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Quest Means Business
Flexible Fed; Central Bank Considerations; India School Lunch Deaths; UK Unemployment Falls; Daft Punk Mask Maker Gets Lucky
Aired July 17, 2013 - 14:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
RICHARD QUEST, HOST: Tonight, no set path for QE. Ben Bernanke says the Fed could take any route to recovery in the future.
Poisoned by their own school meals. Anger in India as more than 20 children are killed by tainted school meals.
And a letter of support. Italy's prime minister tells Britain not to leave the EU club.
I'm Richard Quest. I mean business.
Good evening. Ben Bernanke said today QE, quantitative easing, is not on a pre-set course. He was speaking to the United States Congress giving his regular half-yearly testimony, and the Fed Chairman said the dial on the asset purchase program can be turned up or it can be turned down.
He said it revealed -- it depended entirely on the state of the economy and that risks have lessened despite a jobs market, in his words, "far from satisfactory."
Strong headwinds created by the budget cuts in the US were also weighing on his mind. Ben Bernanke says the Fed is still planning to slow QE later this year, the so-called tapering, and end it completely in mid- 2014 if conditions are right. Then, unemployment will be at or below 7 percent, inflation will be at the near 2 percent long-term trend that they seek.
The markets and how they are reacting in the US --
(RINGS BELL)
QUEST: This was the big speech of the week. Up 16 points, barely a smidgen of market move considering how significant the testimony was perceived to be. Maggie Lake is with me from New York. Maggie, we'll get the economics in the moment from Julia Coronado. Give me the politics, give me the markets, give me the mood. What were they --
MAGGIE LAKE, CNN INTERNATIONAL BUSINESS CORRESPONDENT: Yes.
QUEST: I mean, when Bernanke comes before the House and the Senate, this is the politicians beating him up.
LAKE: It is, Richard. And you know, it always takes a little while for the full impact to sort of set in. But listen, much has been made about the Fed's communication problem, the fact that Bernanke has -- sends mixed signals or has had a hard time sort of getting that message out. But we didn't expect this.
(BEGIN VIDEO CLIP)
REP. JEB HENSARLING (R), HOUSE FINANCIAL SERVICES COMMITTEE CHAIRMAN: Can you pull it a little closer to you?
(INDISTINCT BACKROUND NOISE)
HENSARLING: It is not working, so if you will suspend for a moment, Mr. Chairman.
(END VIDEO CLIP)
LAKE: He wasn't too happy about that. Technical problems -- we know all about that, the mic not working. The testimony was actually delayed until they sorted it out. Once they did, Bernanke tried to be as clear as possible, saying, "We are flexible, we are not going to withdraw that support until the economy's ready for it."
The problem is that economists don't think that the labor market is going to be strong enough for the Fed to do what they really want to do, and that is start to taper, start to withdraw those bond purchases, reduce them --
QUEST: Right.
LAKE: -- by the end of this year. However, Bernanke very pointedly let them know who they thought was to blame for that, Richard. Have a listen.
(BEGIN VIDEO CLIP)
BEN BERNANKE, CHAIRMAN, US FEDERAL RESERVE: Fiscal policy is focusing a bit too much on the short run and not enough on the long run. The near- term policies, which include not only the sequester but the tax increases and other measures, according to the CBO, are cutting about a percentage point and a half, about 1.5 percentage points from growth in 2013. That would mean instead of 2 percent growth, you might be enjoying 3.5 percent growth.
(END VIDEO CLIP)
LAKE: "It's your fault, get out of the way, get to it, fix it," is what he was saying, and that -- he was pretty calm about it, but in Fed- speak, that was the chairman giving Congress an old finger-wagging, Richard.
QUEST: And this could be the last time -- he's got to do the other side of the -- of Congress as well before he finishes, it's a two-part process. But this could be the last time. It used to be called the Humphrey Hawkins testimony in the old days.
LAKE: Right. That's right, and this is significant, because we're not going to hear a lot from Bernanke after this. There might be other public speeches, but remember, we think he's ending his tenure, and we think at the end of the year, there's going to be a new Fed chair in place. It's just speculation now. I would expect when we do hear him to use this last stretch to be a lot more vocal --
QUEST: Right.
LAKE: -- about putting pressure on Congress to get the fiscal house in shape, because the Fed has been carrying the burden on the monetary side for a long time now, Richard.
QUEST: Maggie Lake in New York, thank you Maggie. Julia Coronado is the chief North American economist at BNP Paribas. We're always delighted to have your insight, Julia, into this, like now.
So, Bernanke stated the obvious: basically, we ain't going to do something stupid if the economic conditions don't merit it. So, from an economics point of view, Julia, what do the economics suggest he should do?
JULIA CORONADO, CHIEF ECONOMIST FOR NORTH AMERICA, BNP PARIBAS: Well, one of the problems here, and one of the problems they've had with their communication is that they have been a lot more optimistic than most market economists.
And that led the market to get a little worried. Is the Fed going to go ahead and withdraw support even though the economy isn't firing on all cylinders? And that seemed to be the message that we were possibly getting in June, and they definitely dialed it back.
The message was clear, we are data dependent, the markets have gotten way ahead of where we're comfortable with, and if the economy doesn't meet our very high expectations, then we're not going to taper. And it was as simple as that.
QUEST: And as I -- I mean, I looked at some numbers over the weekend, which really is quite remarkable, if you look at how the Fed continually has had to have high expectations, low delivery, and then had to revise the numbers down.
CORONADO: Yes.
QUEST: It's a constant theme, isn't it?
CORONADO: It is a constant theme, and it's almost, you could argue, it's a policy of theirs. They like to send an optimistic signal. They think that if the central bank's voice is a powerful voice, if they sound optimistic, they're more than -- they're more likely to have a positive influence on sentiment and animal spirits, and that in and of itself will help jump start the recovery.
Now, of course, the problem is, after repeated forecast errors, you lose some of that credibility, and you lose some of that signaling effect.
QUEST: So, let's go through this. Tapering, which is where they just slow down the rate at which they are buying the bonds, when do you expect that will happen?
CORONADO: I don't think it's going to happen until December. I think that a lot of market participants have pulled it up to September. I don't think September -- look, Q2 GDP right now is tracking below 1 percent by almost everybody's estimates. That's a very weak performance after only 1.8 percent in Q1.
Now, we do get a big GDP revision at the end of the month, so that could change the way the world works to us --
(CROSSTALK)
QUEST: Let me just say, let me jump in --
CORONADO: But given the data we know --
QUEST: Let me just jump in --
CORONADO: Go ahead.
QUEST: Sorry, forgive me, but if tapering begins in December --
CORONADO: Right.
QUEST: -- is it likely that full QE expires mid-14, or does that seem like --
CORONADO: No, I --
QUEST: -- it'll go the end of the year there?
CORONADO: I think it's going to be later than they would prefer, because the economy will underperform. And they also tend to have too, maybe, orthodox a view of how markets work. They think that they have this dial that they can turn that -- to micro-adjust financial markets. And as we've seen over the last few weeks, markets are always trying to get ahead of them.
So, the minute they take these actions, the market reaction is going to be bigger than they had been thinking. They've realized that now. That's one of the reasons they're taking a step back. So, I think that means that they're going to be in the game for longer than they think is ideal.
QUEST: All right. Julia, stay there for one moment, because policy- makers in Japan are deeply divided over how to handle their financial markets. The central bankers are at odds over whether to do something more to steady stock and bond prices, take the volatility out. That's according to the latest minutes from the Central Bank of Japan.
Things have been pretty volatile since there was the massive monetary stimulus in April. No formal vote. Minutes show a clear split. The bank left its monetary policy unchanged.
In Britain, the BOE, the monetary policy committee under the new governor, Mark Carney, all nine members voted to maintain QE at its current level of $570 billion. At the previous meeting, Governor King was in the minority on that. The issue at the BOE, of course, is when forward guidance comes along, and that could be in August.
Julia back to you. We now have central banks who are by far and away bearing the brunt of the recovery. The BOE with QE and forward guidance.
CORONADO: Absolutely.
QUEST: The Bank of Japan monetary stimulus. The Fed. The ECB. What do you make of them now?
CORONADO: Well, this is an unprecedented business cycle. One could argue that we're not even really in a business cycle, we're in a global economic restructuring, and that calls for pretty unprecedented measures.
If you look at the global growth profile, we've been continually marking it down, and global growth has been slowing over the last four years, not accelerating. And it speaks to a lot of structural issues. We're actually moving to a low inflation environment.
And central banks are just trying to soften the landing here as we move from a higher-growth reality of the past to a lower-growth reality of the present. And they're doing what they can, but of course, it's not -- doesn't solve all problems.
QUEST: Julia, good to see you. Thank you for helping us understand Bernanke and the central bank dilemma at the moment. Damned if they do, damned if they don't. Whichever option they take, they'll either get into trouble one way or the other.
Now, when we come back, an extraordinary, tragic story. Meals intended to nourish India's hungry children, instead they brought death to one school. A desperate search for answers. We'll be in Mumbai after the break. QUEST MEANS BUSINESS.
(COMMERCIAL BREAK)
QUEST: An inquiry has been launched in India after 22 children died after eating free school lunches that contained a poison. More than 25 other children are now being treated in hospital after the incident, which took place in the northeastern state of Bihar. India's education minister says the food contained an insecticide.
The tragedy has sparked protests and calls for a general strike. All government schools in India are required to provide free meals to people under the age of 13. If you join me over here, I'll show you exactly the size, the scope, the scale of the issue that they are talking about.
Now, it all starts with malnutrition in India, where it's believed 60 million children are underweight. As a result, the government has a policy of serving 120 million children every day. It's the biggest school feeding program in the world.
Interestingly, per se, it's regarded as a success. But of course, it's not enough, as this number shows. The country still struggles to cope with the enormous problems of, as you see, 60 million children in India overweight.
If you look at the economic cost, of course, of this malnutrition, treating deficiencies alone cost $2.5 billion a year, according to the World Bank. So, this is not only -- and it is first and foremost, the malnutrition issue -- it is not only a human factor, it also has an economic component, and in a country where economic growth is set to grow by 5 percent this year and the middle class is expanding rapidly.
Earlier today, the education minister of the Bihar region spoke to CNN's Michael Holmes and said the midday meals program, as you can see the numbers, it is a huge undertaking for the government.
(BEGIN VIDEO CLIP)
PK SHANI, EDUCATION MINISTER, BIHAR STATE, INDIA (via telephone): The trouble is, by multiples of five, you see in the street of Bihar nearly 20 million children are being served a hot meal in about 73,000 elementary schools.
We have been endeavoring to improve the quality and the -- type to get good food served. However, the challenge is still there, because the magnitude of this program is so huge that there are a number of challenges.
One of the challenges is the limitation of financial resources, because we require a huge human resource to man this important program, but we can't fund such human -- such a big human resource.
(END VIDEO CLIP)
QUEST: Malika Kapur's on the line with the latest. She joins me now from Mumbai. Malika, we have much ground to cover, so firstly, I've seen two reports, one of pesticides, and one suggesting the cooking oil was adulterated. Which do we believe it is?
MALIKA KAPUR, CNN ITNERNATIONAL CORRESPONDENT (via telephone): Well, the education minister of the state of Bihar says it's probably because of both. That's what he told CNN when he spoke to us a short time ago. He did not rule out either. He said he's launched a formal investigation, and that will tell us which one of these it was.
But yes, we are hearing reports that this food poisoning case was probably caused by organophosphate, which is a very commonly-used insecticide, and perhaps the rice and the grains that had been treated with organophosphate earlier, perhaps it just hadn't been washed well enough before it was cooked and fed to the children.
And we did hear from the education minister who said that the cook complained to the headmistress of the school that the oil was contaminated, that there was a problem --
QUEST: Right.
KAPUR: -- with the oil. But the headmistress brushed her off and told her to continue cooking and told her the children to continue eating.
QUEST: Malika, is there any suggesting of foul play here?
KAPUR: There could be. State officials are saying that they don't know yet whether the case of poisoning, as they're calling it, was accidental or whether it was deliberate, so they -- no one -- we don't have a clear answer on that yet, but they haven't ruled it out --
QUEST: Right.
KAPUR: -- and they're saying that it could be deliberate, it could be accidental, they've launched a formal investigation, and everyone's waiting for the results of that.
QUEST: And -- the nature of the anger completely understandable, now, completely understandable, this rage that's taking place in the streets. But who are they angry at?
KAPUR: They're very angry at the government. They're very angry at the government of India because this feeding program, it's huge, it's massive, Richard, it's the most ambitious school feeding program in the world. And the intentions behind it are very good, to feed India's hungry children.
But the problem is that India simply doesn't have the resources or the infrastructure in place to handle such a big program. So the feeling here is that if you can't handle it, then don't do it, because you're creating more problems by doing this --
QUEST: But --
KAPUR: So, the anger over here is --
(CROSSTALK)
QUEST: Here you are -- who --
KAPUR: -- at the government --
QUEST: Here --
KAPUR: -- at the lack of infrastructure. And the extensive anger, the outrage, the grief here, it is so strong, not just in Bihar, but across the country because we are talking about children over here, innocent children who did absolutely nothing wrong, showed up at school, sat down to eat one hot meal, for many of them, their only hot meal a day, and this is what happened.
QUEST: Malika, India -- and you know, we've reported from there numerous times on this program and you've reported there for us -- obviously has a vast and serious poverty issue.
But it also has a very fast rate of economic growth, it has a rising middle class. Is there any feeling of shame or just -- it shouldn't be allowed that this country has such a high rate of child malnourishment, one of the highest?
KAPUR: Absolutely. In fact, the levels here of malnourishment is higher than that in sub-Saharan Africa, and that is a huge cause of concern. And yes, it's a national embarrassment. In fact, the prime minister, Manmohan Singh himself, on many occasions has called it India's national shame.
So, across the country, there is a huge level of embarrassment and of shame that on one hand, we're boasting of being an emerging economic title, being one of -- having an economy which is one of the fastest growing in the world, but we still can't get it right, we can't get our hunger problem right, we can't feed our children. There is a huge sense of embarrassment.
And with this case today, the anger that we've seen on the street, as you said, perfectly understandable, because it just highlights the collective shame that India feels when it comes to feeding its children.
QUEST: Malika Kapur in Mumbai, our correspondent there. We thank you for that. We'll be back after the break.
(COMMERCIAL BREAK)
QUEST: Unemployment in the Untied Kingdom has fallen to just over 2.5 million people. Behind that headline, there's little cause to celebrate for the longterm unemployed, whose numbers reached their highest levels in 17 years.
It's a desperate situation for some. In fact, in London, one man is staring at unemployment, had a brainwave. He decided -- it was one of these classic stories -- he started making these. What are they?
Well, I would put it on, but you'll get the idea. It is a mask. And he made these masks, and it struck the right chord with the band Daft Punk.
(BEGIN VIDEOTAPE)
(MUSIC - "GET LUCKY" BY DAFT PUNK)
STEVE LOMAS, FOUNDER, MAKEAMASK.COM: A guy came by. He stopped in his tracks and really couldn't believe what he was seeing. And it turns out that he was specifically there looking for a product to put on the table for a meeting with Daft Punk. And that was it, really. That was a perfect fit for the product. They -- Daft Punk always wear robot masks.
(MUSIC - "GET LUCKY" BY DAFT PUNK)
LOMAS: We'd had a business that was hit pretty hard by the recession in 2008. And we struggled with that for a couple of years, and we unfortunately had to let it go in 2010. I started looking at what I had, and I'd always made masks for the kids for fancy dress parties and World Book Day, that kind of thing.
Ooh! The Green Goblin!
Lying in bed one night, not being able to sleep, worrying about how we're going to change things, I got up and started playing with the masks, went down to the kitchen, started playing with the idea and seeing if I could actually make it out of one piece of card.
Done.
And then, within a year, we were launching at the toy fair, Olympia, and then, they put in a big order, sent it out to 35 different countries around the world when they were promoting the launch of the album. They did various events, but most notably, in Wee Waa in Australia, where the official album launch was.
UNIDENTIFIED ANCHOR: The New South Wales town of Wee Waa remains in a state of euphoria following last night's launch of the latest album by one of the world's biggest names in music.
UNIDENTIFIED CORRESPONDENT (voice-over): The town has been showcased in a swag of videos, along with this must-have item. The mask, donned by locals, was dreamed up by a designer in North London after the recession had claimed his business.
LOMAS: What I can say is that if I hadn't actually have got up and kind of made myself develop it -- because it's one thing, knowing that, it's possibly a quite cool idea. Until you do it, you just never know. So, you've got to believe in yourself and go and do it. It certainly paid off for us, and there we were, in the right place at the right time with the right product.
(MUSIC - "GET LUCKY" BY DAFT PUNK)
(END VIDEOTAPE)
QUEST: And there's no way I'm putting one of those masks on. How to create a YouTube moment if ever there was one. So, instead, our Currency Conundrum. The good, old-fashioned British pound coin, I might even have one in my pocket. Just shows you, the day's gone vulgar, I haven't even got a pound note in my -- pound in coin in my pocket.
Anyway, it celebrated its 30th anniversary. The coin has a nickname. Was it the Maggie, the Majesty, or the Brassy. The answer later in the program. I should have -- the oddest thing that I don't. I'll have a break.
(COMMERCIAL BREAK)
QUEST: Hello, I'm Richard Quest. There's more QUEST MEANS BUSINESS in just a moment. This is CNN, and on this network, the news always comes first.
As you heard in the program, Indian authorities are investigating the death of 22 children in the northern state of Bihar who died after eating a government-funded school lunch on Tuesday. Twenty-five more students are in hospital. The state's education minister says the food may have contained a toxic chemical that is used in pesticides.
Panama has asked the United Nations for guidance on how to handle the weapons it's found on a North Korean ship seized on Monday night. The country's attorney general says the captain and the crew haven't been charged yet. They could face charges of threatening national security.
Russian president Vladimir Putin says American surveillance leader Edward Snowden is a victim of US double standards, as the US has often supported critics of other countries. Snowden has asked for temporary asylum in Russia. He's been marooned at a Moscow airport for three weeks now.
A German prosecutor has indicted the Formula 1 chief executive, Bernie Ecclestone, for bribery. The charges center around a $44 million payment to a German banker whose firm was selling a stake in Formula 1. The 82- year-old CEO has denied any wrongdoing.
Italy's prime minister has told CNN he plans to almost halve the number of Italian MPs. There are currently around a thousand. Enrico Letta told Christiane Amanpour that Italy is amongst the better-performing European countries and will not need a bailout of any sort. You can hear more of that interview in just a moment.
(MUSIC PLAYING)
QUEST: Staying with Italy's prime minister, he says the E.U. would be a weaker place if the U.K. withdrew from the European Union. And Enrico Letta is in London. He held talks with the British Prime Minister David Cameron and says a U.K. exit was a huge risk for both Britain and Europe.
(BEGIN VIDEO CLIP)
ENRICO LETTA, PM, ITALY: I'm here to say that is an Italian interest and I think a European interest that U.K. stay on board of the European process. It would be important because without the U.K. on board, the European Union will be worst, will be less liberal, would be less innovative, less pro-free market, less pro-single market, less global player in the world.
(END VIDEO CLIP)
QUEST: It all comes as the Bank of Italy cut its economic forecast for the country. The central bank now says GDP is down. The Italian economy will shrink 1.9 percent.
Christiane Amanpour spoke to Prime Minister Letta a short time ago.
(BEGIN VIDEOTAPE)
AMANPOUR: You have a huge unemployment rate, particularly about 40 percent when it comes to youth. What are you going to do to stop this terrible catastrophe in your country and around Europe, but to stop the brain drain?
LETTA: Youth unemployment is really my nightmare. We are losing a generation and without this generation, there is no hope for the future of the country.
AMANPOUR: And you've got the whole austerity problem as well. What do you do about that when that seems to be de rigueur around Europe?
LETTA: First of all, we think that Italy today is a virtuous country. We are out of the procedure of excessive deficit by the European Commission. Italian deficit is below 3 percent and our primary surplus is around 2.5 percent.
I think we are among the six, seven better European countries.
AMANPOUR: Do you think that Italy will have to request a bailout?
LETTA: No. We don't need any bailout because we are among the few virtuous country in Europe.
AMANPOUR: You call yourself one of the few virtuous countries. And we're shocked to know that there's something like 1,000 parliamentarians in Italy, and they earn huge amounts of money. And they get a lot of perks.
Is that something that needs to be attacked to give credibility?
LETTA: Yes, it is. That is why we -- one of the most important pillars of the activity of my government is reform of politics. The change of the constitution, we started the process to reduce the number of member of parliament, reduce to 400 from the thousand we have today.
The first law I passed in my cabinet was a law eliminating the double salary for the prime minister and the ministers. I have a salary as member of parliament. I don't want a double salary. So it was a very important decision.
The next prime minister, if he wants to have double salary, he have to pass a new law having the second salary. But it will be, I think, very important for the country and also for me, because now I'm more free when I will nominate somebody in some important positions to say, OK. You have to cut your salary, too, because you can't have a salary 30 times or 40 times your prime minister.
(END VIDEOTAPE)
QUEST: That's Italy's prime minister speaking to Christiane Amanpour. And what else he says in the interview, the full interview, it's on "AMANPOUR." It's 20 minutes from now, and that's right after QUEST MEANS BUSINESS.
The big parliament is preparing to vote on a bill that would slash thousands of public sector jobs in the country. These are live pictures coming to us from Athens tonight. The protesters once again in Syntagma (ph) Square, outside parliament, making their voices heard.
The job cuts are expected to be passed; they've sparked protests already. Greece struggles with record high unemployment -- you know that - - a shrinking economy and international commitments and the troika is once again looking to see these legislation passed before it will pay the next or further transfers of money to the Italian government.
Greece isn't the only European country bracing for a long, hot summer of potential disruption. Political and economic uncertainty simmers in Spain, Portugal and Cyprus, and there's no doubt the epicenter remains the periphery, the southern countries. Jim Boulden reports.
(BEGIN VIDEOTAPE)
JIM BOULDEN, CNN CORRESPONDENT (voice-over): More protests, more austerity, more pain for Greece. This time its municipal workers, like local police, who fear losing their jobs in order for the government to satisfy those who have loaned billions of dollars to Athens.
APOSTOLOS KOSIVAS, ATHENS MUNICIPAL POLICE UNION (through translator): We'll continue our struggle regardless of what happens today. Of course, if we're happy with the outcome, we'll have no reason to continue. But if we're not happy, we'll carry on the fight.
BOULDEN (voice-over): In Spain the government has more to contend with than protests over austerity. It now has a political crisis to go along with grinding recession and unemployment. Spanish Prime Minister Mariano Rajoy vows not to resign in the face of allegations of receiving illegal payments while a junior minister.
MARIANO RAJOY, PM, SPAIN (through translator): The great asset of this country is political stability. I will defend political stability and I will complete the term given to me by Spaniards.
BOULDEN (voice-over): Rajoy, who denies receiving any illegal payments, won a landslide election in 2011 and has managed to push through austerity despite occasional protests and massive unemployment. Up to now, stability in Madrid has taken the heat out of the worry that the Eurozone's fourth largest economy would need a massive bailout or break up the Eurozone permanently.
Protesters in the streets, from Portugal, Spain, Italy and Greece have called for less austerity and more help for unprecedented levels of unemployment -- Jim Boulden, CNN, London.
(END VIDEOTAPE)
QUEST: When we come back after the break on QUEST MEANS BUSINESS, we're all going on a summer holiday, sunshine and beautiful beaches. So what do we like and what don't we like? The Flip-Flop Survey after the break.
(MUSIC PLAYING)
(COMMERCIAL BREAK)
(MUSIC PLAYING)
QUEST: Oh, I do like to be beside the seaside. Tonight's CNN "Business Traveller" update, here in London on the hottest days of the year, now when the weather's like this, it's time to relocate the business meetings to the beach -- if I can get out of this deck chair. The problem with deck chairs is once you're in them, you can never get out of them.
Perhaps you ought to look away. There's never a gainly way to do this.
Now it is Expedia's annual Flip-Flop Survey. And it's revealed what a diverse one it is when it comes to our beach habits. So dressing for the beach: can you believe it? Seventeen percent of Germans have gone sans anything, nude, nichts, nothing.
Meanwhile, 34 percent of Norwegians are rather partial to something skimpy by way of a Speedo. Now apparently the French don't have much of a problem either when it comes to these. But 34 percent of Norwegians find the Speedos acceptable.
When we look at who goes swimming, on the beach activities, 90 percent of Germans love to swim. Malaysians are least likely to sunbathe whilst extraordinarily Indians, half the population of India build sand castles. They're also the most active lot. They pay top dollar or for water sports, massages and going surfing.
And whether it's Speedos or something more robust, what causes stress on the beach? Well, 54 percent of Americans worry that their wallets will be stolen. Meanwhile, Singaporeans worry, 85 percent, have a fear of sharks. Can you imagine it? And most Malaysians ranked that drowning was their top fear.
With so much a fear of wallets and sharks and sand castles and swimming and nudes, it's a wonder that anybody ever manages to relax at all.
Speedos or otherwise, Tom Sater is at the World Weather Center.
Tom, do I need my Speedos or my rain mack?
TOM SATER, AMS METEOROLOGIST: You could Speedo all you want, Richard. I find one problem with the statistics, though. And the Norwegians find the Speedo -- most -- or well, least acceptable, 30 percent say it's OK? I believe that's what it was?
(CROSSTALK)
QUEST: Yes, 34 percent of Norwegians say the Speedo -- even something as skimpy as this -- is acceptable.
SATER: Well, I think most Americans rather have their wallets stolen than have a Speedo on a beach.
QUEST: Something tells me, Tom Sater, that you're more of a man with gussets.
SATER: I like -- considerably as being robust suits, yes. Thank you, Richard.
Get ready for more heat, Richard. Five straight days now, at 30 or higher. It was the warmest day of the year now, surpassing last Saturday's 31.4. You had 31.9. And it's going to continue.
I mean, there's just a lot of sunshine. You're hitting the beaches, I mean, it's really nice. Maybe a few thunderstorms in the southern part of France, of course, like they had in the time trials today in the Tour.
But again, just a few sprinkles. Enjoy the sunshine. This is what you've been waiting for. Sure, some of the farmers that are cutting hay like the dry weather as well, but they're going to need some rainfall. But we'll talk about the lack of rain another time. Let's talk about the numbers, London, yes, we're going to stay right at 32. It was 31.9. Warmest day so far this year.
We're looking at current temperatures heading into Thursday at 32 as well. So the heat will continue. What a stretch. You've got to go back to 2006 for something like this. At least there's a break as we get into Friday and Saturday. Brussels is looking at a nice little cooldown, but not until Saturday.
Now we're going to go to Canada because you're talking beaches. Here you go, Richard. What did they do in Montreal when they have three days in a row at 30 or higher? They're on the beaches as well. I don't know, you might call this prancercizing or what have you. Now there's a fear for some, being buried in the sand. But even Quebec, four days at 30 and higher.
Toronto had three days at 32 and higher. And these numbers just don't like as well, 33 degrees in Toronto, Ottawa 33, the heat is everywhere. It's going to continue in parts of Canada. It's even down in toward the Big Apple.
We'll show you those numbers as well, 31 on Friday. Heat advisories extend now across the Great Lakes, which is typically, you know, the cooler spot for some of those summer months.
But D.C., hottest temperature so far this year, Philadelphia a heat warning in effect. So everyone's going to try to get to the beaches. Do what you can to play it safe, Richard, as we all talk about it. Watch the lifeguards if you're there by yourself, enjoy your Speedo and the glory that comes along with that.
QUEST: I assure you, Mr. Sater, there will be no evidence of me in Speedos.
SATER: You are welcome, then, at any beach you would like.
QUEST: Well, something robust with gussets. Maybe a bit of whalebone to hold everything in.
All right, Tom Sater is at the World Weather Center.
I think we need an @RichardQuest at this point, @RichardQuest.
I mean, Speedos? Long shorts? Something suitably above the knee? Something respectable? When we come back after the break, @RichardQuest. We're expecting a future heir to the British throne any day. Could be any hour. Queen Claire, King Kevin, what's in a royal name? After the break, QUEST MEANS BUSINESS, good evening.
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QUEST (voice-over): The answer to tonight's "Currency Conundrum," what nickname was initially given to the British pound coin? I remember the pound coin being introduced. And it was called the Maggie, because it's hard and brassy. I think it was Maggie Thatcher didn't personally approve of the coin which replaced the 1-pound coin -- note in 1983 when, of course, she was prime minister.
The Queen told well-wishers today she hopes her great-grandchild arrives soon so she can go on holiday. The monarch was on a lake visit -- on a lake -- she was on a visit to Lake Windermere, when a little girl put this question to her.
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UNIDENTIFIED FEMALE: Do you want Kate's baby to be a boy or girl?
ELIZABETH II, QUEEN OF ENGLAND: I don't think I mind. I would very much like it to arrive. I'm going on holiday.
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QUEST: Never mind the date. It's the name that everyone's betting on. When I was a child, we learnt the names of kings and queens to a little ditty. The little ditty used to go, "Willie, Willie, Harry, Steve, Harry, Dick, John, Harry III. One, two, three Neds, Richard two, Harrys four, five" -- you get the idea. It was all very tiresome, very tedious.
The name of the heir to the throne may require something of a history lesson. And the teacher, Kate Williams, who's joining --
KATE WILLIAMS, ROYAL COMMENTATOR/HISTORIAN: Good evening. I can't dance like you do; I'll have to ballroom dance soon.
QUEST: No, let's have a go at this. The Windsors --
WILLIAMS: Fabulous.
QUEST: So as the world waits, let's start; we have Elizabeth. Lots of Elizabeths.
WILLIAMS: Lots of them.
QUEST: Lots of Elizabeths. Tell me, I mean, it's -- what do you think?
WILLIAMS: I think Elizabeth is likely, but I'm -- I think it probably isn't going to be the first name. I think it's only going to be the second name. We've got so many Elizabeths, so many Elizabeths. I think we'll probably see it as a second name, that it'll be something then Elizabeth.
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WILLIAMS: And Diana.
QUEST: And Diana?
WILLIAMS: I think Diana it will be.
QUEST: It will be inappropriate as long as the Queen is still alive to have it as the first name, perhaps.
WILLIAMS: Well, certainly I think they'd like to see slightly (inaudible). It's just going to be Elizabeth III.
QUEST: Albert?
WILLIAMS: Albert --
QUEST: We've got lots of Alberts, but they've never actually had the first name.
WILLIAMS: We have a -- no, exactly. You're exactly right, Richard. So we have lots of Alberts, but they all come to throne as George. So for example, George VI, first name was Albert; comes as George. So George, if it's a little boy, it's a front runner, George is a front runner. So George --
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QUEST: George V, George VI, George over here. It (inaudible) grandfather's name.
WILLIAMS: And Prince Charles perhaps will come to the throne as George, though it's word that Charles seems a bit too control, because Charles I lost his head. So it might be George the -- George again.
QUEST: And that would follow on, of course, from what his grandfather did as well.
OK.
Anne, we've got a Princess Anne, the Princess Royal. We've got Zara Anne, her daughter who's pregnant as well.
WILLIAMS: She is pregnant as well.
QUEST: And Savannah Anne. What's all that about?
Oh, that's her grandmother, isn't it?
WILLIAMS: Savannah Anne is Peter Phillips' daughter, so she is obviously not a princess because he is not a prince.
QUEST: (Inaudible) Margaret --
WILLIAMS: (Inaudible) --
QUEST: -- absolutely. I remember well.
WILLIAMS: Well, because that they've -- obviously that's changed because Princess Anne is -- was so far away from the throne now with our new law, she would be second if it was (inaudible).
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QUEST: You can imagine how sort of absolutely spitting feathers. If the law had been in place --
WILLIAMS: Then --
QUEST: -- decades ago, she would be --
WILLIAMS: -- she would be much further up. I could see a Queen Anne. She would have been -- I think she'd have liked to be Queen.
QUEST: Beatrice. We've only got one Beatrice.
WILLIAMS: Beatrice, Queen Victoria's daughter, Beatrice. Again, I don't think that's likely. Beautiful name; I don't think it's going to happen.
QUEST: William, we've only got one William. We can't call him (inaudible).
WILLIAMS: I don't think we're going to have another William.
Zara --
QUEST: Where did that come from?
WILLIAMS: Originally for Anne. I think Anne was saying, with that name, she's not going to be queen. And that's what -- exactly what Anne was saying.
QUEST: Well, I think we can say the same about Savannah.
WILLIAMS: Savannah and either which of course, (inaudible) happened to Victoria. She was given this ridiculous, insane made-up name. That's what it was at the time. She was the first person ever to be called Victoria, to show she wasn't going to be queen. But she was.
QUEST: Right. It is time to get down to business.
So if it's a boy, what name are you going?
WILLIAMS: I am going for George, but of course, what about King Richard?
QUEST: Well, that's very kind of you, but I have duties to attend to here.
WILLIAMS: (Inaudible) Richard, there's a name.
QUEST: George. I agree with -- I agree with you on George.
WILLIAMS: Yes, George. (Inaudible) George.
QUEST: And if it's a girl?
WILLIAMS: I think we are very likely to see Alexandra.
So to be a first. I think they'd like to have a first one. She'll be Alexandra I, middle name Elizabeth, the second, wife of (inaudible) VII, very popular consort. So my bet is Alexandra, but I --
QUEST: (Inaudible) Alexandra?
WILLIAMS: I also like -- I also think about Victoria because --
QUEST: Ah, you've stolen my thunder! You cad, you!
WILLIAMS: Oh, no.
QUEST: I was going to say it's Victoria.
WILLIAMS: That will be perfect. But I think King Richard is the way forward.
QUEST: Well, forgive me; I won't disagree. Many thanks. Lovely to see you.
WILLIAMS: See you.
QUEST: (Inaudible).
What do you think? @RichardQuest. What would you call the royal baby?
As the world waits and the royal baby fever grows, it's boom time in the baby business across the world. Maggie Lake decided to see how the industry -- never mind what's happening in the U.K. where this child will eventually rule and reign. In the United States, where they went their own way.
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MAGGIE LAKE, CNN CORRESPONDENT (voice-over): No royal blood here. But that doesn't stop parents from spending a king's ransom on their little ones.
UNIDENTIFIED FEMALE: He's definitely a little prince, but he's a boy.
LAKE (voice-over): From designer strollers to high-end high chairs, the baby business is booming, thanks in part to a world gripped with royal baby fever.
ROSIE POPE, MATERNITY EXPERT: You buy everything. You buy everything (inaudible) make you better or it's going to make their life better and you're just kind of going crazy and there's no price tag that seems too much.
LAKE (voice-over): Parenting expert and author Rosie Pope says decking out Junior has become about much more than just the baby.
POPE: I think you see it, especially with celebrity. Babies (inaudible) little extension of people until they start forming (inaudible) personalities. So you know, if you like rock 'n' roll, your baby looks like a little rocker. If you're prep, your baby's preppy. If you want to be an athlete, your baby's athlete. It's like we live out these fantasies that we haven't managed to do. I mean, it's crazy.
LAKE (voice-over): Crazy and lucrative. Last year parents shelled out $49 billion on baby related items, ranging from the practical to the ultra-extravagant. A blinged out Binky, really?
What do you think?
New parents like the Duke and Duchess of Cambridge are overwhelmed with choices. So we asked New York moms for help.
LAKE: If you had to give her advice on one thing that's worth splurging on, what do you think it would be?
UNIDENTIFIED FEMALE: I would say (inaudible).
UNIDENTIFIED FEMALE: It should be her buggy as they say, or her stroller, without a doubt, because that becomes her carriage.
UNIDENTIFIED FEMALE: I just would wrap your baby in cashmere.
LAKE (voice-over): And as for the expert advice?
POPE: I think it's a very safe guess to get a baby some silver.
UNIDENTIFIED FEMALE: (Inaudible) does that seem right -- ?
UNIDENTIFIED FEMALE: No. $450.
POPE: Now we know that the Royals do not live in very small apartments. They live in big, expensive apartments with multiple (inaudible) and multiple (inaudible) with a lot of interference. They are going to need one of the best monitors.
LAKE (voice-over): And for those items best avoided? Baby wigs, baby stilettos and --
POPE: I don't think she should attempt to birth with dolphins.
Just FYI.
LAKE (voice-over): Not all babies are blue-blooded, but just like William and Catherine, many parents these days are giving their little ones the royal treatment -- Maggie Lake, CNN, New York.
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QUEST: And when we come back, there will be a "Profitable Moment" and once again, we'll be back on the beach.
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QUEST: Ah, tonight's "Profitable Moment," the smell of the sea, the wind in your hair and sand in your toes, well, in your flip-flops. You get the idea. I do love a good beach break. In fact, I'm jetting away from London on holiday next week. The BlackBerry will be confined to the hotel safe. Expedia's Flip-Flop Survey makes fascinating reading.
It's clear how we enjoy our holidays varies dramatically from country to country. Do we dare to go there and show more than we wish with a Speedo? Whooah! Or maybe you want something more robust with gussets. It shows what a diverse bunch we are when we go on holiday.
Our preferences are shaped by a variety of things, traditions, parents, loved ones, nationality and, of course, put it together, we all agree, have a holiday even if it's in the back of the yard. Push business aside for just one moment. Take time out and recharge the batteries. We'll all feel better for it. I know I will.
And that's QUEST MEANS BUSINESS for tonight. I'm Richard Quest. Whatever you're up to in the hours ahead, I hope it's profitable.
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QUEST (voice-over): The headlines, it is the top of the hour:
Indian authorities are investigating the deaths of 22 children in the northern state of Bihar. They died after eating contaminated government- funded school lunches on Tuesday. Twenty-five other students are in hospital. The state's education minister says the food may have contained a toxic chemical that is used in pesticides.
North Korea's foreign ministry is calling for Panama to release the North Korean ship (inaudible) along with its crew members. According to the state media, Panama has asked the United Nations for guidance on how to handle the weapons it found on board. The country's attorney general says the captain and crew haven't yet been charged.
The Russian President Vladimir Putin says American surveillance leaker Edward Snowden is a victim of U.S. double standards. As the U.S. has often supported critics of other countries. Snowden has asked for temporary asylum in Russia. He's been marooned at the Moscow airport for three weeks now.
A German prosecutor has indicted the Formula 1 chief executive Bernie Ecclestone for bribery. The charges center around a $44 million payment to a German banker whose firm was selling a stake in Formula 1. The 82-year old has denied any wrongdoing.
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QUEST: The headlines. You are up to date with the world's stories that we are watching on CNN. Now live from London, it's, of course, "AMANPOUR."
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