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First Move with Julia Chatterley

U.S. Growth Falling 4.8 Percent In Q1, The Worst Drop In Over A Decade; Boeing's CEO Announcing 16,000 Job Cuts Saying Recovery Will Take Years; Immunity IDs also Called Immunity Passports Are Tickets Out Of Lockdown. Aired 9-10a ET

Aired April 29, 2020 - 09:00   ET

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

[09:00:00]

JULIA CHATTERLEY, CNN BUSINESS ANCHOR, FIRST MOVE: Live from New York, I'm Julia Chatterley. This is FIRST MOVE and here's your need to know.

Consumer collapse. U.S. growth falling 4.8 percent in Q1, the worst drop in over a decade.

Body blow. Boeing's CEO announcing 16,000 job cuts saying recovery will take years.

And immunity IDs also called immunity passports are tickets out of lockdown.

It's Wednesday. Let's make a move.

Welcome once again to FIRST MOVE, good to be with you this Wednesday and just giving you a slight indication there, we've got a jam-packed show

ahead including what COVID-19 immunity passports could actually work, like and how how healthcare workers around the world are tracking COVID-19 case

outbreaks in real time.

Plus, as you heard there too, earnings season continues. We'll also be hearing from Jay Powell today of the Federal Reserve giving his assessment

on the economic outlook. Ahead of that, we have an indication, U.S. growth numbers for the first quarter -- and they were bad -- GDP falling at 4.8

percent annual rate. That's the worst performance since the financial crisis and the first negative read since 2014.

And of course, the stay-at-home orders only began in mid-March. So, that gives you a sense of how bad those final two weeks of March were. The

second quarter as a result going to look much, much worse.

But the big question now is what comes next and what more financial support, perhaps, is needed to kick start the recovery and of course what

that looks like.

For now, U.S. futures remain higher after losing a little bit of ground yesterday. They have strengthened, too, in the past half an hour amid some

encouraging news on Gilead's antiviral treatment for COVID-19. There's a lot of hope being placed there.

For me, there's still a discrepancy between what we're seeing on Wall Street right now and the weakness in the data we're seeing and we'll

continue to see on Main Street.

Investors, yes, they're responding to the cash stimulus, but I think they're also responding to hope -- hope of a swifter and stronger recovery

than first feared. Will they be proved right?

The Russell 2000 Index, the small cap stocks reflecting and reflect the domestic economy. They're up, as you can see, almost 10 percent in the past

five sessions, admittedly from very beaten up levels. We'll keep an eye on those kind of signals.

For now, the Asia trend continues. Most major indices are ups some two percent or more over the past week. Signs of hope, it seems amid the

heartbreaking loss suffered globally over the past four months.

Let's get to the drivers. Straight to the U.S. economy, too, shrinking for the first time in nearly six years. Christine Romans joins me now.

Christine, it's all about the U.S. consumer, and so many unknowns here and the belief, I think, that the worst is still to come this quarter that

we're currently in is going to be far worse.

CHRISTINE ROMANS, CNN BUSINESS CHIEF BUSINESS CORRESPONDENT: Absolutely. I mean, the first quarter numbers show us clearly the first look at what

could be a coronavirus recession, and that second quarter, you've got forecast everywhere from 20 to 30 percent contraction in the U.S. economy.

Really, even worse than that, some economists -- because we've shut things down.

The government noting in its technical note on this GDP number for the first quarter that -- the first quarter might not even capture all of the

pain because some of the underlying data won't be known yet.

So, it just shows you how we have never been here before. This is a very unique kind of contraction, a very unique situation. The President even

yesterday was saying he expects a V-shape recovery. The third quarter will be great. The fourth quarter will be great.

What really will determine that is how the aid gets into the pockets of American citizens and the bank accounts of small business and it has been -

- clunky is the charitable way to describe it -- that they're going to have to -- Washington will have to prevent a coronavirus recession from becoming

a coronavirus depression.

CHATTERLEY: Yes, I think clunky is the polite way of saying quite frankly, Christine, when people are desperately waiting for their cash.

Reopening is also going to be a critical piece of the jigsaw puzzle here on what that looks like under physical distancing conditions.

The President using the Defense Production Act yesterday, specifically towards meat processing plants, and there have been fears of workers

getting sick in these processing plants and the facilities having to be shut down as a result.

It's not easy for the President just to be able to point the finger and say guys, you have to open and that's the challenge that we're going to face

across all sorts of sectors.

ROMANS: On so many different levels, too. I mean, look at it this way. Assume that all of the workers who are asked to go back, go back. What

happens if they all get sick? Then you're not going to be able to produce the meat anyway, right? So, you could still have shortages and problems and

you're spreading the illness.

What if workers are afraid? And they've seen friends get sick or co-workers die because of Coronavirus and they don't want to go back, do they have

that right? Are there OSHA rules that will protect them in their workplace? It starts to get a little bit murky.

[09:05:24]

ROMANS: Now, we know that the malls are going to start opening, some of them -- 49 of them this weekend -- but with all kinds of social distancing

rules. But will people feel comfortable to go to the mall? Are you going to want to try on a pair of sunglasses that somebody else just put down?

That's kind of the interesting question about the consumer behavior, and we know the polling -- there's a new NPR poll this morning that shows that

most people say they're not ready yet to go back to normal.

CHATTERLEY: Yes. Confidence risks, safety risks, legal risks. Yes, there's a lot to come. Christine Romans, thank you so much for that.

ROMANS: Thank you, Julia.

CHATTERLEY: COVID-19 has delivered a one-two punch to Boeing. The plane maker giant, already reeling from its 737 MAX crisis, now with jet demand

plunging, is reporting a wider than expected Q1 loss.

Shares of the aerospace giant are higher premarket, however, as the company takes new steps to steady operations. Clare Sebastian joins me now.

The CEO calling this a body blow, Clare, it is because it was already a challenged company. But, I look at some of these numbers and the fact that

the CEO is saying it's going to take years and the cuts to the workforce, I think reflect that.

CLARE SEBASTIAN, CNN BUSINESS CORRESPONDENT: Yes, Julia, the bottom line areas that Boeing is now making it very clear that they are not going to be

able to continue in the current environment. The size that they are, they're having to cut 10 percent of their entire workforce, that's about

16,000 people.

Now, in some areas, it's going to be even higher than that, at about 15 percent in commercial airplanes, services and some corporate functions.

That is because revenues this quarter have been hammered by the coronavirus, down some 26 percent. The company burned through $4.7 billion

in cash. That was actually slightly better than some had expected. So, perhaps one of the reasons why the stock is up today, but they're not just

cutting jobs, Julia, they are cutting production sharply across some of their most important lines of planes.

The 787 Dreamliner will be cut from 14 to 10 this year and then seven next year, so that's halving production. The 777 program including the 777X will

go to three per month and the 737 MAX is expected, the company says to start at low levels this year and rise to 31 per month next year.

That is a low rate considering, before this they are producing at 42 per month and talking about raising to more than 50 per month after that plane

is approved for service. No update on its return to service, but the costs, Julia, for the 737 MAX continue to mount.

The company is now assuming it'll be an extra billion dollars for the production stoppage that they're currently in. That takes that number to $5

billion and takes the total, by my calculation, to almost $20 billion in cost, but many analysts expect it will actually be more than that.

CHATTERLEY: It's astonishing, isn't it, to see a share price reaction like this when you see numbers like this, but it shows you just how bearish and

concerned investors have got already.

What about needing support? Government support? What was said, if anything about that?

SEBASTIAN: So, this was the other sort of big piece of news that we were waiting for, Julia. The deadline for companies like Boeing, which are

critical to national security to apply for funding from the Treasury is Friday.

We didn't get anything really on that. They say, they are still exploring options when it comes to government funding. They're lobbying for that, for

the entire aerospace industry and for access to credit markets.

So, we don't know yet. We know that Boeing has been cautious when it comes to some of the strings attached for Treasury funding because we know that

they took stock warrants in some of the airlines when they bailed them out and Boeing has been trying to avoid that.

So, we don't know yet if they're going to take government funding. They say they are still exploring it. It looks like it'll be that, as well as them

tapping the credit markets.

CHATTERLEY: Yes, they need all the support they can get quite frankly. Clare Sebastian, thank you so much for that.

Meanwhile, the CEO of Boeing rival, Airbus, has warned that the coronavirus pandemic is the gravest crisis the aerospace industry has ever known.

The company swung to a loss after burning through more than $8 billion in cash just in the first quarter.

Anna Stewart joins me now. The gravest crisis the industry has ever known, another company saying and we can't predict the future, but it's probably

going to take years to get back where we started, and that has implications for jobs as well.

ANNA STEWART, CNN REPORTER: We knew these results were going to be pretty dire. At the end of last week, the CEO wrote to staff saying, the company

was bleeding cash at an unprecedented speed, as he said there. We now have a number for that. It has burned through $8.7 billion in the first quarter,

nearly double actually of Boeing as Clare was just saying.

They've done a lot already, short term, to try and bolster their balance sheet. They have cut production by a third. They have furloughed over 6,000

workers in France and the U.K. Those workers being paid their salaries mostly by the government.

They've also actually secured $16 billion in funding just last month. However, no new guidance ahead. There's so little visibility.

And when you speak to analysts, Julia, they'd say that in the next few months, we should probably see some sort of big restructuring plan for

Airbus, like Boeing, like many of the airlines because frankly, it's not a short term issue in terms of the cash burnout, there are longer term issues

in terms of what airlines survive and what do their order books going to look like.

The order book at the moment is made up of companies that are on the brink of collapse, and even if those airlines will survive, even when lockdown is

lifted, will people travel in the same way in the next few months? Absolutely not. The next few years, probably not. It is a bleak outlook

with huge ramifications for these businesses.

CHATTERLEY: You know, it's fascinating that you mentioned that. I was looking at the U.S. consumer confidence data this week, and within that

expectations for Holiday bookings was back down to the levels seen in the 1970s. That tells you something exactly in line with what you were saying

about when we get back to some degree of normality in terms of world travel.

What a challenge? Anna Stewart, thank you so much for your analysis there.

Now, the collapse in demand has hit not just plane makers, but airlines themselves, too. The U.S. Southwest Airlines reported its first operating

loss in 11 years. The company's CEO, Gary Kelly outlined the challenges to Richard Quest.

(BEGIN VIDEO CLIP)

GARY KELLY, CEO, SOUTHWEST AIRLINES: It is going to be a difficult recovery, and I think on top of just the health concerns and sheltering in

place and walk downs and all the things that we're dealing with there, there is also a recession.

And, you know, do people have the means if they're -- they may not be willing to travel, but do they even have the means to travel if they're

unemployed, businesses are cutting travel, which is very typical in a recessionary environment.

However, again, we will defeat this virus, but we'll get past this. I just use the Spanish Flu of 1918 as an example, and you had the roaring 20s

shortly after that.

So, there's every reason to believe that we'll get past this, but, you know, companies and individuals are going to feel some pain.

(END VIDEO CLIP)

CHATTERLEY: Okay, let's move on. Lebanon's Central Bank Governor defending his policies, claiming he helped the country buy time to enact essential

reforms.

The Lebanese Prime Minister is blaming the Central Bank for the country's financial crisis. This, as violent protests erupted over Lebanon's economic

hardship and the collapsing currency value.

John Defterios joins us now with the details. John, they've dealt with political crisis, economic crisis, financial crisis, and then on top of it,

COVID-19. It is perhaps no surprise that you're seeing the public rebelling here once again.

JOHN DEFTERIOS, CNN BUSINESS EMERGING MARKETS EDITOR: Yes. And the rebellion under the name of a hungry protest, basically, Julia, because

they're suffering so badly. And that defense by Riad Salameh, the central banker is the sort of finger pointing and defense that drives them crazy

and why they're willing to go back onto the street, despite COVID-19.

They're extremely frustrated after having those deadly protests in October that it has not led to change. So, let's put a picture up of Riad Salameh,

the central banker. He has been in power for 27 years. And then Hassan Diab who came in as Prime Minister in January, he is accusing Salameh of having

better than $5 billion leave the country in the last year.

Salameh was suggesting today, it's closer to $6 billion, but it didn't leave the country. They were bank deposits and they were pulled out to pay

debts and loans. So, you can see why you have this sort of frustration in the marketplace today.

The other thing is, people have to remember, this is an economy that contracted at six and a half percent in 2019, partly because there was that

political stalemate, but the International Monetary Fund to suggest it'll be double that in 2020, a negative 12 percent. So, it's not going to get

better anytime soon as we see it today, Julia.

CHATTERLEY: Yes. And it's where help comes from if they're willing to ask for help from institutions like the International Monetary Fund.

John, I want to tie this in, more broadly to the pressure that we're seeing on oil prices and protests. Pain that's going to be felt and is being felt

in other nations in the region -- Iraq, Algeria -- a couple of examples here. What are we risking based on recent past?

DEFTERIOS: Well, recent past would suggest that they had frustrations in 2019 for a variety of reasons, but most of them have to do with the rising

cost of food, Julia and youth unemployment.

You mentioned Algeria, Iraq, you can add Iran, Sudan major protests and of course, Lebanon.

Now, the Regional Director of the IMF was saying that better than a hundred countries have asked for support. Some of those countries I talked about

have.

Lebanon has not. They're refusing to go to the IMF for political reasons. And they defaulted on a $1.2 billion euro bond back in March. That's the

first time ever for the country.

And I've been exchanging e-mails and I spoke with the former Minister of Economy for Lebanon, who said this is shaping up to be the Arab Spring 2,

but he said he'd rather call it the Arab Firestorm because the coronavirus is putting so much pressure on healthcare systems and budgets that it could

be worse than what we saw in 2011. That's the danger we're facing today.

CHATTERLEY: Yes. I was afraid to say it, but you said it for me. And as far as Lebanon is concerned, principles are expensive when you people are

suffering. It's terrible.

John Defterios, thank you so much for that.

All right. These are the stories making headlines around the world. The Bollywood star, Irrfan Khan has died. He was best known for his roles in

"Life of Pi," "Slumdog Millionaire," and "Jurassic World."

Khan had been admitted to a Mumbai hospital for a colon infection. He was diagnosed with a rare cancer back in 2018. He was just 53 years old.

China will hold one of its biggest political events on May 22nd. That's according to the country's state-run news agency. The National People's

Congress was supposed to take place in early March, but was postponed as the country dealt with the coronavirus pandemic.

The highly choreographed spectacle had not been delayed or suspended since the end of the Cultural Revolution in the 1970s.

The British Prime Minister and his partner have announced the birth of their baby. The little boy was born in a London hospital earlier on

Wednesday. Mother and baby are doing well says a spokesperson. Congratulations to them.

All right, we're going to take a break here on FIRST MOVE. Still to come, the blueprint for reopening, John Hopkins University lays out a framework

for a safe return to business. I discuss with the Director of its Center for Health Security.

And tracing before testing. Data miner uses AI to predict coronavirus spikes simply by trolling the web and social media. We speak to the

company's CEO.

That's coming up. Stay with us.

(COMMERCIAL BREAK)

[09:20:24]

CHATTERLEY: Welcome back to FIRST MOVE live from New York. It is still looking like a higher open for U.S. stock markets this morning, despite

that weak read on U.S. GDP growth for the first quarter. The American economy contracting, almost five percent annualized just as COVID-19 lock

downs were getting started.

Meanwhile, futures, I think getting a boost from Q1 results from the likes of Apple and news from Gilead that its antiviral treatment for COVID-19 is

showing promise, so certainly investors liking the signs of that.

In other earnings news, meanwhile, auto giant, Ford trading lower premarket, forecasting a wider than expected $5 billion loss in the current

quarter, and as we were mentioning earlier with John Defterios, let's take a quick look at what's going on in the oil markets, too.

Wow, volatility once again, trading higher this morning. WTI crude up some 26 percent. So, double digit gains for oil prices this morning.

Now, the data -- Q1 data underscoring the urgency, I think, for U.S. states to prepare the process of reopening and that's exactly what we're seeing.

In the meantime, experts at John Hopkins University have presented their blueprint for what's required.

Let me walk you through this. Communities, they say you need rapid diagnostic tests for all symptomatic cases, and widespread serological

testing to identify those who've developed immunity and the ability to trace all contacts of reported cases.

Let's discuss this. Dr. Tom Inglesby is the Director of the Center for Health Security at Johns Hopkins University. Dr. Inglesby, great to have

you with us to talk through your blueprint for what's required here.

What stood out to me -- and I read the whole report -- was the emphasis you place on tracing, and because you've watched what other nations have done

around the world. Talk me through this.

DR. TOM INGLESBY, DIRECTOR OF CENTER FOR HEALTH SECURITY, JOHNS HOPKINS UNIVERSITY: Sure. Well, we've seen other countries have comparative

success in terms of keeping their outbreaks under relative control. Countries like South Korea, New Zealand, Austria, Denmark, Iceland --

they're doing better than most of the world, and what they have in common is very strong public health programs that can trace the contacts of the

known COVID cases.

They're able to find them and then they're able to have them quarantined until the threat of infection passes, and so that's what we need to do in

the United States. We do that on a normal day for other kinds of diseases like tuberculosis or a measles outbreak.

But the urgency and the pace and the scale of COVID is so much larger that we're going to have to really build up our contact tracing capabilities

around the United States.

CHATTERLEY: Define build up? How many contact traces do you think are required in the United States?

INGLESBY: So, we calculated per capita, how many tracers were working in various countries in the world for COVID, especially the countries that

have had such success? And the range -- they ranged from countries that are smaller have contact tracing workforces of 10,000 to 20,000. But then China

had contact tracing workforce closer to 300,000.

So, our estimate is that given where we are in this epidemic, we need something on the order of a hundred thousand contact tracers distributed

around the United States in the coming year to be able to do the work we need to break transmission of COVID.

CHATTERLEY: It was quite interesting because you looked at New Zealand, you looked at Wuhan, you look to Iceland as well, which I think is all

places when people have been reading about this and watching on social media have popped out to people as places that have been successful in

handling this.

But when you mapped the numbers for Wuhan, and based on what Wuhan did for contact tracing, the numbers in the United States are more like 265,000

contact tracers. So, why do you think a hundred thousand is enough? And it's enough in terms of numbers. But why is that enough compared to what

Wuhan did?

INGLESBY: We already do have some contact tracing workforces in place around the country. So, state health departments, local health departments

do have teams of people already doing that. We've been basically tried to find a number that seemed practical and feasible.

In China, they had many different kinds of people participating in that crisis in Wuhan, and it may be that a hundred thousand is not enough. There

have been some estimates that suggest the number should be higher.

But that was the practical number that seemed like it's sorted out between the various countries.

[09:25:22]

CHATTERLEY: And Dr. Inglesby, are you talking to the White House about this? To the White House Taskforce or even individual states to get their

sense of whether they believe this is also the path that needs to be followed.

INGLESBY: Yes, our impression is that there is strong support at the White House and strong support in Congress for expanding contact tracing. It was

part of the President's plan released about 10 days ago, the reopening plan. It strongly advise states to have robust contract tracing programs in

place.

And so there -- I do think there's going to be support in Washington for helping states to acquire larger -- much larger contact tracing workforces

in the time ahead.

CHATTERLEY: When I spoke to you and introduced you in the beginning, I mentioned readily accessible testing as well. If I look at Harvard's

blueprint for reopening, they're the ones that are saying look, five million tests per day in early June, 20 million tests by July, and then

safely reopening by August.

Give me a sense of where your tracing plan fits in terms of numbers of tests required, and timing for reopening based on what we're already seeing

in the United States.

INGLESBY: So, at this point in the U.S., we're testing about one million people a week. Most of that testing is concentrated on the sickest people,

people in the hospitals and people in nursing homes. People are at high risk, healthcare workers.

What we need to do is to expand the numbers of people who are tested to include those who are minimally ill, or mildly or moderately ill.

Most of those people right now have not been able to get a test because the bandwidth for testing has been too low for that.

In order to be able to really get a handle on the epidemic, we need to expand testing to that mild and moderate group, and those are the people

that we're really going to have to focus on contact tracing.

Right now, those people are not counted in international totals, and we're not doing any contact tracing around people who we don't have a diagnosis

for.

So, when we scale up contact tracing, they will be reacting to the positive tests that come up right across the state.

CHATTERLEY: Right. So, you agree five million a day? Do you agree with Harvard? Or do you think less?

INGLESBY: I think -- I think that's a very ambitious goal. I've seen -- we've seen numbers that are probably in the near term, probably more

achievable, but ultimately, if we're going to get to the point where businesses are going to be using testing, organizations are going to be

using testing to screen people, we will need those kinds of high numbers.

Right now, just focusing on people who are sick with COVID, we are going to need at least three or four million tests per week, which is really far

above where we are now.

CHATTERLEY: Yes, that's even before to your point, we could start doing tracing in the kind of scale and numbers that you're talking about. There's

work to be done. Dr. Tom Inglesby, stay in touch, please. Stay safe and great to get your insights this morning. Thank you.

All right, coming up after the break. Imagine scanning every single social media post available publicly, worldwide, looking for clues about dramatic

events such as the outbreak of coronavirus. Well, that's what a Dataminr does -- and did -- and the CEO is next. Stay with us.

(COMMERCIAL BREAK)

[09:31:56]

CHATTERLEY: Welcome back to FIRST MOVE. I'm Julia Chatterley and U.S. stock markets are open for trading on this Wednesday.

As expected, we do have a stronger open this morning investors looking through today's weak reading on Q1 GDP numbers. Of course, the numbers are

already backward looking.

The critical factor is of course we expect Q2 to be worse, but it is going to be interesting to see what Jay Powell has to say later on today.

We've got the Federal Reserve releasing its latest policy statement. What does he have to say about the state of the economy and the impact, of

course, of the trillions of dollars of stimulus that they've already added to this economy?

In the meantime, Google parent company, Alphabet, helping boost tech stocks, seeing early signs that ad sales and search activity are

stabilizing after plummeting last month.

Paul La Monica joins me now. Well, Paul, I have to say search activity, YouTube activity was buoyant, but what we know about this business is it's

all about advertising spending.

And so, this is an interesting sort of snapshot of what advertisers are thinking going forward about the health of the economy and how willing they

are to spend. Okay signs, perhaps.

PAUL LA MONICA, CNN BUSINESS REPORTER: Exactly.

CHATTERLEY: Yes.

LA MONICA: I think the encouragement, Julia is that Google CFO, Ruth Porat did point out during the earnings conference call last night that yes,

there was a steep drop off in March as the COVID-19 pandemic really hit the U.S., kind of with a full force, but things are starting to stabilize in

April.

And you mentioned YouTube. YouTube ad revenue in the quarter despite COVID- 19 was up 33 percent to $4 billion.

CHATTERLEY: Yes.

LA MONICA: This is a legitimate business for the company right now without question and obviously, I think any media company realizes that, you know,

the power of YouTube is legitimate.

CHATTERLEY: Yes, absolutely and dragging Facebook higher, of course, too, another big advertising spender reliant company. It's quite interesting

when I look at the tech outperformance that we've seen, I was doing some math on this.

Microsoft, Amazon, Apple, Google and Facebook now make up over 20 percent of the S&P 500. The last time the concentration was like that, I think you

have to go back to the mid-1970s, and we will probably be talking about GE and IBM and AT&T, actually. Yes. What do we think of what we're seeing?

LA MONICA: Yes. It's interesting, because there have been people that I've talked to in the past who have expressed concerns that so much of the

market is concentrated in this handful of tech stocks and what will happen if investors leave them en mass.

But we haven't really seen that even though Big Tech got it by the slump in the broader market in March concerns about COVID-19, you haven't seen this

full scale ETF meltdown where the big index funds are collapsing because people are pulling out of all those tech stocks. It just hasn't happened.

And I think that's really a testament to the fact that all of those companies that you've mentioned -- Microsoft, Facebook, Amazon, Apple,

Google, of course, they're all very strong companies financially. They have healthy balance sheets, a lot of cash they are putting to work, not a lot

of debt, and they are growing their earnings.

You can question the valuation of an Amazon in particular, but this isn't like 2000 where the market leaders weren't profitable, and everything was a

hope and a dream of one day being profitable.

These are now companies that are incredibly profitable to the point where there's a lot of concern about how much power they have over the tech

sector and broader American economy.

[09:35:46]

CHATTERLEY: Yes, it's such a fascinating point. Innovation in times of crisis, for me, and they are also about connectivity. Even when we're

physically distant, you need these things more than ever, quite frankly, and consumer behavior is dictating that these guys are powerful for me. So,

it still fits the narrative, too. Will it continue? We'll see. Paul La Monica, thank you so much for joining.

LA MONICA: Yes --

CHATTERLEY: I agree. Interesting times. Paul La Monica. Thank you for that.

All right. Speaking of social media, artificial intelligence has played a key role in predicting the spread of coronavirus, and our next guest

founded a tool that helped detect its apparent origins.

Dataminr harvests the world's publicly available social media content and alerts businesses, healthcare workers in the public sector and journalists

in real time.

Dataminr issued its first coronavirus related alerts on December 30th last year, following eyewitness reports on social media of a SARS-like outbreak

in Wuhan, China.

Six days later, the World Health Organization released a public warning about a pneumonia like incident on January the 5th, and two days later on

the 7th, China itself identified the virus as a novel coronavirus.

You can see that after that point, the surge then in social media traffic exploded worldwide. Now, the company is warning it can identify hotspots in

U.S. states, which are currently in the process of reopening.

Ted Bailey is CEO of Dataminr, which has clients in over 70 different countries, and I should tell you, for transparency, CNN is one of those

clients.

Ted, fantastic to have you on the show and fascinating to see what you're doing. Just start by explaining what you were watching precisely in China

and specifically in Wuhan when you realized something unique was going on.

TED BAILEY, CEO, DATAMINR: Well, Julia, this really is the first pandemic of the age of social media and information is moving as fast as the virus

itself.

And as you said, that started from the very beginning, when the virus was first simmering in Wuhan, not on the radar of health officials, not on the

radar of the world at large, Dataminr detected and delivered the first digital warning of the outbreak.

The way we did this was we found eyewitness on the ground social media accounts in Chinese in Wuhan and these included firsthand accounts of what

people were seeing and hearing in hospitals. They included cell phone pictures of people on the ground taking pictures of Chinese health

officials in suits, disinfecting the landscape.

So, essentially, what we were able to do is find the earliest information in social media and that's how we were able to warn our clients, public

sector organizations, and enterprises an entire week ahead of the first C.D.C. report.

And as you said, that's not the end of it. As the virus spread across the world, Dataminr also first detected an outbreak in South Korea and Iran,

then ultimately in Italy, and in Spain. So, what we're seeing here is that eyewitness on the ground social media, combined with real-time artificial

intelligence can create what we call ground truth.

In other words, an accurate on the ground understanding of what's happening, and we deliver that to our clients and deliver it to them 24

hours a day.

CHATTERLEY: Yes, I mean, when we're talking about whether it is businesses and then trying to plan for risk events going forward, or I know you're

also working now with healthcare workers as well around the world just to give them a sense of upcoming outbreaks based on the data that you're

seeing. It's a combination of all these things and it is an alert mechanism, and it's being used in this outbreak -- in this crisis in

particular.

[09:40:18]

BAILEY: The key to all of this is how we apply the computing power of artificial intelligence. Believe it or not, we detect billions of public

data units today, across 10,000 different public data sets and 150 different languages.

And we perform in reality, trillions of real-time computations to find this needle in the haystack. A lot of people, Julia, are talking about a field

that's getting a lot of buzz called Outbreak Science.

In a way, Dataminr has always specialized in Outbreak Science, not an outbreak in the specific context of a disease, but an outbreak in the

context of the information landscape.

In other words, detecting early information when it first emerges long before it, quote "goes viral," long before it gets on the radar of

mainstream sources.

CHATTERLEY: I mean, in this case, it was days and what we've learned, I think, subsequently is hours matter, days certainly matter. You warned on

March 30th, of concern, I believe in 14 different U.S. states that outbreaks were likely.

We then saw spikes in cases of COVID-19 in all of those. You also warned in the last week of April, the 23rd of April, about small cities and metro

areas in the United States, including in states that we're now seeing, going through the process of reopening.

What have you seen specifically, particularly in states like Georgia and Florida in the last six days or so, since that alert?

BAILEY: Well, Julia, as you mentioned, many of the available resources and data out there have been lagging indicators. The ground truth that Dataminr

has been able to provide has been a leading indicator.

As you mentioned, we were able to pinpoint 14 U.S. states that were showing a pattern that suggested a pre-outbreak state, and within just seven days

of that study, those states have, in fact, started to see exponential case count growth.

And then last week, as you note, we published another study that specifically identified 22 hotspots in small metropolitan areas and rural

counties, specifically across the states that are in fact reopening and easing social distancing measures.

What we've seen is that in the specific states, you mentioned, Florida, Georgia, South Carolina -- in just a week since we published that study,

cases have started to grow and the rate of case growth has increased in each of the hotspots that we detected in those states, suggesting that

governors and suggesting that governments and businesses need to pay a lot of attention to the value and perspective that data AI and social media can

provide.

CHATTERLEY: Yes, I know. And I know you're not talking to state governors either, but I think perhaps they should be listening to you. We have about

30 seconds left, but I do want to mention that you also have had success in predicting other events, some very tragic, like the Parkland shootings,

also the California wildfires, so it's not just about COVID-19, it's other early warning system alerts that you've seen in the past, too.

BAILEY: Well, as you said, Dataminr had long warned our clients far ahead of other sources. On average, we alert four hours ahead of mainstream

sources for events across the world, delivering an alert on the outbreak of the California wildfires and delivering an alert on the Parkland shooting,

which enabled first responders to get to the scene and protect students quicker are two of our greatest success stories.

CHATTERLEY: Yes, and this is vitally important, whatever we can do to help the first responders and our healthcare heroes is pretty phenomenal.

Ted, stay in touch, please and stay well. And thank you for the work that you and your team are doing. Ted Bailey there, the CEO and founder of

Dataminr.

All right, we're going to take a break, but up next here on FIRST MOVE, digital immunity passports. How do they work? And is there are a privacy

trade off? Would be willing to accept it?

The U.K. government has asked one biometric AI company to investigate the potential and we'll talk to them next. Stay with us.

(COMMERCIAL BREAK)

[09:48:12]

CHATTERLEY: Welcome back to FIRST MOVE. Earlier this month, the U.K. government suggested that immunity passports could pave the way out of

lockdown. The idea is that a phone based digital certificate could identify those who have recovered from COVID-19 and allow them to return to some

form of normal life.

To flesh that idea around, the U.K. government turned to AI company, Onfido, which uses biometrics to digitally verify identity.

Joining us now is Husayn Kassai. He's the CEO and co-founder of Onfido. Great to have you with us. I'm very excited about talking to you about

this.

We will firstly separate question marks over the validity of immunity tests because viewers will be wondering about that, too. Talk to me about how a

passport would work.

HUSAYN KASSAI, CEO AND CO-FOUNDER, ONFIDO: It's good to be on. The immunity tests are still yet to be worked out, but once we get to a stage

where there are immunity tests that can be done with a higher degree of accuracy, the intention with an immunity passport is to have individuals

who have been tested to prove that they've been tested and to prove that the test results belong to them, but crucially to do so without sharing any

personal information.

CHATTERLEY: How is that possible? So, I've got my immunity test. I've got antibodies in my system. I have a mobile phone. You have my biometrics,

facial recognition technology, piece those things together.

KASSAI: Sure, it's a -- so along with partners, we are helping governments, authorities, employers and others to be able to give their

citizens and employees, others a presentable proof of immunity, so that if in your example, it were be on a smartphone, on an app that's developed by

a health authority or other authority.

On there, there would be a QR code, and for instance, if it's -- I'm the person who has been tested and I'm coming to you, let's say, you're at a

reception, and I'm looking to enter the building, you would take a scan of my QR code.

And then on your system, you would see the results, and that would be a red, amber, green, or any configuration that is developed, along with a

photo of my face, for example, and then you'd be able to know that I am immune.

And that my -- or at least that's what the results suggest at the time. And that that belongs to me, but without having seen any of my personal

information, just date of birth name, and so on.

[09:50:35]

CHATTERLEY: And therein lies the key because when you attach the idea of facial recognition, technology and governments and government issued ID

like a passport, for example, all sorts of alarm bells start going off about how much information the government, the workplace has to have on

you, and we're so sensitive about that when it's our health. Do we overlook that or is the key part of this that those things can be protected. Privacy

can be protected, while also giving you the luxury of an immunity scan.

KASSAI: Absolutely, and that's been our key focus. The idea of immunity certificates is not new. In most countries, when children are registering

for a new school, they have to show us certificates at the point of registration of having had vaccinations for measles, polio and other

diseases. This is a similar example, but if it's digitized is done in a more effective way.

And the question becomes, if you're looking to give entry to someone to enter a building, or for another reason, then all they really need to know

is that whatever the authoritative testing is for that community or that country that has been granted to you, so you are able to have a presentable

immunity certificate, and that that belongs to you.

And that's essentially the core of what we do is binding the two, so, traditionally, what we've done over the last eight years, is help

individuals sign up to online banks and car rental and payment platforms and things like that.

So, usually it is to show a copy of your government ID as you're registering on these apps, and a selfie video, and then we're using

technology to verify that that government ID seems genuine and it's not fake, and that your face matches the photo, so that it belongs to you.

The step here is that to now bind that to a digital certificate.

CHATTERLEY: Very quickly, because we have to go, how long does this take? One year? Two years?

KASSAI: The process of enrolling is as little as sort of under a minute, but the crucial first step that is still being worked across the world is

to find testing kits, ideally.

CHATTERLEY: The technology.

KASSAI: Precisely.

CHATTERLEY: Absolutely. Husayn Kassai, great to have you with us. Keep us posted on your progress. The CEO and co-founder of Onfido there.

All right, coming up after the break, to survive one pandemic is pretty remarkable. Two, well, that's pretty breathtaking. A superhero story next.

Against all the odds.

(COMMERCIAL BREAK)

[09:55:06]

CHATTERLEY: Welcome back to FIRST MOVE. Before we wrap up the show, I'd like to share one woman's remarkable story of survival.

Angelina Friedman has now survived two pandemics in her lifetime. During the 1918 Spanish Flu, Angelina was born on a ship traveling from Italy to

the United States.

And now, after having survived cancer, the 101-year-old has just beaten the coronavirus. Her daughter say she ran a fever on and off for several weeks,

but now, she is back to herself and looking to get back to her crochet.

To Angelina Friedman who has clearly never dropped a stitch.

And survivors of COVID everywhere, we wish you all a very rapid recovery.

What an incredible smile and what an incredible woman. We will get through this and we will be back, same time, same place tomorrow.

Stay safe, and I'll see you tomorrow.

(COMMERCIAL BREAK)

[10:00:00]

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