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First Move with Julia Chatterley

Bitcoin Hits a Record 50K; The Big Texan Chill Heats Up the Oil Market; Why Big Tech Must Pay News Outlets for the Content They Provide. Aired 9-10a ET

Aired February 16, 2021 - 09:00   ET



JULIA CHATTERLEY, CNN BUSINESS ANCHOR, FIRST MOVE: Live from New York, I am Julia Chatterley. This is FIRST MOVE and here is what you need to know.

Bitcoin breakthrough. The cryptocurrency hits a record $50,000.00.

Winter warmer. The big Texan chill heats up the oil market.

And breaking news. Microsoft and why Big Tech must pay news outlets for the content they provide.

It is Tuesday. Let's make a move.

Welcome once again to FIRST MOVE and another jam-packed show for you this Tuesday.

Coming up, Microsoft's President, Brad Smith on the future of search and social media. We're asking whether Big Tech should pay for the news

gathering done by independent news organizations that provide much of the content that they get paid for, vital for the future, I think, of diverse


And as we have seen over the last several weeks, perhaps for our democracies and the functioning of them, too, lots to discuss there.

And from Microsoft to motors, Mike Jackson, the CEO of retailing giant, AutoNation, talks digital transformation and how COVID has changed both car

buying, but also perhaps the ridesharing economy for the future, too.

We might even discuss the potential for Bitcoin on the balance sheets as the digital currency I mentioned briefly crossed the milestone $50,000.00

mark today, all part of the everything rally that seems to be taking place across global assets.

Wall Street revving up to make fresh record highs at the open today, too. Global stocks, in fact, now up for 12 straight sessions. That's the longest

winning streak in 18 years.

Japan hitting nearly 30-year highs as massive stimulus there helps boost economic growth. Context, though, as we always say is key. The Nikkei still

more than 20 percent away from record highs, but in Europe where STOXX 600, the CAC 40 and the Italian stock markets all hit the highest levels since

the pandemic began. Germany hit an all-time high.

It is not just about stocks, energy prices rallying, too. Cold snaps around the world are boosting demand and pressuring production. More on that in

just a moment.

But the best way I think to sum this up, a truly classic line today from the Bank of America fund manager survey, they said, bottom line, the only

reason to be bearish is there is no reason to be bearish. Someone sound an alarm.

Let's get to the drivers. Paul La Monica joins me now. Paul, just to be clear, that was me saying just sound the alarm, as opposed to Bank of

America saying it, too, but it is a global rally. It's putting pressure on bond yields, too.

What do you make of what we are seeing?

PAUL LA MONICA, CNN BUSINESS REPORTER: Yes, there are obviously growing concerns that maybe this market rally, this rally of everything, it is

stocks, it is obviously Bitcoin and cryptocurrencies -- that it might be getting a little frothy, but I'm not so sure I'll use the "B" word that

rhymes with double and trouble just yet, even though there are worries about increasing valuations.

Blackrock had a note out this morning where they dubbed it risk within reason. Yes, the risks are increasing, but as they pointed out, earnings

growth has rebounded and is expected to recover even more in 2021.

Valuations, while starting to get stretched are not at 2000 levels just yet, so I think that people are cautiously optimistic that this rally can

continue, but you do have to be worried and there could be pullbacks along the way because, you know, we have come very far very fast in the midst of

a pandemic and global recession.

CHATTERLEY: And there could be ubbles, I'll call them, I'll skip the "B" if we are not talking -- not using the actual word. There could be bubbles

in certain parts of this market if not in stocks, which to Blackrock's point here, I think is a very important one to watch.

Now, speaking of Bitcoin because you mentioned it, briefly passing the $50,000.00 level, a psychological level. You and I have talked about this

already over the past couple of weeks, but I spoke to Mohamed El-Erian yesterday, and I asked him about other companies perhaps taking some of the

cash on the balance sheet and swapping it out and adding digital assets like Bitcoin. Listen to what he had to say, Paul.


MOHAMED EL-ERIAN, PRESIDENT, QUEENS' COLLEGE, CAMBRIDGE UNIVERSITY: I think you'll see more companies do that, and it's because they don't know

how else to mitigate risk, so it is part of the distortions of the financial markets.



CHATTERLEY: They don't know how else to mitigate risk and they add Bitcoin to the balance sheet as a way to mitigate risk. There will be some people

here going, what? You are adding risk to your balance sheet here. Go on, what do you think?

LA MONICA: I've got to scratch my beard and what have you here, I mean, clearly, I don't know if this is about mitigating risk anymore.

I think that having Bitcoin on your balance sheet, like Tesla, like Micro Strategy, and if we see other companies potentially do it, GM, for example,

said they are not going to do it in a recent earnings call.

It's really going to be about trying to generate excess return on cash that is really not getting much because of bond yields being so low for so long,

because by the way, the Federal Reserve is likely to keep interest rates near zero for the foreseeable future.

But, long term bond yields are starting to creep higher so you might have more attractive ways to generate return through the Treasury market, which

is obviously safer than Bitcoin.

You know, Bitcoin is obviously something that some companies will find value in, but we saw just last year, I mean, Bitcoin is now at $50,000.00,

a year ago, it plunged to just above $4,000.00 in the midst of the beginning of the global pandemic, not suggesting that's going to happen

again, but Bitcoin is volatile with a capital "V."

I mean, I'm not so sure there are that many CFOs out there that want to put a significant chunk of it on their balance sheet. Maybe a tiny bit like

Tesla is doing, but they're not going to go all in.

CHATTERLEY: Yes, you raised so many great points here. It is capital preservation, and that was the risk that I think Mohamed was talking about,

if you've got cash sitting on your balance sheet and it earns no return, versus the risk perhaps that you have a really volatile and exciting

period, particularly, if you have to report quarterly.

The ups and downs of that could be eye watering.

Paul La Monica, thank you so much. We will continue to discuss this, I know we will.

All right, let's move on. The-everything rally includes the energy market. Oil prices rising once again today amid a powerful winter storm that's

brought extreme cold conditions to much of the southern United States.

Ed Lavandera is in Dallas with the latest.


ED LAVANDERA, CNN CORRESPONDENT (voice over): Freezing temperatures and power outages are pummeling areas from Texas through the plain states, more

than a third of the country reached temperatures below zero on Monday. Texas is receiving the brunt of the storm, with millions across the state

left with no power and no heat.

LINA HIDALGO, JUDGE, HARRIS COUNTY, TEXAS: We all see the current situation. I'm not going to sugar coat it. The next few days are going to

be very tough. There's a high chance the power will be out for these folks until the weather gets better, which will not be for a couple of days.

LAVANDERA (voice over): The City of Abilene that has a population of more than 100,000 residents was forced to shut off water last night due to power


The lacking infrastructure for these conditions is a major concern for hard-hit areas, with some families freezing in their homes.

UNIDENTIFIED MALE: It's like a walk-in freezer. It's like 34 to 36 degrees, I would say.

UNIDENTIFIED MALE: It depends on which room you're in, 40 degrees is the lowest end to 55 at the highest.

LAVANDERA (voice over): In Harris County, power outages nearly spoiled more than 8,000 coronavirus vaccine doses. Moderna advised the county that

3,000 of those doses could go back into storage, and the rest were distributed throughout the county.

Historic lows in Dallas, Oklahoma City, and in Kansas City, the coldest since 1989. The wind chill factor reaching temperatures as cold as minus 32


In Tennessee, authorities reported two fatalities from the storm on Monday. In Kentucky, the governor is warning that another storm is on its way. He

tells residents not to run your gas ovens to generate heat and be careful using generators and camp stoves.

GOV. ANDY BESHEAR (D-KY): Again, I can't stress the dangers of carbon monoxide poisoning, which is absolutely avoidable. Those are casualties we

don't want to see.

We did not make it through almost a year of a pandemic to lose people to a snow or an ice storm.


CHATTERLEY: And we wish everybody safe and well who is struggling with this. The results of course in the energy markets, WTI hitting the highest

level in a year. John Defterios joins us now.

John, great to have you with us. It's just a further tailwind to energy prices now that have been rising for many months.

JOHN DEFTERIOS, CNN BUSINESS EMERGING MARKETS EDITOR: Yes, I like the way you put that, Julia, the tailwind here, because this storm is hitting Texas

particularly hard, and why it is wreaking havoc on the energy market. So let's break it down into specifics, right.

There's West Texas, where Midland Odessa is. That's the heart of the Permian Basin. That represents over a third of the daily output. At the

peak in 2020, we are talking about four million barrels a day, and that's grinding to a halt.


DEFTERIOS: Then you go to the east to Port Arthur where the large refineries are for petrochemicals, the largest is owned by Saudi Arabia. It

is called Motiva. It has been shuttered as a result and it's not alone.

And then, you head south into the Gulf of Mexico there to the Sabine Pass. There are these brand-new LNG terminals that export the shale gas all

around the world that has been compressed. They're having problems as well.

But I do see this, as you are suggesting, the tailwind or the fourth leg, is what I'm calling it because there are other factors driving this market

right now.

Number one is all the stimulus money, so Joe Biden gets his package through. We're looking at $5 trillion over a year, that's a lot of cash

chasing assets right now.

The vaccines are rolling out, Julia. That's a positive. It has got a long ways to go, but it is starting to restore confidence in the economy, and

the last thing we can't forget and this is something very familiar for those here in the Middle East, OPEC Plus.

You know, we had prices go negative for 24 hours back on April 20th of last year, but in May, all the way until today, OPEC has been cutting, not at 10

million barrels a day, but they are still active in the market, which raises the question here, do they come back in and start to loosen up?

But I say, the snow storm is like a blanket, another layer to a very complex market. But you can see the drivers. We've had a strong rally ever

since Election Day in the United States.

CHATTERLEY: A snow blanket, John, to be specific. I mean, you've walked us through a lot of the fundamental drivers in the market now. What about to

circle back to what I was talking about with Paul, Wall Street's role in the rally that we are seeing?

DEFTERIOS: Well, you know what? There was a record $58 billion that came off the sidelines and was active, primarily in equities. But we see the

hedge funds moving in because of the concerns we have talked about over the last week, because of inflation.

So what do you chase? You chase some of the hotter commodities and the hottest game right now in town is oil. So $58 billion, you have got to at

least think a fifth of that going into the commodity market right now, it makes perfect sense.

Number two, I talk about OPEC Plus. It's going to be a political decision that is going to be coming up pretty soon here, Julia, because there were

some divisions at the last meeting. It was Saudi Arabia that wanted to cut, add another million barrels a day.

If prices are edging closer and closer to $70.00 a barrel, the international benchmark, can Saudi Arabia really hold that position because

there are four or five within that camp of OPEC Plus that said, look, we need to start adding oil back on to the market.

That next meeting is March 4th, but it is the complexity of the financial trade right now, which is making it difficult for OPEC Plus, but also for

consumers which are paying a much higher price for heating oil and prices at the pump as well.

CHATTERLEY: Yes, they need a crystal ball, quite frankly -- a crystal ball, and we don't have it. John Defterios, thank you for that.


CHATTERLEY: All right, let me bring you up to speed now with some of the other stories making headlines around the world.

Some welcome news. New coronavirus cases continue to fall sharply in the United States and the United Kingdom. In the U.S., the seven-day average is

down 66 percent from its peak in January. Health experts remain concerned, though, about the spread of new, more contagious variants.

To Hong Kong now who is relaxing social distancing restrictions after it reported its lowest daily number of new cases since last November.

From Thursday, new health regulations will allow indoor dining in restaurants with up to four people at a table. Will Ripley is in Hong Kong

with all the details. Will, it doesn't matter where in the world it is, I'm always delighted to hear a loosening of restrictions.

Tell me what some of these restrictions are and what they are going to mean in terms of just getting back to life.

WILL RIPLEY, CNN INTERNATIONAL CORRESPONDENT: Oh Julia, I can't tell you how much this means. I arrived here in Hong Kong from the United States

about a month ago. I was in a three-week mandatory quarantine in a hotel where you couldn't leave the room. I had an electronic wrist band to make

sure I didn't leave.

Then I was able to get outside, but you know, the gyms are closed, the movie theaters, the arcades, outdoor tennis courts, amusement parks, ice

skating rinks, it's all been closed ever since December 10th when the Hong Kong government saw a spike in cases and decided to shut much of the city


Small businesses have been in an uproar. A lot of them saying they're just barely holding on. So, at least for restaurants, now they'll be able to

continue serving dinner again because they have been having to basically shut down at 6:00 and limit seating to two people per table.

I went to brunch the other day, if you have more than two people in your group, there's a big plastic divider in between you and the person that

you're sitting next to, which isn't so conducive for conversation.

So, at least now, things are starting to feel a bit more normal, with the caveat, the Hong Kong government says that this is only because case

numbers have been dropping. They're down to about single digits per day. They want to get that number down to zero cases per day.

So what they have been doing are these kind of ambush style lockdowns that similar to the ones we have actually seen in Mainland China, Julia, so

people who live in a particular neighborhood or even a particular apartment building could all of a sudden learn that the police and health officials

have surrounded their building and nobody gets to leave until everybody is tested.


RIPLEY: They have done that a few different times here in Hong Kong, especially over on the Kowloon side when cases were spiking there and they

are going to continue to potentially do that in the near future.

But for most people, they are looking forward to a resumption of normal life with a few exceptions. Schools, they are still doing virtual learning

for now.

We are being told that schools will eventually start to allow one sixth of students in the classrooms based on their educational needs which is

certainly going to be welcome news for the parents here in Hong Kong, many of whom are living in very teeny, tiny flats having to figure out ways to

watch their kids while their kids are doing virtual learning at home.

CHATTERLEY: Yes, a huge relief all around, Will, and let's hope we can keep the cases down there.

Will Ripley, great to have you with us in Hong Kong there.


CHATTERLEY: All right, still to come here on FIRST MOVE, no showroom, no problem. America's biggest car dealer sees a record quarter despite COVID-

19 shutdowns. We're joined by the CEO of AutoNation next.

And make them pay, Australia wants tech giants to shell out for news, the Microsoft President agrees. He joins us later to discuss. Stay with us.


CHATTERLEY: Welcome back to FIRST MOVE live from New York where U.S. stocks are set to begin the holiday shortened trading week at, yes, you

guessed it, fresh record highs.

Commodities, Bitcoin, all rallying with stocks even as U.S. bond yields break through some pretty key levels, raising fears as we have discussed

already on the show over the last couple of weeks, higher borrowing costs.

The 10-year U.S. Treasury currently at an 11-month high of 1.25 percent on hopes that new stimulus will trigger stronger growth.

Reopening stocks also revving up. IMAX shares set to soar on news of record ticket sales in China this Lunar New Year holiday. Southwest also rallying

premarket, too. They say ticket sales are on the rise this month, too, of course Southwest Airlines.


CHATTERLEY: All right, so much for the China economy, the pandemic is driving personal mobility right now, too.

AutoNation the biggest car dealer network in the United States has just reported all-time record results in the fourth quarter, leaving sales and

profit forecasts for dust, and it is fueled by digital earnings in the autumn.

Over half the sales originated online as America takes hands-off approach to buying cars. Mike Jackson is Executive Chairman and CEO of AutoNation

and joins us now.

Mike, fantastic to have you on the show. Wowsers. I have to say, with regards to the results. You had your best quarter last quarter ever. You've

topped it this quarter, and it's the digital sales I find remarkable.

I know it was a push, but it's still remarkable.

MICHAEL JACKSON, EXECUTIVE CHAIRMAN AND CEO, AUTONATION: Well, thank you. It is absolutely the best ever, so it has to be enjoyed and celebrated. And

let me tell you what the factors are.

First, with the pandemic, there has been a major shift that people want more space in their home. They are fixing up their home and they want

personal mobility, not shared mobility.

So there's been a reallocation of priorities in the American household budget towards the home and personal transportation.

You combine that with the fact that the cost of money is very low, and we finance most of our products for our customers, and gasoline is available

and affordable. There's a lot of fiscal stimulus, both here and coming. And that has created a tremendous demand for personal mobility.

Then AutoNation itself is outperforming in that positive environment. We have a great brand. We have a tremendous customer experience with one price

on preowned and we have a tremendous digital capability as you just pointed out.

And if I look at the fourth quarter, where our preowned business was generally flat, we increased -- for the industry -- we increased revenue by

12 percent.

And digital allows us to do all of this more cost effectively, hence you have an over 90 percent increase in earnings per share.

CHATTERLEY: You know, it is fantastic, Mike, and for all the reasons that you pointed out, it's a perfect moment. The stars have aligned: cheap

financing, all prices relatively low. The gig economy crushed by COVID.

So, I guess a skeptic would look at this and say, you're making hay while the sun shines but it is sustainable when all of these things come back,

particularly the sharing economy? Do you think that comes back?

JACKSON: So listen, I'm all about building a company and building a brand. That's what I have done my entire career, because to your point, Julia, a

brand gives you great runway and sustainability.

And every brand must have a great customer experience, and we have done that, and customers want to do business digitally. So I feel very good

about that.

The irony, though at the moment is, we have far more demand than supply. The manufacturing process for new vehicles is very disrupted both by the

pandemic and also by the shortages of microchips, because as consumers and Americans are spending more time at home, the demand for consumer

electronics is through the roof.

And you're competing for microchips between those industries and there is a shortage for the automobile manufacturers that you can't produce without

these microchips.

So we have far more demand than supply, and I expect that situation to continue well into this year.

CHATTERLEY: Is that going to create some upward pricing pressure, Mike, do you think?

JACKSON: Pricing pressure? Well, actually, at the moment, the consumer is -- we're all in a good position. So most consumers have a trade-in, and the

trade-in is worth more than ever. We give them value for that, and most consumers' finance, so the cost of money is very low.

So while price points are higher because of the demand-supply situation, in total, it is attractive proposal for the consumer and they are buying.

CHATTERLEY: What proportion are electric vehicles, Mike, very briefly, of what you're seeing? We have obviously been through a period where we're

that much more sensitive I think about the impact on the environment of the lifestyles that we were living in and that we had.

What are you seeing in terms of demand for EV?

JACKSON: So Julia, you're spot on. There's no question that we have passed an inflection point on electrification and why it may be less than two

percent pure electric sales in the U.S. last year. It's going to increase every year going forward.


JACKSON: And here's what the consumers are doing. They are buying a vehicle, they prefer around 250 miles of range, but they are using the

vehicle primarily to go to work, run errands, whatever, locally.

And when they get home at the end of the day, they plug it in. They go home, they pull it in their parking spot, they plug it in, and they wake up

every morning fully charged and they never have to go to a gas station again, and they love that.

Now, most of our electric customers also have another vehicle. They may have a big Suburban or a Cadillac Escalade, whatever, and they use that for

family trips or they use the existing infrastructure of gasoline stations for a longer trip.

So I think the transition, the inflection point to electrification is here. We have them coming from all our manufacturers. If you go to our website,

you'll see a big button for electrification that shows you everything AutoNation offers around electrification, and this migration to electric is

under way.

But let me be clear, let's say by 2030, maybe 20 percent of what we sell will be all electric, but the vehicles on the road of America will only be

five percent, six percent electric by 2030.

Because this is not like going from the flip phone to the smartphone where you take your cheap flip phone and throw it away. The internal combustion

vehicles that are on the road of America today, 265 million - 270 million, have a life span of 20 to 25 years and people are not going to discard them

or throw them away.

CHATTERLEY: That's such a great point. Don't disregard.

JACKSON: So this transition to an electric fleet will take decades. But it's here, it is beginning. I'm excited about it.

CHATTERLEY: An inflection point, but it's going to take time. Very quickly, Mike, because I have about a minute left. You've always had choice

words for Tesla and their business model, the subsidies that they get in terms of clean energy.

What do you make of the Bitcoin on the balance sheet idea? And is it something perhaps you would consider, allowing customers to pay in Bitcoin

one day?

JACKSON: So listen, I could be wrong about Bitcoin, I'll be frank, I really don't know. I really don't understand it.

I served on the Federal Reserve here in the United States for nine years ending up as Chairman of the Atlanta Fed, so it is not like I haven't

thought of these issues and it may be that I'm myopic, I don't know, but AutoNation is not accepting Bitcoin.

We love Uncle Sam and the U.S. greenback reserve currency, just that's -- that's putting it nicely.

CHATTERLEY: Bring your dollars, my friends, and you could buy a car, that's the message.

JACKSON: Just give me the good old U.S. dollar, I'm fine. I'll leave Bitcoin to others.

CHATTERLEY: Thank you, Mike. Great to chat and congratulations again on the earnings.

JACKSON: Good to see you.

CHATTERLEY: Mike Jackson there, the CEO of AutoNation. Likewise, sir.

All right, the market opens next. Stay with us.



CHATTERLEY: Welcome back to FIRST MOVE. U.S. stocks are up and running after the long holiday weekend and we have got a strong start across the

board with all of the U.S. majors at fresh record highs in what many are calling the-everything rally, as we've discussed already on the show.

Investors heading big on the reflation trade, leaving remaining bears well and truly in the dust. Tech leading the charge this morning, the NASDAQ

currently up more than 10 percent year-to-date, too.

Elsewhere, remember, it's not just about stocks. Bitcoin crossed the $50,000.00 mark. $50,000.00 mark earlier today.

MicroStrategy's CEO, do you remember Michael Saylor, who was on the show last week? He announced today that the company will sell $600 million worth

of convertible debt in order to buy even more Bitcoin. It already owns more than 70,000 Bitcoin.

All right, let's move on. Australia plans to make Google and Facebook pay for news. The company currently controls 81 percent of every digital

advertising dollar spent in the country, and an estimated 75 percent of Australians get their news from social media. Two very important facts.

Now, backing the proposal is another tech giant, Microsoft. It says paying for your news is not just important for journalism, but key to healthy


Joining us now, Brad Smith, President of Microsoft. Brad, it is always great to have you on the show, and I have to say, prescient as always on

this because it's something you were talking about at the back end of 2019, saying journalism, the role of social media, was going to be so crucial for

democracies going forward. Just explain your stance on this.

BRAD SMITH, PRESIDENT, MICROSOFT: Sure. Absolutely. And thanks, Julia. It is always good to talk, and as you point out, we have been focused the last

couple of years on a couple key facts.

One is, social media has not necessarily been kind to independent journalism. We have seen the financial base of independent journalism erode

as people have gone online, as advertising has moved online.

And I think you hit the nail on the head. You cannot have a healthy democracy without healthy journalism, and we all depend on having a healthy

democracy. That means we all depend on having healthy journalism.

And so we saw this Australian proposal as an opportunity to step in and stand up for what we think is not just good business for Microsoft but

really a good cause for Australia and the world.

CHATTERLEY: I mean, there were two things here, Brad, when you're looking, and we keep it specific to the Australia situation. There is people just

simply going online and searching for news, and then there's where these social media platforms actually get the news from.

And to your point, they effectively borrow the news from local news outlets. They attract all the advertising money, these big platforms, and

it leaves the smaller guys out in the cold.

Talk to me about the model that --

SMITH: And that's why we have seen -- I was going to say that's why we have seen sort of the spread of this notion of news deserts where local

communities are literally losing their local newspapers.

We have to find some way, I think, to build a better model, to support them. And that's what Australian Prime Minister Scott Morrison has done.

His legislation would require that services like Google and Facebook or Microsoft with Bing if we can grow it to a certain size would compensate

independent journalists, newspapers, for the benefits derived from having their news content on these sites, and it would back this with an

arbitration mechanism. So it struck us as actually a big step in the right direction.


CHATTERLEY: That was actually one of the things I loved about your blog when I read it. It was you putting your hands up and saying, hey, we get

it. We would benefit from this because we have our own search function that gets squished, quite frankly, in Australia.

So allowing greater competition, different search function sources, but also providing payment to some of those that provide the content on these

websites benefits everybody, surely, and society, particularly when we look at what we have been through over the last few weeks.

If we look at the United States' example and how prolific social media is and fake news on social media, quite frankly.

SMITH: I do think the events in the United States have caused us all to just reflect on just the need to address disinformation on social media. I

think that's one side of this issue. But then having a healthy independent journalistic base on the other. I think these two need to go together.

And frankly, what really got our attention was when Google said to Australia that if the law was passed, they would leave. They would just

pull their service out of the country.

So, you know, Microsoft's CEO, Satya Nadella and I called Prime Minister Morrison and said, look, even if Google wants to leave, we will stay. We

will invest. We will need to grow our market share so we have revenue to share with publishers.

But we're comfortable running a search business as we have with Bing in a way that shares proceeds, revenue with publishers.

We just need to grow it in a country like Australia so we have more revenue.

CHATTERLEY: You mentioned Google. So we'll talk about that first, and then we'll talk about the role you already play in compensating news sources at


Brad, it was fascinating the decision that Google made to say, hey, we're actually that powerful. We're pull out if you don't do what we want or you

do something like this, we'll leave. They have reconsidered, it seems.

SMITH: Yes, I thought it was fascinating. We announced our public support for the Australian law and said that we would stay, and 24 hours later,

Google was on the phone with the Prime Minister. They reversed course. They said they would stay.

And I think the good news is they have been moving fast and furiously to now do deals with Australian publishers. They recognize that the passage of

this law is imminent, and I think they have rightly concluded that if they can get deals done and really satisfy the publishers before the law is

enacted, then they're less likely to feel the law's bite once it's approved.

CHATTERLEY: Part of the argument here is that the publishers of news will charge too much money. It will suppress the margins.

I mean, it is tough when you look at the billions of dollars of advertising revenue. How do you attribute what proportion to the content that's been

provided by journalists elsewhere in the world? So we can question that.

But Brad, I know, one, you're already doing this. You crossed the $1 billion of revenue share with 4,500 media brands in 180 countries as of

October 7th, 2020, so that's the first thing. You already have a sense of this.

But two, and I think this is also the important part, you're willing to see collective wage bargaining among these smaller institutions just to give

them a stronger voice.

SMITH: And I do think that is one of the important innovations in the Australian proposal. It is a classic case of a remarkably imbalanced

negotiating position.

On one side of the table, you have a company like Google. It is large, it has this high market share, and it has high profit margins. And on the

other side of the table, you have even in Australia itself, more than a hundred small news organizations. They all operate on very low margins.

That's a hard negotiation if you're a small publisher.

So by giving the publishers the ability to bargain collectively, the government is creating one of the ingredients that I think is actually

indispensable to just leading to a fair negotiation process.

CHATTERLEY: Yes. Brad, obviously, the Australian market news consumers are different from other nations in the world, but there are aspects of this

that I can see surely would work here in the United States, it would work in other countries around the world, other nations should be looking at

this and going, there's a road map here.

SMITH: I think other nations are following what's happening in Australia very closely. We have been hearing from publishers and government

officials, literally around the world, since we endorsed the Australian proposal.

Other governments have tried, and they haven't succeeded to a remarkable degree, and I think that's why some of the innovations in the Australian

proposal are so interesting.

We all depend on a healthy journalistic base in every democracy. There's 76 democratic countries in the world. I think that means there's 76 nations in

the world that have an interest in thinking about something like this.


CHATTERLEY: Brad, very quickly, to the skeptics that are saying, you know, Microsoft is one of the best examples of those that would perhaps

understand unfair competition and scale and size given what the company has been through in the past, what's your response to that today?

SMITH: Well, in a way, we were the first graduate of the School of Hard Knox. You know, it was 25 years ago now that we were thrust into this

middle of an antitrust controversy. It took us a long time to work our way through it.

We definitely emerged older and wiser, and I think some of the lessons that we learned do call on us to reflect on what the problems are that need to

be solved, how a company can do more to step forward to help solve them.

I think big companies when they are in these kinds of controversies, you know, typically have a hard time understanding why they're there. They're

reluctant to make changes they regard as painful.

But I look at Microsoft's own experience, and I say, you know, change is not only possible. I actually think it puts us, the industry, markets, and

governments around the world in a better place.

CHATTERLEY: Yes. Our societies and our democracies depend on it, I think, brad. Very quickly, while I have got you, it would be highly remiss of me

to have the President of Microsoft on the show and not ask him his views of Bitcoin on the balance sheet in light of what Tesla has decided to do.

I know you were listening in to my previous conversation as well with the AutoNation CEO, so is this having an impact on your Board? Are you

potentially discussing crypto diversification, Brad, she says with a smile?

SMITH: Well, I haven't heard any new conversation about Bitcoin, but let me just say, if we change our investment policy on Bitcoin, Julia, you'll

be the first, well, at least the second to know.

CHATTERLEY: Oh, you being the first. Thank you.

SMITH: I'll let you know right away.

CHATTERLEY: I'm going to hold you to that. An exclusive on FIRST MOVE. Thank you. Brad, also a pleasure.

SMITH: Thank you.

CHATTERLEY: Brad Smith, President of Microsoft there, thank you.

All right, we seem to hear more promising news about COVID-19 vaccines almost every day, but despite all the progress, experts say it could take

years to meet demand around the world. We'll explain why up ahead.



CHATTERLEY: Welcome back to the show. Coronavirus vaccine manufacturer Novavax takes another step towards winning U.S. government approval. The

biotech company say it expects to announce this week that its vaccine trial has reached full enrollment. That would be in record time.

The trial will include 30,000 adults across the United States and Mexico. Novavax says it's on track to apply for Emergency Use Authorization in the

United States by the summer.

There are several COVID-19 vaccines already on the market, of course, and many more in the pipeline, but making enough doses for the entire world

could take years.

CNN's Anna Stewart explains why.


ANNA STEWART, CNN REPORTER (voice over): This lab is making lipid nanoparticles. The genetic code in mRNA vaccines are transported into human

cells by these little fatty bubbles.

Around a thousandth of the width of a single human hair, they are incredibly small, critical to the COVID-19 vaccine rollout and there aren't

nearly enough.

Acuitas Therapeutics is one of biotech firms making the lipid component in the Pfizer-BioNTech vaccine. They are also supporting CureVac and Imperial

College London who have vaccine candidates in the pipeline, but they can't make enough by themselves.

TOM MADDEN, PRESIDENT AND CEO, ACUITAS THERAPEUTICS: We don't try and do it all ourselves, we try to enable others around the globe to be able to

contribute to this effort.

Whenever we reach out to other companies to ask them whether they could support manufacturing of the lipid components, for example, as soon as they

hear it's to support a COVID-19 vaccine, you know, they are completely engaged.

STEWART (voice over): Powerful alliances are being forged in the private sector. There are calls, though, for more cooperation at government level.

PRASHANT YADAV, SENIOR FELLOW, CENTER FOR GLOBAL DEVELOPMENT: Now, we are facing a situation where overall capacity, whether for it is the first

steps of manufacturing or it is for fill and finish, they are scarce. And as a result, we need public agencies, so governments nationally or

regionally, they have to come together and ask the question, if I have scarce capacity for something, how do I show that it remains coordinated

between multiple vaccine manufacturers?

STEWART (voice over): GreenLight Biosciences, a biotech firm in Boston, has delayed the development of their mRNA vaccine candidate so they can

tailor it for the newer variants of coronavirus. It will also allow them more time to increase capacity.

ANDREY ZARUR, CEO, GREENLIGHT BIOSCIENCES: GreenLight have been looking for multiple facilities. We are in conversations with multiple regional

partners in South Asia, Southeast Asia, Africa, North America, South America, to implement those facilities. Those facilities will take roughly

six to nine months to construct, then they need to be validated by local regulatory authorities which adds anywhere between a month and three months

or whatever.

But once each one of those facilities is up and running, they will be able to produce billions of doses of COVID-19 vaccine locally.

STEWART (on camera): If you see other vaccine makers fail to make a vaccine, pull out of the vaccine race, are you looking to buy out their

facilities as well to ensure that you can make as much as possible.

ZARUR: We're looking for a GMP facility. We are looking for local partners, you know, so that's my wanted ad on CNN. Can we please via spare

capacity or you want to participate in getting local production up and running, please give us a call.

STEWART (voice over): Vaccine factories and lipid nanoparticles are just some of the bottlenecks to vaccinating the world. There will be more.

Not least is new variants of coronavirus require modifying vaccines and perhaps for years to come.

Anna Stewart, CNN, London.


CHATTERLEY: All right, coming up, making the case for massive new stimulus. President Biden heads to the heartland to pitch his bold new

spending plan in a special CNN Town Hall. All the details just ahead.



CHATTERLEY: Welcome back to FIRST MOVE. U.S. President Joe Biden getting set to pitch his almost $2 trillion emergency aid plan to Americans later

today during the special CNN Town Hall. The pace of COVID vaccinations and school reopening will also be key topics.

That event taking place in Milwaukee, Wisconsin, and Jeff Zeleny joins us from there now.

Jeff, great to have you with us. I think the audience is approving of a $2 trillion or near $2 trillion stimulus. There's no selling needed there.

The key I think for people as well is to hear when are we going to get vaccines? When can we get back to life, quite frankly, and are we over the

worst? What is he going to say?

JEFF ZELENY, CNN U.S. CHIEF AFFAIRS CORRESPONDENT: Well, Julia, that certainly is the question that President Biden is likely to entertain when

he'll be speaking really face-to-face for the first time with voters since taking office, and this comes at the end of his first month as President,

but it really is the beginning of the rest of the push of this.

I mean, the first few weeks of this administration have been so, you know, competing basically with the impeachment trial of the former President, but

now that that is out of the way, he is making his case for this Economic Relief Bill and largely going to go alone with it with the Democrats in the


But average Americans, real people, want to know when they will get their vaccines, when their schools are opening, and will they get some economic

relief? And really, there's about a month left of that economic stimulus that people have been receiving. So you know, time is of the essence here.

But the vaccination rollout, yes, it has improved. There have been more vaccines. The administration has pledged and promised 300 million Americans

will be vaccinated by the end of July. But in the short term, there is still a big supply issue.

There is some confusion over how it is being distributed by the State and Federal government. So I think President Biden will take many of those

questions on those topics here tonight.

CHATTERLEY: I mean, you pointed it out, the handover was, let's call it challenging. We've had the distraction of impeachment. The challenges, yes,

I know I'm being diplomatic. That's my role here.

ZELENY: Indeed.

CHATTERLEY: Jeff, how has his popularity held up? And what do you make of what we are seeing in terms of a sea change? He talked about unity, uniting

the government. Is he managing at this stage with all those distractions to begin that process in your mind?

ZELENY: Julia, that is the big challenge, uniting the country, uniting the government. The Biden White House is very well aware of the fact there are

still deep divisions.

One of the ways they believe they can try to get beyond that is through success. It is by having a successful vaccination rollout plan, it is by

having a successful Economic Relief Bill, and whether Republicans vote on it or not.

The surveys and polls show that the vast majority of Americans do actually support this relief.

At the end of the Trump administration, just at the end of last year, there was a plan to send $2,000.00 to all Americans. Now, this much smaller

checks in this, about $1,400.00 or so, but added with that $600.00 from last year, that would be $2,000.00.

Now, it is going to be targeted more toward the people who need it the most, but Julia, when I have been talking to voters here, including voters

who supported President Trump, Wisconsin was one of the closest battlegrounds in the country.

Even Trump supporters are saying, look, we want President Biden to be successful. We want him to be successful in the short term on fighting

COVID because that will get the economy back on track and that will get things moving again.


ZELENY: So I sense, first and foremost, a sense of patience. People are exhaling a little bit, if you will, that President Trump and all that he

brought is not front and center, but now the challenges are President Biden's. He owns them. He knows that; now, he has to deliver.

CHATTERLEY: Yes. Get us back to life, please, sir. Jeff Zeleny in Milwaukee, there. Thank you. Always great to have you on the show.

And President Biden's Town Hall moderated by Anderson Cooper begins at 9:00 p.m. Eastern Time, which is of course, Wednesday morning in Europe and


We'll also replay the event at times that might be more convenient for you right here on CNN.

And that's it for the show. If you have missed any of our interviews today, they will be on my Twitter and Instagram pages over the next few hours.

Search for @jchatterleyCNN.

Stay safe. "Connect the World" with Becky Anderson is next. We'll see you tomorrow.