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First Move with Julia Chatterley
Macau's Gambling Stock Shed Billions As China Considers Greater Oversight; Instagram Investigation Reports That Facebook Knew The Social Network Was Toxic For Teen Girls; SpaceX Set To Launch The First Flight Crewed Entirely By Non-Astronauts. Aired 9-10a ET
Aired September 15, 2021 - 09:00 ET
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ISA SOARES, CNN INTERNATIONAL ANCHOR: Live from London, I'm Isa Soares in for Julia Chatterley. This is FIRST MOVE, and here is your need to know.
Casino clampdown. Macau's gambling stock shed billions as China considers greater oversight.
Instagram investigation reports that Facebook knew the social network was toxic for teen girls.
And ready to blast off. SpaceX set to launch the first flight crewed entirely by non-astronauts.
It is Wednesday. So let's make a move.
Welcome to FIRST MOVE everyone. Great to have you with us this Wednesday.
And the Apple iPhone 13, if you remember, that launch took place yesterday. The SpaceX inspiration for crew are set for their historic launch later
U.S. stocks though unfortunately are trying to take off, too. Futures are pointing to modestly higher open after what has been a pretty volatile day
of trading on Tuesday. Stocks rallied earlier yesterday after the release of that pretty tame read on U.S. consumer inflation only to lose their
gains as you can see there and close lower, pretty flat right across the board there, the Dow taking the biggest hit.
If we have a look at the Dow now trading near two-month lows. Meanwhile, the S&P 500 has fallen more than 1.5 percent so far this month as well.
That's in the last three months.
Well, meantime, stocks have turned lower in Europe. New numbers show U.K. inflation spiking at a record rate last month. FTSE pretty flat right now,
and it's been a rough day in Asia. China today reporting weaker than expected retail sales numbers. Macau based casino stocks plunged on fears
of tighter government control.
Let's take a look at these huge moves in the casino, stocks as you can see there, Sands China down 32 percent, Wynn Macau 28 percent, MGM China 26
percent, and Galaxy Entertainment plunged 20 percent in Hong Kong trading, too.
Well, U.S. listed casino names with ties to Macau sold off on Tuesday as well and are lower again in premarket trade with Wynn premarket 10.8
Let's get more on this in our drivers. Steven Jiang has the latest for you from Beijing.
STEVEN JIANG, CNN SENIOR BUREAU PRODUCER: This massive selloff of Macau casino operators stocks came one day after an announcement from Macau's
authorities really pointing to a regulatory overhaul for this extremely lucrative industry starting next year when these companies licenses are up
A senior Macau official on Tuesday told a press conference that the government in this semi-autonomous Chinese city would launched a 45-day
public consultation starting today on Wednesday, covering nine major areas affecting this industry, ranging from the number of licenses to be given,
how long they will last to even sending government representatives to supervise day-to-day operations of the casinos.
And the government also indicated they wanted to consider promoting a project with non-gambling elements really indicating a shift in government
priority or preferences for local economic growth engines.
This may not come as a total surprise though, because the central government here in Beijing has become increasingly concerned about Macau's
over reliance on this one industry. And a major part of that is because a large portion of Macau's gamblers actually comes from Mainland China where
gambling is strictly prohibited.
So, the authorities here in China have already placed in restrictions, limiting the flow of both people and money between the two sides even
before the pandemic.
Now, there's also a geopolitical dimension here as well because many of Macau's biggest casinos are run by companies based in the U.S. We're
talking about Sands, Wynn, and MGM, so there are some fears that these companies may not fare as well as their local competition as the rebidding
process begins with the tensions continuing to grow between Washington and Beijing.
So all of this, of course, has spooked investors, who have already been slammed hard by China's recent crackdown on a number of sectors ranging
from Tech to education to gaming, wiping out $3 trillion off market value of some of China's biggest companies.
Steven Jiang, CNN, Beijing.
SOARES: We'll stay on top of that story for you in the coming days and see how stocks move both in Beijing, as well as in the United States.
Well, China is also dealing with a new COVID outbreak in the southern eastern province of Fujian. More than 150 cases have been reported in five
I want to show you this video that's been circulating on social media showing a child in Fujian wearing a hazmat suit and undergoing a CT scan
all by himself after testing positive for COVID-19.
Now the outbreak, also prompting officials in other parts of the country to issue travel warnings ahead of major holidays. I think, it's coming up in
about a month or so.
Ivan Watson is live for us in Hong Kong with the latest. Ivan, what more do we know about this video about this child, and this latest outbreak?
IVAN WATSON, CNN SENIOR INTERNATIONAL CORRESPONDENT: Well, the video was reportedly taken by a nurse who can be heard narrating saying, hey, this
four year old child is going into quarantine alone wearing this hazmat suit, and that has spread rapidly across China's very heavily censored
internet and social media and has triggered some real concern understandably and some outrage.
Where and how has this happened? Well, China maintains this very strict zero COVID case policy, even though COVID was first detected in the Chinese
city of Wuhan back in December of 2019.
So, whenever there's an outbreak, there are very strict measures imposed that try to squelch the virus. In the case of Fujian, it is a different
outbreak from previous ones official say, because it has spread particularly in one school for around 10 days before it was noticed.
So there are around 20 children at least that have tested positive out of more than 150 positive COVID cases over the last five days that have been
detected. There have been some strict measures imposed to try to stop this ongoing spread. Part of it has involved strictly quarantining thousands of
people and also some lockdowns on several cities where people cannot even cross the thresholds of their homes. Also, barring non-essential travel
outside of two or three cities that have been impacted thus far.
This is how seriously the Chinese government takes an outbreak with only about 152 cases, thus far. We are already hearing though, signs that local
officials in that City of Putian where that video was taken, reversing course on imposing quarantines on children with a press conference on
Wednesday where a local official said, okay, we're going to allow a relative or close contact to do the quarantine with children under the age
of 14, which will probably make everybody breathe a little easier now -- Isa.
SOARES: Yes, and meanwhile, Ivan, you know, we've got a busy holiday month next month, Golden Week, and I'm guessing the government might want to try
and bring those numbers down before obviously the biggest, the busiest time for travel in China kicks off.
WATSON: Yes, I mean, that's one concern, too, that you could have tens of millions of people moving around and, and the fear that particularly this
COVID Delta variant could then circulate further.
So, you do have Chinese officials that are also trying to ramp up vaccination. We've heard some impressive statistics coming from the
government. The Ministry of Education, saying that 91 percent of students between the ages of 12 and 17 across the country have received both of
their vaccination doses, for example.
That's pretty impressive. There is one caveat there. One of China's vaccines for COVID is Sinovac, which has an efficacy rate in the 50
percentile range, and could be more vulnerable to something like the delta variant of COVID, could leave people who are vaccinated, potentially more
In the case of this one province of Fujian, we are also seeing, as I mentioned before, strict bans on people leaving their home cities. That's
one of the measures that they want to take to stop people from getting out and spreading the virus further.
SOARES: Impressive numbers indeed, but a very important context there from Ivan Watson on exactly what that means. Thanks very much, Ivan.
Now, let me bring you up-to-date with the stories making headlines around the world this hour.
North and South Korea have conducted rival missile tests just hours apart from each other. Not long ago, Seoul fired a new submarine launched
ballistic missile, becoming only the seventh country in the world to do so. It came less than three hours after Pyongyang launched two ballistic
missiles of its own into the sea.
CNN's Paula Hancocks has been monitoring all from Seoul and she joins me now.
SOARES: And Paula, I can only imagine you know, how much this has raised tensions in the region. What more are we learning about this? And in
particular, the timing of this -- Paula.
PAULA HANCOCKS, CNN INTERNATIONAL CORRESPONDENT: Well, Isa, it certainly has been a busy day on the Korean peninsula. Let's start with what North
Korea did just after 12:30 p.m. local time.
They fired two ballistic short range missiles. Now, these are the types of missiles that are violating the U.N. Security Council resolution. So surely
there will be much reaction to that. And then just a few hours later, as you say, there was this submarine launched ballistic missile that was
launched and test fired by South Korea, making it just the seventh to be able to do this in the world and all the other countries that have
testified this kind of missile technology are nuclear capable countries.
So certainly from South Korea's point of view, it was a significant day. The President Moon Jae-in was in attendance watching this as well. He was
at pains to point out that this was not in retaliation and reaction to what he called North Korean provocations, but he did say that improving the
missile capabilities would certainly help in the deterrence against North Korea.
Now, there are a number of other things that South Korea was showing off today, as well different missile technologies and they really have
increased their capabilities recently increased their defense budget as well, which all really started from last May when President Moon Jae-in,
went to Washington to meet with the U.S. President Joe Biden, and there, they agreed to lift this restriction that had been in place for 40 years, a
restriction on the range of missiles that South Korea is allowed to produce, and also the capability.
So that's been lifted, and South Korea has made no qualms about wanting to increase its missile capability. But clearly the world is going to be far
more concerned with what North Korea is doing with its missiles than what South Korea has done -- Isa.
SOARES: Paula Hancocks for us in Seoul, thanks very much, Paula.
Let me continue taking you right around the world with other stories were following. CNN projects California is Democratic Governor Gavin Newsom has
defeated the year-long attempt to remove him from office.
The recall effort was launched by Republicans fed up with Newsom's pandemic response including lockdowns and mask mandates. Well, after the vote,
Newsom thanked voters for saying yes to science, and yes to vaccines.
And CNN's Becky Anderson has an exclusive interview with Pakistani Prime Minister Imran Khan, his first video interview since the Taliban took power
in Afghanistan. It covers as you can imagine a range of topics and will air in full in the next hour, in fact, on "Connect the World."
But for now, I want to leave you with this quick preview.
(BEGIN VIDEO CLIP)
BECKY ANDERSON, CNN INTERNATIONAL ANCHOR: How would you describe the situation in Afghanistan today?
IMRAN KHAN, PAKISTANI PRIME MINISTER: I think, it's worrying. Afghanistan is on a historic crossroads. One, if it goes well, and we pray that this
works in the direction of peace after 40 years in Afghanistan, if Taliban hold all of Afghanistan and if they can sort of now work towards an
inclusive government, get all the factions together, Afghanistan could have peace after 40 years.
But if it goes wrong, and which is what we are really worried about, it could go to chaos. The biggest humanitarian crisis, a huge refugee problem,
unstable Afghanistan and the reason why the U.S. came in was to fight terrorism or international terrorists.
So unstable Afghanistan, refugee crisis, and the possibility of again, terrorism from Afghanistan's soil.
(END VIDEO CLIP)
SOARES: And you can see the full interview of Prime Minister Khan and Becky Anderson right here in the next hour on "Connect the World." You do not
want to miss that exclusive interview.
And still to come right here on FIRST MOVE, Facebook knew Instagram was toxic for teens and did nothing about it. The latest on the explosive "Wall
Street Journal" report.
And SpaceX is set to launch four people into orbit with no professional astronauts aboard. We're bringing both their stories after a very short
You are watching CNN.
SOARES: Welcome back to FIRST MOVE where it is looking like a mostly higher open for U.S. stocks as you can see there after Tuesday's really across the
board pullback, green arrows all over as we look at the futures of course, we're still waiting a good 12 or so minutes until the opening bell.
News the U.S. consumer price inflation moderated last month came of course as a relief to investors yesterday. And if that trend continues, well, it
could help the Fed really keep interest rates lower for longer. The fresh economic challenges, of course await investors tomorrow when the U.S.
releases its latest look at retail sales.
Now China today reporting that its retail sales rose just two and a half percent last month. Economists were looking for a seven percent jump, so
quite a difference. All this, of course, as the crisis at Chinese property developer, Evergrande deepens.
We brought you that story yesterday, we'll continue to stay on top of it. It shares fell again in Hong Kong today amid reports you won't be able to
make key loan payments that come due next week. Markets fearing that Evergrande default could have of course a wider impact on the Chinese
financial system, and that's why we stay on top of the story.
Meanwhile, "Wall Street Journal" says Facebook knew Instagram was harmful to teenagers and did nothing about it. The report cites three years of
internal research on the app's mental health impact. Anna Stewart joins me now for more.
And Anna, what's critical here for our viewers, and many will no doubt will be asking, exactly what did Facebook know? And when did they know it?
ANNA STEWART, CNN REPORTER: So what we know is Facebook has been conducting these studies for the last three years looking at the impact Instagram has
on the mental health of teenagers and young people and it won't surprise anyone I think to know, there are some negative implications here. But the
extent of it from these studies, is perhaps quite shocking.
So take a look. The researchers found that Instagram makes one in five teens feel worse about themselves. Teens who struggle with mental health
say the platform makes it worse. And then perhaps most shocking of all, six percent of U.S. teen users trace suicidal thoughts directly to Instagram,
and that number over doubles for those in the U.K.
The research also showed, Isa that some of these problems are specific to Instagram. It looks at the different platforms that says TikTok bases a lot
on performance for instance; Snapchat more focused on faces and jokey filters, whereas Instagram is very much linked to body image, to lifestyle,
And perhaps most shocking of all with this report from "The Wall Street Journal" isn't just the study itself, but the fact that maybe Facebook
didn't do enough about it. They didn't share it. In fact, they looked quite invasive.
U.S. senators did ask directly for Facebook's internal research just last month in August and they didn't really give it. One senator today says we
can expect to hear more about this in hearings and legislation.
STEWART: Now the response from Facebook, they don't deny the research that has been found. They have put out a statement which includes this. "Social
media isn't inherently good or bad for people. Many find it helpful one day and problematic than next. What seems to matter most is how people use
social media and their state of mind when they use it."
However, they do say, Isa, they'll be more transparent going forwards when it comes to sharing their research.
SOARES: Yes, that is a start, but I'm sure as the senators have pointed in the United States, this is not the end of this story.
Meanwhile, Anna, TikTok, which of course competes fiercely with Instagram and who has also come under fire, I think, it's fair to say, said it is
taking mental health seriously. What are they doing?
STEWART: Yes, interesting. They put a direct statement following this report going through some of the things they think can help, some of the
tools that they are using. And they do point out that sharing personal experiences on social media can be helpful, but it has to be done in a safe
Some of the tools they are using include publishing wellbeing guides regarding mental health issues from suicide to eating disorders, and making
sure that when people search for specific hashtags like suicide, they are directed to help or they have public service announcements on there.
That is something Twitter and Instagram have said they already do. Facebook have also tried things like removing the like function from posts. The
issue is, do any of these tools make any real difference? It is a huge predicament facing social media firms, regulators, parents, and of course,
the young users themselves -- Isa.
SOARES: Indeed. Anna Stewart there for us. Thanks very much, Anna.
And of course, if you or someone you know might be at risk of suicide, there are ways to help.
In the United States, you can call the National Suicide Prevention Lifeline. The number is on your screen right now. For support outside of
the United States, a worldwide directory of resources as well as international hotlines provided by the International Association for
Suicide Prevention. And of course, you can turn to Befrienders Worldwide.
Now, Apple unveiled its new iPhone range on Tuesday, upgraded cameras and options, including a huge one terabyte of storage stole the headlines.
Apple also showed off a new watch and improved kind of mini iPads.
And best of all, the prices stay the same. And in fact, some of them actually went up.
Joining me is Dan Ives, Managing Director of Equity Research at Wedbush Securities. Dan, great to have you on the show. What did you make of the
Apple event yesterday? Were you impressed with these incremental upgrades and new product models?
DAN IVES, MANAGING DIRECTOR OF EQUITY RESEARCH, WEDBUSH SECURITIES: Yes, we were very impressed, especially when it comes to the chip the A15. Remember
Apple, they are controlling more and more of their ecosystem, because they own the chip. You look at battery technology, and I think the camera that's
really going to be a game changer in terms of cinematic mode, and the terabyte for iPhone Pro Max. That's significant. And that's something many
core users has been waiting for.
We believe this is sort of the second and third inning of the super cycle playing out, and it is our opinion, this is just going to be another growth
driver into what I think is going to be a holiday bonanza for Apple.
SOARES: And we will get into that holiday bonanza, but I was surprised to see that there was unfortunately one unwelcome update and that's the price
of the iPhone. I think it's the most expensive model ever. The price I looked at, and you can correct me is $1,599.00. I mean, will people be
flocking to Apple, especially coming out of a pandemic, you think?
IVES: Well, I think Apple has needed to sort of balance that. If you look at the base model, prices stayed unchanged. They came out with a mini. And
they are of course, in the high end, you know, those are more much more expensive models, especially on the terabyte one.
I think what you're seeing here, and you've seen with iPhone 12 as well, Apple will come in all different price points. And that's why iPhone 12
because of the pent up demand, it has been massively successful.
Right now, about 25 percent of users, about 250 million based on our research, have not upgraded their phone in three and a half years. And I
think that's why this continues to be a super cycle, no doubt given consumer, you know, in terms of some of the pressures we are seeing from a
spending perspective, they'll continue to see a bit of a headwind. But overall this has really been the super cycle playing out.
SOARES: Really interesting. The number of users who actually have not bought, but -- who, you know, in terms of upgrading, but Dan, look, what do
these Apple releases mean for Apple stock? If I can get my producers to bring up the share price? I mean, shares have really outperformed the tech
sector. Is that, do you think sustainable?
IVES: Well, it's our view that that when we go into early, call it, spring 2022. We're looking at a $3 trillion market cap for Apple, because we
believe the success on iPhone 13, but also that services business which continues to get rerated. I think the Street is under estimating the Apple
growth story. They've screened as it's gone from one to two trillion. Now, pulling out their hair going from two to three trillion.
IVES: I think it just comes down to that install base, the monetization and to new multiple, a new way that investors are valuing Apple.
SOARES: But what -- I mean, as a product, as an Apple product, what makes you think that Apple will indeed go up in so much like in value, like
IVES: Well, part of it, we talk about that install base. I mean, that's the one thing -- if there's any number, that's the key. I mean, you have a
golden installed by 25 percent that haven't an upgraded their phone in three and a half years. Then you look at the services.
Their ability to monetize customers, it's only 15 percent penetrated today. That's services business alone, we think is worth $1.3 trillion to $1.5
trillion. No doubt regulatory pressure, we saw the Epic verdict come out last week.
I think if you put that all together, this is a stock multiple continues to go higher. I think numbers go higher. And that's the focus, you know, as we
look at Apple, especially going in 2022.
SOARES: And very briefly, we've seen a regulatory crackdown on Chinese tech stocks. Do you think this will have an impact on U.S. stocks?
IVES: I think a little more tough on like -- and ultimately we've seen a massive rotation from Chinese to U.S. tech stocks right now unless you are
like jumping off a cliff without a parachute. It's hard going to Chinese tech stock today given the crackdown.
SOARES: Indeed, Dan Ives there. Great to have you on the show, the Managing Director of Equity Research at Wedbush Securities.
IVES: Thank you.
SOARES: Thanks very much Dan.
And the market open is next.
SOARES: Welcome back to FIRST MOVE. U.S. stocks -- there you go, that's the bell -- U.S. stocks are up and running this Wednesday as the opening bell
signals a new trading day.
SOARES: And we're off to it mostly -- well, let's have a look. Higher? No flat. Flat, down as you can see volatility. Stocks, however, have struggled
to gain traction in September so far, but at this hour pretty flat.
Global investor sentiment took a further hit today from news that COVID lockdowns continue to put pressure in the Chinese economy. All of this of
course ass Beijing continues its historic clump down as we mentioned at the top of the show with our Steven Jiang -- clamp down on private businesses.
U.S.-based casino firms with licenses in Macau, we brought you that story at the top, that expire next year, are sharply lower for a second day as
you can see MGM two percent, Wynn also eight percent, Las Vegas Sands five and a half percent. Now investors fear that officials in the Chinese
territory are considering tighter regulations on that industry, hence why you are seeing those very sudden market moves.
Well, later today, SpaceX will launch the world's first spaceflight entirely crewed by non-astronauts. Among them will be billionaire, Jared
Isaacman who is funding a three-day mission called Inspiration 4. He'll be joined by a cancer survivor, a geologist, and a raffle winner, and they
will return to Earth by splashing down off the Florida coast.
Rachel Crane joins me from the Kennedy Space Center. And Rachel, this is incredibly exciting. I mean, an all civilian crew, I know you've been
speaking to them, give us a sense of how perhaps they may be feeling and what we can expect today.
RACHEL CRANE, CNN BUSINESS INNOVATIONS AND SPACE CORRESPONDENT: Well, Isa, I spoke to them yesterday, and I asked them "Are you nervous?" And they
said no. They maintain that they had the good kind of butterflies, but they weren't nervous at all. In fact, after I spoke to them, they went for a run
around the launch pad that you see over my shoulder here, to go run around and look at their beautiful rocket and that launch pad is 39-A. It's the
site of where Apollo 11 brought humans to the moon, also, the location of many shuttle launches, also where SpaceX restored America's capability of
launching humans from American soil to the International Space Station.
So the site of many historic launches, and also today, hopefully a new chapter in spaceflight will open with this Inspiration 4 launch of the
first all-civilian launch to orbit with no professional astronauts on board.
And the tick-tock here isn't really going to start until about three hours before that 8:02 launch Eastern Time launch window begins. In fact, the
crew is still sleeping. They are not expected to wake up till about 1:00 p.m. today, and 45 minutes before that launch window opens again at 8:02
Eastern Time, that's when that critical go for propellant load pull will take place and that's when you know it's really full steam ahead.
But today is really the culmination of months of preparation for this mission. Now this crew, they've hiked Mount Rainier together to bond.
They've gone through mission simulations, one of which was 30 hours long. And they also did some really cool Zero G flights to acclimate themselves
to weightlessness. And I actually had the opportunity to go through that exact same training that Inspiration 4 did on that Zero G flight.
Take a look.
CRANE: Oh my goodness. Wow. I'm feeling like an astronaut that's for sure.
Where are we? And what are we going to be doing today?
UNIDENTIFIED MALE: Here we are Newark Airport and we're going to be going up and zero gravity on G Force One, and you're going to get the same
experience as people on the ISS have.
CRANE (voice over): Zero Gravity Corporation that uses a modified Boeing 727 flying in parabolic motion to create multiple spurts of weightlessness.
Richard Branson acclimated himself to Zero G's on one before he went into space, as did the crew of Inspiration 4, the first all civilian flight into
UNIDENTIFIED MALE: You don't want your first experience in zero gravity to be in space. It's a very unique feeling and this gives them the framework
to understand that.
CRANE (on camera): I'm a little nervous.
WE all know that flying on a rocket ship is dangerous. But how dangerous are these flights?
UNIDENTIFIED MALE: There's no risk or danger and what we do. We've flown 17,000 passengers over the last 16 years, not one injury, and not one
issue. So, we have all the same regulations, safety, everything as that United flight does.
CRANE: Wow. Oh, this is amazing.
CRANE (voice over): Unlike Jeff Bezos or Richard Branson's flights, this plane isn't on a rocket aimed at space, an airspace of 10 miles by 100
miles is cleared for G Force One flight.
CRANE (on camera): There's a lot of talk about these suborbital flights democratizing space. But is this experience the closest thing that you
know, a normal ...
UNIDENTIFIED MALE: A normal person --
CRANE: ... will ever experience?
UNIDENTIFIED MALE: Absolutely. Absolutely. Yes, the price point. I mean, no one would say $7,500.00 is cheap, but it's accessible.
CRANE: It's a lot less than $28 million.
What is the value of the weightless NASA experience like? Is this just for thrill seekers? Or is there real research value to these flights?
UNIDENTIFIED MALE: Right now, I would say half of it is research, and then the other half is consumer facing.
We've done things that are literally on the cutting edge for space, testing out how to do 3D printing in microgravity. We've done experiments in in how
to animate freeze dried blood to go out and test things in zero gravity or microgravity in space prohibitively expensive and not realistic.
CRANE: Now, Isa, the crew of Inspiration 4 will be in orbit for about three days. They'll be orbiting the Earth 15 times a day, and there is something
interesting about this Crew Dragon, they've replaced the docking mechanism onboard the spacecraft with a beautiful cupula.
So those crew members, they are going to get quite a view of space -- Isa.
SOARES: Super exciting. I'm very jealous you took part in that. I know you said they're all sleeping, I very much doubt they are sleeping. They must
be so excited and nervous. Thank you very much. Rachel Crane for us there.
Well listening to that is Leroy Chiao, a former NASA astronaut and a Commander of the International Space Station, a well-known face on the
show. He's also a member of the Safety Advisory Panel for SpaceX.
So, Leroy, great to have you on the show. So here you have really a billionaire, a cancer survivor, a geologist, and a raffle winner. I mean,
where do we even start? How do you train them, Leroy, for space?
LEROY CHIAO, FORMER NASA ASTRONAUT: The biggest thing is that this is an automated flight, and so there's nothing for them to do that a professional
astronaut would be doing on a different mission. So the biggest thing that you want to do is to make sure that they bond together as a team.
So as you heard earlier, they have done multiple things together, they've been in stressful situations together. And it looks from all of all things
that I've seen that they have bonded very well. So that's important, because you know, you're going to be in a small space together for several
days and so you want to be able to get along.
SOARES: I mean, there are no professional astronauts, as you heard that on that flight. I know, the gentleman we heard on that piece, say there's no
risk or danger. But what happens if something does go wrong?
CHIAO: Well, I think it's inaccurate to say there's no risk. There is risk in everything you do. You know, so there is going to be risk anytime you're
sitting on top of a rocket with propellant, and rocket engines and all that. And of course, there's going to be risk.
Also flying in space, once you're in orbit, there's less risk, but there's still risk. And so you know, the biggest thing we worry about with
spacecraft is orbital debris. Now, fortunately, we have good, you know, models that -- and in tracking devices that are tracking most of that. But
you know, that is the biggest concern and at the altitude that they'll be flying at, which is actually higher than the ISS, there is actually a
little bit more orbital debris up there.
But all the mitigation strategies have been employed, so I think they're going to be fine.
SOARES: And obviously, much has always made of the launch and the risks, like you said with it, Leroy, but I was reading that the re-entry -- and
I'm quoting someone here -- could feel like a blazing meteor coming in. Explain that to us?
CHIAO: Sure. Well, you know, you've got to put a lot of energy into a spacecraft to get it up to orbital speed of around 25,000 kilometers an
hour. And then you have to take that energy out when you come back down.
And so people have this idea that coming back down is safer than going up, but it's really not. It's the transfer of that energy. And yes, you are in
a fireball. There's no question about it, especially coming down in a capsule. I remember my experience coming down on a Soyuz, a Russian Soyuz
capsule. I was sitting right next to a porthole and I could look out and see flaming bits of the heat shield go by, so no question, you're in a
SOARES: Yes, that's -- of course, because everyone always focuses on the launch. Look, Leroy, I think our viewers will love a sense from you what it
is like traveling to Earth's orbit. You know, and what you think this all civilian crews really can expect on this three-day journey here.
CHIAO: Well, it's going to be spectacular. You know, the rocket ride, of course, is very exciting. It's very quick. You know, it's only around a
nine-minute, you know, flights into orbit. Once you get into orbit, you know they are going to be greeted with a beautiful view of the Earth and
it's just going to be wowing.
I mean, even though I'm sure they've seen the movies and the photographs and talk to people, but when you see it for yourself, you're still not
quite prepared for it.
Coming back down, we kind of talked about. It's not like the movies. You're not being bounced around as much as in the movies. You're going to pull
some G Forces, but it's not going to be too bad and -- but you are going to get that fireball.
CHIAO: You know, so it's going to be a very exciting ride for all of them and those few days are going to go by like in the snap of a finger.
SOARES: Yes, and they seem to have definitely been training for this. Look, Leroy, this mission, as you would no doubt have heard so many of us say is
being billed as the beginning of a new era for space travel, where, you know, ordinary people, not just astronauts or millionaires can take part.
But realistically, how far away are we away from this? Because it's still expensive?
CHIAO: Oh, absolutely. There's no question about it. I mean, as you pointed out, the sponsor if you will, of this mission is a billionaire. And that's
what it takes, it takes a lot of money to buy a rocket even though SpaceX has made great strides to dramatically bring down the cost of access to
space in less expensive rockets. It's still out of reach for most people, you know, we're still talking about millions of dollars, perhaps tens of
millions of dollars per seat to get on one of those spacecraft and go.
And so, we're a long ways from the so-called, you know, buying a ticket on an airline and going into space because of the complexity. You've got
rocket engines, you've got, you know, a lot of moving parts, a lot of fuel, a lot of propellant, and everything has got to work just right.
So bringing that cost down has been a challenge and it is going to take probably some kind of a breakthrough in propulsion technology where we can
inexpensively and reliably propel people into space, that's what's going to bring the price down.
SOARES: Well, at least we are getting closer, Leroy. I think that's a great sign. I for one, I'm super excited about it. Leroy Chiao, thank you very
much. Great to have you on the show.
And of course, you can see the live coverage of the launch later today right here on CNN. Thanks, Leroy.
CHIAO: Thank you.
SOARES: Now, dreaming of a second home? Fast growing property co-ownership platform, Pacaso is now moving into Europe. We'll have the details, next.
SOARES: Welcome back, everyone. Now, Pacaso, a real estate startup that helps people buy and co-own a second home is raising another $125 million.
That puts a value of $1.5 billion on Pacaso which still isn't even one- year-old.
The San Francisco based company now wants as you can imagine, to expand into Europe.
SOARES: Joining me now, CEO of Pacaso, Austin Allison.
Austin, great to have you on the show. And congrats, by the way on raising that last batch of funding. Let's talk about the business and in
particular, your venture into Europe. Explain to our viewers exactly, first of all, where you're looking to go, and why.
AUSTIN ALLISON, CEO, PACASO: Yes, absolutely. Well, first off, thank you for having me, Isa. It's great to be here. So Pacaso provides a service
that empowers people to buy beautiful homes and beautiful second home locations for one-eighth the cost, and we do that through this concept of
co-ownership where a small group of people come together and co-own a home together.
And as you mentioned, we're really excited to announce a $125 million Series C that was led by SoftBank, and that capital will empower us to
expand into a lot of new markets, starting with Spain, which will be our first European market.
SOARES: Before we talk Spain there, let me ask you this, because our many viewers, perhaps some of the viewers might not know about the business, you
said one-eighth. Families can share, obviously the price or they can share the home. How many families though Austin, on average, share a home just to
get a sense?
ALLISON: Yes, that's exactly right. So the best way to get your mind around this is imagine if you and four or five of your closest friends or family
members decided to own a second home together. That's how Pacaso works.
We form an LLC, the property is owned in an LLC and up to eight families can co-own a home together. You can buy as little as one-eighth of the
home, or as much as four-eighths of the home or 50 percent and Pacaso manages all the details, everything from bill pay to maintenance to design,
as well as scheduling so that each co-owner has fair and equitable access to the calendar throughout the year.
SOARES: I can imagine our viewers are probably screaming at the TV for this moment thing saying, okay, that sounds great. But what if you want to sell
a home? What if one of the other eight family -- seven families damages the house? What happens then, Austin?
ALLISON: Yes, these are some really great questions. So first, if you would like to sell a home, if you're a second homeowner today that owns a hundred
percent of your home, but you're like most second homeowners in the sense that you only use it five or six weeks per year, you can call Pacaso and
we'll actually buy 50 to 75 percent of your home to bring in other co- owners that would like to co-own it with you.
In terms of the damage question, we handle that as well. If an owner were to do damage to the property, that owner would be responsible for paying
for that damage. But the big difference here with home ownership is that when people own property, they're committed to not just the home, but
they're committed to the community and the neighborhood. So they treat the home like it's their own, because at the end of the day, it is their own.
SOARES: And Austin, you're moving now into Spain, explain why you've decided to venture into Europe, in particular, into Spain.
ALLISON: Yes, so a lot of people aspire to own second homes. About 75 percent of the families that we survey are interested in owning second
homes. But the number one thing that prohibits people from owning a second home is the cost. And this constraint exists all over the world, not just
in the United States, but throughout Europe, throughout Mexico, throughout the Caribbean, frankly, throughout, you know many parts of the world.
So Pacaso goes into markets where people are interested in co-owning homes. We have about two million people that visited our website last quarter, and
all of those people tell us what they're interested in, and we have a lot of buyers who are interested in Spain, because it's a beautiful place
that's very desirable as a second home location and that's where Pacaso operates.
SOARES: But of course, I mean explain to us and really give to the viewers the challenges, of course of going, you know, mostly from a U.S. market to
now a European market. What are the challenges for you as a business?
ALLISON: Yes, well, as a business, I would say the biggest challenges are our exponential growth. I mean, we launched this business about one year
ago, on October 1st of 2020. And it's been growing super-fast. We've gone from six months ago, we were just in a dozen markets to more than 25
We've gone from, you know, just 30 people at the beginning of the year to 120-plus people across 20 states, and that sort of growth is a challenge
for any business. So ultimately, that's really where we spend our time and energy, is making sure we do what we do well and consistently for our
owners every time.
But in terms of purchasing real estate across borders, there are a lot of challenges. If you're from the United States, for example and interested in
owning property in Spain, there's a lot that you need to know. You need to have the proper attorneys, the proper real estate professionals. You need
to know how transactions work.
And one of the big benefits of owning through Pacaso is that we handle all those details, making purchasing real estate across borders very easy.
SOARES: Austin Allison, we wish you the very best of luck, the CEO of Pacaso. Thanks very much, Austin.
ALLISON: Thank you, Isa.
SOARES: We will have much more news after this short break.
SOARES: Now, 40 countries have so far ratified an agreement struck in January to create the African Continental Free Trade Area. The deal came
with a target of boosting Africa's exports by $560 billion.
Eleni Giokos asked the man at the helm, how the agreement is processing.
ELENI GIOKOS, CNN BUSINESS AFRICA CORRESPONDENT: So Secretary General I mean, at the end of the day, you are the one that's helping implement this
mammoth task to connect a single market. So how far are we in harmonizing rules, lifting tariffs, and opening up borders so we can boost inter-Africa
WAMKELE MENE, SECRETARY GENERAL OF THE AFRICAN CONTINENTAL FREE TRADE AREA SECRETARIAT: It's going to take time. It's going to take a very long time.
I always make the point that it took market integration in Europe over 72 years. It took the European 72 years to get to the point where they are
And so we have a long way to go to build the capacity of our customs authorities, to make sure that our customs authorities across the length
and breadth of the continent, that they know exactly what the rules require for trade facilitation for goods in transit.
GIOKOS: Some people don't believe that the Continental Free Trade Area will be implemented. Are you feeling confident it will be done?
MENE: I am very realistic about the challenges that lie ahead, but I believe with all my being that this agreement will be implemented.
We have never had this level of political will and legal commitment before for a trade agreement on the African continent. I know that, like in any
other trade agreement, not everybody is going to implement at the same time. Some countries will move much faster than others. Some countries will
have an interest in the services sector. Some countries will have an interest in manufacturing.
And so we have to bear all of that in mind.
GIOKOS: Do we have any success stories that have already started to see the benefits or at least gearing up for what a more connected Africa will look
like? What are you hearing from executives and the business communities?
MENE: The success stories are there. If you are a big corporation, as soon as that new market is opened to you, you are able to ensure that you have a
commercial presence there, and so that we are going to see that bigger corporations will be the immediate beneficiaries, and that institutional
investors will be the immediate beneficiaries.
MENE: But what we have to work on -- and to make sure that they also see the benefits are the small and medium enterprises, and that is going to
take perhaps two to three years.
SOARES: Now, we've been talking of mammoth tasks and the "Jurassic Park" movies were all about extinct species by extracting their DNA.
Now, that idea is a step closer to becoming reality. A company called Colossal has raised $15 million to resurrect the giant woolly mammoth. They
plan to extract DNA from frozen remains and mix it with elephant DNA.
Now, supporters say the hybrid could help restore the Arctic ecosystem. And believe it or not, this is what is written for me, I hear they like eating
plants, not humans.
And that's it for me. Thanks very much for watching.
A Special Edition of "Connect the World" is next with Becky Anderson live for you in Islamabad, Pakistan.
Do stay right here with CNN.