Simple. We're going to attempt to buy a bit of a bitcoin. Clearly, we're not going to buy that much. With

Nolan and Paul, we're going to show you how easy or difficult it is.

I want to buy a bitcoin. Have you ever bought a bitcoin?

PAUL R. LA MONICA, CNN MONEY CORRESPONDENT: I have not bought a bitcoin before. I am interested to see how easy it will be.

QUEST: Where do I start?

NOLAN BAUERTE, FOUNDER, COINDESK: First we are going to get your wallet.

QUEST: Before I've even got my bitcoin, I'm going get a wallet.

BAUERTE: Wallets, digital wallets we use in the cryptocurrency world. Don't actually store coins. With the store are cryptographic keys they

manage, generate and transact.

QUEST: There you go. Your wallet was successfully created. Before accessing your wallet, please choose a pin number, to unlock your wallet.

It's important to remember this pin, as it cannot be resettled, changed, without first unlocking the app.

BAUERTE: This has put a lot of onus on the user for security. That's one of the major differences here. Instead of asking the bank to secure all of

our personal information, the onus is now on us to manage our own cryptographic needs ourselves.

I have brought what was a party gift to people at one of our events two years ago. And there are .01 bitcoins on it, so $187.

QUEST: Where did you get this?

BAUERTE: This was given to me. This was a gift.

LA MONICA: But it's just symbolic. You cannot use this as legal tender per se.

BAUERTE: The coin is symbolic what's under this hologram here as a private key.

LA MONICA: Gotcha.

BAUERTE: And what we're arguing in this whole bitcoin revolution is keys are currency, like cash. Private keys are bearer instruments like cash, if

someone would see your key, they could use it as if they possessed the bitcoin. What you've got to do now is peel the sticker off. Take your

fingers and peel it off. This is there so you know that the manufacturer, these are bearer instruments the actual private key is a bearer instrument.

It would be the same as having cash. If someone knows your private key, they can access your funds. So now what we've got here is just a simple QR

code, you'd call this a paper wallet.

LA MONICA: If you get access to these wallet, it like getting access to cash.

BAUERTE: Think of it as a bearer instrument and cash. Success.

QUEST: So, this is a private key.

BAUERTE: So, you've got .01 bitcoin.

QUEST: I have a $186.43.

[16:40:00] QUEST: Let's assume we haven't got this. How do we now get a bitcoin?

BAUERTE: So normally you would fund an account after you shared your personal information, so they know who you are, you would attach a bank

account to it. And that would allow you to do these transfers.

QUEST: So, I would -- where would I do that. With one of these people?

BAUERTE: You could do it with Coin Base,, you can do it with Kraken.

QUEST: I've already got my wallet. So, if I want to look at my wallet on here.

BAUERTE: You can log in.

QUEST: There we are, look at that.

LA MONICA: And it's now supporting ether, we can buy even more.

QUEST: I think I understand it.

LA MONICA: A little bit.

QUEST: Mr. La Monica and I now call $170 worth of bitcoin which we will follow frequently on QUEST MEANS BUSINESS.


QUEST: To be continued indeed as I keep warm around the fires. This year brought stability to want typically volatile item, swans. It is time for

the annual 12 days of Christmas.

Now economists at PNC have been calculating how much of the each of the gifts in the song would cost today. The biggest changes in the year so

far. Pear trees up 5 percent due to the cost of limited supply of mature trees increased living costs for workers.

Then you've got gold rings! That is up 10 percent, mainly the biggest percentage due to increased demand had been flat for five years.

The price of lords a leaping, are also up, some 2 percent. Tight job market. Workers' cost stayed flat now, if you were to buy all of the

gifts, then you would cost $34,559. Five gold rings but if you buy the whole lot, as you have to, with the 12 days of Christmas, because you have

to buy them over and over and over again, then your total cost would be $157,558!

Put it all together, according to the consumer price index, the price is up some .7 of one percent. Once again, Christmas has become an expensive

opportunity for all. Whether it's pear trees, lords a leaping, golden rings, the whole lot is all yours for $157,000 and with that, PNC and all



[16:45:00] QUEST: Thank goodness. A last-minute deal in Britain saves thousands of jobs to Toys "R" Us.

Creditors nearly called it a day. The rescue plan involves 26 stores closing across the U.K. The company still faces bankruptcy in the United

States. Clare Sebastian is here. We must be grateful, no cynicism at all, that jobs are saved, and the company doesn't need to seem to have been


CLARE SEBASTIAN: That's in the U.K., Richard and not all jobs, unfortunately, because of those 26 stores, that's around a quarter of their

stores in the U.K. up to 800 jobs could go. That's a quarter of the people they employ there but yes it could've been a lot worse. The could've gone

to Administration if they hadn't agreed on this restructuring deal.

And it looked up until the last minute they might not. This was very much an 11th hour agreement. As I said, they are already in administration in

the United States. And that we don't know. There is a big question still hanging over that, over whether or not there is going to affect stores and


QUEST: What is the issue here? Amazonification of the toy industry?

SEBASTIAN: Absolutely. The adverts, millions of toys under one roof. Now they're all on Amazon. This is one of the problems that Toys "R" Us is

facing, epitomizing industry this year. It's not just Amazon. It's the change in habits toys aren't what they used to be.

There is a lot more technology involved nowadays, and that's hit some of the suppliers that supply to Toys "R" Us, the likes of logo and Mattel and

things like that.

QUEST: OK, so let's just take the online component to it. I mean, Toys "R" Us, in the way that Walmart has, can launch their own online portal to

sell gifts, toys and the like. Is it that these companies have just been slow? Or haven't got the magnitude or the experience, expertise.

SEBASTIAN: I think they might have missed their window. It seems they have been struggling under a huge debt burden and they have to restructure

about 5 billion of debt. And it just reached the point back in September, Richard, when they just didn't see another way around this. No store wants

to file for chapter 11 bankruptcy in September right before the holiday season.

But that is what they were forced to do. And the CEO said on a call today in the United States, that that is really -- the chapter 11 process has

really caused them to kind of take their eye off the ball for this holiday season, to kind of put business planning to one side. I think they

certainly do want to try and ramp up their e-commerce offering, but they just haven't had the bandwidth to do that in the last few months.

QUEST: So, if we look at more generally, do we know, and I know you revealed on "QUEST EXPRESS" in the stock exchange, 95 percent of your

shopping has done online. I don't know how you can do that? You've got to feel something. You've got to touch them. You've got to look at them.

You've got to play with them. But more to the point, do we know what the numbers are looking like? Early indications?

SEBASTIAN: I think we can look back to the start of the holiday season, Black Friday and cyber-Monday. Sales as a whole on black Friday were up 17

percent, and cyber-Monday, Amazon said it had its best year on record, Richard. So, this isn't so much about how much people are spending. It's

more about the proportion online versus brick and mortar I think the bottom line is, we don't know yet how this holiday season is going to look. But

2018, according to a lot of people, is going to be better. We are going to start to see more of the up side of this transition. In particular with

this tax bill more people will have more money.

QUEST: Don't spend it all on me. Thank you.

You can now download QUEST MEANS BUSINESS as a podcast, it is available from all the main providers. And you can listen to it also at

Now to update you on a story we brought you last night. Africa's richest woman Isabel

dos Santos. On last night's program, we told you about local media reports that Ms. dos Santos was under investigation at Angola state oil company.

She was chief executive until her removal last month. Today Ms. Dos Santos says that no such investigation exists. In a statement to CNN, she says

the news reporting and alleged investigation or probe on Ms. dos Santos' conduct as CEO of Sonangol is completely false.

The public prosecution service of Angola has informed that it has not received any criminal complaint against Ms. Isabel dos Santos and there are

no legal procedures of any kind on any matter against the businesswoman. A spokesman for Sonangol told us earlier there was no official investigation

into dos Santos and they are currently reviewing the matter internally.

Now, as we continue tonight on QUEST MEANS BUSINESS, what happens in Vegas, will earn Lady Gaga a lot of money. The popstar has booked a residency and

we will show you the numbers after the break.


QUEST: Welcome back. Las Vegas is now preparing to go crazy for Lady Gaga, the popstar has confirmed a residency there after months of

speculation. She signed a 74-show run at MGM's Park Theatre. She'll personally earn around $1 million a show.

Overall the deal is worth 100 million. She'll join other stars who have taken up Las Vegas residences. Britney Spears made $34 million this year.

She's been there quite a long time. And let's not forget Celine Dion, who has made $42 million this year.

Jem Aswad is joining me, senior music editor at "Variety." How long has Celine Dion been in Las Vegas making that sort of money?

JEM ASWAD, SENIOR MUSIC EDITOR, "VARIETY": Feels like forever doesn't it? It is really quite a long time. Several years. I'm not sure exactly.

QUEST: Multiple years. Same with Britney Spears. How are they able to command these huge sums of money out of Las Vegas? Which is really, you

know at the end of the day it is a show. They're not getting it from television rights and from broadcast rights.

ASWAD: Exactly. The difference is you've got tourists coming. You've got a constantly replenished audience and it's very attractive for them the

musicians always say I love performing, but I hate touring, meaning they hate the travel. And what could be more perfect than being able to tour

without going anywhere?

QUEST: Lady Gaga going there takes it to a new level. Would you agree?

ASWAD: Yes, because she is probably the most contemporary artist who has taken on a Las Vegas residency on this scale. Occasionally people will

come in for, you know, seven dates or ten days or something like that. But this is a very long, extended serious run. And it's rare for an artist

that young to be performing in Vegas usually they're at a later phase in their career.

QUEST: I don't want to be uncharitable. Would you say that sometimes in the arc of one's career, maybe you're on the turn, quite often, Vegas?


ASWAD: Oh, no, it's not an unfair thing to say, at all. And you could argue that she's at a later phase of her career, right? Because she

actually cycled quickly. She was a global icon by the time she was, what, 23? And there was a little bit of backlash after a couple years and she

sort of reset herself with a Tony Bennett album, the duets album she did with him. And she really set herself up with this Vegas residency with her

super bowl performance. It proved that it doesn't matter didn't do she's got enough hits and she's got enough showmanship, show-person-ship, to

command a stage like that.

[16:55:00] QUEST: So, to go back to the great days of Vegas. Frank Sinatra, Dean Martin, the rat pack. Even Elvis. There's, you know, the

biggest names of all have performed in Vegas.


QUEST: And this tradition continues with Lady Gaga. It seems entirely appropriate what do you think Frank Sinatra -- used to appear there.

ASWAD: Yes, he did. Week as far as I can tell.

QUEST: For years!

ASWAD: But Vegas has tried to reboot itself. And modernize itself and get itself beyond its Liberace and Wayne Newton sort of image, right? And so,

you have a lot of top deejays playing there, and commanding almost as much as a lot of the performers like Britney are. Calvin Harris, playing every

single weekend. And Vegas is trying to go younger and position itself for a new generation. They've largely succeeded over the last five years.

QUEST: A million dollars a show. Amazing.

ASWAD: Yes, I'll collect my check on the way out.

QUEST: Don't let the door hit you. Good to see you, sir. Very best to you and your family.

ASWAD: You too.

QUEST: We'll take a Profitable Moment after the break.



Tonight's Profitable Moment. 2017 it really is just an opportunity to say with all the goodies that we have had, with all the presents and the market

records and the green stock markets and the Dow record one after the other. it is a treat and pleasure to be here at this time with you every night

with or morning or whenever you may be watching.

Thank you for taking the time and trouble to join us. It really wouldn't be the same we didn't get together and have this conversation every day.

And as we look to next year, it merely remains for me to say to you whatever you're up to in your head, I hope it's profitable. A happy and

healthy one to you and yours.