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Quest Means Business
Ballmer Quits Microsoft; NASDAQ Questions; Past Trading Glitches; NASDAQ Regulation; Brazil Real Intervention; European Markets Finish Week Up; Euro Rallies; Bo Xilai Trial
Aired August 23, 2013 - 14:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
FELICIA TAYLOR, HOST: Ballmer bows out. Succession planning begins at Microsoft.
NASDAQ reckoning. Regulators warn systems must improve.
And whatever it takes. The US president tells CNN exclusively he will pass a budget.
I'm Felicia Taylor, and this is QUEST MEANS BUSINESS.
Good afternoon from New York. The man who led Microsoft for 13 years is stepping down. Steve Ballmer shocked the markets with his announcement to retire as soon as a successor is found. He told staff in an internal e- mail there is, quote, "never a perfect time for this type of transition, but now is the right time."
Ballmer also said, quote, "This is an emotional and difficult thing for me to do. I take this step in the best interests of the company I love."
Microsoft shares are on the move. They surged nearly 7 percent just after the announcement. They were even higher before the open. Right now, they are trading up by six and four-fifths of one percent.
Somewhat of a larger-than-life character, Ballmer has had plenty of hits and misses during his time in charge. Jim Boulden is in London with some Microsoft products. Jim, give us an idea of some of the things that he did achieve in his tenure at Microsoft.
JIM BOULDEN, CNN INTERNATIONAL CORRESPONDENT: Well, obviously, he was at Microsoft for a very long time. In fact, Steve Ballmer joined in 1980, became the CEO in 2000, so he was there for a very long time and 13 years as the CEO himself.
So, a lot of what we think of Microsoft happened during his time, but when you think of when he was in charge, we think of things like XP and we think of some of the failures, like Zune, which was a music player. It didn't do very well at all trying to go against the iPod.
There was also the failure of Surface, which was going to be a computer you could touch the screens and -- that didn't do well at all, and they've had to write that off pretty much.
Windows Mobile, really, I think is the one we want to talk about the most. You would see it inside Nokia phones, for instance. This is something that people thought really important for Microsoft to take its product mobile. That has not been successful.
What has bee successful? Well, we can talk about the Xbox and the Kinect, which goes onto the Xbox. It's something we didn't think Microsoft would get into, did we, really, when it first started? And moving into the gaming, it was a niche product, I have to say, but very, very successful product, Felicia.
TAYLOR: Yes, Jim, the product line is really what is under question right now and who is going to be able to lead this country forward. But you had the opportunity to meet and interview Mr. Ballmer. What was he like as a person?
BOULDEN: A very energetic person. I think of him as the salesman. If you think of Bill Gates, the co-founder of Microsoft, as the guy who did the tech, he did the business deals, he was the one dealing with the guts of the company, Steve Ballmer was a pitchman, a salesman, and a very energetic guy.
I remember thinking he was jumping out of his chair when we were interviewing him in Barcelona a few years ago, and he was promising that Windows Mobile would be very successful, with tiles inside phones, he said this was something that Microsoft could really do well. Well, it hasn't been able to do that, but he was always saying things very positively about where the company was going.
TAYLOR: And Jim, he ends his note to his employees with a positive note saying that Microsoft has its best days ahead. Is that really possible at this point? A big question facing the company is --
TAYLOR: -- can they regain the lost ground?
BOULDEN: Absolutely. So many things they do very well. We think of computing, desktop computers, the enterprise behind. We all have Microsoft on our desks, so you think of it as almost a utility, really, and that's why the share price hasn't been very sexy until today, because it's a big, lumbering company. How do you change that?
Well, do you bring someone in from the outside to make its days better? That's going to be fascinating. Will Microsoft go outside for the first time to bring somebody, and will it bring somebody back that has left Microsoft and gone onto another company?
Will it break itself up, sell things off? What could a next person do to push it forward? Because everything now seems to be mobile. We saw Facebook go through this as well. Once they get that right, that share price took off. So, can somebody successfully take from our desktop to mobile? It is a huge task, Felicia.
TAYLOR: It certainly is. And Jim, I like the way you characterized the share price of Microsoft as not necessarily being so sexy. Maybe it will be in the future.
TAYLOR: Jim Boulden for us in London. Back in the United States, the NASDAQ is facing some major questions after what's thought to be the longest technical outage in its history. The market reopened today, and it looks positive. It also reopened on Thursday after what was three hours of a market glitch.
Now, some market observers have compared the scale of that outage with the impact from Hurricane Sandy. Now, market CEO says however that no one was disadvantaged.
(BEGIN VIDEO CLIP)
ROBERT GRIEFIELD, CEO NASDAQ: It's really no liability in that you look at the fact that we halted the market as soon as we saw there was information asymmetry and professional traders could have some advantage over the traditional long investor, we halted the market. No trading happened. It was a regulatory halt, so nobody was relatively advantaged or disadvantaged.
We hear this from our customers today and yesterday that this was handled well and that everybody was in the same boat at the same time on those some conditions.
(END VIDEO CLIP)
TAYLOR: And Maribel Aber certainly has been following this story for us scrupulously at the NASDAQ and she joins me now. It's somewhat disheartening, I think, for a lot of the traders and investors to hear those words that people weren't at a disadvantage. The NASDAQ still has the task of satisfying the SEC that it has a number of controls in place so that this won't happen again.
MARIBEL ABER, CNN MONEY CORRESPONDENT: The SEC definitely focusing on this right now, Felicia, again, this widespread is the impact here. And traders are upset, and not just traders. Retail investors, too. How are they getting the message?
So, NASDAQ's comments regarding the trading glitch, again, still leaves a lot of questions in the air. And when you think about just how many big names of stocks are listed on NASDAQ -- Google, Starbucks, Staples -- a flatline for three hours is not insignificant.
NASDAQ stocks, they make up more than 20 percent of the S&P. And think about all the indexes, the mutual funds, ETFs that include NASDAQ companies like Apple. Apple's widely held. What's in people's 401Ks and IRA accounts? That's what matters, and the trading glitch affected how stock prices are determined.
Now, NASDAQ says the cause of the problem has been identified and addressed, but the securities watchdog, the SEC, is taking this, as I said, very seriously. The SEC says the trading halt, quote, "should reinforce our collective commitment to addressing technological vulnerabilities of exchanges and other market participants."
And SEC chairman Mary Jo White was a former NASDAQ board member, so she certainly has some familiarity with the landscape. So the focus, Felicia, will shift to regulation. You were saying it earlier -- White plans to hold a meeting soon with leaders of the major exchanges and other market participants.
Also, Felicia, I've got to mention here, technical problems are not new at NASDAQ. And it seems to be part of the trading world we live in now, with everything electronic. Traders live by algorithms, automated trading systems. Felicia?
TAYLOR: Yes, there's no question about it. This is our new reality, and we can anticipate that glitches are going to happen in the future, hopefully not of this magnitude or even greater. Hopefully those problems will get lesser and lesser.
But is it too soon to quantify exactly what may have been lost in Thursday's trade? In other words, in terms of volume, in terms of lost trades, in terms of monies lost to various holders of these various securities and options. And not to mention, the options expirings that happened today.
ABER: Absolutely. And thank goodness there was not a lot of volume that happened just yesterday, and we're seeing light trading today. But I think it will take if not weeks or months to find the real -- quantify, really, how much was lost at this point, Felicia.
TAYLOR: Maribel, thank you very much for keeping a watch of what has been happening at the NASDAQ, and as we've been just discussing a little bit about regulations, the SEC certainly says it is determined to improve safeguards for market systems. It's a timely warning coming after a series of glitches in the markets over the last few years.
Only last week, a programming error at Goldman Sachs flooded exchanges with unintended stock option orders. A year earlier, there was a similar mishap at Night Capital Group, wiping out a third of its value.
And obviously, nobody can forget that Facebook IPO. Trading was delayed, orders weren't completed. That technical error cost NASDAQ a $10 million fine.
And a trading program sparked the May 2010 flash crash. The Dow Jones plunged 9.2 percent as a result, briefly erasing about a trillion dollars in market value.
The SEC may take a closer look at NASDAQ's emergency systems. It has the power to order an upgrade. Phillip Stern is a former SEC attorney now in private practice. Speaking via Skype, he told me what's likely to happen.
PHILLIP STERN, FORMER SEC ATTORNEY: We are in a technological age right now that there's likely to be additional instances of outages going forward. And that's one of the issues that the commission addressed yesterday as well as the exchange is addressing today, which is what caused the outage?
Whether there are sufficient redundancies built into the system when there is a technological problem if the systems don't go down. And I think that is the single greatest issue right now is, we know there's going to be technological issues.
But we have to have sufficient redundancies or backups in the systems so when it occurs, we don't have a shutdown. And certainly, if there is -- if the markets have to go down, not for this length of time.
TAYLOR: How likely is it we're going to see a number of different legal suits following this kind of a glitch? Obviously, litigation has already been discussed.
STERN: I suspect there will be some. People who had positions and couldn't get out, people who were using the NASDAQ or the options that trade off the derivatives from the NASDAQ securities to hedge positions, those are the people who are going to be looking as to whether they have any claim for damage. So, I suspect we will see claims. How successful they'll be remains to be seen.
TAYLOR: And from your point of view, what is the number one thing that the SEC should be concentrating on now with regards to the future of electronic trading?
STERN: There needs to be a full evaluation at all the exchanges of their technological systems to make sure that they are as state-of-the-art as humanly possible as we go forward. Because we're just going to see more and more electronic trading. And to protect the integrity of our markets, people have to feel that they -- that our markets will always be up and running for them to execute their transactions.
TAYLOR: And finally, how much confidence do you think has been lost on behalf of the investor? As you well know, this isn't the first time this has happened.
STERN: I think for the average investor, it's not going to be a problem. For the institutions, realistically, they have limited options where they're going to go. So, I don't think it's going to have an impact on the NASDAQ directly.
I think if we have more problems, you're going to see corporations, though, reviewing their decision whether to list on the NASDAQ.
TAYLOR: And that certainly would be a problem for the NASDAQ in return if they aren't able to attract those kind of IPOs in the future and they go to other exchanges.
We're going to turn our attention when we come back to Brazil, which has launched a currency intervention. That's to stop the real from falling any further. Find out if it's working, after the break.
TAYLOR: Brazil's central bank says it'll launch a $60 billion intervention program to halt a slide in the country's currency. The real jumped 2.4 percent against the dollar today on the back of that news. In recent days, it fell to its lowest level since 2008.
The intervention, which consists of a series of currency swaps and loans worth $3 billion per week, will be carried out regularly for the rest of the year. Shasta Darlington is covering this story for us, and she joins us now from Sao Paolo. Shasta, this is a fairly aggressive move. The question remains, though, is it going to be able to work?
SHASTA DARLINGTON, CNN INTERNATIONAL CORRESPONDENT: Felicia, I think we'll have to wait and see on that. But what it does do is it gives some predictability to the market. Most of this money is going to be spent in the futures market and the currency swaps, in the derivatives, and it just allows people to hedge their bets.
In fact, the only cash being -- the only cash market transactions that we'll see will be on Fridays. So every Friday, the central bank is going to offer $1 billion on the cash market, the rest mostly in the futures.
It should at least slow the slide. There was a lot of speculation going on -- and in fact, a lot of economists that we've seen the reports and talked to them, are saying they expect it to stabilize around the 2.4 level. So, we may have bottomed out, and we can see this beginning to sort of balance out.
But it's interesting when we look at this whole scenario compared to a year ago. You'll remember, when the Brazilian government was accusing the United States of a currency war, of a currency tsunami because of all of the quantitative easing.
And of course, it's the end of that that's caused this crisis here in Brazil and in many other emerging markets. So, you have to ask if they don't regret such aggressive language, right, Felicia?
TAYLOR: Well, anytime you use aggressive language, one has to worry a little bit about that. But the real has been down about 15 percent over the last few months. This kind of depreciation, though, is also threatening to stoke inflation. How much of a concern is that at present, and especially with regards to people living in the various cities there?
DARLINGTON: It is a big problem, Felicia. As you mentioned, the currency's down 14 to 15 percent on the year, and it's not just the currency. Stocks are also down. The benchmark Bovespa is down 19 percent.
And basically, it's a combination of two factors, the one that I mentioned, the influence of the US quantitative easing, but it's also a series of domestic problems. During this crisis, the reaction of the Brazilian government was often very interventionist, a lot of micro- managing, and instead of instilling confidence, they scared off investors.
So, both business and consumer confidence were pretty low despite really low interest rates, and they didn't invest. So, now we've seen a spike in inflation. Inflation is back, it's over 6 percent, that's above the roof set by Brazil itself. And the interest rates are having to come back up again to try and rein in inflation. So, this is a real balancing act.
Obviously, the government wants to kickstart the economy, but they also need to rein in inflation, and interest rates is one of the few tools that they have to do that. And so, they're really trying to find that middle ground where they can bring inflation back down but get the economy going.
As it is, they've said they expect GDP now to grow just 2.5 percent instead of the 3 percent that they were talking about just a few weeks ago, Felicia.
TAYLOR: Oh, Shasta, there are so many economies that would pray to have a growth of 3 percent. Let's hope that they are able to achieve at least 2.5 percent, as we would like to do in the United States. Shasta Darlington for us in Sao Paolo.
We're going to take a look at how the European markets finished the trading week, pretty much on a positive note across the board. The FT100 stock index up about three quarters of one percent, the rest of the indices in Germany, Paris, and Zurich up just about a quarter of one percent.
We have a Currency Conundrum for you now. Which country's currency is named after the explorer who discovered it? Is it A, Nicaragua? B, Panama? Or C, Nepal? I'll have the answer for you a little bit later in the program.
And the euro rallied against the dollar, the dollar strengthening against sterling and the yen.
TAYLOR: Disgraced Chinese official Bo Xilai is once again defending himself against allegations of taking bribes made by his own wife. The once high-flying Chinese politician spent a second day in court. His trial is set to continue on Saturday. CNN's David McKenzie is there reporting on the case and how covering it is becoming increasingly difficult.
DAVID MCKENZIE, CNN INTERNATIONAL CORRESPONDENT: They've expanded the exclusion zone during this highly-sensitive Bo Xilai trial. Over there, you can see the expanded section where they've blocked off entire highways, people being checked coming in and out. Earlier, we tried to get in there to do our work, and see what happened.
We're trying to have a conservation here, and there's no reason for --
(MAN SHOUTING IN CHINESE)
MCKENZIE: This is supposedly an open trial. They're physically manhandling us. This is where we were yesterday. In fact, we were even closer.
(MAN SHOUTING IN CHINESE)
MCKENZIE (voice-over): As you can see, they're in lockdown. But from inside the court on Friday, salacious details of a high-flying lifestyle of Bo Xilai and his family, coming from no less than his wife, star witness Gu Kailai, who is serving a suspended death sentence for the murder of British businessman Neil Heywood.
She described a complex web of tax shelters and real estate deals in Europe through her business contacts and the alleged intimidation of their son that led to the murder of Heywood. And she claims Bo knew about it all.
In response to his wife's testimony, Bo called her, quote, "insane," and a liar, unfit as a witness. He denied the prosecution's charges of bribery, embezzlement, and abuse of power. Going against the expectations of a show trial, Bo has come across as forceful, offering a spirited defense.
In an unprecedented move, the court is releasing details of the trial on social media. But the Chinese we spoke to haven't decided whether it's just for show.
UNIDENTIFIED FEMALE (through translator): The trial indeed went public, but government will make the decision anyway. I don't really pay attention to things like these.
UNIDENTIFIED FEMALE (through translator): It won't make much difference. I think this is just a show.
UNIDENTIFIED FEMALE (through translator): I don't pay much attention to things like these, but the recent case is very transparent. At least everyone can see it.
MCKENZIE (on camera): The Communist Party runs the court system in China entirely, so most analysts believe that Bo Xilai will be convicted no matter the strength of his defense. So, the better question might be will Bo Xilai win the PR battle with the Communist Party, a party he once helped run?
David McKenzie, CNN, Jinan.
TAYLOR: Bo's outspoken defense could mean the trial becomes an embarrassment for the ruling Communist Party just ahead of an important party gathering to discuss China's economy. Jonathan Fenby leads the China team at Trusted Sources, a research and consulting firm for the emerging markets, and he joins me now from our London bureau.
Jonathan, we just heard a number of people talking in David McKenzie's piece that this is a bit of a show and they don't really pay much attention to it. It was expected that this would be somewhat of a state-scripted trial. That's not really what has come. Obviously, it's a very spirited, as David said, and feisty defense. A bit of theater.
JONATHAN FENBY, TRUSTED SOURCES: Yes, indeed. I think the outcome has probably been decided and agreed in advance, probably a suspended death sentence. But certainly Bo has had his day in court, and he must have argued strongly for that in the long negotiations which took place between him being dumped from the Communist Party a year ago, now coming to trial.
And he's made the most of that, obviously denying the allegations against him, attacking his wife's mental condition, and describing the main prosecution witness as a mad dog, and also implying that a lot of pressure was put on him and that a confession, which he supposedly agreed to, was extracted under duress. So, this is a pretty unusual trial for China.
TAYLOR: Certainly is. And the question, obviously, that comes to mind is, why are they allowing this to take place in such a public way? This is certainly not the normal order of business.
FENBY: No, not at all. I think probably it stems from the fact that Bo was a very high-profile politician in China. He was heading for the top. I've described him often as the rock star of Chinese politics.
And the rest of the Politburo which runs China around him decided he was getting too powerful, he was too dangerous, he was a real maverick. They wanted to bring him down, and the Heywood affair gave them the smoking gun to bring him down.
But then, because of his high profile and because of quite a lot of public support and sympathy that he gets, I think the new leadership of Xi Jinping wanted to be seen to give him something like a fair trial, even if the outcome is already decided.
And they probably thought that the eventual verdict would have more credibility if Bo was allowed to speak out. The question is, did he speak out rather more than the leadership had bargained for?
TAYLOR: Oh, I'm sure there's no doubt that he did. But --
FENBY: He did
TAYLOR: -- fine. From their perspective, they've given him what is now a public and, quote-unquote, "fair trial," regardless of what the verdict ends up being, and that's probably already been decided. But from Bo's perspective, why is he doing this? One professor said that possibly this is for the history books, because this will be his last public act.
FENBY: Well, I think it is that. He was -- he's a very feisty politician, he's a very high-profile man, and he's going to grab this opportunity to either go down in history or establish himself so that if there's some change in China, if the economy tanks, if there are political changes, that he might still nurture a hope of a comeback.
But it's interesting, the sensitivity of this, because we've just learned that the official censor's office has issued instructions to Chinese media not to run headlines supporting Bo, such as mentioning his very sharp interrogation of a prosecution witness. So obviously, although they're putting it out, the authorities obviously quite guarded about this.
TAYLOR: Jonathan Fenby of Trusted Sources, thank you very much.
FENBY: Thank you.
TAYLOR: And coming up on QUEST MEANS BUSINESS, US president Barack Obama speaks exclusively to CNN about the all-important US budget.
(BEGIN VIDEO CLIP)
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I was willing to do whatever it takes to get Congress, and Republican in Congress in particular, to think less about politics and party and think more about what's good for the country.
(END VIDEO CLIP)
TAYLOR: Welcome back. I'm Felicia Taylor and here are the latest headlines.
The court martial in the case of Ft. Hood shooter Major Nidal Hasan will reconvene in a couple of hours. Army psychologist Hasan was convicted of 13 counts of murder and 32 counts of attempted murder over the 2009 shootings at the Ft. Hood Military Base in Texas.
There's a question, however, on whether the verdict was unanimous. For more details on this, I'm joined now from Ft. Hood by CNN's Ed Lavandera.
Ed, does it have to be unanimous in this kind of a case?
ED LAVANDERA, CNN CORRESPONDENT: No, from everything we're able to gather at this point whatever this detail is that needs to be clarified, will not have any impact on the greater news here or the greater issue is that Nidal Hasan will be found guilty on all of these counts, 13 counts of premeditated murder, 32 counts of premeditated attempted murder.
He now qualifies for the death penalty under the rules of the military justice system. And to do that, he only needed to be found guilty unanimously on one of the premeditated murder charges as well as found guilty on another of the murder charges.
So all of this will really have no bearing; it's just some clarification at this point to be able to say whether or not all of this was unanimous. But that obviously, the news of him now qualifying for the death penalty is the biggest news, especially for the family members who have been sitting inside that courtroom, listening to almost three weeks of testimony.
Nidal Hasan was stoic, had very little reaction when the news was read by the soldier reading the verdict. He just simply stroked his beard as -- in the crowd, family members of the victims, several of them were crying, hugging on each other, offering support. They did this quietly.
You can imagine just how difficult this has been for the last three weeks, having to listen to all of this gruesome and graphic testimony about what happened on November 5th ,2009, here in Ft. Hood, Texas, Felicia.
TAYLOR: Ed Lavandera, watching the case for us in Ft. Hood, thank you.
Syria's main opposition group says it will guarantee safe passage for U.N. weapons inspectors awaiting access to a rebel-held part of Damascus. It's where a chemical weapons were purportedly used in an attack that's said to have killed 1,300 people on Wednesday.
U.S. President Barack Obama told CNN's Chris Cuomo the attack is very troublesome. A senior Pentagon official says plans for a possible forceful intervention in Syria have been updated.
Still pictures show the immediate aftermath of a powerful explosion in Tripoli, Lebanon. The mayor says twin attacks killed 50 people. Hundreds more were wounded. The bombings struck near two different mosques as worshippers were observing Friday prayers.
Police in India say five men raped a photographer Thursday as she was taking pictures in Mumbai. They say the attackers tied up the victim's male colleague. The assault has one again put a spotlight on sexual violence in India. One man has been arrested and the woman is in hospital.
Bank of America Merrill Lynch says it will hold a formal review following the death of an intern in the bank's London office. Twenty-one- year-old Morris Earhart (ph) was found dead at his London accommodation last week. Police say his death is not being treated as suspicious. Bank of America says it wants to learn from the tragedy.
TAYLOR: U.S. President Barack Obama has told CNN he is willing to do whatever it takes to get Congress to pass a budget and avoid a potential government shutdown. Congress returns from recess on September 9th to some pressing deadlines.
On October 1st, the government would partially shut down if they can't agree on a deal. And lawmakers have by mid-October to reach an agreement on the debt ceiling or face a default.
Chris Cuomo sat down exclusively with the president.
CHRIS CUOMO, CNN ANCHOR: When they get back in session do you believe you know the way to get things done for the American people so that that we don't have another shutdown of the government, which effectively punishes everybody else except the lawmakers?
OBAMA: There is a very simple way to doing this, which is the Senate passed a budget and the House passed a budget, and you know, maybe you're not old enough to remember "Schoolhouse Rock," but --
CUOMO: No, I remember it.
OBAMA: Remember how the bill gets passed, the House and the Senate try to work out their differences, they pass something; they send it to me and potentially I sign it. We like to make things complicated but this is not that complicated. Congress doesn't have a whole lot of core responsibilities. One core responsibility is passing a budget, which they have not done yet.
The other core responsibility is to pay the bills that they've already accrued. And if Congress simply does those two things when they get back then the economy can continue to recover and folks out there who are working hard or trying to find a job will have some sense of stability.
And we can start thinking about things like college education and some of the big structural changes that we have to continue to make to ensure that we're competitive.
CUOMO: How much of the lack of action in Washington do you put on yourself in terms of blame?
OBAMA: Ultimately the buck stops with me. And so anytime we are not moving forward on things that should be simple, I get frustrated. And I've said before and I continue to say, I'm willing to do whatever it takes to get Congress -- and Republicans in Congress in particular -- to think less about politics and party and think more about what's good for the country.
And then finally now what we've got is Republicans talking about the idea that they would shut down the government -- bad for the economy, bad for not just people who work for the government, but all of the contractors who -- and the defense folks and everybody who is impacted by the services that they receive from the federal government, we should shut that down because Republicans, after having taken 40 votes to try to get rid of ObamaCare, see this as their last gasp.
Nobody thinks that's good for the middle class. And I've made this argument to my Republican friends privately. By the way, sometimes they say to me privately, I agree with you, but I'm worried about a primary from, you know, somebody in the Tea Party back in my district or I'm worried about what Rush Limbaugh is going to say about me on the radio.
And so you got to understand, I'm -- it's really difficult.
I can't force these folks to do what's right for the American people, but what I sure as heck can do is stay focused on what I know will be good for the American people.
TAYLOR: And coming up, we're going to have a check of the weather in just a minute.
And the latest on these very dramatic scenes at Yosemite National Park in the United States.
TAYLOR (voice-over): A little earlier I asked you which country's currency is named after the explorer who discovered it? The answer is B, Panama. The Panamanian balboa is named after Spanish explorer Vasco Nunez de Balboa. He led an expedition to the country in 1510.
In Western Europe, cooler weather but not for long. Meteorologist Karen Maginnis is at the CNN International Weather Center.
How hot is it going to get?
KAREN MAGINNIS, AMS METEOROLOGIST: Well, it looks like those temperatures are still going to be sizzling across the southeastern portion of the continent.
We'll see a little bit of a dip as that frontal system starts to move through, as we see this large area of low pressure with its accompanying frontal system that swings its way across the United Kingdom, into France. That's where the storms may be located.
Over the last several days, we've seen some of those storms lined up across northern sections of Germany also into Poland, had a couple of form right across Greece. There was actually a waterspout that was reported there in the last 24 hours. No reports of any damage.
How about some high temperatures? Well, Bucharest, 32; Paris at 23 and London should see about 20 degrees for a high on Saturday. And as I had mentioned, here come the showers, we've got it all the way from Glasgow towards Edinburgh, right around Dublin, also into Shannon, Ireland. It's overcast there as well.
And a few showers right across the Alps, extending in towards Austria as well. But very little in the way of rainfall all across the country.
What we've zoomed into on our Google Earth has been the fire that is referred to as the Rim fire in the United States. This is near the very famed Yosemite National Park. Well, as you take a look, you see some of those fire signatures. But where this red shaded area is, that is all the area that has burned.
Let's just show you how dramatic it is by showing you this video from the air, from the ground in any way possible they are trying to put out this fire, which has quadrupled just in the last day or so. This has been very difficult to handle because the weather conditions are not very conducive for the firefighters to battle, meaning it has been hot. It has been dry.
And being a terrain that is very difficult to battle, this is a pristine area that is known not just in the United States, but around the world, for its wildlife, for its beauty. But unfortunately, now we're looking at about 70,000 hectares that have burned and it doesn't look like much is expected to happen weather wise. It's only 2 percent contained.
And this is what we've seen over the last 24 hours, some monsoonal moisture blowing into the southwestern U.S. But go 300 miles to the east or east-southeast of San Francisco, and that's where Yosemite is located.
And there are thousands of homes in danger. And it doesn't look like that's going to be under control at least for a while and as it grows every day, it makes it even more difficult to battle. We'll keep you updated on that.
Felicia, back to you.
TAYLOR: All right. Thank you, Karen.
Let's take a final look at the big board before the end of this show. There's just an hour of trading or a little bit more than an hour. The Dow up now just about 22 points. One of the things keeping stocks in line today on this last trading day of the week is new home sales, hit the lowest rate since October. And banks are on review for a possible downgrade by Moody's, again the possible downgrade is the stress on that one. Goldman Sachs shares are now down about 2/3 of 1 percent. Gold though, ended the day with a 2 percent gain. That commodity has been under scrutiny of late, ending at about 1,396.
One of the other things that of course was a focus for the week was the Federal Reserve earlier releasing its minutes, nothing new in particular except for the fact that the eyes -- all eyes are going to be on the data that will be coming out in the next couple of weeks in particular the labor report at the beginning -- or rather the end of the first week in September.
And that is it for QUEST MEANS BUSINESS. I'm Felicia Taylor in New York.
MARKETPLACE AFRICA continues on CNN.
ROBYN CURNOW, CNN HOST: You're watching MARKETPLACE AFRICA. I'm Robyn Curnow. Now one of Ethiopia's most prized exports is its food. So it's no wonder then that an Ethiopian immigrant's American dream involved his country's cuisine. And he's been helped by an innovative program meant to give minority entrepreneurs a leg up. A taste of Ethiopia in the Big Apple and beyond.
Let's put a spicy on this. One quart of garlic, half a quart of ginger, another vegan dish to add.
CURNOW (voice-over): For Ethiopian-born Hiyaw Gebreyohannes, growing up in America did not mean hot dogs and hamburgers at the family meals.
HIYAW GEBREYOHANNES, ETHIOPIAN-BORN CHEF: My lunch box had like ndera (ph) with some lentils in it and it was very weird, because you have kids with bologna and turkey sandwiches. And here I am with an ndera (ph) sandwich, if you will. And as a kid, I don't know if I appreciated it as much. But as I got older, it was -- it brings back all these memories every time I get to eat it.
CURNOW (voice-over): Gebreyohannes was born into a family entrenched in the food industry and raised in the kitchen of his mom's restaurant. It's this childhood that has spurred a burgeoning business called The Taste of Ethiopia that he says is made out of $300,000 in revenue this year, almost double the sales for all of 2012.
GEBREYOHANNES: A Taste of Ethiopia is a Ethiopian line of food that does two things. It does food service and it does a retail line.
CURNOW (voice-over): He says right now his staff of eight produce over 11,000 kilograms each week.
GEBREYOHANNES: Dinatuit (ph) means potato soup.
CURNOW (voice-over): The company started in 2010 in a very familiar place, his mom's kitchen.
GEBREYOHANNES: She had two restaurants in Michigan. She wanted me to take over one and I said, "Mom, you should just package this food."
And she said, "Well, OK. Why don't you do that?"
And I was like, yes, why don't I?
So that's kind of how it started at the beginning and played around in the kitchen and the restaurant, put it in deli containers that you would put potato salad in, started giving it to small mom-and-pop grocery stores, organic stores, vegan stores and they loved it. And they wanted more.
And I had -- went to Kinko's and printed out a black-and-white label, no sealer on these things, but it was in their fridge and it was selling.
CURNOW (voice-over): Michigan was only the beginning.
GEBREYOHANNES: That gave me the boost and the confidence to say, hey, if this can work in Michigan where it's not necessarily as diverse as New York is, then I think New York has a great shot. If it's made in New York, or if it has that stamp of New York, then it's much easier to get it out to other (inaudible).
CURNOW (voice-over): But he soon found that making them move and winning over big U.S. grocers like Whole Foods would take a lot more convincing than local mom-and-pop shops.
GEBREYOHANNES: They were like, yes, we'll try your Ethiopian food. This is in the Midwest. So the buyer came out to my mom's restaurant, tried the food, loved it and was like, you're not ready. And left.
And so with a little disappointment, I was like, OK, what do I need to fix? And what's wrong with this? And then slowly over time, I understood what he meant.
Made the transition back to New York, found Hot Bread Kitchen, where we are here today, and fell in love right away when I walked in. It was a commercial space that was big enough, that was able to hold everything that I needed to do and was going to be the potential for this dream that I had and make it kind of grow.
What's the spice level for you guys? Is this spicy? It's good, right? It's not too spicy, right?
CURNOW (voice-over): Hot Bread Kitchen started in 2007 as the brainchild of Jessamyn Rodriguez.
JESSAMYN RODRIGUEZ, FOUNDER, HOT BREAD KITCHEN: Hot Bread Kitchen is a company that's dedicated to getting minority women and minority entrepreneurs into the specialty food industry. So we have two programs, HBK Incubates, which is a food incubator for entrepreneurs who are starting their food businesses.
And then we have a workforce development program primarily for immigrant women called Project Launch, which is a fully operating commercial bakery.
CURNOW (voice-over): Since its conception, Hot Bread Kitchen has helped launch 35 local food businesses, including Taste of Ethiopia.
After learning how to balance business with the art of cuisine, Gabriel GEBREYOHANNES went back to pitching his product.
GEBREYOHANNES: So I think my steps were -- I didn't want to go too bad. So a perfect example is when Whole Foods came to me and they said we'll try you in one store and then we'll grow and we'll see what that store does, for me it was like that's perfect.
So I started in one store of Whole Foods. And if they get to taste it, then they'll buy it if they like it. And that's your -- that's what you need to find out. Do you have a product that people want to buy?
CURNOW (voice-over): Now two years later, he says his product can be found in over 60 stores in states across the greater Northeast with expansion plans in place for stores across America by the end of the year.
GEBREYOHANNES: I see Ethiopian food growing just as a culture and as almost something that kind of rolls off the tongue, just like Indian food and sushi does now. And I hope I'm the go-to person for it.
But I think Taste of Ethiopia, being able to be in many more regions. So touching the West Coast and going through the Midwest and doing the South. And I would love for it to go international as well and be able to create -- maybe it's like a Chipotle, but an Ethiopian styled one.
And so just being able to show that there's this healthy food and good food out there that we need to -- we need to explore and have -- and have a lot of it.
CURNOW: Now immigrants like Gebreyohannes make up 43 percent of New York's labor force, helping to build that city's economy one American dream at a time.
Well, after the break, we're going to talk financial inclusion with the president of international markets (inaudible).
CURNOW: Welcome back. Now Africa's new consumer class has been a focus for many multinationals, MasterCard included. And to build their cashless infrastructure, they've turned to the governments of Nigeria and South Africa.
Here in South Africa they (inaudible) with the country's social security agency, SAFA (ph), to put MasterCards into the hands of 10 million social grant (ph) beneficiaries.
ANN CAIRNS, INTERNATIONAL MARKETS PRESIDENT, MASTERCARD WORLDWIDE: What we see is something like 2.5 billion people in the world today that are really financial underserved or unbanked. That's about a half of the world's adult population.
But many of these people receive money from their governments and so on. And it's really the solution that's been produced here in South Africa is really addressing that.
CURNOW: It's not just South Africa that you've partnered with. Also Nigeria, very big scheme with the Nigerian government, as said even on this show, they're very excited about.
CAIRNS: Yes. Well, actually, the Nigerian rollout is going to be even bigger because the pilot for Nigeria is 13 million people. And the full rollout is 100 million people. And this is what we are doing, is layering payment capability on the back of a Nigerian card, which is a full identity card.
And I know the minister of finance for Nigeria was down here in South Africa recently an in an economic forum, and I know she's incredibly excited about it.
CURNOW: All of these projects, this link between a private company and the public sphere, is that the way to do it, these relationships?
CAIRNS: I think that you can't really solve any of these problems unless you do it through a number of partnerships because you need new technology; you need companies that will move very quickly. You need to have banks involved. People who know and understand how to handle the money flow.
You've obviously got to have the government there as the main funder and the driver and the leader and the visionary for the projects. And also you need companies like MasterCard, which are infrastructure and networks who know how to move money around the world.
CURNOW: You're a global company. When you look at the African continent, it's also very diverse, different economic stages of development, different needs, different populations wanting different things.
How do you connect those dots?
CAIRNS: It's a great question because our whole Middle East and Africa business is actually 69 countries. And for sure, Africa is not one place. It's a whole variety of different countries with different needs. So what we try to do is we identify partners that we would work with in different geographies that really are the best in their space.
So for example, in Egypt we're working with a country called -- a company called Fowry (ph) and that is creating the ability to do bill payment capabilities in Egypt, which we'll be exporting across the rest of northern Africa.
Here in South Africa, we're working with Nat Warne (ph) on the SASA (ph) solutions. As we're building out the ability to roll cards out and move into the mobile space, we're also building the underlying infrastructure the ability to accept these cards in different shops with small shopkeepers.
CURNOW: And the infrastructure is what's going to drive this, isn't it? It's the foundation (inaudible).
CAIRNS: Yes, I mean, one of the great things about the SASA (ph) program here in South Africa is it will build the infrastructure for many people who don't have bank accounts, have never used financial instruments. And all of a sudden they've got a card that they can go and use in the supermarket or to buy their basic needs.
They'll soon learn that these -- this financial instrument has much more capability than that and it'll start to cause shopkeepers who don't have the ability to accept cards to want to do it. And that will create a whole new ecosystem. And so one thing builds on another, builds on another.
So you can see how this can be used for social good and also to bring people into the modern age in terms of using digital technology.
CURNOW: Ann Cairns, the president of international markets at MasterCard.
That's it for me, Robyn Curnow. See you again next week.