Return to Transcripts main page
Quest Means Business
Catalonian President Says We Have the Right to Independence; Harvey Weinstein Accused of Rape; Dow Rolls to Fresh Record; Donald Trump Says Tax Reform is on Track; Putin Cautions of Cryptocurrency. Aired 4-5p ET
Aired October 10, 2017 - 16:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[16:00:00] RICHARD QUEST, CNN HOST: The closing bell ringing on Wall Street. Dow Jones Industrial up a third of a percent, closing at a record
high tonight. No record for the Nasdaq and the S&P 500. What a strong day on the markets. And I think that's firm gavel. Trading is now over. It
is Tuesday, it's the 10th of October.
Tonight, Catalonia says it's time to become independent. Its president wants Madrid to make the next move.
Deeper disgrace for Hollywood's Harvey Weinstein. He now faces multiple allegations including those of rape.
And the green arrows are back for the Dow. Donald Trump insists tax reform is still on track.
I'm Richard Quest, live in the world's financial capital, New York City. Where, of course, l mean business.
Good evening. Tonight, Catalonia would appear to have stepped back from the brink, at least for the moment. Speaking to the Catalan Parliament a
short while ago, the regional president said he would declare a declaration of independence off now for talks with Madrid. He did not specify what
form the talks would take, nor who would mediate them. The Spanish Prime Minister had suggested he could suspend Catalonia's autonomy if regional
leaders went through a so-called, irreversible actions. In the Catalan Parliament the President Puigdemont said, it was the vote on October 1st
that was irreversible.
(BEGIN VIDEO CLIP)
CARLES PUIGDEMONT, CATALAN PRESIDENT (through translator): The results of the referendum of 1st of October, Catalonia has earned the right to be an
independent state. And has earned the right to be heard and respected.
(END VIDEO CLIP)
QUEST: The right to be heard. The right to be respected. Nic Robertson is CNN's international diplomatic editor. He's following developments
outside the Catalan Parliament where he has been during the day. The right to be heard and the right to independence. Square that circle for me, Nic,
with his statement, the president's statement, he would delay a declaration to allow time for talks.
NIC ROBERTSON, CNN INTERNATIONAL DIPLOMATIC EDITOR: So, he's walked up to the line that the Spanish government has set. They had told him not to do
something irreversible. And I thank this is a position that President Puigdemont wanted where he listens to what he was being told by
international community, by leaders in the European Union, not to do something that would escalate the situation here. And cause -- and bring
about a situation where it would harder to get talks going. So, what he's done is walk up to that line. They believe, he believes that he's
respected the international opinion over how he should handle this situation.
But what he has done, and this is a bit of the circle that is going to be hard to square for the Spanish government. What he has done is to say that
the referendum was legitimate, and that is something that the Spanish government cannot stand behind, hasn't stood behind. They have said that
the referendum was illegal. And he says, therefore, because it was a legitimate referendum, the people's voice was heard, and this gives them
the mandate to be called an independent republic. But as you say, he's deferred it to give time for talks. Time, weeks, one week, up to four.
The ball is in the Prime Minister of Spain's court now.
QUEST: Nic, it's very -- it's messy. It's confusing. And it's uncertain. And as I understand it tonight, we're unlikely to get much clarity on the
way forward.
ROBERTSON: It is messy. But it's avoided a far Messier situation, where you would have potentially had his arrest, the suspension by the Parliament
here, by the Spanish government. You know, which could have led to, you know, contest between the local police and the national police. And many,
many other issues. So, while this is -- while this messy, is not as messy as the situation could have been. The reason Puigdemont and supporters
believe they have this right, is because they've been criticized from both extremes. Both those in the coalition, the left-wing party that's really
pushing the hardest and strongest for independence. They don't believe his statement went far enough today. To the other side, the opposition, the
Socialist Party, saying Puigdemont, what you've done is divide the Catalans. He feels that he's taking the middle position here.
QUEST: Nic, there are reports on the wires now -- you won't have had a chance to see them. But the Catalan president -- we're looking at a
picture of -- live pictures coming now. The Catalan President has signed a document sort of symbolic, but no legally binding declaration of
independence, and we're looking at various members of Parliament signing this. I imagine this will be or something to do with the declaration if
and when it happens, if it's not delayed. I mean, this is -- go ahead.
ROBERTSON: This is a -- Yes, sure. I was just speaking to spokesman about that. This is a technical issue, if you will. It is a symbolic
declaration of independence. And is being signed by 72 independent politicians from -- politicians that support independence by 72 of them.
And this will allow the Parliament here to go ahead and vote on the suspension. Because what he laid out before earlier about the
independence, this after an independence referendum where the vote was yes, then within 48 hours, the state becomes independent. So, what you have to
do here is a technicality. This is how they're explaining it. A technicality that there is a document that the Parliament then says we
suspend it. So, it's procedural, and it's symbolic. But, again, this is also designed to sort of trend for him to keep the coalition of
independent-minded politicians on one team, on one side. Because, of course, he recognizes that the Spanish Prime Minister would like to see
division amongst the pro-independence parties falling out of this. So, he also avoid that. And he's fighting on many fronts here -- Richard.
QUEST: Nic, one more for you, if I may, sir. So, this document which is symbolic but a necessary technicality. If we were to take the scales of
this, on the side of the scales, you've got the referendum a now this document. On the other side of the scale, you've got the president saying
he will delay the declaration for more talks. Which at the moment is the heavier side of the scale?
ROBERTSON: It's delayed. This is not in question. What he's saying is, we have the right to it. We're not" going to do it. He's delaying it.
He's implying a matter of weeks. But if this is a position that's reciprocated to get into talks by the Spanish government then this is a
process that could, you know, play out over many weeks, many, many months. The window of opportunity here is that we're being told at the moment for
the talks that begin, or something to begin is a week to four weeks. That's the window of opportunity.
QUEST: Nic, thank you. Nic Robeson, who is in Barcelona.
The banks and the rating agencies are warning of economic consequences of a declaration of independence and saying that such a consequence would be
severe. Barclays says it would mean a cycle of clashes, clampdowns and by Madrid and volatility in the financial markets. Berenberg's chief
economist says Catalonia doesn't have the fiscal means to enforce full independence. The only viable option is talks between Madrid and
Barcelona. While the rating agency Fitch is predicting Catalonia will gradually achieve more autonomy, and says that the event of Catalan
independence companies that do business in the region could suffer if it end up outside the eurozone.
Earnest Urtasun is a Catalan politician and economists. An MEP with a group of the Greens in European Free Alliance, joins me now from Brussels.
You are not in favor of a declaration of independence. So, I ask you, sir, what for you is the best that comes out of this delay with the prospect and
only the prospect of talks with the government in Madrid?
EARNEST URTASON, CATALAN MEMBER OF THE EUROPEAN PARLIAMENT: Well, I think that today we have avoided the worst-case scenario. The words case
scenario was unilateral declaration of independence, followed immediately by a suspension of the autonomy. From the side of the Spanish government
that would mean huge and sedition crisis with very clearly affects effects on the economy. We already have some companies fleeing Catalonia because
of this. And that big and sedition crisis with the intervention of the Catalan autonomy, would have been the worst-case scenario. So, I think
like your correspondent was saying, we have avoided that and the reason -- a small room for dialogue now that that opens.
[16:10:00] And we need to take a profit of that small room that we have, and need to promote dialogue. And I think that it's very important what
also the European commission will do. Whether they will be able to promote that dialogue. We have the opportunity now. I think what happened in
Catalan Parliament is a good step forward towards dialogue.
QUEST: Let me ask you, what business is it of the European Commission? In the sense that it's an internal matter for Spain. Yes, there would be
ramifications for the rest of EU. And there will be questions of whether an independent Catalan would be in or out, and it would obviously be out.
But it's not an EU matter. This is a Spanish versus Catalan, matter.
URTASON: It's an internal matter of Spain. But I think that the crisis has gone to a level where I think most European countries and European
institutions are worried. One of the reasons why I think today, the Catalan President decided not to go for unilateral declaration of
independence is that we had statement of the president of the Euro Council asking him directly not to do so. And I want to take the opportunity to
thank the president of the Euro Council for that call. Many people have been calling the President of Catalan not to do that. And I think at some
point institutions in the EU, even though this is an internal affair, they realize there is a European problem.
So, I don't expect from them an intervention. But at least to have some talks here and there, to ease the situation. Yes, they can do that. And I
think it's important.
QUEST: But I keep coming back to my core point, which is, if Catalonia wants independence, and at best we're talking about a delay. And Spain is
not going to give that independence. Then I can't see immediately what talks are about.
URTASON: Well, I think the -- the Catalan people in a majority are asking is the right to have a referendum like the Scottish had. I think, of
course, this l something that the Spanish government has been denying for many, many years. But I think this is something that at the moment the
Spanish government should start accepting to discuss. On the other hand, the Spanish government has also refused completely to discuss
constitutional reform. And I am one of those who think that constitutional reform towards the path of a federal arrangement would be a solution.
But for that until now, the Spanish government has even refused to discuss about that. So, think that now, afterward the Catalan president said --
made today, that he refrained from unilateral declaration. Talks could have a double objective. One, to see whether there is ground for
referendum, but also to see whether there is a ground and a possibility to discuss constitutional reform. That is important as well.
QUEST: Sir, thank you. We look forward, please, come back again on QUEST MEANS BUSINESS so we can talk more about this as this develops. This
serious issue about us. I appreciate it. Thank you.
To the markets. Europe markets had to close by, the time the Catalan president's spoke. The Spanish stock gave back all of Monday's gains and
some more. If you look the IBEX was down 1 percent. The London FTSE rebounded from losses. Shares of BAE Systems slightly fell. The aerospace
company has announced plans to cut nearly 2,000 jobs.
Tonight, explosive new allegations against the Hollywood film producer, Harvey Weinstein comes from the "New Yorker" magazine publishing a story
containing three separate allegations of rape and audio from a New York Police Department, NYPD sting operation. Some of the audio you may find is
distasteful and disturbing.
(BEGIN VIDEOTAPE)
HARVEY WEINSTEIN: You must come here now.
UNIDENTIFIED FEMALE: No.
WEINSTEIN: Please?
UNIDENTIFIED FEMALE: No, I don't want to.
WEINSTEIN: I'm not doing anything with you. I promise. Now you're embarrassing me.
UNIDENTIFIED FEMALE: No, I'm sorry. I don't know. No, yesterday was kind of aggressive for me. I need to know a person to be touched.
WEINSTEIN: I won't do a thing, please. I swear I won't, just sit with me. Don't embarrass me in the hotel. I'm here all of the time. Sit with me, I
promise --
UNIDENTIFIED FEMALE: I know, but I don't want to.
WEINSTEIN: Please sit there. Please. One minute. I ask you.
UNIDENTIFIED FEMALE: No. I can't.
WEINSTEIN: Go to the bathroom.
UNIDENTIFIED FEMALE: Please, I don't want to do something I don't want to.
WEINSTEIN: Go to the bath -- Come here. Listen to me.
UNIDENTIFIED FEMALE: I want to go downstairs.
WEINSTEIN: I'm not going to do anything and you'll never see me again after this, OK? That's it. If you embarrass me in this hotel --
UNIDENTIFIED FEMALE: I'm not embarrassing you. I just that I don't feel comfortable.
WEINSTEIN: Honey, don't have a fight with me in the hallway.
UNIDENTIFIED FEMALE: It's not nothing, It's --
WEINSTEIN: Please, I'm not going to do anything. I swear on my children. Please come in. I'm everything -- I'm a famous guy.
UNIDENTIFIED FEMALE: I'm feeling very uncomfortable right now.
WEINSTEIN: Please come in now and one minute. And if you want to leave when the guy comes you can go
UNIDENTIFIED FEMALE: Why yesterday you touch my breasts.
WEINSTEIN: Oh, please, I'm sorry. Just come on in. I'm used to that.
UNIDENTIFIED FEMALE: You're used to that?
WEINSTEIN: Yes, come in.
(END VIDEOTAPE)
QUEST: That was a conversation that Weinstein was having with somebody in the hallway of his hotel, trying to get her to go into the room.
Weinstein's representatives leased a statement to CNN concerning other allegations within the "New Yorker" article.
Saying, any allegations of non-consensual sex are unequivocally denied by Mr. Weinstein. Mr. Weinstein has further confirmed that there were never
any acts of retaliation against any women for refusing his advances. Mr. Weinstein obviously can't speak to anonymous allegations, but with respect
to any women [16:15:00] who have made the allegations on the record, Mr. Weinstein believes that all of these relationships were consensual. Mr.
Weinstein has begun counseling, has listen to the community and is pursuing a better path. Mr. Weinstein is hoping that, if he makes enough progress,
he will be given a second chance.
Brian Stelter is with me. Let's go through this slowly, bit by bit and then walk me through this, if you would be as kind. Firstly, the
statements, the "New Yorker." This is more serious in the sense it's rape.
BRAIN STELTER, CNNMONEY SENIOR MEDIA CORRESPONDENT: This time last week, we heard about harassment allegations. Yes, now we hear about assault and
rape allegations. Three women, according to the "New Yorker," making those rape allegations. Two named on the record. I was able to speak with one
of them today to confirm the account. She said, this is our truth. It is far past time for these stories to be told. Now, at the same time,
Richard, Gwyneth Paltrow and Angelina Jolie, two of the best-known Hollywood stars, they have also said today, they were harassed by Weinstein
in the 1990s. So, you have these various kinds of improper behavior being alleged all the way from please come up to my room and give me a massage,
all the way to rape.
QUEST: All right, second thing. This statement he's put out tonight, unequivocally denying the forced sexual --
STELTER: Right., just homing in on the rape allegations, saying that never happened. Saying, I believe every single time I ever had these
interactions, it was consensual. So, that's his claim. It's also noteworthy, Richard, we haven't heard anything else from Harvey Weinstein
since he was fired on Sunday. He is a famously loud and volatile executive. But he has said nothing publicly except to deny the rape
legations.
QUEST: Where is this story going next?
STELTER: Well, I think there's even more women likely to come forward. It's been an avalanche today.
QUEST: But the core case -- I mean, I don't say this in any disrespectful sense. The core case has been made. There would have to be a full or
somebody mendacious not to believe that something went wrong. So merely heaping more on doesn't necessarily mean -- in terms of what happens next
in the industry, for example.
STELTER: Two pieces. Number one, the business. What's the future of his business? They're going to change the name. Great. What's that going to
do? They're going to have a board meeting tomorrow talking about the future of the business. If there is a future at all for the Weinstein
Company. On the criminal side, on the question of illegal behavior by this man over the course of decades, we're told by the New York and L.A.
district attorney's offices, right now there are no open investigations. But that can change,
QUEST: And the other studios, the other small independents, in Hollywood, what will change, because of this, if anything?
STELTER: Gwyneth Paltrow says this way of treating women stops now.
QUEST: Do you believe that?
STELTER: Sunlight may have a beneficial effect. But there is always a power imbalance in Hollywood. These powerful mostly male bosses and these
women hoping to get their start. That imbalance isn't going to go away, even though there's a lot of sunlight right now on this awful behavior.
QUEST: Brian, thank you.
STELTER: Thanks.
QUEST: As we continue, let us skate, straight away to our regular business agenda. The more savory. The IMF thinks the Trump administration's tax
plan is doomed. The president says otherwise. He'll be talking to the IMFs chief economist after the break.
(COMMERCIAL BREAK)
[16:20:34] QUEST: The IMF has upgraded its growth outlook for the entire world. At the same time, there are warnings and risks ahead. It's the
word economic forward and the we are the world economic outlook. And the forecast for the United States is mostly unchanged. It doesn't see Donald
Trump's tax reform doing much to produce growth, because they doubtful it will happen if at all. The IMF's term for that is significant policy
uncertainty. You'll hear the chief economist in just a minute on that.
There is a rosier prediction, let's cross the Atlantic and you'll see the rosier prediction for the EU. Where growth forecast is actually 2.1 for
this year -- no, 1.9 for next, driven by higher exports and domestic demand. And China was also revised upwards on expectations that Beijing's
expansionary policies will continue. The IMF'S chief economist says the recovery in the developed world is incomplete. Maurice Obstfeld, joined me
from Washington a short while ago, and I asked him, you know, if you take the overall report, there are extremely tricky trends within a largely
upbeat wheel.
(BEGIN VIDEOTAPE)
MAURICE OBSTFELD, CHIEF ECONOMIST, IMF: Yes, you know, we have seen a trend over years of inequality growing, and slow median wage growth. So,
we definitely say that the recovery is incomplete within the advanced economies.
QUEST: If it's incomplete, what policies do you now suggest? Because you are upgrading growth for all the major countries with the exception of the
U.K.
OBSTFELD: Right. You know, this is a great time for policymakers to think about structural reforms, which would raise growth and make it more
resilient. Think about investing in people, in education, in youth, in training and apprenticeship programs that would spread the benefits of
growth more widely.
QUEST: That said, if we start to pass the actual countries involved, let's start with the United States. The prospect of tax cuts or tax reform, is
seemingly dwindling, possibility of infrastructure an infrastructure spending, have you written off to some extent all of these things?
OBSTFELD: Oh, not at all. You know, the tax plan that has been put forth is not really complete. There are a lot of elements of it that still need
to be fleshed out. And we're hopeful we'll see something that while not raising the deficit and while raising revenue in the median term, is
attentive to the middle class, to voters below the median. And that also raises enough revenue to eventually fund some productive infrastructure.
QUEST: And the prospect of higher rates, we're expecting one more move by the Fed before the end of the year. The Fed obviously says that, look, you
know, inflation is below target and has been for some time. But actually, this is only a minor tightening when taken with all of the other moves.
Because it's still extremely accommodative monetary policy. You'd have to agree with that.
OBSTFELD: Yes, I think monetary policy in the U.S. remains accommodative. The Fed is obviously concerned with slack disappearing, with full
employment approaching or here that inflation could rise suddenly. So, they're taking a cautious and data dependent view of the problem.
QUEST: The U.K., if there is one area that you do raise a red flag, it's Brexit, isn't it? The Brexit chickens are starting to come home to roost.
OBSTFELD: The first half of 2017 has not been strong for the U.K. economy. It's grown more slowly than its peers, for the most part. And, you know,
in terms of monetary policy, the Bank of England is in a position that central bankers don't like to be in, where inflation is high, above target.
[16:25:00] But growth is relatively slow. So, they're going to have to monitor conditions going forward, and make appropriate decisions.
QUEST: In the funds view, what is the appropriate decision?
OBSTFELD: I think they're going to have make a guess on how strong inflation momentum is. And ultimately their mandate is price stability.
And that's what they're going to have to pursue.
(END VIDEOTAPE)
QUEST: Brian Obstfeld of the IMF and a reminder that QUEST MEANS BUSINESS comes from Washington. From the annual meetings of the IMF on Thursday and
Friday of this week. We'll have all the ministers, the finance ministers, and hear from Christine Lagarde and the world economic debate. That's
Thursday and Friday here on QUEST MEANS BUSINESS.
And so, to today's markets. We're in the trading post, the QUEST MEANS BUSINESS trading post. No sign of a correction, far from it on Wall
Street. Everything was green today. You have green for the Dow. The S&P and the Nasdaq. In fact, the Dow goes through 20,800 powers through it
with a gain of some third of a one percent. And indeed, the Dow is at record. So, that makes it the 47th record for the Dow so far, this year.
We've had 43 S&Ps, 55 Nasdaq.
Within the Dow, Walmart shares -- one of the large reasons why the Dow rose, Walmart was up 4.5 percent. The company has announced a 20 billion
share buyback. And Procter & Gamble declared victory over the activist shareholder, Nelson Peltz who failed to win a seat on the P&G board.
To the sentiment, green on the Dow, sharp green on the sentiment, 84 on the CNNMoney and fair and greed index, which signifies extreme greed. Alan
Valdes is on the floor of the DME securities. He's on the floor of the exchange. Alan, I'm overcome with the whole question of the Dow. The Dow
was up, it's at a record. Walmart, one of those elements that pushed it. But the market on all the indices wanted to move higher.
ALAN VALDES, DIRECTOR OF FLOOR TRADING, DME SECURITIES: Yes, no question about it. I mean, yesterday was a holiday, so we just disregarded anything
that happened yesterday. Today the market is back to its normal run. It seems like every week we're getting new highs. You know, constantly.
We're waiting for that correction. But I don't know, Richard. I don't know if we're going to see a correction any time soon. If you look at the
basic fundamentals, I mean, you look at that ISM number last week, it knocked it out of the park. It was the best in years. Full unemployment
basically, jobs number continues to be strong. Discount that hurricane stuff. But basically, that continues to be strong. We saw inflation and
wages pick up a little. So, looks like we'll get a rate hike, too this year.
QUEST: And that rate hike, not killing off growth but actually could consolidate the growth, couldn't it? I mean, this market -- the Dow was up
all throughout the session as indeed was the broader market. If the economics is good, we're about to enter the earnings season. What should
we be looking for?
VALDES: Well, you know, I think the earnings may be a little disappointing compared to last quarter. Only because the hurricanes hit the airlines,
the energy sector and some other major sectors. Big players in the earnings cycle. So, I think you might see it a little disappoint. But
traders are prepared for that. I think basically, like I said, the basic economy is so strong that it's going to take something major to really
correct this market down big. I mean, we'll probably see a little correction, 2 percent down the road. That would be normal. But I'll tell
you, I don't see anything on the horizon even with Trump and North Korea and everything else, affecting this market.
You know, Richard, last week, we got the liquid bonds and equity amounts around the world, 129 trillion. This market is up 55 trillion from the
election alone.
QUEST: Alan, I need, though to square the circle when I have Wolfgang Schauble, the German finance minister writing in the "Financial Times" that
he's worried about bubbles and asset bubbles and too much liquidity and imbalances. How do we -- they are the sort of -- that is the sort of meat
and veg that could blow this market out of the water.
VALDES: It could. But at the same time, I just think this is the only game in town. If you're looking to make money, make anything on your
money, you have to go into equity markets somewhere around the world. Does it cause a bubble? Yes. According to Warren Buffett, it's not that
overpriced right now. So, I think we've got a way to go. Market is strong. There's no place else to invest. And there's just so much money.
The world is awash in money. I think it going to keep pouring into the economy here in the United States. We're the best house in the worst
neighborhood.
QUEST: When you put it like that, Alan -- thank you very much. Alan Valdes, the best house in the worst neighborhood or the, or cleanest white
shirt in the dirty laundry is another way of putting it.
As we continue on QUEST MEANS BUSINESS, tonight, Catalonia's President has delayed a declaration of independence. It's already too late for many
Catalan businesses. They are moving out. Will have more after the break.
[16:30:00] (COMMERCIAL BREAK)
QUEST: Hello, I'm Richard Quest. There's more QUEST MEANS BUSINESS in just a moment. When Donald Trump insists his plans for tax reform are more
popular than ever even as he continues to pick fights with Republican colleagues.
Vladimir Putin says it's time for Russia to regulate crypto currencies. We're going to take you inside a Russian bitcoin farm. Before that this is
CNN, and here on this network the news always comes first.
The President of Catalonia says the region has earned the right to independence from Spain. Now wants to allow time for dialog with the
Spanish government. The President Carles Puigdemont also said, the results of an October 1st referendum must be respected. It was then that
Catalonians voted in favor of independence. Spain declared that referendum illegal.
President Donald Trump says he has confidence in the Secretary of State, Rex Tillerson, despite strange relations between the two. Mr. Trump and
Mr. Tillerson met on Tuesday at the White House. The meeting follows reports that Tillerson called the president a moron earlier this year.
Kenyan opposition leader, Raila Odinga, now says he's quitting the presidential election rerun set for later this month. He says he is
withdrawing because he feels the electoral commission has refused to reform. It's not clear if the election will go ahead if the incumbent
president will automatically be declared the winner.
A South Korean lawmaker is accusing -- North Korea of hacking classified military documents from a South Korean defense ministry database. The
breach includes U.S. South Korea wartime plans, as well as a document on procedures to decapitate North Korean leader Kim Jong-un. U.S. pentagon
spokesman said he's confident in the security of operational plans and the ability to deal with threats from North Korea.
An explosive new report is adding to the sexual misconduct allegations against the Hollywood producer Harvey Weinstein. According to the "New
Yorker" magazine, three women are accusing the movie mogul of raping them. Weinstein has denied the accusations.
[16:35:00] And the "New York Times" reports a-list stars including Gwyneth Paltrow and Angelina Jolie are now saying Weinstein sexually harassed them.
While the final decision may have been delayed. Businesses in Catalonia are doing what they need and needs must. They are preparing for
independence. Seven companies in the IBEX are based in Barcelona. All but one of them have now announced plans to move their legal base. Even
Barcelona's water company is moving its legal address to Madrid's. And Freixenet the region's top Cava producer says it may move out, as well.
CNN's Isa Soares is in Barcelona.
(BEGIN VIDEO CLIP)
ISA SOARES, CNN CORRESPONDENT (voice over): On the outskirts of Barcelona one company is preparing its exit strategy from region it has always called
home. This is Cava country, and Freixenet is the leader in sparkling wine, with roughly 185 million bottles of Cava and wine being sold globally every
year.
Inside it's caves echoes of independence are rattling some nerves. None more so than its president and head of Spain's chamber of commerce, Jose
Luis Bonet, who tells me independence would be catastrophic.
JOSE LUIS BONET, PRESIDENT, FREIXENET (through translator): If Catalonia declares independence and if that declaration isn't stopped, he says, it
will be out of the European Union. And leaving the European Union for Catalonia is a disaster.
SOARES: So, he's meeting with the Freixenet board and laying his cards firmly on the table.
BONET: In the event there will be a declaration of independence, he says, I will tell the board that my advice and my recommendation would be to
change Freixenet's headquarters.
SOARES (on camera): The fear is that a declaration of independence could send a company like Freixenet into the depths of the unknown. Potentially
hampering a company that's been right here in Catalonia for more than 100 years.
(voice over): But the concerns go deeper than that. With roughly 70 percent of its exports going to Europe and with Germany it biggest market,
Freixenet has reason to worry about its financial future, and critically competitiveness.
I asked Mr. Barnett whether he could feel this Catalan disillusionment always bubbling away beneath the surface.
BONET: He tells me, we have gone from a dictatorship to a democracy. From a country without rule of law to a country with rule of law. A country
that didn't have a welfare state to one that has. And has survived an economic crisis. This doesn't mean there aren't any problems. And there
are problems, and we should address them. But what we shouldn't do is destroy what we have built.
SOARES: Strong words from a man who is hoping neither leader will burst Catalonia's prosperous bubble. Isa Soares, CNN, Barcelona.
(END VIDEOTAPE)
QUEST: And you have missed one or two items or just feel the need to have a listen again. You can download our show as podcast. It's available from
the major providers and it's at CNN.com/podcast.
In a moment, Donald Trump, Tillerson and tax. The president speaks out about his top diplomat and what's next for his tax plan.
(COMMERCIAL BREAK)
[16:40:16] QUEST: President Trump says he did not undercut his Secretary of State, Rex Tillerson, with his public statements. The two men have said
to have clashed in recent months since reports emerged that Tillerson called the president a moron. Ahead of a meeting with Mr. Tillerson, the
president welcomed former Secretary of State Henry Kissinger to the White House. Now the president is insisting his tax reform is still on track.
(BEGIN VIDEO CLIP)
DONALD TRUMP, PRESIDENT OF THE UNITED STATES: People want to see tax cuts, they want to see major reductions in their taxes, and they want to see tax
reform, and that is what we are doing. And we will be adjusting a little bit over the next few weeks to make it even stronger, but I will tell you
that it has become very, very popular
Jeff Zeleny is at the White House. So much to get to grips with, Jeff Zeleny. Let's first get to the tax plan. It's a little it's strange to be
talking about the tax plan when you are sitting next to Henry Kissinger, who is a foreign policy guru.
JEFF ZELENY, CNN, SENIOR WHITE HOUSE REPORTER: You know, just add it to the list of strange things that occasionally happen here or often happen
here at the White House. The president was asked a question about his tax plan right
there when he was meeting with the former Secretary of State earlier today. It's something we have not heard the president talk a lot, certainly no
specifics about the tax plan.
But he did say. I was interested to hear, he said it will make some adjustments to this plan will make it stronger. Well, I'm not sure if that
means to make the tax cut bigger or what. We asked for clarification. And the White House Press Secretary Sara Sanders
said, look, they're going to leave the broad framework as it exists. This is still being written on Capitol Hill and the House and the Senate.
Richard, it's tied into all these fights that the president is having with Republicans, because the reality is, he needs virtually every Republican
vote on this tax plan. It's why some officials here at the White House and on Capitol Hill have heartburn that he's picking fights with his fellow
Republicans.
QUEST: Right. What do we me -- what's your understanding, Jeff Zeleny, of this
spat, dispute, argument, would everywhere call it between Tiller's and Trump?
ZELENY: You know, it's been long-brewing, long simmering and came into a boil publicly last week when there were those reports that the Secretary of
State referred to the president earlier this summer in Pentagon meeting as a moron. The president, of course, not pleased by that. But, again, the -
- he's intending to keep him around, we're told. He was asked directly if he has confidence in his Secretary of State. He said, yes, he does.
But one of the reasons that the officials here say he's keeping him around is, frankly, the government is still largely unfilled, how many vacancies
can you have at one point? So, his advisors have urged him to keep Secretary of State Tillerson and physician at least through the end of the
year. But of course, the questions today in "Forbes" magazine with the president raising questions about his IQ, who is smarter, et cetera, simply
add fuel to that fire. But the reality is, at least for now, Rex Tillerson seems to be staying, Richard.
QUEST: Jeff, the White House on this IQ question said the president was joking. The president was having a bit of fun. I guess it raises the
legitimate question, our week, you, me, the media, the entire body politic, taking him too seriously at his word, and should we lighten up?
ZELENY: I think on things like is, talking about his IQ, I think you can pretty much make the case the president is joking. But the reality here
is, the real tensions that underlie this ongoing fight between the secretary of state and the President are very real, think perhaps not even
two weekends ago about those tweets the president sent out undercutting his secretary of state about negotiating with North Korea.
There is nothing joking about that, there is no laughing matter in that, so the reality here is perhaps the president should send up a warning flag
when he's joking and if he's not. Because sometimes it's difficult to tell.
QUEST: Now, finally, yesterday with the whole issue of the comments, with attacking Senate, senior Senate Republicans. Senator Corker basically said
others are saying this publicly, others are saying this privately, I am really going to say what others are saying, I am paraphrasing, basically
behind closed doors.
At what point, you know, Jeff, from your contacts that top Republicans are saying that on a daily basis about the president. At what point will they
all go public?
[16:45:00] ZELENY: Richard, I just do not see that happening. And this is why. Senator Bob Corker, suddenly became free to speak about these things,
Beta truth serum if you will when he said he wasn't running for reelection. So, he is now free to talk about this. The reality is a lot of other
senators are running for reelection and they do not see any advantage here in picking a fight with the president. The larger reason is that Trump
supporters out in America in their home states still like the president more than they like members of Congress. So, I do not look at all for a
groundswell of Republican senators to join in this.
We have called around and asked aides, advisors of every single one of the Republican Senators, 52 of them. Richard, there's been very little
response back terms of my boss or my Senator is going to follow suit here. Yes, they may think it but do not look for a groundswell of people
following suit to Bob Corker.
QUEST: Jeff, grateful you've given us such time this evening. Thank you, sir. I appreciate.
President Trump says the U.S. government will stand with the people of California
as the wildfires there intensify, more than a dozen fires raging control. The largest in California's wine country, at least 15 people have been
killed. More than 20,000 people have been evacuated from the region. Dan Simon is in Northern California in the town of Santa Rosa, which has been
largely destroyed, or at least parts of destroyed. Dan, it is difficult for those of us who have not experienced this to understand the ferocity
and speed with which a wildfire takes hold and then spreads.
DAN SIMON, CNN CORRESPONDENT: It's unbelievable, Richard. Utter devastation here. We are in the coffee park neighborhood. There is not a
single home standing. Take a look behind me, you can see all of the devastation here. 20,000 folks in the area have been evacuated.
We were actually at an evacuation center and the need is great, you need toys for kids, they need clothes, so many people have been impacted. Take
a look.
From northern to southern California more than a dozen wildfires still burning out of control.
UNIDENTIFIED MALE: We're trying to get out of here, we saw it, now to getting across the road. It's all bad.
SIMON: 50 miles northwest of San Francisco in wine country, flames tore through parts of Santa Rosa California turning cars and subdivisions into
ash.
UNIDENTIFIED FEMALE: They were screaming fire, fire, fire. Get out
UNIDENTIFIED MALE: It just happened so fast you just had time to run away with nothing.
UNIDENTIFIED MALE: We have cars and Harleys and boats and all kinds of stuff, all gone.
SIMON: Fast food restaurants, hotels and homes all destroyed. Hospitals in the area evacuated, more than 115,000 acres have been burned. Much of
it in California's wine country, Napa and Sonoma counties.
These flames destroyed wine storage buildings at one historic vineyard. Farther south near Los Angeles fires in Anaheim have lit up skies over Walt
Disneyland. Hurricane force winds pushed the flames so fast, firefighters couldn't keep up.
UNIDENTIFIED MALE: On the eastern flank, last night we tried to go direct and a couple of different places, NB got out run by the fires.
SIMON: Mill Valley fire chief Tom Welch's own home near Santa Rosa burned.
CHIEF BARRY BIERMANN, NAPA COUNTY FIRE DEPARTMENT: The fires are still out there, they are still actively growing.
SIMON: And the firefighters are exhausted.
BIERMANN: Resources still continue to be limited. We have folks on the fire line starting their third shift right now, they have not been
relieved, because there were folks not available to come in with so many fires in the area.
SIMON: The fierce winds, which have been spreading uncontrollably, died down Tuesday. The flames with it. But a forecast of dry weather and no
rainfall for the week, still a concern.
In this fire is 0 percent contained. Richard, at least 15 people have died. Authorities are now releasing the names of some of those folks. Two
of them include an elderly couple. The husband, 100 years old. The wife, 98 years old. They died in the middle of the night while trying to flee
the flames. Richard?
QUEST: Dan, thank you, Dan Simon with the very troubling and disturbing fires, thank you.
Vladimir Putin of Russia says that digital currencies can be used for everything from tax fraud to terrorism. Now that he is planning a
crackdown, we are going to take you aside a Russian bit coin farm. After the great.
[16:50:00] (COMMERCIAL BREAK)
QUEST: President Vladimir Putin says there are serious risks with crypto currencies
like a bit coin after you call the top-level meeting on their use. Digital currencies are growing more popular in Russia and now the government is
trying to regulate them. To a lot of people, bitcoin looked like a good bet, its price in dollars -- just look, risen more than 400 percent so far,
this year. As CNN's Claire Sebastian reports from Moscow many Russians don't want to miss out., but miss out on what?
(BEGIN VIDEOTAPE)
CLARE SEBASTIAN, CNNMONEY CORRESPONDENT: This is processing power. Hundreds of computers in an old Soviet car factory, hunting for bitcoins.
Very noisy in there! Very windy.
It's the big idea of Dmitry Marinichev, an entrepreneur and Russian President Putin's Internet ombudsman.
He wants to make Russia global leader in cryptocurrencies.
It is cheap electricity here he tells me, in the cold climate which allows you to build facilities like ours and cool equipment naturally.
How many bitcoin's can you mine here in one day?
DMITRY MARINICHEV, RUSSIAN INTERNET OMBUDSMAN: I don't know.
SEBASTIAN: And that's just it. His computers are in a global race to complete complex mathematical tasks that reward them with bitcoin's. That
is how mining works.
The bitcoins are allocated using block chain technology, a huge ungoverned reservoir of data that's constantly refreshed as hundreds of thousands of
bitcoin transactions take place every day.
And I am about to add another. Alexander Ivanov a physicist now developing crypto currency has agreed to buy me dinner with bitcoin. The transaction
is settled by the mining computers on the bitcoin network. No banks or credit card companies which means no fees or commissions.
Ivanov runs the online platform, Waves.
ALEXANDER IVANOV, FOUNDER, WAVES: You can pay here, you can send money to another account. You can also create and make change. You can't turn it
off, it exists on its own. It doesn't need some kind of governance or guidance.
SEBASTIAN: While block chain technology is gaining traction, using crypto currency to pay for anything in Russia is illegal. So, when we paid for
dinner, the restaurant also had to carry out a mirror transaction in rubles making it a legal exchange.
The owner told me he had already had a visit from the Russian prosecutor's office who found no wrongdoing with how they handled transactions.
Russia's parliament is grappling with the challenges of trying to regulate crypto currency.
ELINA SIDORENKO, RUSSIAN PARLIAMENT GROUP OF CRYPTO CURRENCIES: I think that the risks are the same for all countries, it is the anonymous nature
of the transactions, in the fact that it is impossible to apply international anti-money laundering standards to crypto currencies at the
moment.
SEBASTIAN: At this bitcoin mine, Marinichev says, crypto currencies may be more transparent than real ones.
MARINICHEV: Bitcoin can help the world change. It will allow it to cleanse itself from the madness of some individuals, governments and
parliaments. It will allow the world to become a more equal place.
This is how technology -- touch it, it's hot.
SEBASTIAN: And the computers even generate energy, all in a day's work on the frontier of money. Claire Sebastian, CNNMoney Moscow.
(END VIDEOTAPE)
QUEST: In the last few moments, we have learned that the Spanish prime minister, has called an extraordinary cabinet meeting that will be held on
Wednesday morning. It comes after the Catalan president announced a suspension of the declaration of independence for Catalonia.
[16:55:00] European markets are closed by the time the Catalan president spoke but the issue becomes what that cabinet meeting will be about. Will
it be to start some form in negotiations or talks or further autonomy discussions with Catalonia, a will that just basically reaffirm the
position that has already been put forward?
Spanish stock gave back all of Monday's gains and more. If you look at the FTSE it rebounded from yesterday's losses, but the other big three, the
DAX, the CAC and the IBEX they were all lower and a quick look at the Dow Jones industrials and why not. Because of all of the three major markets
in New York, the Dow was the one that closed at an all-time record, the 47th record so far, this year. The S&P on the Nasdaq they were up but
there were no records there for them.
Those are the markets, we will have more with a Profitable Moment after the break.
(COMMERCIAL BREAK)
QUEST: Tonight's Profitable Moment, the speed with which the wheels have come off the Weinstein wagon is really quite remarkable. The allegations
have gotten more serious against Harvey Weinstein with a report from the "New Yorker" magazine alleging forced sexual activity including rape.
Now, the size, scale, the entire way in which this has been perpetrated, is quite remarkable. Because many of the cases that we are hearing about now
happened at a time when it was well-known that sexual harassment and this sort of behavior was unacceptable.
I too was brought up and came to age, if you like, in the workplace at a time of a different era, if you like, when women knew that if you got into
the elevator with Mr. Smithers of accounting, you had better have a sharp stick with you or pencil to do again when his hand started to wonder. But
over the years, everybody has learned that such behavior is not acceptable.
Yes, in large organizations, it will continue in some measure. But the scale of the Weinstein allegations shows much more complicity than we heard
so far. And that's what the store needs to go from here.
And that's Quest Means Business for tonight, I'm Richard Quest in New York, and whatever you are up to in the hours ahead, I hope it is profitable.
We'll do it again tomorrow.
END
