Return to Transcripts main page
First Move with Julia Chatterley
Major U.S. Banks Offer $30B Lifeline to First Republic Bank; At Least 310 People Detained Thursday Night; Rogoff: It's a Difficult Global Situation to Navigate; Regional Bank Stocks Fall, Despite Aid to First Republic; Luxury Hotel Used in "The White Lotus" sees Bookings Surge; Potentially Toxic Red Tide Threatening Florida's West Coast. Aired 9-10a ET
Aired March 17, 2023 - 09:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
JULIA CHATTERLEY, CNN HOST, FIRST MOVE: A warm welcome to "First Move", wonderful to be with you, as always, and after a truly unprecedented week
on financial markets at least for a few years. TGIF, Friday, a good time to assess where we stand on those financial stability risks after a week of
frenzied news float.
Let me just recap, in just one week, we saw the failure of 3 U.S. banks, Silicon Valley Bank Signature and Silvergate. Then the Swiss Central Bank
gave Credit Suisse the gift of what I call time in the form of a $54 billion size loans. It remains a troubled bank, a basket case in my mind.
And then late in the session Thursday, 11 of the biggest U.S. banks deposit dumped a whopping $30 billion into struggling Regional Bank First Republic.
Now the plan was simple, elegant and creative. In my mind, the proxy, if you remember, full weakness in these regional banks for days has been their
high holdings of uninsured deposits.
So we're talking sums over $250,000 and the fear is that deposits will simply or depositors will simply feel safer, moving that cash to bigger
banks. And we've seen that, that's what's been happening. So now what you've got is the mega banks, effectively taking that new money and handing
Thereby allowing those stress banks to more easily meet depositors demands without some form of cash crunch. Now, I've still got plenty of questions
like how long that lasts. What it means for shareholders in some of those smaller banks? But it seems like a tidy interim solution and it did help
stabilize sentiment somewhat.
But now take a look at these markets still extremely cautious. No St. Patrick's Day green for U.S. futures or for European stocks. And banks at
the center of this week storm, not yet in the clover. Just take a look at that Credit Suisse down over 7 percent. JP Morgan, analysts said yesterday
that they still believe ultimately bigger bank and rival UBS will have to step in at some point and further U.S. Regional Banks First Republic.
They're also weak at pre market concerns in the latter, and you can see that on the left of your screen of a dividend suspension a key not to
mention, of course, how all this volatility and the deposit outflows will hit earnings in the future? And you know what? I haven't even mentioned
it's the Federal Reserve meeting next week.
The good news is Christine Romans is still standing and joins us now. She's sitting at this point, you know, our colleague Wolf Blitzer said to me,
late Thursday night, Julia, is that the whack a mole here going to continue. And I thought, actually, that was quite a good analogy. There's
been plenty of whack-a-moles, and you can talk about your answers. But I said, perhaps and perhaps this brings some stability. What do you think?
CHRISTINE ROMANS, CNN CHIEF BUSINESS CORRESPONDENT: I say what a year this week has been right? I mean, unbelievable the amount of developments on the
financial front and on the banking front here. And I think the whole point of the Fed rescue of the FDIC backstop of depositors, and Signature Bank
and SVB and of this really amazing.
Your right creative bank led bank bailout or bank booster of one of its competitors has been remarkable here. What they're trying to do is put a
floor under this conversation, you know, put the fire out, there are still embers, there are no question. There are still embers that are smoking, but
put the fire out and project reassurance.
And I think that's what this week has been. We've gone from honestly panic, like a week ago, Thursday, spread through the weekend, all kinds of
negotiations and trying to understand what systemic risk issues there are. And then this week, it's just trying to draw a line under this whole event
and project to the public that, you know, the banking system is safe, that with higher interest rates, of course, there will be places of weakness.
I think the weakness you're seeing is some of the premarket trading of these banks is regional banks is not existential, its earnings --, you're
absolutely right. There'll be suspending dividends, there'll be pressure on their earnings, no question because they will, right?
If you want to attract these deposits that are moving around, you know, you're going to have to have higher interest rates on those savings so all
of these things are a big brew here that we're still coming to terms with.
CHATTERLEY: I preferred the term that you use booster rather than bailout.
CHATTERLEY: And we had it on the screen now and I'm like, I still feel that sort of tension over that word. It's sort of a help me to help you,
situation because this level of volatility doesn't help any bank and it can what size you are?
The nervousness that I understand from these big depositors because they don't have this explicit protection when the sum is of above $250,000 I'm
putting you on the spot here but do you think do you think we can get away with not having some kind of explicit guarantee from Congress on this?
Because I understand those that are saying, look, you keep telling me it's safe, and I probably am, but I just feel safer being in a bigger bank.
ROMANS: Yes, I think it's so fascinating and I've heard more and more people. And there are lots of people who for years have been saying that
the FDIC insurance levels should change. But you know, what, Julia is interesting. I mean, in Canada, what is it 76,000. And I want to say, in
Europe, in the U.K., it's more like 100,000, you know, its 100,000 euros.
I'm mean have to check these numbers, but the rest of the world; their guarantee levels are much lower than ours. So I think it's interesting
about the playing field. If you have U.S. banks that are guaranteeing, I mean, I think it's going to be the next logical conversation to have.
I also think you've got two federal probes of what happened at SVB and what happened at Signature Bank, and then you've got the Fed looking into
regulatory, I think there's going to be pressure about clawing back compensation, examining stock sales before this happened. So there's a lot
regulatory wise, I think that we're just at the very beginning stages of in terms of the health of the banking sector in the U.S.
CHATTERLEY: Yes, 85,000 pounds, by the way, in the U.K.
ROMANS: It's 85, 000 pounds, yes.
CHATTERLEY: Yes, and I completely agree with you. And I understand all the moral hazard issues with that blanket guarantee too, but I just we did it
in the financial crisis, just a couple of years or one year just to shore up confidence firmly.
CHATTERLEY: I don't know, wonder whether we get there very quickly, Christine, because I can't get told off at the beginning of the show. I
always get told off at the end. Fed next week, what do you think?
ROMANS: So if I mean, if I were a betting woman, which I'm not because honestly, I've tried so many times, I think 25 basis points I really do,
CHATTERLEY: Yes, OK, yes, there we go. Unfortunately, yes. Christine has a good weekend.
ROMANS: You too, bye! Bye!
CHATTERLEY: Christine thank you. Alright, Chinese President Xi Jinping will meet his Russian counterpart in Moscow next week. His 3-day state visit to
Russia is the first visit since the war in Ukraine began.
(BEGIN VIDEO CLIP)
WANG WENBIN, CHINESE FOREIGN AFFAIRS MINISTRY SPOKESPERSON: China will uphold an objective and fair position on Ukraine crisis and play a
constructive role in promoting talks for peace.
(END VIDEO CLIP)
CHATTERLEY: And Will Ripley joins us on this the Chinese Foreign Ministry. Will and great to have you with us determined to present China as a peace
broker, in this situation that this trip doesn't alter their impartiality, as they would call it unclaimed the West is far more cautious about where
this relationship leads.
WILL RIPLEY, CNN SENIOR INTERNATIONAL CORRESPONDENT: Well, it's a curious definition of impartiality when President Xi's first overseas trip since
this unprecedented third Presidential term, which is really signaling what you know, is going to be top of agenda for him, which is supporting his no
limits partnership with Russia's President.
So you have these two leaders for life, essentially, one who's waging a war right now, one who is believed to be seriously contemplating a war at some
point down the road, or at least some sort of effort to take control of Taiwan. And China has said that they're neutral and yet, President Xi has
refused to even get on the phone with President Zelenskyy of Ukraine.
So how can you be a neutral party put out a 12 point, peace plan that doesn't even call the war in invasion doesn't condemn Russia's actions and
ask for Ukraine just lights up its country that was stolen by Russia. So set aside the claim of impartiality and then the real conversation that the
world and certainly the West wants to know is Xi and Putin are they going to come to some sort of an agreement about lethal weapons.
The U.S. believes that China has been seriously considering resupplying Russia with ammunition potentially providing other weapons for use on the
battlefield. When China is asked about this, they just point the finger back at the United States for doing so and saying that China has not been,
but they're certainly helping prop up Russia's economy, to minimize the impact of sanctions.
I was chatting with, in some kind of just regular Russian citizens who actually are here in Taiwan, saying that the average person in Russia isn't
really talking about this war, and they're living their life as normal. That's in large part because of China's economic assistance.
Unlike in Ukraine, where they're living with constant bombardment, and you have a whole generation of people, particularly generation of children, who
are going to be traumatized for many years to come by what is being inflicted upon them. A life goes on for most Russians.
And yet, China is perhaps considering now according to the United States, giving Russia the weapons and tools that it would need that could
potentially shift the course of this battle and not in a favorable direction for Ukraine.
CHATTERLEY: Yes, valid points. Will Ripley, thank you so much for that.
And as we were saying, for all those reasons, of course, this makes you will be closely watched by Officials in Ukraine and beyond. Ivan Watson
joins us now from Kharkiv Ivan, as well as saying that they may call it some level of impartiality but it's clear that the relationship between
China and Russia and the relationship between China and Ukraine are very, very different.
IVAN WATSON, CNN INTERNATIONAL CORRESPONDENT: Absolutely, because, you know, the Chinese leader Xi Jinping has not had conversations with the
Ukrainian President Volodymyr Zelenskyy, as opposed to hey, he's about to fly to Moscow next week and sit down face to face with his good friend
Vladimir Putin, with whom he has this friendship with no limits.
That said there was a rare phone conversation between the Ukrainian Foreign Minister and his Chinese counterpart on Thursday, where the Ukrainian
Diplomat highlighted in the readout the principle of territorial integrity, which has very much come under siege from Russia after occupying Ukrainian
territory, declaring that it is annexing it.
In its peace plan, China does say that territorial integrity and sovereignty. Those are important principles to it, but it has not
criticized those moves by Moscow on the battlefield. So the Ukrainians are watching closely and as we just heard, Will, explaining, they don't want to
see an injection of weapons going into the Russian Military, which it is struggling against, but holding its own at great losses on the battlefield.
We have heard new statements of support coming from some Eastern European allies. Now the Slovakian Prime Minister coming out with a statement
promising to hand over 13, Soviet area, MiG-29, fighter jets to Ukraine that coming on the back of Poland announcing yesterday that it's going to
give four of those jets in a matter of days and more sometime in the future.
Both of those governments made those announcements prematurely perhaps last year and didn't follow through, they will be welcomed if they do in fact
arrive here in Ukraine, even though the bulk of the fighting and of course, the dying is taking place on the ground, with infantry, with artillery with
both armies expending huge amounts of vehicles and ammunition on a daily basis.
We've seen some reports coming from Ukrainian Commanders, that the tempo of the Russian assaults all along that front line that runs for hundreds and
hundreds of kilometers, has decreased somewhat. But that is of little consolation, not only to the troops, but remembers the civilians who were
still living in these frontline areas.
Still taking casualties on a daily basis being pounded by long range artillery and rockets we've seen that firsthand and even though the U.S.
and NATO countries have delivered billions of dollars, worth of assistance and weapons and financial support.
We're still seeing in the frontline areas that Ukrainian troops are driving around in civilian vehicles that have been kind of converted for military
use. That just gives you a sense of how desperate Ukrainians are for help in this grinding war, Julia.
CHATTERLEY: Yes, and it's the reporting reminder too, but I guess the symbolism and the statement of those jets are important also, to
underscore. Ivan, great to have you with us thank you. Ivan Watson there! And as a Paris were earlier this morning, protesters blocked one of the
city's ring roads a day after anger erupted when the government raised the retirement age to 64 without holding a parliamentary vote.
You're looking now at some of the dramatic images from last night when more than 300 people were detained. The French Prime Minister says the
government was forced to make a last minute decision to enact the reforms, saying it had done everything it could to get a majority.
Sam Kiley has the very latest for us from Paris. Sam, great to have you with us! I can understand I think the anger at how this reform was enacted.
But I do have to remind myself that this is a 64-year-old retirement age and it's our children that pay for this ultimately.
SAM KILEY, CNN SENIOR INTERNATIONAL CORRESPONDENT: Yes, I think the Anglo- Saxon world often finds this very difficult to understand, don't they? The idea that people would take to the streets and the violence was spontaneous
Here outside the National Assembly, you can see the police, the riot police are assembled in case it happens again, and that is because the idea that
you raise the retirement age for 62 to 64 is not something that you would normally expect people to take to the barricades for, but take to the
barricades they did.
There's the remnants here of tear gas canisters, burning tires, or graffiti since I'd been here in the last couple of hours has actually been cleaned
off that monument in the center of the plaster of Concord. But the essence of this, and we're all very used to the very strong tradition for street
protests among the French.
But this goes to a very fundamental part of the French way of life, if you like, this is a pension plan that younger people pay into. They pay for it,
like all pension plans, but it's largely supported. The government says by people in work, financing people who've stopped work, and they're saying
that that is causing a 12.5-billion-euro similar sort of amount of money in dollars.
Gap in the finances and Macron has been trying to get this reform through since 2019. There is about two thirds of the population are against it. And
interestingly, both the far left and the far right are also against it.
That means though, ironically, that early next week, when there's anticipated to be a no confidence vote in the parliamentary - government of
Emanuel Macron, not the President himself, but his Prime Minister, and Ministers.
They're likely to win it because ultimately, the far left and the far right hate this policy, but not enough for them to make friends, even for the
short period it would take to make sure that vote of no confidence went through.
CHATTERLEY: That's interesting and to your point, as well, previous Presidents have tried reforms like this and not ended up extending the
political capital to do so. Sam, very quickly, do you think we see more protests or does this quieten down now?
KILEY: No, I think we are anticipating more protests perhaps more organized protests, certainly next Thursday, the unions and public sector unions in
particular are planning a very big set of demonstrations and marches. There is some reporting that the far right might be trying to put something
together for tomorrow.
For now, I think it's likely we've seen not the last but a decline in the likelihood of any of these spontaneous demonstrations. That was very much I
think, in response to the idea that you could lose a parliamentary vote or face losing a parliamentary vote and then ran through legislation where
this executive feared, Julia.
CHATTERLEY: Yes, and that makes sense. Sam, thank you for that! Sam Kiley there! OK, coming up here on "First Move", bank collapses, cash infusions,
and market turmoil March Madness indeed. We'll discuss it all with Former IMF Chief Economist Professor Ken Rogoff, after the break.
And later an HBO smash hit triggers a surge in bookings we're having to Sicily to speak with the real manager of the luxury resort used to fill
white lotus. I think we need that this week. Stay with us. We're back after this.
CHATTERLEY: Welcome back to "First Move", it's been a week filled with uncertainty for the banking sector investors and consumers. Last Friday,
Silicon Valley Bank collapsed over the weekend, the U.S. government stepped in to bail it and Signature Bank out. By midweek Credit Suisse was in
trouble in its stocks tumbled after one of its top shareholders said it would not offer additional assistance and raise its stake it couldn't.
And then it received nearly $54 billion in emergency aid from the Swiss National Bank. And then yesterday 11 of America's largest banks provided
deposits to the tune of $300 billion to First Republic. That is a lot for the Federal Reserve to think about ahead of its upcoming interest rate
meeting not to mention its ongoing fight to tame rising prices.
Former IMF Chief Economist Ken Rogoff has repeatedly warned of financial instability if the Central Bank continues to raise interest rates. And
Professor Ken Rogoff joins me now. He's currently a Professor of Economics and Public Policy at Harvard University. Sir it's always a pleasure to have
you on the show.
I can remember two highly prescient articles that you wrote, this year alone, actually, the looming financial crisis for Project Syndicate very
much sticks in my mind that you didn't mention Silicon Valley Bank. So I'll deduct a point in all seriousness, how worried are you?
KEN ROGOFF, FORMER CHIEF ECONOMIST OF INTERNATIONAL MONETARY FUND: Well, I mean, I think the global economy is about to go through the wringer because
interest rates have gone up. And there was this euphoria a few weeks ago that maybe nothing's going to happen, but I think we're going to get some
kind of global recession.
I don't think we're going to get a 2008 style banking crisis for all the reasons that the ECB and the Federal Reserve are saying, I don't think
they've necessarily stemmed every possible problem, but the situation is better. But on the other hand, you know, we have inflation, which we didn't
have, I think we won't have the era of ultra-low interest rates anymore and I could go on the war in Ukraine. It's a difficult global situation to
CHATTERLEY: There was speculation after the European Central Bank move yesterday. And despite some of the turmoil that we've seen, or weakness
across European banks, they decided to do what they promised and hike interest rates by half a percentage point. There's obviously now
speculation about what the Federal Reserve do.
But I think the belief, at least certainly from the markets is that perhaps the European Central Bank is now done. And if the Federal Reserve does
another quarter of a percentage point, that could be peak rates in the United States. What do you make of that Professor Rogoff?
ROGOFF: No, I don't agree with that at all. I think inflation's still quite high in both places. What might be true is they might take it slower. So
they may, you know, wait to see how things are shaking out.
But I think even if we have a recession, I'm not sure this time, that's going to bring inflation down. People are always thinking of the last war,
we're more like the 70s than we really are like 2008 as far as that goes.
CHATTERLEY: That leads me on to a different question. So does for Europe and the United States, they simply have to accept whether they say it or
not a higher rate of inflation, no one really understands the target of 2 percent at this stage. Do we just accept that somewhere in the middle,
perhaps of where the United States is significantly lower still for Europe is acceptable 4 percent, even if they don't say it?
ROGOFF: Well, yes and no, I mean, they're going to say, we're going to bring it down slowly. I think it is hard to get that last bit of inflation
out of the system. So getting it down from 10 percent to 4 percent is way easier, because a lot of these transitory temporary things reverse.
You didn't have to do anything. But there's an embedded part that's going to be more painful. And I frankly think it makes sense to take your time
getting it out. But I wouldn't go telling the market, oh 2 percent, we swore on a Bible that we would never, ever let it be something else and we
changed our minds.
CHATTERLEY: Do you think if the Federal Reserve slows down; perhaps even does a temporary pause.
It can avoid U.S. Congress having to come out and say look, we'll give you at least for a short period of time, and explicit guarantee that will be
back stop those uninsured deposits, because I think that's the big question now.
And it was done during the financial crisis to shore up confidence admittedly that requires Congress to come together and agree on anything,
quite frankly. But do you think slowing down these rate hikes will enable the banking sector to be stable enough to avoid that explicit promise?
ROGOFF: Well, I think the Treasury was behind this and I don't know to what extent the Congress can step in around it. They did basically cast a net
ROGOFF: So yes, they only did the uninsured deposits. Yes, only did the uninsured deposits at the failing banks. But it's kind of clear to everyone
that everything's insured. And that's very problematic, because, you know, some deposits pay a higher interest rate.
Believe it or not, there are bankers that do risky practices, and you want to have some checks and balances on that, it's a concern. But I do think
they did the right thing. There was just panic going on last weekend, not just in Silicon Valley, but everywhere, and that they really had to
overshoot, or would have gotten worse.
Look what's happening in Europe still, after, the ECB said everything's fine. The Swiss National Bank gave this lifeline or at least temporary
lifeline the may break up Credit Suisse at the end. There's still a lot of concern, and I think there were financial crises tend to come in waves and
I think we've just seen the first wave.
CHATTERLEY: OK, that's where I was headed next. You weren't so worried about the United States and Europe, when you wrote that article. You were
looking at the impact of rising interest rates on countries that have far greater holdings of sovereign debt. You mentioned Japan, China is an
interesting Italy is also an interesting one.
And we've sort of been there done that and bought the T-shirt on that one. Where should we be looking, because it was funny? Earlier this week, I was
sort of looking at how the Asia session performed and sort of just waiting, differences in inflation and interest rates there, perhaps which is a
bonus, but still?
ROGOFF: Well, I have to check if my T-shirt still fits after COVID. But I was surprised at where that had happened. Where did OK, after it happened?
I can tell you why. But no, I wasn't expecting it in two of the richest places in the world, California and Switzerland, theoretically, very well
regulated financial sectors.
I am worried about Japan, because, you know, here, and I'm in the United States, but also Britain, Europe, young people had never seen inflation.
They never have seen interest rates go up. In Japan, you can go many generations, and they haven't seen it and they're going to.
And so it's hard to know how, what will happen when that does the Bank of Japan's trying to hold it off, but I don't think they can indefinitely? And
Italy, yes, I mean, it's actually done fine. It's actually inflated down a lot of its debt.
But the glue that holds Europe together, the Eurozone has been these zero interest rates, and they're gone. And so next time, there's a deal, it's
going to say more expensive, more difficult to negotiate.
CHATTERLEY: Can Central Banks and Authorities manage whatever comes, because we proved in the financial crisis that it can get incredibly rocky,
but that the situation can be managed by creativity wherever required? It just means we need to wear hard hats; perhaps we'll have them ready for
ROGOFF: OK, well, they're very good at the Central Banks. And actually, I think what they did so far, on the whole is great. Although, I'm not sure
why Silicon Valley Bank happened they were supposed to be being supervised. I'm not sure why they didn't bail them out sooner. I don't know what was
But yes, we have very good Central Bankers, but they're not the whole picture. I think, as you mentioned about Congress, and I think we can go to
other governments. They're paralyzed and by the way, debt is really high around the world and interest rates are higher so this whole idea, well,
whatever happens, the government will pay for it. Not so simple this time. We're fighting a different war, and then we did in 2008.
CHATTERLEY: Quick question there because you've just sort of running alarm in my head. You clearly have questions for the Fed and for the San
Francisco Fed. What was going on?
ROGOFF: Well, I mean, I wouldn't say I in particular, everyone does. So how can it be that I'm sure that the San Francisco Fed knew a lot of things
about Silicon Valley Bank probably their carbon footprint?
What was going on with this? It's just surprising. And then when it unfolded, they weren't technically insolvent right away. So why didn't they
give them liquidity right away and nip it in the bud? It's hard to know these things move so fast.
And there are so many political pressures. It's hard to know. Again, it hasn't happened everywhere so you know, it's so hard to supervise this big
banking sector. But this was an important bank. It was very much will be missed.
CHATTERLEY: Yes, valid points as always sir, great to chat to you. Thank you so much. Former--
ROGOFF: Thank you.
CHATTERLEY: --IMF Chief Economist and Professor Ken Rogoff we'll speak soon, sir. Thank you. We're back after this.
CHATTERLEY: Welcome back to "First Move"! U.S. stocks are up and running for the final session of the week thankfully and it's been an eventful and
drum filled week for investors and the banking sector in particular drawing to a close.
But I think the warning is braced for fresh volatility today. U.S. stocks beginning the session mostly lower as you can see there, the DOW the
underperformer as investors assess all that's been done to stabilize the global banking system this week following the collapse of three U.S. banks.
The turmoil at Europe's Credit Suisse and the multi billion dollars in aid extended yesterday to First Republic Bank not to mention the hike of course
by the European Central Bank. Still a lot of nervousness in the regional U.S. banking sector despite the extraordinary moves by major banks to
bolster up First Republic.
As you can see there down some 17 percent at the early start of the session, sizeable losses for many of these stocks, amid all these historic
events the S&P 500 and the NASDAQ are still on track for a winning week yes, you heard me.
With lower bond yields helping boost interest rate sensitive tech in particular a relative safe haven would you believe it. Today by the way is
a triple which options expiration day which means we could see even more volatile stock swings in the session.
Now just noting this one financial asset that has not suffered amid the most volatility is Bitcoin, the crypto currency currently up some just shy
of 7 percent, briefly regaining the 25,000 level. In fact, we're above that, as you can see gains more broadly too across the crypto space, it
goes back to the premise of crypto which is that you simply don't trust central banks and traditional fiat currencies, so clearly a better week for
Now updating you on Credit Suisse shares of the Swiss banking giant sharply lower, but off the session low as a reversal of the relief rally that we
saw earlier this week, following the Swiss Central Bank's $54 billion loan package today's action reflects concern that more needs to be done three
letters spring to mind UBS.
Anna Stewart join us now. Anna you know that there's a problem in a bank. And we've been talking about this now for many, many months, when the
moment a $54 billion loan is extended by the Central Bank, someone comes out and says still not going to be enough and that we do analysts at JP
ANNA STEWART, CNN REPORTER: Well, we knew yesterday Julia that the story didn't end there. And it really didn't take very long for that relief rally
to come to a pretty sudden halt. Looking earlier today, I think the share price is still down around 25 percent on the week, and that's despite, as
you say, a nearly $54 billion loan from the Central Bank.
And you're right that JP Morgan note was a really interesting one, because it underlines the fact that the capital position of Credit Suisse isn't
really the problem or the problem at all really, when you consider this bank, particularly aside from all of the other pressures we've seen on the
sector so far.
What happens next, because options are on the table now at this stage for Credit Suisse? It has been undergoing this big restructure now for many
months, has had issues now for years. I think it's on its seventh, restructure already. So what do they do?
Option number one, do nothing. I don't think that is an option, really, that's viable at this stage, looking at the share price, looking at those
outflows we saw particularly in October of last year looking at its customer base.
So then you get to option number two, just you know, accelerate, revamp the current restructure plan, maybe get rid of that investment bank unit much
sooner speed up that timeline, or, you know, this is a big option, but just close it down altogether.
The third option is to consider that Credit Suisse, as it stands doesn't seem to be as valuable as the some of its parts, perhaps sell those parts
off to different buyers, whether it's wealth management or asset management or retail banking.
There are probably buyers for various units, although you do question what you'd be left with. And that leads as you say to that third option, which
certainly is getting a lot of headway in the report today, which is a complete takeover by UBS.
Now, according to Bloomberg reports neither sides are interested in that but it certainly seems like one of the obvious choices, and then you get to
the end of the line worst case scenario and I don't think we're there yet which is where the central bank simply has to take control and make those
But we're some way off that. I for one Julia not sure about you, I'm really the markets will soon in a few hours close and yet another crazy week on
banking will be over.
CHATTERLEY: Yes, I still got a deja vu sensation from UBS itself, what 15 years ago now. What we've got to remember with Credit Suisse is the
domestic Swiss business is very profitable. So the sum of parts point that you made is very important. Anna Stewart good job thank you so much! You
should also get some sleep this weekend.
STEWART: Thank you.
CHATTERLEY: OK, coming up after the break, time to pack your bags; a story of intrigue, romance and vespers. What's it like staying at a real life
'White Lotus Hotel' the manager of the luxury resort used to film the HBO hit reveal a few of its secrets, we have next.
CHATTERLEY: Welcome back to "First Move"! Now to a story of sun and sea infidelity and intrigue among super rich vacation is tangled in a web of
deceit. What's more, if I told you "These gays are trying to murder me, and then fans of a certain award winning HBO series will know exactly what I'm
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: Whenever I stay at a White Lotus, I always have a memorable time always.
(END VIDEO CLIP)
CHATTERLEY: There can be no forgetting Jennifer Coolidge's role as Tanya, or the magnificent setting of the Island of Sicily, where Season Two of the
White Lotus was filmed. One of the biggest stars of the show was the San Domenico Palace in the Town of Taormina rebranded for TV as the 'White
Lotus' of course.
Now the five star four seasons property has seen a surge in bookings. And its real life manager says it's a match for its fictional counterpart. And
his name is Lorenzo Maraviglia and he joins us now. Lorenzo, amazing to have you on the show! Sort of dangerous in certain cases to call this a
match but what a showcase for your hotel, although I did read that you're completely sold out this season what's the truth?
LORENZO MARAVIGLIA, GENERAL MANAGER, SAN DOMENICO PALACE HOTEL: Yes first of all, it's a pleasure to get in touch with you and your audience. Thank
you for this opportunity. Yes, we are - it starts to be an incredible season. I mean, we saw some interesting number last year as well. So we
were - of the Nation is someone's - point of view. Obviously, White Lotus, you know, has added a lot of value to that.
CHATTERLEY: I mean, you're already an American favorite, I believe. And I think everybody around the world knows the Four Seasons brand too, but
who's now coming because Netflix is pretty global showcase?
MARAVIGLIA: Yes, actually, it's very interesting to see. I've been mentioned and seen in a Polish family home January, or Australians family -
you could actually see where 'White Lotus' had more impact, you know, but of course, the number one market for us, it remains the U.S.
It had an incredible impact. I was lucky enough. I know it sounds foolish, but I was lucky enough to be invited at the opening at the premiere in
Hollywood, you know, back in November or early October, late October and that could really see the impact that you know, this series has on people.
You know, the 'White Lotus' is an incredible show - it had that incredible grip on the Americans in particular. But again, the Italians, the French,
the Polish as I was saying the Germans are crazy. The Australians are crazy. I think it's a global thing.
CHATTERLEY: Now it is quite naughty. I mean, there's murder there's but I'll carefully say on television. For a young audience too ladies of the
night there are all sorts of intrigue. How closely does an art imitate life at these hotels Lorenzo? How much of this was and is sort of true to form
of some of the things that you've seen are you banned from speaking about them?
MARAVIGLIA: Yes, I mean, obviously there's--
MARAVIGLIA: There is a big component of drama and spies that you know, they add to make it interesting. I honestly would say that Taormina is far from
it, you know, it's a destination, you know, it is a family destination is an extremely romantic destination. So you see a lot of in our newlywed or
you know celebration, et cetera.
So you don't really see much of that night movements to be honest with you. But you know, it was - the show, and I think they did very well to have
that level of spiciness. But to be honest with you, I hope I don't disappoint anyone. Taormina, it's a family destination. It's a perfect
place for a family reunion.
CHATTERLEY: Yes. OK. So for anyone who's watched and I should be clear, HBO, not Netflix, the White Lotus series that it's slightly less spicy,
perhaps is what you're saying Lorenzo?
CHATTERLEY: Sir, you obviously spent time with the stars. We all know Jennifer Coolidge. And I think a lot of people love her. But can you tell
us who your favorite star of the show was?
MARAVIGLIA: Well, I think I got extremely close to Sabrina - because of the role she was playing and the fact that you know, she wanted to get in touch
with me and to spend time with me and shadow me on my day to day life. And she came in many of my meetings. We just sat on the side taking notes.
And it was incredible. I mean, it was not a global star yet but she was extremely known in Italy so for me to have you know, an actress like that
so dedicated to her role and you know, wanting to get every single shape of it was incredible.
And you know we ended up going to the gym together in the night. And so we got very close. I just want to be precise that I am not that type of
general manager right? You know she has - a lot of - to that I am not their way. Don't expect me to kick out people from my hotel.
That's not the way we are. But I think more of you know the approach and some of these small daily dynamics. Jennifer Coolidge is as you see it on
the screen; she's really like that on anything she says she's probably one of the funniest people I've ever met. I also very close to those who don't
see like, you know, my quiet and that, you know, is behind the camera, but it is such an incredible person very inspirational.
CHATTERLEY: I'm glad you changed the subject to her because the spice level of this whole thing was rising briefly there. Lorenzo, I have about 30
seconds left, I have two questions you have to answer very quickly.
If you could have your choice of where series three is set? Where would you set series three of the 'White Lotus'? And the second question is, were you
in it? I was trying to see you at some point, were you actually in it?
MARAVIGLIA: I was not in it although I try every card possible--
CHATTERLEY: Exactly I was about to say walking past, yes.
MARAVIGLIA: My ego was--
CHATTERLEY: Is big enough.
MARAVIGLIA: I wanted to be actually the main actor, but they didn't put me. The second - the third one I would suggest Bangkok because understanding
and see how crazy they are I think Bangkok will be the perfect place. I know that wanted to do something in Asia, and I think that will end
somewhere around that part of the world.
CHATTERLEY: Yes, Bangkok crazy in a good way Lorenzo. Great to chat to you, have a great summer! I think you're going to be busy.
MARAVIGLIA: Thank you.
CHATTERLEY: Thank you so much. General Manager there! Done, if I can afford it? General Manager of the San Domenico Palace Hotel sir thank you! I'm
from an idyllic setting in Italy to worries for the Caribbean in the Gulf of Mexico. We look into the giant blob of seaweed that threatened beaches
and more there.
CHATTERLEY: An alarming threat for tourism in Florida, Mexico and the Caribbean right now. As we speak a giant blob of potentially dangerous
seaweed is floating towards the region from the Atlantic Ocean. The buildup could be the biggest we've ever seen on record. Leyla Santiago is on the
scene in Key West in Florida Leyla, devastating for the fishing industry too not just tourism?
LEYLA SANTIAGO, CNN CORRESPONDENT: Right, this is something that could have a big impact. Some folks the fishermen actually say that there could be
benefits of that. You'll hear about that in just a second but let me show you exactly what this looks like, right?
This is what's washed up here in Key West and mixed in this is a bit of what they call Sargassum it's this seaweed this particular type of seaweed
scientists had been tracking it in the tropical Atlantic since 2011. And they say this massive amount record amount that they are seeing now could
be a new normal.
JOE KAPLAN, RESIDENT AT KEY WEST OF FLORIDA: It's the ache in the summertime builds up and smells terrible.
SANTIAGO (voice over): Joe Kaplan captured these images about a week ago, massive amounts of seaweed washing up at Smather's Beach, a beach he knows
well, because he walks it several times a week.
KAPLAN: I was shocked when I saw that day where it wasn't even spring yet. It's still winter, which is very unusual.
CHUANMIN HU, USF COLLEGE OF MARINE SCIENCE: And this is about a 5000 mile long.
SANTIAGO (voice over): Professor Chuanmin Hu is one of the leading experts on what many have referred to as a massive blob of seaweed heading to
SANTIAGO (on camera): Fair to call it a blob?
SANTIAGO (on camera): No, we can't call it a blob, OK.
HU: I would never call that a blob.
SANTIAGO (on camera): OK, why?
HU: Because he's not.
SANTIAGO (voice over): Satellite images, he says show it's not one massive body of seaweed, rather a bunch of patchy clumps traveling from West
Africa. It's called the Atlantic sargassum belt and is considered a natural phenomenon. Right now, it's twice the width of the U.S. carrying 6 million
tons of seaweed and headed to the East Coast.
HU: In June of this year, it may turn into 20 million pounds.
SANTIAGO (on camera): So let me get this straight. This is what we're seeing the last month is 6 million tons and it's going to get bigger.
HU: Yes, there's no way to stop that. This is nature just like no one can stop a hurricane.
SANTIAGO (on camera): Should we be worried about that?
SANTIAGO (on camera): Why?
HU: Reason is a sargassum is not toxic.
SANTIAGO (voice over): But it smells pretty bad and it's a nuisance for those trying to keep beaches clean to attract tourists just a few years
ago. Here's what it looked like in Mexico. Officials in Monroe County, which includes the Florida Keys, have set aside more than $200,000 to clean
and remove sargassum from its beaches.
DAN MATTHEWS, MISS CHIEF FISHING CHARTERS: Seaweed is a mixed blessing. We need it; seaweed is a nursery for all these large pelagic fish. The
negative sides of that seaweed is if it comes in the concentrations that are believed we're going to see our fishing grounds are going to be
completely covered with it. There's almost no point to fishing because we're going to be spending the entire day cleaning weed off our lines.
SANTIAGO (voice over): And as the sargassum belt heads toward Florida another natural phenomenon is already hitting its beaches on the West Coast
Red Tide that can be toxic, kill fish and cause respiratory issues. This year's red tide concerns were enough to cancel at least one major event
here in Indian rocks were one family visiting told us.
MARGO SAGE, CANADIAN TOURIST: As soon as my son and my husband and I got out of our car. We all started coughing.
SANTIAGO (voice over): But for spring breakers like this group from Iowa, the concerns of massive amounts of seaweed or red tide were not enough to
change vacation plans.
ANNA SANDERS, TOURIST: I would rather it be red tide than raining every day.
SANTIAGO (voice over): Tourists noting friends back home.
SAGE: They'd be pretty jealous regardless of having a little bit of the red tide symptoms. They'd be pretty jealous that we're here and they're not.
SANTIAGO (voice over): Because the Pristine beaches of the Sunshine state are hard to resist for many, despite what may be looming offshore.
SANTIAGO: And the scientists will tell you more research is needed because while they have a pretty good understanding of what it is and sort of how
the current moves it around, they still can't forecast it. And that is where they say they need more funding for research.
So when I asked the scientists OK, so if we wanted to see less of it, could we find a solution? He caution that like anything else in the ecosystem
that could have unintended consequences, so his best recommendation, just try to avoid it if you can, Julia.
CHATTERLEY: Leyla Santiago, thank you so much for that report. And that just about wraps up the show. "Connect the World" with Becky Anderson is up
next, have a great weekend, and I'll see you next week.