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Quest Means Business

U.S. Markets Fall As Trump Warns Of Painful Two Weeks; Two Carnival Cruise Ships Waiting To Dock In Florida; WarnerMedia Names Ex-Hulu Boss As CEO. Aired 3-4p ET

Aired April 01, 2020 - 15:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

[15:00:14]

RICHARD QUEST, CNN BUSINESS ANCHOR, QUEST MEANS BUSINESS: Grim day in the markets. It's the Dow's largest points drop so far this week. The market

has been unhappy since the opening bell such as it is several hours ago.

We're now 60 minutes before the closing bell, and those are the markets and these are the reasons why.

It's a nightmarish new normal. As stocks are falling, the White House is warning about thousands of deaths, tens of thousands, possibly a hundred

thousand deaths in the United States.

The new month brings new bills, rents and mortgages have to be paid. But can they, when people have lost their jobs?

And CNN's parent, WarnerMedia makes a major switch. A new CEO for WarnerMedia, the old and the new are with me in this hour.

We are as you can see live from New York on Wednesday. It's the first of April. I'm Richard Quest, and today, on the roof. Absolutely. I mean

business.

A very good evening to you. A warm welcome to New York. The weather is delightful. But that's just about the only good bit of news I'm going to

bring you over the course of the next hour.

Well, we will see what we can find, but the Dow has fallen very sharply on the exchange. It's down more than four percent. The eight major indices are

down. And as you can see, it looks like we are at session lows at the moment. The NASDAQ is the largest loser. We are down nearly 300 points.

Donald Trump last night, warned of a painful, a very painful two weeks is how he put it and the White House is projecting more than up to 100,000 to

240,000 deaths in the United States. The Vice President has told CNN that the U.S. could -- just could turn the corner by June.

(BEGIN VIDEO CLIP)

MIKE PENCE, VICE PRESIDENT OF THE UNITED STATES: There are tough days ahead, and the President was straight with the American people about that,

but I hope people look at what happens if all of us continue to do our part and that is by sometime in early June, we could well have the coronavirus

largely behind us as a nation, reopen our country, put America back to work.

(END VIDEO CLIP)

QUEST: CNN's Jim Acosta is at the White House. We know the new tone and we know that it came because of the meeting yesterday or with the medical

advisers.

Now we wonder what comes next from a President who must be seriously worried about what comes next.

JIM ACOSTA, CNN CHIEF WHITE HOUSE CORRESPONDENT: I think that is a big question, Richard. And at this point, we're seeing a couple of different

signs of what might be coming. Obviously, the administration is trying to prepare for the possibility and they consider to be a likelihood at this

point that there are going to be 100,000 to 240,000 deaths in the United States, something on the magnitude of double of the toll of the Vietnam

War.

It's just a staggering thing to hear from government officials. But that's what it was like to be in the room last night. I was in the Briefing Room

last night as all of this was unfolding.

Richard, you do get the sense that the administration has sort of been scared straight in all of this. For weeks now, the President had been

downplaying the severity of this corona virus outbreak, saying it would go away and that he had it under control and so on.

You're not hearing that anymore. What you're hearing from the President is that he is no longer denying the science in all of this and that he is

trusting these projections coming from Dr. Deborah Birx and Dr. Anthony Fauci, who we expect to hear from once again at a briefing later on this

afternoon.

But a key thing that we should point out, Richard, and it is a sign that perhaps the tone hasn't changed all that much over here at the White House.

Vice President Mike Pence in an interview with our Wolf Blitzer earlier today, was almost blaming the Centers for Disease Control and blaming China

for the way that the administration responded to the coronavirus pandemic.

That obviously doesn't comport with the facts. The President repeatedly praised China in its handling of coronavirus and there were C.D.C.

officials in January and February, warning there was a pandemic on the way and that it could be very bad and so they are trying to shift the blame

here at the White House, which is an indication that perhaps they haven't learned everything at this point yet -- Richard.

[15:05:00]

QUEST: Jim Acosta who is at the White House staying up with the political and the President. Donald Trump is calling for a $2 trillion infrastructure

bill, and he wants it to be part of the fourth congressional relief plan.

(BEGIN VIDEO CLIP)

DONALD TRUMP (R), PRESIDENT OF THE UNITED STATES: So we have a zero interest rate essentially, and I said, wouldn't this be a great time to

borrow money at zero interest rate and really build our infrastructure like we can do it?

I'm suggesting $2 trillion, we redo our roads, our highways, our bridges. We fix up our tunnels which are many of them in bad shape.

(END VIDEO CLIP)

QUEST: Now a different name within the first stimulus, which of course was bailing out and ensuring that American workers had a wage check or at least

unemployment benefits. This time -- remember then households also got their checks which should be received in the next three weeks.

Vincent Reinhart is with me, Chief Economist at Mellon. Vincent Reinhart, an infrastructure bill would be different in design and effect, but it

would be no bad thing. More than one depression recession has been saved by an infrastructure spending.

VINCENT REINHART, CHIEF ECONOMIST, BNY MELLON: The problem though, is infrastructure spending has a very long spend out rate. You don't build a

bridge overnight. It's a multi-year process.

What we need now given the temporary nature, we hope that very nature of the economic dislocations, we need to get funds in the hands of the people

who are disrupted, affected, i.e. the small businesses, single proprietors who are out of work and scared at home.

So, yes, we need infrastructure. Just go from your rooftop to JFK and you can see how bad and crumbling our roads are, but don't we need more funds

now?

QUEST: So if that's the case, and we come to a fourth project or plan, since checks have already gone out, would you be in favor of another check,

obviously, increasing the level, the length of time for unemployment.

But what is next? If you're going to bail out, or you're going to do a stimulus plan, where do you favor its emphasis and priority?

REINHART: So first of all, I'm very suspicious of Phase 4 to begin with, because we haven't even seen the Phase 3 checks sent out and it really very

much depends on after the pandemic and then the economic consequences of the mitigation efforts to halt that path.

What I worry about is politicians are following Rahm Emanuel's law, which is a crisis is a terrible thing to waste. And so on the left, you hear

about a Green New Deal. In the middle, you hear about infrastructure. And then on the right you hear about using Social Security as an opportunity to

provide funds but at the same time, shore up Social Security.

All three are good things for the longer term ambitions of the U.S. and growth on a permanently higher trajectory, but it doesn't get funded right

now.

So I would be more in favor of temporary, targeted and timely with the emphasis on timely. Temporary is important because you don't want to meet a

V in economic activity with a plateau in the level of spending higher level of taxations forward.

QUEST: Right. Vincent, the market is down. One shouldn't be surprised. That rally last week, we are in for a loss, one loses tracks. It was a

classic dead cat bounce, wasn't it? Put in place by the stimulus package. Now we're really seeing the worries and fears of investors.

REINHART: So let me first talk to the worries and fears. Yes, I can. So first, let me say that though with regard to the temporary nature, the

Federal Reserve's policies are getting traction now. They're buying a lot of securities, they're buying a wider collection of securities, and they're

lending at the window.

They're also lending to foreign central banks to get dollars throughout the global system. So we've got to let that get traction.

Second, one of the biggest pieces of news over the last couple of days has been we really don't know what the Chinese infection and mortality rates

were. Everyone had been assuming a certain V, because we were just following the path for China.

Well, it turns out that there was systematic misreporting of both the number of cases and the number of mortality. And so I think people right

now are at sea as to the core of the problem. How long does this pandemic last?

[15:10:10]

REINHART: And how big or reach doesn't have into our global population?

QUEST: Vincent Reinhart, thank you, sir for joining us. I appreciate it. We will talk more and we'll check in with you more as this crisis

continues.

Carnival wants to raise $6 billion in stocks and bonds. Now, Carnival shares are down 25 percent on the day that 75 percent off so far this year.

Carnival says it has 6,000 passengers -- 6,000 who are still at sea.

Meanwhile, cruise lines worldwide have at least 12 ships still at sea. And there's a carnival ship that's floating with sick passengers which wants to

dock in Port Everglades in Florida.

CNN's Rosa Flores is there, so what have the authorities said? Will they let these ships dock? And if not, what do they do then?

ROSA FLORES, CNN CORRESPONDENT: You know, they're in a pickle right now, Richard because that decision has not been made yet.

At last check this ship is off the coast of Cuba, and people on board are trying to figure out what they're going to do. Their family members are

very concerned. They are very concerned because there are at least four individuals on board, excuse me, eight individuals on board who have tested

positive for COVID-19.

There are for individuals who have died. Their cause of death have not been determined yet and there are dozens -- dozens of passengers with flu like

symptoms.

But here's where the situation is. The Broward County commissioners and a group called the Unified Command are the ones who are going to make the

decision whether the ship is going to be allowed to dock or not.

They met for more than five hours yesterday, Richard and they did not come down with a decision. They tabled order until tomorrow.

Meanwhile, this ship keeps moving closer and closer. They did not approve the plan that the cruise line presented which included allowing the

passengers that do not have any symptoms to go home.

The passengers with flu like symptoms, they will be quarantined on the ship for 14 days, and then they would need to hospital beds here in Florida for

two individuals who need that type of treatment.

But I'm sure you've been following the news, Florida Governor Ron deSantis has been saying that he does not want this ship to dock on Florida shores,

and in the last hour and a half during the press conference, he said that he would allow Floridians to get off the ship, Richard.

We know that there's about 49 Floridians on board, but there's 304 Americans on board, and at least 247 Canadians on board. The big question

is, what about everybody else? What are they going to do and right now, it's in limbo because U.S. authorities have not made a decision -- Richard.

QUEST: Rosa Flores is in Port Everglades in Florida. We'll talk more and we'll follow that ship closely.

More on the Carnival. On the line now is James Hardiman, the leisure analyst at Wedbush Securities. James, Carnival is looking for this sizable

amount of money, should it get it?

JAMES HARDIMAN, LEISURE ANALYST, WEDBUSH SECURITIES (via phone): Well, sure, it is a difficult question. I mean, this is an amount of money that

they're getting from either potential equity investors, potential bank -- potential bondholders.

I think for the most part, that money is lined up. I think the should question is maybe a little bit more appropriate as we look to the stimulus

bill from last week, and ultimately, they were excluded from that and I think a lot of politicians and I think a lot of their constituents said

that no, they didn't have -- they shouldn't have access to those Treasury loans.

We'll see if that changes in the future. But that's where we stand right now.

QUEST: So as we look at the major cruise lines, do any of them risk going bankrupt? Getting to the stage of requiring to file for Chapter 11

protection because of this crisis, can you see that happening?

HARDIMAN: It's a plausible scenario. To be clear, I think it's a pretty unlikely scenario at this point, but I think that that solvency risk or

that liquidity risk is, I think it's safe to say, it's higher than it's ever been. Now, you know, it's not 50 percent, I don't think it's 20

percent.

What the likelihood is, is a difficult question to answer, but I think it's unlikely, but certainly that risk has gone up. If Carnival is successful in

getting the $6 billion, I think, today it was actually up to closer to $7 billion, certainly that minimizes that risk for them.

[15:15:08]

HARDIMAN: They said that they should have enough liquidity for at least 12 months with that money. Now, I'm not entirely convinced that this is only

going to last 12 months, but that certainly puts them in a much better position.

QUEST: You see that's the point. That's the point that you raised quite rightly, that even after the ships are open and sailing again, there is a

stigma and a stench over cruising fair or otherwise, I'm not saying, but there is this stigma that will take a lot longer for consumers and

holidaymakers to be comfortable about?

HARDIMAN: Yes, I don't think there's any doubt. I think eventually, we're going to slowly go back to something approaching normality.

We're going to go back to work. We're going to go back to school. We're going to get back on airplanes. I think cruising is dead last in terms of

that activity hierarchy, right?

I think people are going to think about how risky is the activity? And how important is the activity? And I think in both cases, their answers would

tell them that getting on a cruise ship any time soon doesn't make a whole lot of sense.

Now, I think it'll eventually, you know, this is an industry that I do think will come back and ultimately thrive. I just think it's going to take

a long time.

QUEST: Good to talk to you, sir. I appreciate it. We'll follow on. Thank you, sir. Now, when we come back in just a moment, the changing of the

guard at WarnerMedia, a major announcement.

When we come back, I'll be talking to my boss, and then I'll be talking to my boss's boss after the break.

(COMMERCIAL BREAK)

QUEST: WarnerMedia, the parent company of CNN has named its new CEO, Jason Kilar is the founding Chief Executive of Hulu. He begins in May, and that

would be just in time for the launch of the new flagship streaming service, HBO Max.

Kilar replaces John Stankey, who now serves as Chief Operating Officer and President of WarnerMedia's parent of course, which is AT&T.

Jason now joins me from Hillsboro, California. John Stankey is in Dallas in Texas. Gentlemen, I wish we were talking on happier occasions, but thank

you both for making time to talk to us. I very much appreciate it and I want to start the first you and then John Stankey.

Before we look at the whole picture of WarnerMedia, let's just talk about AT&T. Give us an update, please, on how the company is performing, and how

stressed they are in this time of difficulty.

[15:20:10]

JOHN STANKEY, PRESIDENT AND COO, AT&T: Richard, thanks for having us on today. I hope you're well and healthy. And I would tell you, in terms of

how AT&T is faring right now, and very unfortunate circumstances, I couldn't be more pleased, frankly, with how the core part of the operation

is performing and in serving our customers and caring, you know, the all- important data and voice traffic around the globe that people need right now.

And I'm so proud of my coworkers that are coming in every day and ensuring that these networks stay up and running. We've seen unprecedented volumes

across virtually every network, whether it's wireless or fixed line, consumer customers or even the largest, you know, global businesses and

it's by and large other than a few hiccups here and there, I couldn't have asked for things to go smoother or better relative to how that's been

faring.

QUEST: And John Stankey, why the decision to change in the middle of this crisis? Obviously, it was in the works before. And obviously, you must have

considered whether to delay. Why did you decide that Jason should start right at the middle of the crisis?

STANKEY: Well, hopefully, we're going to give Jason a little bit of a respite here and I think we announced that it will be effective on the

first of May, and I'm an optimist and I'm somewhat hopeful that by the time we roll into May, maybe we're starting to work back to getting our normal

sea legs about us and get our footing about us and then he'll be able to come in at a little bit quieter time.

And in the meantime, you know, my role is to continue to shepherd the organization through this unprecedented moment. But you know, I think you

touched on it, Richard, the world goes on, the business goes on.

And, you know, this is something that has been in the works for a period of time, and, you know, we do things in this company that are critical,

whether it's a time of crisis or a time of calm and the fact that we have you know, a great streaming service coming out in May, as you talked about,

I think that's something that even if people are stuck at home could be really a good thing for him, along with all the critical communications

that the networks provide.

So we're continuing to push ahead, keep the business focused and do as much as we can, under these circumstances. So Jason will be ready and raring to

go the day he comes in here.

QUEST: All right, Jason, you're with us as well. Now, what do you see as your main challenge once you start as head of WarnerMedia? One assumes

you've had a plan that you've put forward to the Board, so tell us, what are our weak points?

JASON KILAR, INCOMING CEO, WARNERMEDIA: Well, I wouldn't say the weak points, but I think the challenge will be, and this is not unique to the

current time, Richard, I think the challenge is to make sure that you've got a very finely tuned ear to the customer.

And I think that is a challenge that any company has, including WarnerMedia. And what I mean by that is to be very, very careful to listen

to what customers are telling you, and in the case of Warner, that means, how they want to consume stories, where they want to consume stories, how

they want to consume stories, all the things that go into that.

And I think that's the challenge, because there are historical ways that things have been done. They have been incredibly successful, and I think

some of them will continue to be very successful. But I also think in these unprecedented times, as John said, consumer behavior is changing, and it

will continue to change.

And I think the big challenge is not just for myself, but an entire organization to not only respond to that change, but get out in front of it

by inventing on behalf of customers.

QUEST: Jason, do you think it is still realistic and we should still launch HBO Max at the end of May? So many things are being delayed for very

understandable reasons. Should this be delayed, too?

KILAR: I don't think so, Richard. I think, it's a fair question. But I believe that and John alluded to this a little bit, when you think about

what's going on right now for people, not just in America, but all over the world, I think that being able to have stories that are -- that means

something to people to be delivered in very convenient ways. I think that's maybe even more important now and in May than it might be in other points

in our history.

So I think that's the kind of service that you'd really love to see put out there in this world. And so I think there's no reason to delay that and

thankfully, the team is in a good position to launch that service in May.

QUEST: Right. One more thing, Jason, so many productions have been delayed, or paused, and so many openings have been put off. Later in the

year, there's going to be, thank God, when things get back to normal. But there will be an embellishment of riches waiting for the viewer, won't

there?

KILAR: I believe there will. There is certainly -- in the case of WarnerMedia, you're looking at some incredible stories that I'm very

excited about, you know, consuming as an individual and a fan, but also sharing with the world.

So you're absolutely right, that there is going to be a number of titles across the whole industry, both in film and television that will be very

ready to be released.

Now, that said, there's also this current period where all productions have been suspended, which has never happened in the history of media. So there

is going to be that to recognize that there's a disruption in production, and so there's a bit of a buildup, but there's also going to be a lot of

work to be done to catch up.

QUEST: John Stankey, are there any problems that you've experienced? Any likelihood that AT&T will have to throttle network bandwidth for consumers

in any way? The demand on the networks is so huge.

STANKEY: Richard, it's interesting to see what's happening in different parts of the globe, and since we're a worldwide provider, we see a lot of

different dynamics.

But I will tell you, in the United States where we have local access, broadband networks, we're not having that kind of a dynamic or issue and I

think a lot of the reason behind that, frankly, is policies in this country that had been very pro-investment and very well thought out in terms of

making sure that there was infrastructure put in place that was scalable, and that there were economic models that worked on both sides of the

equation, the people who provide the local access and those that use that to get their information out to the end user consumer, are very rational

and they're very market oriented.

There's been a couple of little snags and points where we've seen some contention here and there, but very quickly, you've seen the market work

and getting those ironed out over the last couple of weeks, and I think the network is performing incredibly well.

QUEST: John, you'll forgive me if I give the last word to the new boss, Jason. Jason, all right, so you're on board. You've got the helm of this

tony group of companies. Can you assure us that CNN will be robust, you will be the stalwart and standard for CNN, as we face a very difficult

autumn, particularly in a political time? Are you ready for the brickbats coming your way?

KILAR: I think right now is a fantastic reminder to the world about the importance of CNN. So I don't think that I can say anything other than

please keep doing what you're doing because the service that CNN and the team provides is more critical today than probably it's ever been. And I

think that's going to be, you know, true in the case of COVID-19 and I think it's going to be true in the case of an election.

These are such important moments for the world. They are important moments for America and I've got your back.

STANKEY: Richard, you and your colleagues have done a remarkable job.

QUEST: Good to hear. Jason, thank you. I'll show you where the photocopiers are when we first get in all back into the Hudson Yards

together. John Stankey. Thank you as well. The boss and the boss's boss, it's always good to have them on the program.

As we continue from the rooftop today. It is rent time. It's mortgage payment time. And it doesn't really matter which country you're in.

The difficulties for those who now find themselves without work, without a paycheck, without a business. It's QUEST MEANS BUSINESS from the roof.

[15:30:00]

(COMMERCIAL BREAK)

RICHARD QUEST, CNN INTERNATIONAL HOST: Hello, I'm Richard Quest. There's more QUEST MEANS BUSINESS in just a moment, as we continue, we'll hear from

the Chief Scientific Officer from Johnson & Johnson about the desperate need and search for Coronavirus vaccine. And it is April the 1st, and that

means bills have to be paid, businesses means paying the rent. You and me, we have to pay our mortgages and some are refusing to pay. We'll get some

advice and some guidance. First, of course, though, this is CNN, and on this network, the news always comes first.

Testing in Ireland and the U.S. suggests up to half the people with coronavirus show no symptoms. To help stop the undetected spread of COVID-

19, U.S. health officials may soon advise more people to wear masks. Public health experts say social distancing and stay-at-home orders could

dramatically lower the U.S. death toll. The Danish Prime Minister says his country's stay-at-home restrictions appear to be flattening its curve. If

the trend continues, Denmark could begin to gradually reopen the country after Easter.

With English Premier League season suspended, so its football clubs are under fire for seeking help for an emergency job program. At least three

teams want assistance paying furloughed staff, while still giving star players their full salaries. One British lawmakers accused the clubs of

living in a moral vacuum. For the first time since World War II, the Wimbledon Tennis Championships have been called off. The latest

cancellation in the eerily quiet sports world. Wimbledon which was to take place in late June is now scheduled for June of next year.

It's April the 1st and the rent is due. U.S. commercial landlords have been collecting tens of billions of dollars every month. Residential landlords

are restricted on what they can now evict people here in New York. Some people, of course, many people are simply saying they don't have the money

to pay the rent or the mortgage. The Cheesecake Factory on the commercial side says it won't pay rent until April -- won't pay April's rent, I beg

your pardon. In a report it says Mattress Firm and Subway will cut or delay payments, too. And homeowners looking for mortgage relief. Well, all

mortgage lenders have one description or another are saying that help is available. But as Mr. Cooper, which is a mortgage servicing company, one of

the largest in the U.S. The CEO put out this video saying help was available, but you still owed the money.

[15:35:00]

(BEGIN VIDEO CLIP)

JAY BRAY, CEO, MR. COOPER: Homeowners who can't pay their mortgage due to COVID-19 can apply to pause their payments. And this is called a

forbearance. However, it's not a waiver and it's not payment forgiveness.

(END VIDEO CLIP)

QUEST: Well, Broeksmit is the chief executive of the Mortgage Bankers Association. He joins me now. And let's deal with that first point, not for

-- its forbearance, not forgiveness. If banks, mortgage companies forbear, then, even if you forbear for three months, four months, five months, the

people are still going to have to -- at the end of the mortgage life, and they're not going to have the extra money necessary. Doesn't it need to be

forgiveness?

ROBERT BROEKSMIT, CEO, MORTGAGE BANKERS ASSOCIATION: Well, thanks, Richard. Thanks for having me on. And Jay Bray from Mr. Cooper is correct. The

forbearance is a deferral of payments, not a forgiveness of payments. And there will be ways that will be manageable for the consumer to pay that

back, they can pay it back at the end of the mortgage. In some cases, they can extend the term of the loan by the amount of the months that the

payment was deferred. So, they're there. It's in everybody's best interest to have this be something that consumers can handle once they're back on

their feet.

QUEST: Why not forgive the interest? Would it kill mortgage lenders to forgive the interest for the period that people are in, in difficult times?

BROEKSMIT: Well, I think it's important to understand that even when a mortgage servicer does not receive the payment from the consumer, that

mortgage servicer is obligated legally to advance it to the investor. So, it's not a situation where the servicer can forgive the payments because

the investor is contractually obligated to receive those payments, and because this situation came up through nobody's fault, through a global

health emergency, it makes sense to press the pause button rather than to forgive.

QUEST: Now, but you're not pushing the pause button, really, are you? Because the people -- if your business has gone out of business, and you

have no realistic way of earning money for the foreseeable future, you have a temporary forbear -- avoidance of foreclosure and eviction because of

laws, but you really are and it's up to your neck. I'm not saying, sir, that it's, you know, that this is easy. I guess I'm saying the deepest

pocket should bear the biggest loss.

BROEKSMIT: Well, I think that the federal government and the CARES Act that just passed has all sorts of assistance to the sorts of businesses that

you've discussed. Hundreds of billions of dollars made available in small business administration loans, checks to people all across the country,

depending on their income levels, very much enhanced unemployment benefits. So, there's all sorts of things in the relief bill that will get at the

things that you're talking about, but from a perspective of the lender, it's not as if they have the deep pockets that would permit them to just

forgive these things. They are -- they are working on -- working with the borrowers so that they can pay it at a time when they're back on their

feet.

QUEST: Finally, I guess, there's no easy answers, Bob, I fully understand that there's no easy answers -- excuse me -- in what is a difficult

situation. I think, though, that we do need your assurances that from your understanding, nobody gets kicked out of their home, the proper length of

time is given to allow people to accommodate these appalling times.

BROEKSMIT: Oh, absolutely. And we couldn't agree more. We feel very acutely for anybody who has been affected by this crisis all over our country. And

the foreclosure moratorium is in full force and effect already. And while people are in these forbearance plans, which depending on how long the

hardship last, could go as long as a year, there certainly would be no move toward foreclosure for those borrowers. We agree with that completely.

QUEST: Bob, good to talk to you, sir. Thank you for joining me. Now, the cycling company Santini is in the heart of Italy's Coronavirus outbreak.

For years, this company has made official jerseys for several world races, now shifting production to make medical masks and hopes to produce 50,000

masks today. It's the voice of the crisis. It's a different voice with a different message.

[15:39:59]

Monica Santini is the chief executive of Santini, joins me via Skype from Bergamo in Italy. Good to talk to you. You are in the heart of this crisis.

And I know that one of your, your most important aspects is to make sure that your masks go to your region to help your people who are hurting. You

must be very proud to be able to do that.

MONICA SANTINI, CEO, SANTINI (via Skype): We have very proud as inside. We definitely are in the heart of this crisis here in Bergamo. This is the

most (AUDIO GAP) city of Italy. And we are really concerned about the lack of medical devices like mask. So, that's why we decided to look into the

possibility to make them ourselves. Luckily for us, we are still producing everything of our normal production in Italy. We have a facility that can

really produce this type of masks.

QUEST: So, how difficult was it to turn your company to adapt? You know, an ignoramus, like me thinks whilst sewing is sewing, but you're dealing now

with highly technical masks that have to be made to very exacting specifications.

SANTINI: Well, actually, it's -- the production that we normally do of cycle clothing is more complicated to make actually than a mask. But it's

very different. So, we had to learn a totally different kind of job. The most difficult part was really to find the right fabric that was used for,

you know, to protect against the virus. And I have to thank also the fact that we are in a region where we have a lot of productions of different

type of fabric and in fact, this mask is a kilometer zero mask, from the fabric to the final production that we do ourselves.

QUEST: Right. Now, the company itself, luckily for you, you're still manufacturing, you've managed to keep your workforce there, you're doing

masks. But psychologically, anxiety levels, how are you coping with it?

SANTINI: Well, I we have bank all the -- all my staff because that, you know, it's a difficult period, everybody is scared off by -- of coming to

work. Of course, we had to cope with that situation already a month, more than a month ago. So, internally, we are, of course, using all the

necessary devices that we have, of course, everybody with mask, they are separated by at least a couple of meters, and so on. But the fact that they

are now producing masks, I have to say that was embraced by a lot -- all of my people. And I think that for everybody, this was a way to how our

territory -- as you said at the beginning, of course, we'll try to give all these mask first to the people in our region. And then, if we can produce

enough to enlarge it (INAUDIBLE) out.

QUEST: Good to have you with us. Voices of the crisis that you'll hear. Thank you, ma'am, for joining us. I appreciate that you may be able to hear

here now we're on the roof. For sounds of the crisis, it's pretty constant here in New York. The ambulances going up and down the avenues. The only

good thing is that the avenues are clear. There's just about no traffic anywhere. So, you are able to get around.

When we come back, tobacco leaves could hold possibly the answer to a vaccine for Coronavirus. We will consider that with Johnson & Johnson after

the break. It's QUEST MEANS BUSINESS. The Dow is down, it was off more than 1,000 a few moments ago. It's going to be a grim day on the markets, as

well when the closing bell rings.

(COMMERCIAL BREAK)

[15:45:00]

QUEST: The pharmaceutical giant Johnson and Johnson's working on a COVID-19 vaccine, the company's Chief Scientific Officer, Paul Stoffels, joins me

now. Sir, as you know, all these things, are really simple question. How close are you and how soon will you be able to produce one?

PAUL STOFFELS, CHIEF SCIENTIFIC OFFICER, JOHNSON & JOHNSON (via Skype): Well, we decided this week to start production and start the preparation of

clinical development. So, the clinical studies will start in September, and hopefully we'll have data beginning of next year to conclude safety and

efficacy. We start manufacturing now. We have discipline to fully go at risk and start manufacturing now. And so, we look forward to bring the

first batches early next year, and millions of vaccines mid next year.

QUEST: So, not in time, obviously, for this flu season, coming up at the end of the year. But, I guess what people want to know is that there's

light at the end of the tunnel, in the sense of there is going to be a vaccine for COVID-19. That, you know, we're not going to go through this

every year.

STOFFELS: Well, I think that's a very important thing that we can start working on putting a stop to the disease. And starting -- we started

working on the vaccine, 15th of January, we are now 10 weeks in, we have a lead vaccine. We start full scale production now, upscaling production,

both now in Europe and we'll quickly put up manufacturing plant in the U.S. J&J has fully supported the building of that plant and will look further to

produce more vaccines in the rest of the world.

So, with the goal of putting a billion vaccines into in -- at work in '21, '22, so that there is a stop to the COVID-19 epidemic.

QUEST: Right. So, we'll talk more and we'll need to leave it there for the moment. But thank you, that is the best bit of news we've heard, so far, on

this program. Thank you. I appreciate it. When we come back this morning, I took a walk. I wanted to see Times Square like I've never seen it before,

after the break.

(COMMERCIAL BREAK)

[15:50:00]

(COMMERCIAL BREAK)

QUEST: This morning, I got up pretty much at the usual times, did all the usual things, and then decided to do something unusual. I wanted to see

Times Square, which is the heart of New York City. I wanted to see what it looks like. Times Square is about 40 blocks in that direction.

(BEGIN VIDEOTAPE)

Eight o'clock on Seventh Avenue. Normally, this main artery would be full of traffic, heading south to Wall Street and the towers of finance. Today,

few cars, fewer people. This is exactly as the authorities wanted. Stay at home. The subway is still running, sort of. Miss one train and there's a

long wait for the next. Normally crowded platforms are deserted, as it should be.

As the train arrives, it's obvious there are few passengers on board. These are the essential workers of New York, God bless them, keeping the city

going while the rest of us stay safe at home. And behind those masks, what it faces. The train is the riskiest part of their day. It's three stops to

Times Square, I should be battling by now.

So, this is Times Square. Normally, it would be packed with computers. But as you can see, at this major interchange, there is virtually no one here.

Times Square is the most obvious example of today's New York. This is rush hour. And one of the busiest places in the city.

Times Square is known as the crossroads of the world. Today, the crossroads are empty, and the traffic, well, this is the extent of the rush hour.

Some things don't change. The giant lit up screens are still screaming their messages. Normally advertising the latest in everything. Now, they

gave their latest advice to keep us safe. As I walked through the Square, time and again, once thought keeps coming back to me.

Walking through Times Square actually feels like something out of a science fiction movie or a disaster film. There is nobody here and just warnings

everywhere, about staying at home and washing your hands. And of course, ubiquitous police cars are everywhere.

Times Square has a special place in my heart. As I walk back home, I'm reminded why.

[15:55:09]

Four months ago, I was standing just here, looking up there when the ball dropped on New Year's Eve. 2020 had a lovely ring to it, a new decade with

so much promise. Who could have imagined?

Who knows how long this will last? It's good to see it's all still here, waiting for us to return.

(END VIDEOTAPE)

QUEST: So, Times Square, just one of the many places, of course, this is deserted, eerily so. Before we go, I need to update you on how the markets

have traded down yesterday and then very heavily down today. There are some disappoint on that day, worrying consumer confidence numbers which came out

during the course of the day.

In addition, there are concerns now about what we'll get with the unemployment numbers, and the jobless claims numbers that will come out

tomorrow, 3.3 million was the last numbers that we got. So, let's see what we get over the next 24 hours when those numbers come out. We are off the

lows of the day. Not that that's saying much, because the Dow is off four percent.

Investors really now starting to realize the length, the depth, the seriousness, I'm almost running out of adjectives in which one can describe

the situation facing investors, you, me, everybody, like -- but we are still here. And that's what's important. Thanks to Chris, who did the work

behind the camera tonight. And that's 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. Let's make a date tomorrow.

(COMMERCIAL BREAK)

END