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QUEST MEANS BUSINESS
Central Bank Uncertainty Rattles Global Market; W.H.O. Says Spike in Cases Should be Wakeup Call for Europe; Trump Contradicts C.D.C. Director on Vaccine Timeline; Raab: Good Friday Agreement Not In Jeopardy; Wyndham CEO: U.S. Franchisees. Aired 3-4p ET
Aired September 17, 2020 - 15:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
RICHARD QUEST, CNN BUSINESS ANCHOR, QUEST MEANS BUSINESS: As we go into the final hour of trading on Wall Street. The market is lower. There was a
sort of a brave attempt at a lunch time rally, but that evaporated and they are lower off the lows of the day. Still heavily down by about one percent.
Other markets are off even more. The tech stocks being beaten up once again, down nearly two percent for the NASDAQ, S&P down one and a third.
So it's a volatile day and we need to understand why. These are things that have been happening.
The Central Banks are rewriting the rule books. They're trying to say the global economy and rules on inflation have changed, too.
Airline chief executives are back at the White House asking for help before the current coronavirus act expires.
And the British Foreign Secretary has told CNN there are no plans for a hard border on the Island of Ireland.
We are live from London. It is Thursday, it is September 17th. I'm Richard Quest. I mean business.
Good evening. Tonight, the market volatility that we're seeing on both sides of the Atlantic is reflecting the Central Bank uncertainty over what
is going on.
Over the last couple of days, we've heard from major Central Banks. Yesterday was the Fed, today was the Bank of England, and in all cases, the
level of unease seems to be rising.
The Big Board shows the hazy outlook on how things have moved. Obviously, the worries that are taking place within the U.S. economy. The Dow is off
just about one percent and although I will say off the lows for the day.
On the triple stack, the S&P and the NASDAQ are well behind. Mohamed El- Erian's view is that the Fed until now has propped up the market, but it has been unsuccessful elsewhere.
(BEGIN VIDEO CLIP)
MOHAMED EL-ERIAN, CHIEF ECONOMIC ADVISER, ALLIANZ: The fed has been exceptionally successful in boosting asset prices well beyond what
fundamentals would validate.
When it comes to the real economy, however, the Fed has been pushing on a string.
(END VIDEO CLIP)
QUEST: Now, the Central Banks form the focus of our attention tonight, not only because of what Jay Powell said yesterday, but also what the Bank of
England said today when it held monetary policy in place, no change in interest rates, but once again started to look for other measures, for
example, exploring negative rates.
Let's look at what the Bank of England did. The Bank of England held rates where they were and said it was going to start the process of looking at
the practical issues towards using negative interest rates. And it said the outlook was unusually uncertain.
The E.C.B. last week has withheld rates, but on a more positive note, the E.C.B. projected a smaller recession than earlier. Christine Lagarde said
the Euro zone governments must do more.
Now, that idea of fiscal versus monetary was a view passed on by the Fed yesterday. We know that they said they're going to keep rates pretty much
at zero until late 2023 at the earliest and they have adjusted the inflation target to two percent asymmetrically.
Again, that phrase uncertain, Powell's press conference yesterday, extraordinarily uncertain. Julia Coronado is the President and Founder of
MacroPolicy Perspectives. Julia tonight is in Austin, Texas where she joins me.
So we've known that interest rates are going to remain low across the board for some years to come. But what we're seeing now, Julia is much more
nuanced messaging from Central Banks about what they are going to do.
JULIA CORONADO, PRESIDENT AND FOUNDER, MACROPOLICY PERSPECTIVES: Well, I think it reflects the limitations of their tool kit. I think we have seen
the Bank of England maybe even flip flop a bit on negative interest rates and the need to do more and the Fed has certainly -- you know, they
clarified their guidance on interest rates, but they left their guidance on quantitative easing quite flexible and up in the air.
So, I think that they recognize that their tools are limited. Some of what we're seeing may not just be reflecting the message from Central Banks, but
the increasing dysfunction and anxiety around fiscal policy. In the U.K., it is around the job retention scheme and the expiration of that. In the
U.S., we just can't seem to get a fourth package of support.
Millions of people have lost the Federal support to their unemployment insurance and that really is where the rubber hits the road for the real
QUEST: Are we fooling ourselves to some extent? I mean, not just by the stock market, but if you take, for example, the U.K. when the official
unemployment rate is four percent because of the job retention scheme and in the U.S., the numbers are coming down, but we're going to hit a sort of
a high level where it will settle.
There's a feeling that things are perhaps -- I don't want to say better, but they're more okay than they really are. And actually, if you look under
the hood, it's pretty worrying.
CORONADO: Well, I think, Richard that you're kind of touching on what might be an unintended consequence of early and aggressive monetary action
that as you note, really did a fabulous job of short circuiting the economic crisis from becoming a financial crisis.
So the Fed and the Bank of England and the E.C.B. really caught the falling knife in March and April and helped restore market functioning, you know,
Meanwhile, the real economy continues to struggle. We certainly have regained a lot of the jobs lost as the economy has reopened in the U.S.,
but we are only halfway there.
And meanwhile, fiscal policy makers may be getting a little complacent because of that market support. Usually markets tanking is a signal to
fiscal policy makers to take action. They might be thinking things are okay when in reality, millions of people still need support to stay in their
homes and feed their kids and continue to live a prosperous life.
QUEST: Julia, your picture has been freezing off and on so we will leave it there, although we'll talk more about it in the future. Julia Coronado
Now, European markets, have a look at the numbers and they tell their own sort of tell, they slipped on Thursday. They've seen what was happening on
the opposite side of the Atlantic. It is not surprising bearing in mind the totality of the events of the today.
Not huge in terms of numbers, Paris is obviously the worst, slightly worse than what they have in Zurich and Frankfurt. The reason -- let's be blunt
here. The reason that Europe turned turtle was because the W.H.O., the World Health Organization has said the number of rising cases in Europe is
(BEGIN VIDEO CLIP)
DR. HANS HENRI P. KLUGE, REGIONAL DIRECTOR FOR EUROPE, W.H.O.: The September case numbers, however, should serve as a wake-up call for all of
us. Although these numbers reflect more comprehensive testing, it also shows alarming rates of transmission across the region.
(END VIDEO CLIP)
QUEST: Now, joining me now is the Allianz Chief Executive, Oliver Bate who joins me. Oliver, thank you. Good to have you, sir. Very much appreciate
As one of the world's largest insurers, asset managers, there's much to cope with here. Let's start where we've just left off. We'll get to
insurance in a minute. If we look at the way in which Central Banks are warning and we know we're in a low interest rate environment, the premium
for asset management now has to be surely risk premier in the market.
OLIVER BATE, CEO, ALLIANZ: Good evening from, Munich, Richard. Thank you for having me.
So the question was, how do we look at markets? The issue for us is less, to be honest, what is happening in equity markets because we are
dramatically de-risked from equities given the environment.
As you heard from a former colleague a moment before, we thought that prices were inflated so we have de-risked. But the real question is what is
going to happen on credit and that is very closely related to what the economy is going to do.
And I share the comment of the lady you just talked to that the situation might be much more difficult than the market price it for today.
QUEST: Right. But how does that now translate itself? Because we know that Central Banks are doing all they can. What do people like you who are
insuring and asset managing in the real world, what do you want to see more of or less of?
BATE: What we really need, Richard, is action by the government. We need fiscal action. So the first one is to make sure that people do not run out
of support at exactly the wrong point in time.
We have what we call short working for lowering here, and we expect that only about two-thirds of the people that are on short work will return to
jobs, potentially one third of the people in Europe will come back and have more jobs.
So unemployment is significantly rising and we need to deal with that. We need to pre-think what they are going to do about it.
BATE: The second one, savings rates have doubled. So we are standing at savings rates now across Europe about 20 to 25 percent. So people are not
investing, they're not consuming and we need to have real government action to mobilize that money for investment, not just consumption.
And the third thing is, we need do that in a way and Europe is particular about it that is sustainable. Not just getting more debt and spending more,
but finding a way to finance that in a sustainable way and turn the economy into a sustainable model, including addressing climate change.
My key worry is that with problems rising, we will forget about reforms and just start thinking about the next months and the next quarter.
QUEST: If we look at the insurance business, it has not been as badly hit as others both in terms of pandemic insurance, coverage, and business
I am wondering, do you see for example, I am not sure whether you are involved. We have talked with Lloyds about the insurance of the
vaccinations industry as it now comes closer to having vaccinations, do you see issues in terms of vaccination manufacturers and the difficulties
bearing in mind the speed with which this has been put together.
BATE: No, we are focusing actually, at Lloyds, we are ensuring clinical trials for vaccinations. We are very close to the action. We are offering
supplemental health and by the way, health insurance for health workers that are at the frontline of dealing with COVID.
So, we are trying like many others to do our best in helping with the situation. What we can do, however, is pay claims where there was no
premium paid for and we cannot insure systematic breakdowns or governments deciding to shut down the economy and then paying for that. That is
something we cannot do.
QUEST: You see, that's the controversial bit, isn't it? And you'll be familiar with the court ruling in England earlier this week, but that's the
difficult bit because as we're now going into regional lockdowns, I am in the U.K., well, the northeast has been locked down. Parts of Germany have
been locked down, parts of France.
The argument goes, Oliver, you know it well, the argument goes, well, the insurance companies manage to wriggle out when it mattered most. You've
heard the argument.
BATES: Yes. And it's a prejudice a lot of people have and partially, we have to self-reflect and take the blame for that. Why? I think the key
source, Richard, my personal opinion is, the reason is that our -- the products that we offer are often too complicated. They've been designed by
lawyers and actuaries and not by people that understand clients and our ability to communicate what we do actually cover and not cover has not been
That's why in our case, when things are really not clear, we need to stand up for that and clarify and in case of doubt, and real doubt, we have to
take what we can and we can't do and you know that from the United States and others where people are trying to change contracts in hindsight and
expand coverage for the rich at the instigation of politicians and others, pay for something that was never foreseen.
And to define that is not easy, I understand. But our job is to make clear to people and our clients first and foremost, what do we cover and what do
we not cover? That has not been so clear and that's our fault.
QUEST: Oliver, finally, give me a gut feeling for how your gut feeling is as we look now towards Christmas. Northern hemisphere, it's dark now here
in London and obviously in Munich where you are. What's your gut telling you about how this moves forward now?
BATE: So infections are going to rise and the key thing is, however, and I think we're looking in my personal opinion at the wrong KPI. What we need
to look at, also because increase in testing, is how -- what is the development of serious complications out of COVID infections?
We have a lot of young people that have caught the disease but are actually having mild symptoms and are going through it fairly well. We need to make
sure it doesn't spread too fast and it's often related to young people gathering and drinking lots of alcohol, so we have to think about that.
But I'm more worried about the economic outcomes. I'm very worried about the gastronomy sector. I am very worried about the travel sector, of our
people that run hotels, they need real support and it has to be un- bureaucratic and it has to work and it would go well into 2021.
So, we cannot think about having all of these things rolling off, as we speak, and particularly for restaurants that have been able to serve
clients outside owing to the great weather we've all enjoyed across Europe, we now need to really help them and all the work that's connected.
Why? Because it's often the most vulnerable people in our society that have the lowest pay rate, they have the lowest savings rate and they have the
lowest resilience, so we need to focus on those that need our help.
QUEST: Oliver, thank you so much. I really appreciate you taking this time. We will talk more between now and the end of the year, obviously, to
continue getting an update.
And as Oliver was just saying of course there, those in the industries who are most affected. Last night, we had Chef Boulud on from Daniel. Tonight,
we've got the CEO of Wyndham Hotels on who will talk to us about that sort of industry as well.
In fact, the travel industry that Oliver was talking about, the airlines CEOs in the United States were back at the White House seeking more help as
the current help expires at the end of September, a last-minute plea.
And also, developing a vaccine is hard enough, the logistic of getting it around the world are absolutely mind-boggling. It's QUEST MEANS BUSINESS,
good evening to you tonight.
QUEST: The W.H.O. is urging the United States to get on the same page about when and how vaccines will be authorized and distributed after
several days of confusion between the C.D.C. and President Trump: the mixed messages on U.S. vaccine timelines.
So, first of all, the C.D.C. says that it probably won't be until the middle of -- the head of the C.D.C. says it won't be until the middle of
next year, then President Trump contradicted his own Director.
(BEGIN VIDEO CLIP)
DR. ROBERT REDFIELD, DIRECTOR, CENTERS FOR DISEASE CONTROL AND PREVENTION: You're asking me when is it going to be generally available to the American
public so we can begin to take advantage of vaccine to get back to our regular life? I think we're probably looking at late second quarter, third
QUESTION: The vaccine for the general public likely would not be available until probably next summer, maybe even early fall. Are you comfortable with
that time frame?
DONALD TRUMP (R), PRESIDENT OF THE UNITED STATES: No, I think he made a mistake when he said that. It's just incorrect information. We're ready to
go immediately as the vaccine is announced, and it could be announced in October. It could be announced a little bit after.
QUESTION: How can the American people trust you on the pandemic when you're contradicting the head of the C.D.C. and --
TRUMP: Because of the great job we've done.
(END VIDEO CLIP)
QUEST: If that wasn't bad enough, the C.D.C. then back tracked on what the Dr. Redfield had said. He said -- the spokesman said, "Dr. Redfield was
answering a question he thought was in regard to the time period in which all Americans would have completed their COVID vaccination and his estimate
was by the second or third quarter of 2021. He was not referring to the time period when COVID vaccine doses would be made available to all
It didn't sound like that when you actually heard what he said because if you listen to what he had said, he actually took part of the question into
his answer, which does suggest he knew exactly what he was being asked. But that's a discussion for another day.
The German company BioNTech is buying a new production plant because it is one thing to actually get a vaccine that is effective, it is quite another
to be able to produce it in quantities and then yet another thing to distribute.
Here is CNN's Anna Stewart.
Pharmaceutical companies are inching closer to the finish line. There are over 170 vaccine candidates around the world. Eight are in the final stage
of human trials.
Proving them to be effective, safe, and achieve regulatory approval isn't the only challenge.
(BEGIN VIDEO CLIP)
KATE O'BRIEN, DIRECTOR OF IMMUNIZATION, VACCINES & BIOLOGICALS, WORLD HEALTH ORGANIZATION: We have to go from there to actually having billions
of doses of vaccine that can be delivered to people around the world. We're investing in the process of manufacturing before we even know whether a
given vaccine will reach licensure and could be used.
(END VIDEO CLIP)
STEWART (voice over): Governments around the world have committed billions of dollars to vaccine makers, buying up hundreds of millions of vaccine
doses, which may not even work.
Pfizer, in partnership with BioNTech, plans to make 100 million doses of its vaccine candidate by the end of the year and over a billion next.
(BEGIN VIDEO CLIP)
PAMELA SIWIK, VICE PRESIDENT, GLOBAL SUPPLY CHAIN, PFIZER: Well, it's absolutely not normal. It's unprecedented.
(END VIDEO CLIP)
STEWART (voice over): To try and meet that demand, Pfizer has set up separate manufacturing in the U.S. and Europe and is drawing on all its
(BEGIN VIDEO CLIP)
SIWIK: This really is a collaborative effort. It has to be. You know, in this case, the race, right, that people talk about the competition. Right?
The competition is -- is not each other, right? It really is working against the virus.
(END VIDEO CLIP)
STEWART (voice over Making the vaccine isn't the end of the challenge. Next up, getting it to those that need it all over the world.
Companies like UPS plan to be ready to pick up, store, and deliver a successful vaccine.
(BEGIN VIDEO CLIP)
WES WHEELER, UPS: We don't know who's going to be first. We know that Pfizer, Moderna, AstraZeneca with Oxford University, we know that CanSino
in China is -- is doing well. We know that Novavax is moving fast.
(END VIDEO CLIP)
STEWART (voice over): Different kinds of vaccine need different transport and storage conditions. One of the biggest challenges is temperature.
(BEGIN VIDEO CLIP)
WHEELER: A few months ago when we started to get good information about what temperatures would be required for these vaccines, we made an
investment in freezer farm technology. So we have invested in both the U.S. and Roermond in the Netherlands, this is one of our hubs near our Cologne
air hub in Germany.
So we have made investments there and also on the clinical side, we've put freezers now in several of our depots around the world.
(END VIDEO CLIP)
STEWART (voice over): Keeping the vaccine safe and secure is critical, and UPS plans to have 24/7 tracking for every single vial.
(BEGIN VIDEO CLIP)
WHEELER: We are taking very seriously the fact that our clients are counting on us to move every single vial and not lose a single one.
STEWART (on camera): And they're not alone. Vaccine developers, suppliers, manufacturers and logistics firms are all taking unprecedented action. Not
just to make, but to deliver a vaccine for COVID-19.
Anna Stewart, CNN, London.
QUEST: Now, we're hearing from sources that Global TikTok is planning a U.S. IPO. It could happen next year. Brian Fung is with me. What are you
BRIAN FUNG, CNN TECHNOLOGY REPORTER: Well, we're hearing that the company, TikTok as a global company will try to file for an IPO on a U.S. Stock
Exchange in the next 12 months. This is all part of a broader deal at TikTok and its Chinese parent company, ByteDance is trying to strike with
the United States government over concerns that TikTok may pose a national security risk.
FUNG: As a part of that deal, ByteDance will retain majority ownership of TikTok with Oracle coming in and managing much of the data that TikTok
carries on U.S. consumers.
And the big question here is whether or not President Donald Trump is going to go for this plan. At a White House press briefing yesterday, he
indicated that he would be conceptually opposed to any sort of deal in which ByteDance retains majority ownership in TikTok -- Richard.
QUEST: Brian, thank you. When there is more on this, please come back so we can report it. Thank you.
The CEOs of the major U.S. airlines were at the White House again seeking further Federal support just as the current plans are due to expire at the
end of the month.
Without further support, the airlines are basically saying they will have to lose more jobs. Pete Muntean is with me. Pete, I thought that the
airlines had already said that they will not be needing or some of them have said they will not be needing to make involuntary furloughs, so what
are they now saying?
PETE MUNTEAN, CNN AVIATION CORRESPONDENT: Well, some airlines are saying they will not be facing involuntary furloughs, but United and American both
executives in those companies in this meeting are saying that they will furlough close to 30,000 people come October 1st.
You know, airline executives are painting a really dire picture of the airline industry as a whole. They are saying that 30,000 to 40,000, maybe
50,000 workers could be furloughed October 1st that is if there is not a clean extension of the payroll support program protecting those jobs for
another six months into 2021.
But what's so interesting now is that airline executives are now taking this plea directly to the White House. They feel that there is support for
this in Congress but there has just not been a vessel to pass this program extension once more again.
You know, the American Airlines CEO, Doug Parker says that time cannot be wasted for workers, especially with demand for travel still down to only
about 30 percent of what it was a year ago.
(BEGIN VIDEO CLIP)
DOUG PARKER, CHAIRMAN AND CEO, AMERICAN AIRLINES GROUP: We, airline CEOs are here on behalf of the people that work for us who are doing great jobs
out there taking care of keeping our country moving when our country is largely paralyzed. They're out putting their uniforms on and going to work
every day making sure we're moving.
And without action, they're going to be furloughed on October 1st and it's not fair. It's not fair to them, it is not fair to our country.
(END VIDEO CLIP)
MUNTEAN: When White House Chief of Staff, Mark Meadows spoke to reporters after the meeting and says he thinks there could be a deal by sometimes
next week, but it will be specific to the airline industry, not part of a broader stimulus package, another $25 billion for the airline industry.
Southwest CEO, Gary Kelly says that this affects more than just the airline industry. Airline executives stress protecting one airline job protects
many more down the line -- Richard.
QUEST: Pete, thank you for the briefing. Pete Muntean in Washington. In a moment, after the break, Biden, Brexit and the Belfast Agreement. Why the
significance of Joe Biden's comments on Northern Ireland and what that probably means for the British government.
In a moment, it's QUEST MEANS BUSINESS.
RICHARD QUEST, CNN INTERNATIONAL HOST: Hello, I'm Richard Quest. There's more QUEST MEANS BUSINESS in just a moment. The Chief Executive of Wyndham
Hotels will be with us. You heard earlier in the program, talking about how the hospitality industry is being so badly hit, and it means will help
airlines, as well. What does Wyndham Hotel CEO see in the markets at the moment? And Qantas, and it is an offer for AV geeks the world over. The
flight that goes to nowhere and it's already sold out. I'll give you the details of that in just a moment after the news headlines because this is
CNN, and on this network, the news always comes first.
The World Health Organization says a very serious situation is unfolding across Europe, as coronavirus cases rise dramatically. The regional
directors warning there are more infections now than during the peak in March while the lockdown in spring and summer pushed cases to an all-time
low. The continent has been easing restrictions and reopening economies.
Aides to the Russian opposition leader Alexei Navalny says he was poisoned in a hotel room in Siberia last month, not at the airport as initially
thought. They say traces of Novichok have been found on a water bottle that was taken from his room shortly after he became critically ill. The FBI
Director Christopher Wray says Russia is actively interfering in the U.S. election. He testified before a House committee on Thursday. Wray said
Moscow's main goal is to denigrate Joe Biden, and that Russia is using social media proxies, state media, and online journals to sow divisiveness
The U.K. Foreign Secretary speaking to CNN has said that the U.K. will uphold its commitments under the Good Friday Agreement. Joe Biden had
tweeted and I quote, "We can't allow the Good Friday Agreement that brought peace to Northern Ireland to become a casualty of Brexit. Any trade deal
between the U.S. and U.K. must be contingent upon respect for the agreement and preventing the return of a hard border, period." The same position as
Nancy Pelosi, the House Speaker. The Foreign Minister, Dominic Raab, told CNN's Brianna Keilar, the Belfast Agreement is safe.
(BEGIN VIDEO CLIP)
DOMINIC RAAB, SECRETARY OF STATE FOR FOREIGN, COMMONWEALTH AND DEVELOPMENT AFFAIRS: First of all, the Good Friday Agreement is not in jeopardy.
(INAUDIBLE) in the U.K. side. We've been crystal clear all along. We're committed to it. And we've made the unilateral commitment come what may,
with our negotiations with our European friends come what may, we will not put infrastructure or erect a border between the North and the South.
(END VIDEO CLIP)
QUEST: Nic Robertson is with me, and why does -- Nic, why does Joe Biden's intervention -- why does it matter? I mean, yes, he might. He could well be
the next president, but the U.K. said that there'll be no border on the island of Ireland.
NIC ROBERTSON, CNN INTERNATIONAL DIPLOMATIC EDITOR: Yes, and the Irish would take exception to that, as have European Union politicians who said
if Britain does go ahead and introduce and pass its Internal Market Bill, which is the thing that could well as already been admitted by a British
ministers to be breaking the international law. The withdrawal agreement that Britain struck was sort of divorced part of the Brexit deal that the
European Union will potentially take them to court and consider fines.
The sort of the default is if that section the Northern Ireland protocol, part of withdrawal agreement gets broken by this legislation. The
implication is that it would so damage the Brexit process itself, that there would by default, arrive a hard border on the border between the
North Northern Ireland and the Republic of Ireland to the south. That, in itself, would be fuel enough to rekindle the embers which haven't gone out
of the conflict that plagued Northern Ireland for more than three decades. And so, that's the root of this. One thing begets another begets another.
And the British say, yes, they want to uphold the Good Friday Agreement.
But why does it matter when Joe Biden weighs in? Because his real -- this is -- this is a war. Again, Britain has had one for the European Union, and
now one from potentially the next U.S. president, certainly for the Democrats, who have the power to slow down and hinder a free trade
agreement with the U.K.
QUEST: Right. Nic, if we look at the measures that the British government has now put forward to appease its own backbenchers, which some say is not
enough. And we listened to what the Prime Minister said, is it true, Nic, that Europe was trying to get an overarching reach back into the United
Kingdom through an interpretation of the withdrawal agreement?
ROBERTSON: So, essentially, we're talking here about state aid and the European Union potentially having reached back to affect state aid within
the United Kingdom. And that's a very real concern in the U.K. There's a sense that, you know, on the British side that they want to be able to give
state aid to businesses potentially in the north of the country, where they're talking about leveling the playing field, bringing up the sort of
economy of the north of -- the north of England to be on a better par with the South.
Now, the European Union is very sensitive about state aid because if there is -- if Britain is outside the European Union, outside of the control of
European Union regulations on state aid, there's the feeling would be therefore that Britain would be able to fund some of its businesses at the
expense of European businesses. Have unfair competitive advantage. So, that's --
ROBERTSON: These are genuine concerns on both sides. However, the withdrawal agreement and the Northern Ireland protocols that Boris Johnson
signed last year and then went into an election that he won handily in the U.K., based on that, that was all about securing the Good Friday Agreement
as well as the Brexit divorce deal. It was torturously detailed. It had brought down Theresa May. And the detail of it, Boris Johnson signed up to
on the Europeans' understanding that he knew what it meant top to bottom.
QUEST: Which apparently didn't mean exactly what he thought it meant. Nic Robertson, thank you. Now, the Whole Foods' chief executive says capitalism
is on the brink of a new era. But as we go through COVID, one has to question what that era is. The CEO is with me after the break with his new
QUEST: Six months into the pandemic and our grocery shopping habits apparently have changed and changed in quite some ways. The spending is up
six percent, but that's because we're all at home. And the number of trips to the market, to the shops is down 11 percent. John Mackey is the CEO of
Whole Foods and the author of "Conscious Leadership." John joins me from Austin in Texas. It is good to have you, sir. Thank you. You believe that
there is a new form of leadership, a new type of -- I suppose it's grandiose as capitalism, but you know what I mean. It's been born out of
recent events. What's its defining characteristics?
JOHN MACKEY, CEO, WHOLE FOODS: Well, our book, new book, "Conscious Leadership" is calling for our leaders to become more conscious, and to put
purpose first, try to lead with love, have integrity in everything they do. Find win-win-win solutions. And we have a whole menu of the way we think
leaders need to be. I mean, we need conscious leaders who are trying to find higher ground for people to come together. America is being torn apart
by different sets of values. And we're not looking for win-win-win solutions. We're just looking to win and have others lose. So, we need,
really, tens of thousands of new leaders to come out with a new way of leading that basically is more conscious.
QUEST: How did they get it so wrong? I mean, leaders get to the top because either they're good for shareholders. I'm old enough to know -- to remember
the phrase, the stakeholder economy. When you say leading with love and not cutthroat competition, I sort of wonder and -- is that even possible in
today's business environment?
MACKEY: The way we think about business today, the metaphors that we use are fundamentally only partially correct. We use war metaphors. We have
Darwinian survival of the fittest metaphors. We have sports metaphors, where it's somebody winning and somebody else losing. And those metaphors
don't serve as well any longer because they're all hyper competitive. And while competition is part of business, to be sure, it's also about creating
value for other people, value for customers, value for your employees, value for your suppliers, value for your investors. We need different
metaphors. We need to think about business differently. And if we do, we can begin to lead with love.
QUEST: I hear what you're saying, but you're now part of Amazon, which is arguably one of the most cutthroat businesses that has -- I mean, don't get
me wrong. I'm a faithful consumer of it. Certainly, in quarantine, there have been Amazon boxes arriving at my door every day. But nobody would --
but one could hardly say that your parent company has, quote, lead with love in the way it's gone about going into new markets.
MACKEY: Well, I'm not going to be talking about Amazon today, or really any other company. I'm prepared to talk about Whole Foods. We've been one of
the hundred Best Companies to Work for for 20 consecutive years. And our company does lead with love. And so, it's possible to do so. And we're in a
very competitive industry, food retailing.
QUEST: It's a fascinating industry that you are in. And I'm wondering, when you look at where -- I mean, what do you see next as being the hallmark of
a post-COVID grocery shopping? You know, here I am, as I say, I've been buying things online and having them delivered, groceries, because I'm in
London in quarantine. And what do you see the future direction of grocery shopping looking like?
MACKEY: In the long term, people are going to be able to get whatever kind of food they want, wherever they want it, whenever they want it at a price
that they're willing to pay. And so, there'll be online options, delivery options, pickup options, in-store shopping options. The market is going to
continue to evolve to meet the demands that people have. And it is evolving very rapidly right now primarily due to COVID. I mean, Whole Foods' online
sales have tripled in the last 12 months.
QUEST: Right. Finally, the whole issue of, you know, here in the U.K., while Israel is going into another full national lockdown for some talk
here that, you know, a greater lockdown. States by state in the U.S. may have to consider more lockdown measures. If that happens, how do you
MACKEY: How do we respond as a grocery company? I mean, I don't -- I --
QUEST: Yes, if -- sorry, sorry --
MACKEY: Probably the similar way we've responded when we had lock -- we had lockdowns in March and April --
QUEST: Right. Sorry. I --
MACKEY: People have to get food. So, our stores -- our store sales are way up. I mean, our prepared foods are down, but almost every other category is
way up. So, I mean, like every business, Whole Foods responds to the marketplace as we find it. We respond to the external conditions we find
ourselves in. You have to -- you have to adapt to the marketplace as it changes and evolves. And so, I mean, we've had lockdowns, and if that
happens again, and we'll probably respond the same way we did previously.
QUEST: Mr. Mackey, I apologize for the interruption. It's going backwards and forwards. It's the delay between me here, Atlanta, and then to you,
sir. I appreciate you taking the time, though, to speak to me this afternoon. I appreciate -- thank you, sir. John Mackey of Whole Foods. In a
moment, you get on the plane. It takes off but where do you go? Qantas has a new flight in a moment.
QUEST: If you're like me, of course, regularly traveling, then not being on the air has been something what's unusual. Now, Qantas is running a flight
for those who miss flying. It goes nowhere.
QUEST: It may have been the fastest-selling flight in Qantas' history. A seven-hour trip around Australia, where you don't get off the plane at all.
Demand is high. Ticket sold out in just 10 minutes. One of the pilots is just as excited to get going.
DAVID SUMMERGREENE, FIRST OFFICER: It's been a few months since I've been back in an airplane, and I cannot wait to go fly. I cannot wait to see
people on the airplane. I cannot wait to see excited, happy people going flying.
QUEST: The date of this flight to nowhere and back is October the 10th, and the plane is a Boeing 787 Dreamliner. One usually reserved for
international travel. In fact, I flew on it on the Perth to London nonstop. This time, though, it's a long local cruise.
SUMMERGREENE: So, we have a fantastic day plan which will see us depart Sydney around mid-morning. From there, we're going to hit up the New South
Wales coast with some great viewing on both sides of the aircraft as we make our way up. At this point, we'll follow the Great Barrier Reef for
about 90 minutes and we'll be doing some flights over certain reef marks at high and low altitude so it'd be great viewing for 30 minutes (INAUDIBLE)
Once we finished with that, we'll be then setting back to Sydney. Upon arrival which we're getting close to sunset, we'll be doing a flyover of
the harbour and the beaches of Sydney before landing finally back in Sydney.
QUEST: Flights like these have become more common in recent months as people who have been under stay-at-home orders because of the pandemic are
itching to get back on a plane. In July, Taipei's Songshan Airport began the first of three flights to nowhere, where passengers got on board a
plane and it never actually took off. Royal Brunei Airlines did a dine and fly sightseeing tour in August. And Singapore Airlines has reportedly
considering a new route as well to nowhere.
For Qantas, the flight has some additional perks. food From the chef Neil Perry, a gift bag and an Auction of memorabilia from Qantas's recently
retired 747s. The beauty of these flights as Qantas says is there's no passport or quarantine required. And it's proving the old travel adage
true, it is better to have traveled than to have arrived.
QUEST: Now, let's continue talking about hotels and the travel industry. With me is Geoff Ballotti, the CEO of Wyndham Hotels, the largest hotel
franchising company in the world. He joins me from Cape Cod. Geoff, it is good to see you. Now it gets difficult doesn't it? Now the summer's over,
yet some money was brought in but not much. RevPAR went up, but again, not much. But now, we're into a potentially difficult dark winter. How is
Wyndham going to do?
GEOFFREY BALLOTTI, CEO, WYNDHAM HOTELS (via Skype): Well, I'm not -- I'm not sure that's the case, Richard. I love that last ad. You know, someone
once said that life is what happens when you're busy making plans. And in a life as we were just talking before the show without plans, nothing really
happens. And that is -- that's the tagline of the U.S. travels. Let's go there, which so many of your guests this week, so many airlines, so many
hotel companies including David Kahn at Best Western and certainly Wyndham are all supporting. Is that need and that love of travel. And look, you're
right. There are -- there are certainly challenges out there in fly to destinations.
Your quarantine, there are certainly challenges in urban, in downtown locations. But our story and I think the story of travel that has been
supplanting that is that drive to destination travel. That -- our business which is 90 percent drive to is actually performing quite well and 95
percent of our hotels are open now around the world. We are confident and we are bullish that travel will return. And it is going to be a tough, but
a steady climb in --
QUEST: This is good to hear, Geoff.
BALLOTTI: We're very positive.
QUEST: This is good to hear. And if we look at that optimism and work out what it is that the industry needs, either from regulators or from
government or in terms of quarantine and corridors and things like that. What is it that you would now like to see that will ensure that optimism
BALLOTTI: Well, certainly are. The biggest piece of our business is here in the United States of America. Our franchisees need more government support.
It has been monumentally instrumental, helping them remain open, helping them survive, what is now being proposed and kicked around Congress for our
franchisees, what is most important is that second round what is referred to here in the United States is PPP, the Paycheck Protection Program.
That we'll allow them to not only bring their employees back to work but will allow them to pay their real estate taxes, their utility bills, their
mortgages. And I have a very high degree of confidence that that will happen, but the industry needs as we began, and as you've been showcasing
and promoting all week, just more promotion that it is safe to travel, it is safe to get out there. And we're seeing consumer sentiment continue to
rise. People are feeling safe as you are on a plane and people are feeling especially safe staying in hotels today.
QUEST: Geoff in a word, and if there's one piece of advice that you would give a traveler now in a sentence or two, what would it be?
BALLOTTI: It'd -- it'd be to get out there. It'd be to be careful and be responsible. All of your guests this week, all of our hotels and our
franchisees are taking the precautions we need to take, using those hospital-grade disinfectants. Putting in place those new cleaning
protocols. But just be careful, be responsible. There are so many great locations to drive to until you could fly to that -- with this industry we
need most of all, or all of us to feel safe traveling again.
QUEST: Thank you, Geoff, we'll be -- I'm driving up to Northern England this week to be filming and I'll be driving upstate New York to be filming
next month. Thank you, Geoff joining us from Wyndham, I appreciate it. Now, we will take a short break. And there's a "PROFITABLE MOMENT" on the other
QUEST: Tonight's "PROFITABLE MOMENT." We reported on the Qantas flight. I just love the idea of these airlines running flights where people either --
some of them don't even get off the ground at all. Others get off the ground, fly around, you get a chance to see some wonderful vistas and you
land where you started. Now, obviously, no airline is going to make a fortune doing that. But it does prove the #AVGeek.
And as Geoff from Wyndham was saying, the need and wish, desire, inspire to travel that so many people face. And on that note, I'll be off for the next
week. I'm going up north of England, where we'll be filming for a "WORLD OF WONDER." And then, back to the U.S. and then back more filming in upstate
New York. There's so many places to visit by car by train without even getting on a plane. And there's still a prospect of those plane journeys to
And so tonight, as I say goodbye for a week, one of the thought occurs to me, may I just take the opportunity to wish any of our Jewish viewers very
happy new year Shanah Tovah and well over the fast. Sorry, I can't leave you with an up market. Today the market is down. The closing bell comes
next, as we come to the top of the hour. "THE LEAD" with Jake Tapper follows. And that's QUEST MEANS BUSINESS for tonight. I'm Richard Quest in
London. Whatever you're to in the hours ahead, I hope it's profitable.