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Quest Means Business
Pentagon Briefing on U.S. Operations in Niger; Trump "Very Close" To Fed Chair Decision; ISIS Loses Lucrative Syrian Oil Field; "Wolf of Wall Street" Worried by Cryptocurrency; Megyn Kelly Hits Outs at Fox News Over Harassment. Aired 4-5p ET
Aired October 23, 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: Grave day on Wall Street. The Dow spent most of the session higher and then turned turtle toward the end of
the day. It is actually off about a fifth of a percent. The Nasdaq and the S&P are down. No record on any of the major markets.
And well, look at that. Look at it, he's gritting his teeth. That's what you call a firm gavel. Trading is over around the world. And it is. It's
Monday. It's October the 23rd.
Tonight, Donald Trump said he's very close to picking the next Fed chair. Who will it be?
ISIS loses one of its most lucrative oil fields. We'll take you to the heart of that battle.
And it's been called a fraud and the next Enron. I'll ask the original real wolf of Wall Street why he's worried about cryptocurrencies.
I'm Richard Quest, live from the world's financial capitol New York City, where I mean business.
Good evening, straight to Washington and a press conference with the Joint Chiefs of Staff on Niger.
MARINE GENERAL JOSEPH DUNFORD JR., CHAIRMAN, U.S. JOINT CHIEFS OF STAFF: - - my sincere condolences to the families and the units of the fallen. They're all in our thoughts and prayers. Unrelated, today is the
anniversary of the 1983 Beirut bombing and I want the families of the 241 Americans lost that day to know we'll also never forget them.
After speaking to Secretary Mattis this morning, I decided to address you because there's been a lot of speculation about the operation in Niger. It
is a perception that the Department of Defense has not been forthcoming. And I thought it would be helpful for me to personally clarify to you what
we know to date and to outline what we hope to find out in the ongoing investigation. Secretary Mattis would to be here, but as many of you know
is in Asia.
Our soldiers are operating in Niger to build a capacity of local forces to defeat violent extremism in West Africa. Their presence is part of a
global strategy. As we've seen many times, groups like ISIS and Al Qaeda pose a threat to the United States, the American people and our allies.
They're a global threat and enabled by the flow of foreign fighters, resources and their narrative. And they seek to operate where they can
exploit weaknesses in local government, in local security forces.
If you think of those enablers as connective tissue between groups across the globe, our strategy is to cut that tissue while enabling local security
forces to deal with the challenges within their countries and region. While we can be proud of our progress to date, we have to acknowledge our
work is not done. Even with the fall of Mosul and Raqqa, we're at an inflection point in the global campaign, not an end-point.
That's why tonight I'm going to welcome chiefs of defense and representatives from 75 different countries to improve the effectiveness of
our military network to defeat terrorism. In our discussions over the next day or two, we'll focus on improving information sharing between nations to
detect and defeat attacks before they occur and to approve this support we provide to nations, provided that -- confronted with violent extremism.
And that's exactly what our forces in Niger were doing. The United States military has had forces in Niger off and on for more than 20 years. Today,
approximately 800 service members in Niger work as part of an international effort led by 4,000 French troops to defeat terrorists in West Africa.
Since 2011, French and U.S. troops have trained a 5,000-person West African force and over 35,000 soldiers from the region to fight terrorists and
affiliated with ISIS, Al Qaeda and Boko Haram.
Let me address the specific events in Niger that took place earlier this month. On the 3rd of October, 12 members of the U.S. special operations
task force accompanied 30 Nigerian forces on a civil military reconnaissance mission from the capital city of Niamey, to an area near the
village of Tongo. Approximately 85 kilometers to the north was the location of that village. On the fourth of October, U.S. and Nigerian
forces began moving back south. And in route to their operating base, the patrol came under attack from approximately 50 enemy, using small arms
fire, rocked propelled grenades and tech vehicles.
And what I want to do now is I want to walk through for you the timeline that we have and kind of what I would categorize as what we know about the
incident. So, early in the morning on 3rd of October, as I mention, U.S. forces accompanied that Nigerian unit on a reconnaissance mission to gather
information. The assessment by our leaders on the ground at that time was that contact with the enemy was unlikely.
[16:05:00] Midmorning, on October 4th, the patrol began to take fire as they were returning to their operating base. Approximately one hour after
taking fire, the team requested support. And within minutes, the remotely piloted aircraft arrived overhead. Within an hour, French Mirage jets
arrived on station. And then later that afternoon, French attack helicopters arrived on station. And a Nigerian quick reaction force
arrived in the area where our troops were in contact with the enemy.
During the fire fight, two U.S. soldiers were wounded and evacuated by French air to Niamey. And that was consistent with the casualty evacuation
plan that was in place for this particular operation.
Three U.S. soldiers who were killed in action were evacuated on the evening of 4, October, and at that time, Sergeant La David Johnson was still
missing. On the evening of 6, October, Sergeant Johnson's body was found and subsequently evacuated. From the time the fire fight was initiated
until Sergeant Johnson's body was recovered, French, Nigerian or U.S. forces remained in that area.
Now many of you have asked a number of questions, and many of them are fair questions and we owe you more information. More importantly, we owe the
families of the fallen more information. And that's what the investigation is designed to identify. The questions include, did the mission of U.S.
forces change during the operation? Did our forces have adequate intelligence, equipment and training? Was there a pre-mission assessment
of the threat in the area accurate? Did U.S. force -- how did U.S. forces become separated during the engagement, specifically Sergeant Johnson? And
why did it take time to find and recover Sergeant Johnson? Again, these are all fair questions that the investigation is designed to identify.
And what I would say is that I hope from this brief overview I've outlined why our forces were in Niger. What they were doing at the time of the
incident on the 3rd and 4th of October, what we know and, again, the questions that remain that we will work on over the next several weeks as
the investigation unfolds. And with that, I'm happy to take your questions.
JIM SCIUTTO, CNN CHIEF NATIONAL SECURITY CORRESPONDENT: General Dunford, thanks very much. We've reported that Sergeant Johnson's body was found
some one mile away from the initial site of contact. Is that consistent with the information that you have and is there any assessment at this
point as to why that was the case? And I have a brief follow-up if you don't mind.
DUNFORD: Sure. Jim, this really is for all of you as we ask questions. We feel pretty confident in what took place before this patrol moved out.
We know the general route that the patrol took before they came back in. What happened from the time the patrol went out on the operation until the
time when it returned, there's been a lot of speculation and a lot of reports. And that's why I want to baseline today what we know and what we
don't know. And what you're asking is a fair question, but we don't know that definitively right now. I can't answer it definitively.
What I'm trying to do today and be very candid in what do we know, I'll share with you where I've seen speculation, and then what are the
fundamental questions we're asking. And the questions that we're acting -- now this is a very complex situation that they found themselves in. A
pretty tough fire fight. And what tactical instructions the commander on the scene gave at a given time that caused units to maneuver and where they
might have been when Sergeant Johnson's body was found, those are all questions we'll identify during the investigation. And you had a follow-
up.
SCIUTTO: You're aware, I imagine, that some of the administration when faced with tough questions about this operation, the information sharing
from the operation have intimated that perhaps members of the press shouldn't ask such tough questions, particularly of people in uniform or
recently in uniform. And I'm curious if you have a reaction to that? If you share any of that or you take any issue with those kinds of questions?
DUNFORD: Let me just speak for myself on sharing information with the media. I don't know exactly what you're referring to and so I'm not going
to benchmark my comments against that. I think first and foremost in this particular case we owe the families as much information as we can find out
about what happened. And we owe the American people an explanation of what their men and women were doing at this particular time. When I say that I
mean men and women in harm's way anywhere in the world. They should know what the mission is and what we're trying to accomplish when we're there.
And so, those are all fair questions in my judgement.
In other words, that's why we're out here today, is to take your questions and provide as much information as we have. The only thing I'm asking for
today is a bit of patience to make sure that what we provide to you when we provide it is factual. And the other thing I think that is also important
is when this information is finally available, the first thing we're going to do is go visit the families in their homes should they welcome us. And
we will have a team go in of experts. And I've done this personally myself several times. A team of expert goes into the family and share with them
all the facts that are available as a result of the investigation and give them an opportunity to ask questions.
[16:10:00] And as soon as we're done with that, we'll come back in here and we'll share exactly that same information that we shared with the families.
So, when I tell you today we don't know, it will be a fair answer. We don't know. And I'll tell you everything we do know definitively, and I'll
tell you what the key elements are of the investigation that we hope to find out in the coming weeks. But, again, with regard to being
transparent, I think we do owe the families and the American people transparency in incidents like this and we intend to deliver just that.
UNIDENTIFIED MALE: General Dunford, if I can get a quick follow-up on the timeline. You said they didn't call for air support until an hour into
contact and then the French came? That would make the arrival of the French 90 minutes, a good two hours after the initial contact, which
conflicts with what we've been told.
DUNFORD: OK. Let me walk you through timeline. The best we know now, you know, when I have a degree of confidence, I'm sharing it. About an hour
after the initial contact was made, they requested support. When they requested support, it took the French aircraft, the French were ready to go
in 30 minutes, and then it took them 30 minutes -- approximately 30 minutes to get on the scene. So, from that, I think it's a fair conclusion to say
that about two hours after the initial contact was made, the initial French Mirages arrived overhead.
But it's important to note when they didn't ask for support for that first hour, my judgement would be that that unit thought they could handle the
situation without additional support. And so, we'll find out in the investigation exactly why it took an hour for them to call, we shouldn't
conclude anything by that one hour. It may very well have been and have been in these situations myself where you're confronted with enemy contact,
your initial assessment is you can deal with that contact with the resources that you have, and at some point, in the fire fight they can
colluded they needed support. And so, they called for additional support.
The confusion of the 30 minutes, which is always the danger of coming out and sharing information. Right. And so, this is what I'm trying to do to
clear up today. I think you were told in the past that the French were there in 30 minutes. They responded within 30 minutes and they were
overhead of this unit within 30 minutes. That's where the 30 minutes came from and I'm making that clarification.
UNIDENTIFIED MALE: And then an operational clarification. You said they were ambushed when they were coming back to your outpost. Previously we
were told they were ambushed when they were leaving the village. Is there a discrepancy there?
DUNFORD: No, there is not a discrepancy. When I described it, they're leaving the village. Where are they going at that point? They're going
back to their operating base. They're moving south.
UNIDENTIFIED MALE: Were they far from the village?
DUNFORD: I don't have the exact details of how far. The investigation, again, we'll go out there. You know, these investigation for those that
haven't been involved in the past, there will be people on the ground that will actually go and look at where this took place and measure the
distances and get the details. And we will be provide so we can provide the family with detailed graphics of exactly what happened and how this
unfolded. So, I wouldn't want to talk about numbers and meters from the village. But the initial report was that the contact they made with the
enemy was outside the village, south of the village as they were heading back to their operating base.
UNIDENTIFIED MALE: I just want to be clear here, that you said that they did not call for support until an hour after first contact. That's kind of
putting a lot of pressure on those team members. So, can you say without a shadow of a doubt that within that hour they did not try to call out for
support?
DUNFORD: Look, what I can tell you is the timeline that we have is the first indicator that the unit called for external support was one hour
later. Now, I will tell you, the information I'm providing to you today is the complete information I have available. We may very well find out --
this is the difficulty in addressing these before the investigation is complete. And I'm not -- I'll tell you what, the one thing I would push
back on hard is, I'm not putting any pressure on that unit. I made it very clear that I make no judgement as to how long it took them to ask for
support. I don't know that they thought they needed support prior to that time. I don't know how this attack unfolded. I don't know what their
initial assessment was of what they were confronted with.
What I do know is that our logs indicate an hour after the contact approximately they requested support and then I talked about the timeline
of the French response. That's just what I know right now. I'm not going to tell you that in the investigation we won't find out that they attempted
to get support and it didn't come, I'm just telling you what I know. Everything beyond what I told you would be speculation -- Tom.
UNIDENTIFIED MALE: Is there good enough intelligence, do they have enough ISR and equipment? But General Waldhauser, who runs African command, in
his confirmation hearing last year said he's the economy theater. Clearly, he doesn't have enough. And if the French have to come and help out,
doesn't that, you know, raise the question -- is there enough American equipment there. Number one. And again, Secretary Mattis said he wants to
expand, lean forward more in AFRICOM. Can you do that without sending more equipment, ISR over there?
[16:15:00] DUNFORD: Tom, fair Question. I think I would distinguish between what does the commander of AFRICOM need to do the full range of
missions that he believes need to be done and what missions are being done with the equipment available? I will tell you, that while General
Waldhauser may need more capability to do more missions or more expansive missions, the responsibility of the commander is to employ the force within
the resources they have available. So, we shouldn't confuse the need for more capability to expand the mission with what capabilities are provided
to a particular unit at a particular time, if you understand the distinction I'm trying to make.
UNIDENTIFIED MALE: This particular question you still need to be answered --
DUNFORD: Absolutely. I mean, look, there are two reasons to do the investigation. One reason is to make sure that we inform the families, the
American people. And the Congress, of course. The second is every time something like this happens, we do an internal look at ourselves and find
out what is it that we did, what could we do better and then make changes based on what I would consider an after-action review.
QUEST: So, there's Marine General Dunford talking about the operation in Niger that left four dead. A very frank, honest assessment of it. CNN's
Ryan Browne is at the Pentagon for us listening. As I listened to what the major general, head of the Joint Chiefs of Staff, very interesting, going
out of his way, quite the opposite from what we heard last week from Kelly, the White House Chief of Staff and others. This time basically saying
there's nothing to hide. If we've got it, we'll tell you.
RYAN BROWNE, CNN PENTAGON REPORTER: That's right, Richard, in a very rare appearance from the chairman of joint chiefs. America's number one top
ranking military officer doesn't come to the Pentagon briefing room often unless he has something to say. Clearly, he felt the need to kind of come
out here and explain exactly what happened during this operation in Niger, and kind of reveal some additional details.
QUEST: And also, interestingly, and not to harp on it. To Jim Sciutto's question, again and again saying your question's fair, fair question. I
made a list of the things. Was there bad -- did the mission change? Did they have adequate equipment? Why were they separated? Why did it take
the time to recover the bodies? All questions, but in the past reporters have been told they are not appropriate to ask. But here we have Dunford
going out of his way repeatedly to say these are fair questions.
BROWNE: That's right and the military is looking into these questions themselves. Trying to get to the bottom of it, launching an investigation
into what exactly happened in order to make sure that it doesn't happen again. And I think you hear from the military and even Chief of Staff
Kelly, necessarily I think the tactical elements of it, welcoming that kind of line of questioning. You know, what could be done better? But in terms
-- so definitely the military more comfortable speaking to that. Of course, Chairman Dunford, not willing to kind of be drawn into whether or
not he was taking a different approach from the White House. Making it clear that he was speaking for himself. But again, very clear that they
want to give as much as possible to both the families of the killed servicemembers, as well as the media and the general public.
QUEST: Ryan Browne, who's at the Pentagon. Ryan, we thank you for that. Keep listening to what the chairman of joint chiefs said and if there's
more, please come back to us.
As we continue tonight on our business agenda. President Trump said he's very close to his decision on who will lead the Federal Reserve. The
president has earmarked this week as an opportunity to make critical progress on two of Wall Street's biggest priorities, the Fed and tax
reform. And to that end, he's due to visit Capitol Hill on Tuesday.
Here he is today in the White House, in the Rose Garden, with the Prime Minister of Singapore.
The U.S. Tax code has not seen substantial changes in three decades, speaking to Fox Business, the president says he expects Congress to pass
tax reform before the end of the year.
(BEGIN VIDEO CLIP)
DONALD TRUMP, PRESIDENT OF THE UNITED STATES: I want to get it by the end of the year, but I would be very disappointed if it took that long. It
could be substantially less than that, depending on what happens when we send the bill back to the House. You know, they'll send it back and people
are going to go and, you know, make 200 suggestions as opposed to maybe no suggestions because it's a great bill.
(END VIDEO CLIP)
QUEST: David Chalian, is CNN's political director. He's following the developments in Washington. I do love the way the president talks about
making suggestions, as if sort of these people coming along as sort of bystanders, as opposed to actually making amendments which are the core of
what they are supposed to do.
DAVID CHALIAN, CNN POLITICAL DIRECTOR: It's called legislating.
[16:20:00] QUEST: Yes, that's the word.
CHALIAN: Co-lethal branch from the one that he president runs in the executive branch. Yes. What you actually heard the president doing there,
he's talking about the first step of this process. Richard, as you know, the United States Congress is in the process of passing a budget basically
to set the rules for how tax reform will pass. We don't have tax reform legislation yet. So, when he says suggestions, we haven't even seen the
bill yet. Believe you me, there are going to be tons of suggestions from people from both sides of the aisle as they look at this.
What I think is so interesting, Richard, is that in that -- yesterday on that same day that interview aired, president Trump was on the phone with
House Republicans, sort of teeing up the week and trying to get the pep rally going. He's leading with politics with them. He says we must get
this passed or you're going to lose your jobs. This is where he got into trouble with the health care. Thinking that the political imperative would
get everybody on board, rather than getting the policy in the right place. And there are a lot of questions about this tax cut package so far.
QUEST: Is it -- I keep asking this sort of every day, because I -- is it likely, is it even possible to have full throttle tax reform by a bill by
thanksgiving, which is three full weeks away? I mean this thing requires huge amounts of deliberation by extremely geeky people who work out the
long-term ramifications if you're going to go for reform, not just tax cuts.
CHALIAN: And the reform may not be as robust as initially envisioned. But I will be surprised if it's just tax cuts. I do think though a lot of
Republicans on the Hill are making the argument that some of these reforms have to be in place if these tax cuts are going to have the kind of
economic boosting effect that they hope and that they're selling to the American people. I had breakfast with a Republican member of Congress at
the end of last week, he laid out the schedule. And so, I'll answer your question. It is potentially possible if everything goes according to plan,
that by Thanksgiving break this thing is on course. But I would never say likely. We' re talking about the United States Congress.
QUEST: I just remember the old phrase, you'll be familiar with it, David. Legislate in haste, repent at leisure. Is a paraphrase. David Chalian
joining us from Washington.
The markets had seen a lot of what was happening, join me at the trading post. No records on the markets. The Dow, the Nasdaq and the S&P, they
were all lower. The Dow had been higher during the course of the session. Whereas these two had remained lower throughout. But by the close, the Dow
was also up, and pretty much similar sort of the Nasdaq saw the biggest loss.
Remember, this week, it's a third of the S&P 500 are going to be declaring. So red across the board for all the major markets. No records in either
Europe or the United States. And on this question of tax reform and the president, Donald Trump today said he is very, very close to deciding on a
new Fed chair, and there are three people plus a couple of others in his words.
So, who have you got? You've got Jerome Powell who oversees Bank regulation at the Fed. So, he's already there as a governor. You've got
Taylor, John Taylor, Professor Taylor who teaches economics at Stanford. And you've got Donald Trump -- with Janet Yellen, the existing chair.
Donald Trump says he likes Janet Yellen a lot. But he's been very skittish on whether or not he's going to give her a second go. Kevin Warsh has been
the most visible. And Gary Cohen is the director of the National Economic Council, former president of Goldman Sachs.
Remember, President Trump has to fill the positions open by Janet Yellen, if he doesn't reappoint her. And by Stan Fisher, the former vice chair.
And there's also two other Fed seats available. There's only seven of them. So, over the next year or so, the President will get a chance to
completely reshape the board of the Federal Reserve. No market records, red day on the Dow.
When we come back after the break, striking a new blow in the battle against ISIS. U.S.-backed forces say they have captured Syria's largest
oil field from the Islamic state. We'll talk about that in just a moment. QUEST MEANS BUSINESS.
[16:25:00 (COMMERCIAL BREAK)
QUEST: The oil production from ISIS is evaporating. At the weekend, ISIS lost control of Syria's biggest oil field to a group of U.S.-backed Kurdish
and Arab forces. That particular one is Deir Ezzor, which is just over to the west. Just look at this, this shows you the intensely complicated
position that I think we don't quite appreciate. If you take Syria, the part that's under Syria's government, then you've got the Kurdish forces
over in the north. And over in the East you've got the Iraqi government over here, obviously in Iraq. And you've got the Sunni insurgents dotted
throughout the place. Put all this together, and you can see the difficulty of the forces as they try to recapture that remaining oil
production that ISIS has. CNN's Nick Payton Walsh, in Deir Ezzor, Syria.
(BEGIN VIDEOTAPE)
NICK PAYTON WALSH, CNN SENIOR INTERNATIONAL CORRESPONDENT (voice-over): This may be where ISIS leader Abu Bakr al-Baghdadi is hiding, but probably
wishes he wasn't. Russian and Syrian regime airstrikes pound ISIS's remnants in the city of Deir Ezzor. But they aren't alone in the skies or
on the ground here. Banking hard and keeping out of the Russians' way are U.S. jets. Assisting these U.S.-backed Kurdish fighters to take the nearby
country side from ISIS just the day before. ISIS are collapsing, and leaving in their wake an almost cold war standoff.
(on camera): While ISIS may be holding out in a pocket of a town of Deir Ezzor, behind me over there, surrounded by the Syrian regime. But they
have been kicked out too of this area by American-backed Kurdish SDF forces. Now they've advanced to this river here, which puts them literally
meters away from the Syrian regime who are backed by Russian airpower. We are told in fact these Kurdish-American-backed forces have held face-to-
face meetings with Russian military officials to be sure they don't clash around here. Now in the end game against ISIS, Moscow and Washington's
forces, literally meters away from each other.
(voice-over): The Kurds are so relaxed with their new neighbors that fishing is this afternoon's task with hand grenades. Five years in, and
Syria is ground to dust. And this is what they're still fighting over. It's unclear who is left inside Deir Ezzor, for those who fled, estimated
recently at 10,000 a day, dot the skyline.
They try to filter them, but last week a suicide bomber struck and yesterday they found 30 ISIS fighters. That followed a round of the horror
that they just fled, but also by suspicion. A simple question, are the last to flee the most loyal to ISIS, or just the least fortunate?
We saw everything in my village, she says, air strikes, children and elderly died, my relative just last week. The children couldn't stop
crying from fear. I could only stand there. What could I do? I don't know if our home is still standing or even who's bombing us.
[16:30:04] Use of us 10, it doesn't have any superhero powers here, just dust and bad dreams. When I hear the shelling, he says, I hide in the
ground. The hardest part about living in the desert, is I'm not at home.
The stream is endless, like the bombing they flee and this war. Which keeps finding new chapters and adversaries around them. Nick Payton Walsh,
CNN, near Deir Ezzor, Syria.
(END VIDEOTAPE)
QUEST: As we continue our program tonight, $32 million, the "New York Times" says that's how much money Bill O'Reilly paid to settle a sexual
harassment lawsuit at Fox News.
(COMMERCIAL BREAK)
QUEST: Hello, I'm Richard Quest. There's more Quest Means Business in just a moment. When Megyn Kelly hits out at a former employer after claims
of sexual harassment at Fox News. And I'll be speaking to the real wolf of Wall Street, who is calling cryptocurrencies the biggest scam ever.
As we continue our conversation tonight. This is CNN and on this network the news always comes first.
The chairman of the U.S. Joint Chiefs of Staff has just said that the families of the four fallen soldiers in Niger deserve more information on
deadly ambush that took their lives. At the news conference within the last hour, Staff Marine General Joseph Dunford discusses a timeline of what
happened during the attacks.
Later this week Senators on the Armed Services Committee are expected to receive their own briefing.
The fight over Catalan's independence has escalated with a new warning from Spain's prime minister. Mariano Rajoy says he plans to dissolve Catalan's
parliament, applying a never before used article of the constitution. Catalan leaders say they will reject any attempt to impose direct rule on
their self-governing region.
A New York attorney general is opening a civil rights inquiry into the Weinstein Company. It will examine the allegations of sexual misconduct
against its co-founder Harvey Weinstein reflect a broader atmosphere of gender discrimination. The attorneys general office has sent a subpoena to
the company seeking several documents.
The former Fox News anchor Megyn Kelly says she complained to the company's president about the anchor Bill O'Reilly's behavior towards women.
[15:35:00] Kelly's revelation follows the bombshell report by the "New York Times", it says O'Reilly paid $32 million to a Fox News colleague who
threatened to sue him for alleged sexual misconduct.
Kelly says the behavior at Fox News has to change.
(BEGIN VIDEO CLIP) MEGYN KELLY, FORMER FOX NEWS ANCHOR: At Fox News, the media relations chief Irena Briganti it is known for her vindictiveness. To this day, she
pushes negative articles on certain Ailes accusers. Like the one you're looking at right now. It gives me no pleasure to report such news about my
former employer which has absolutely made some reforms since all of this went down, but this must stop.
(END VIDEO CLIP)
QUEST: Bill O'Reilly says the "New York Times" report is a smear article against him. Brian Stelter is here to help me sift fact from fiction here.
First, let's talk about Megyn Kelly, she has spoken out before but not quite so strongly, if she is right, and I wouldn't disbelieve her, she is a
former lawyer. If she is right, then the protestations of O'Reilly nobody ever went to HR cannot be believed.
BRIAN STELTER, CNN SENIOR MEDIA CORRESPONDENT: She says that she sent an e-mail and she has published it today, so folks can see it for themselves.
Complaining about his behavior, the way that he was being rude toward her and critical of her.
Richard, the more that we talk about this harassment story, this is the new phone hacking scandal. What I mean by that is phone hacking was a
challenge for News Corporations for years. It was an awful, awful period. And now this harassment scandal, it is going on and on and on. And every
time Fox thinks it has gotten through it, there is a new shock.
QUEST: So, the O'Reilly, 32 million, we can all have a sharp intake of breath at that eye watering amount of money.
STELTER: Yes.
QUEST: But knowing there was a settlement even if they didn't know how much, knowing there was a settlement in January, went on to renew his
contract in April.
STELTER: Yes, renewed his contract in February, then in April, that's when he gets booted because there were other harassment allegations, other
settlements that were exposed. The "New York Times" was on to this one, the 32 million. But had not confirmed yet.
So, they wrote about other allegations, but this is what boggles the mind. Why didn't they find out the price tag? Did they not want to know? They
didn't want to know how bad this was.
QUEST: Fox said over the weekend, look, you know, he was one of our top stars.
STELTER: He was the top star.
QUEST: He said, of course, we're going to renew his contract.
STELTER: For whatever price he would like, 25 million a year. That's why he's able to afford $32 million settlements.
QUEST: We need to look at this, in terms of this as a business show, the fallout. First of all, on the Skye deal. The U.K. secretary responsible
has already kicked it over for a full investigation. Largely on the back of worries about fit and proper.
STELTER: Yes. American scandals are dooming this British regulatory deal. It doesn't seem likely to go through, they keep delaying, delaying,
delaying, every day, every week, every month, it seems less likely to ever be approved.
QUEST: We have never heard a word, really, from the Murdochs, other than a couple of statements, me think you doth protest too much. But now they
have a real serious question to answer, why did you renew the contract of your star that just paid $32 million in a settlement of which he had many
previous offenses?
STELTER: But if they were to answer honestly, wouldn't they say, because the viewers loved him, and he was worth hundreds of millions of dollars to
us?
QUEST: Can you blame them for that?
STELTER: Yes, I can. Because you are giving someone this platform, this prime-time platform has to be considered. It has to be a factor. And look
at the fallout from the business point of view, look at how much damage these harassment scandals have done to Fox.
There may have been a short-term reward for Fox but long-term suffering, an ongoing federal investigation here in the United States, Questions about
the deal in Britain for Skye, the reputational damage has been severe for Fox, and doesn't seem to be over yet because these revelations keep coming.
QUEST: Excellent report, Brian. Thank you.
The self-proclaimed wolf of Wall Street has a warning about digital currencies, and says investments like bit coin will blow up in many
people's faces. The wolf himself Jordan Belfort jointly after the break.
[16:40:00] (COMMERCIAL BREAK)
QUEST: The Saudi Prince says bitcoin is the next Enron. The name synonymous with the biggest ever corporate collapses in history. The
prince thinks that digital currency's meteoric rise in value are unwarranted. And one day it will implode.
So, bit coin and bit coin mining and the whole industry of bit coin, I visited one of the curious factories where bit coins are created on an
island are more famous for about explosive device, volcanos.
(BEGIN VIDEOTAPE)
QUEST: It's called the land of fire and ice. Ancient Iceland is now the home to an extremely modern endeavor, mining for bit coins at this bit coin
farm. Noisy computers run 24/7, hoping to solve the puzzles that create the virtual money. Those who succeed are rewarded with bit coins. What is
all of this?
PHILIP SALTER, GENESIS MINING: All of these are our mining rigs, we call them, we have standard hardware optimize in the design for bit coin mining.
QUEST: It takes this number of computers to stand a realistic chance of mining bit coins and winning the block chain battle. Since January, bit
coin's value soared some 450 percent. So, with returns like these, you can put up with a bit of noise. Why is it so noisy?
SALTER: It's the fans at the top, the take out a lot of air.
QUEST: There is one overriding reason why these bit coin mines are here in Iceland, plentiful, cheap electricity, the country abounds with geo-thermal
energy. The whole set up in Iceland is perfect for cooling all these machines. Ordinary air from outside is just drawn in, wafted through the
computers, and then eaten up and sucked back outside.
Some call bit coin, the biggest financial bubble the world has ever seen. Those who run this bit coin farm see it more a part of a thrilling future.
SALTER: There's several rival cryptocurrencies coming up which are competing for market share in the space. And many of them offer similar
features, but I think bit coin has most of the benefits that all cryptocurrencies have and it's going to be the largest player for a time to
come.
QUEST: Iceland is a volatile, unforgiving landscape, perhaps perfect for bit coins, it makes this country a fitting location to mine digital gold.
(END VIDEOTAPE)
QUEST: Our next guest says the explosion of cryptocurrencies is the biggest scam ever. Jordan Belfort known as the wolf of Wall Street, he
knows a thing or two about the odd scam.
(BEGIN VIDEO CLIP)
LEONARDO DICAPRIO, ACTOR PLAYING JORDAN BELFORT, WOLF OF WALL STREET: We're going to do this, first we pitch them Disney, AT&T, IBM, blue-chip
stocks exclusively.
[16:45:00] Companies that these people know, once we succor them in, we unload the pink sheets, the penny stocks where we make the money. 50
percent commission. Now the key to making money in a situation like this is to position yourself now before the settlement. Because the time you
read about it in the "Wall Street Journal" it's already too late
(END VIDEO CLIP)
QUEST: DiCaprio playing Jordan Belfort in the movie "Wolf of Wall Street." Belfort served 22 months in prison for stock fraud. He is now an author
and motivational speaker, and he is to give the keynote speech at the upcoming Synergy Global Forum here in New York.
And we, sir, are delighted to have you, we could not resist just a clip of DiCaprio, as I'm sure you could probably quote that movie backwards in your
sleep. Look, cryptocurrencies, Jordan, everybody's hot on bit coin, 400 percent in the last few months, but you're sounding a warning, why?
JORDAN BELFORT, THE WOLF OF WALL STREET: I mean, listen, I am certain that -- it' s not because it's a scam, I don't know if there's anything
fundamentally wrong with the concept of a cryptocurrency, but what's happening right now is pure insanity, it's pure speculation, and I think
there's a lot of well-meaning people in the space, there's no value, it's no different than a blind pool stock offering where you raise money for
nothing, it's just bits of stock, each share has no value other than the money that was paid for. That it trades higher on based on speculation,
and in the end, they always end up going down, they always end up going back. They just do.
It is a fact of life, what's happening right now is a perfect storm of that and social media. So, everyone's now finding out through social media, so
we have this worldwide audience. Listen, I have been traveling around the world, and it's these third world countries that this massive demand is
coming from.
QUEST: Those of a certain age will know something about tulip mania. At least with tulips you could put them in the ground and grow something. And
here we all agree that someday, Jordan, there will be a cryptocurrency. But there is a demand for a digital currency.
BELFORT: Yes, and I agree, and I think that's wise. It's not cryptocurrencies I'm against, there needs to be massive regulation. Here's
the bottom line, any time in history you have a dark market, where you don't really know who's involved, no regulation, it always ends up being a
scam.
It's the nature of people. Here's what I would do, honestly, you got to be really, really careful. I would not invest until regulation comes into the
market. People are going to get slaughtered all over the world. I just know it.
QUEST: Let's take this particular market that we are seeing at the moment. Today's been a down day, but one of the traders on Wall Street, on the
stock exchange earlier was pointing out. It is a record number of daily rises, 6, 7 weeks or months of daily rises, months of rises. Are you
concerned at the lack of a correction and the view that maybe people have forgotten what it looks and feels like?
BELFORT: It's just classic herd mentality here. You know, you're at that point, like maybe 2005, 2006, when you would get your hair cut, and your
hair cutter would say, oh, I'm also a mortgage broker, I'm flipping houses on the side. Everybody's starting to get involved in that mania. That is
why it is in that logarithmic growth phase right now. It' s not sustainable. And as soon as that ends, something will happen, there will
be some fraud involved, someone will be -- not even issuing fake coins, but steal coins in a more easier way. So, it's going to collapse, because
there's really no fundamental value, I don't know where it's going to collapse too. Its value is not going to vanish, but close to it.
QUEST: Jordan, great to see you, I have one request please, agree that you will come back on more often, we can talk these issues more.
JORDAN: Might as well.
QUEST: Excellent. Good to see you.
Now, as we continue tonight, your mother may like a personalized gift from Amazon's new handcrafted good shop, ETSY wishes there was a return policy,
it shares are down nearly 4 percent.
[16:50:00] (COMMERCIAL BREAK)
QUEST: QUEST MEANS BUSINESS. We need to have some business on the move.
All right, London's mayor wants to clear the air, polluting cars will need to pay $13 each starting today. That $13 is in addition to the congestion
charges, it applies to mainly diesel or petrol cars sold before 2006.
A planning board, 60 miles from New York, has approved plans to build a Legoland theme park right in the city. The critics are warning of
pollution from all the visitors estimated at more than a million a year.
Amazon has a special delivery. Tucson, Philadelphia, New York, these are all places with megacities in the regions of north America that have put in
bids to be the site for Amazon's second headquarters, Amazon says it will be a full equal to Amazon's campus in Seattle. Business on the move.
Claire Sebastian is falling new developments at Amazon, joins me now, Clare, who is in this?
CLARE SEBASTIAN, CNN MONEY SENIOR CORRESPONDENT: We have had a lot of people putting out reports saying these are the odds, these are the front-
runners, but there are some big cities that are in the running, we have Atlanta, Philadelphia, Denver, there's all kinds of --
QUEST: Do we know what Amazon is looking for?
SEBASTIAN: Yes, they put out a detailed RFP, they want at least a million people in the metropolitan area, they want within 45 minutes of an
international airport, they want a mile or two from big highways, they want a city that's going to think big and think creatively. There aren't
anywhere 238 cities that have a million or more people, even if you take into account Mexico and Canada where we have seen some bids.
QUEST: They're already over here, it would make sense to go here. It would make sense to go here or here or here.
SEBASTIAN: Yes. Or up north into Toronto according to many people is one of the front-runners as well. There's a big prize, they say $5 billion in
investment, 50,000 jobs that will average $100,000 in salary each over the next 10 to 15 years.
QUEST: Good paying jobs. Amazon is getting into hand crafted goods as well. Another example of Amazon moving, who is suffering?
SEBASTIAN: ETSY, they are eating someone else's lunch. We have seen this across the board. There is no company like Amazon that has the ability to
shock competitors a way that it does. It already had Amazon handmade that launched in 2015. All it said today, it was going to do a gift shop right
in time for the holiday season, send ETSY's shares down almost 4 percent.
QUEST: I was reading in the "New York Times" in my weekend reading as you will be aware about Australia and Amazon moving in on books.
And the point is the real problem here is that we're all hypocrites. We will sit here and tut, tut about ETSY or hand-crafted gifts, meanwhile, I'm
ordering something from Amazon.
Hypocrite.
SEBASTIAN: They have it all, they have convenience, they have price, they're able to undercut everyone else in terms of how fast they can
deliver and how much they can do it for.
[16:55:00] And the really interesting thing about what they have done with Etsy, now that they're such a huge, dominant company, now that they're able
to go into this sort of niche products. That's in a way what they were doing with Whole Foods, locally grown things, things that have smaller
production lines.
QUEST: Are you prepared to say where you think that headquarters is going to go?
SEBASTIAN: I think it could go a number of different places.
QUEST: No. You had your moment. Profitable Moment after the break.
(COMMERCIAL BREAK)
QUEST: Tonight's Profitable Moment. So once again Fox News is well and truly embroiled in the whole business of sexual harassment over the latest
allegation that Bill O'Reilly paid $ 32 million to settle a sexual harassment claim and then Fox renewed his contract barely a month later,
knowing about it together. The issue we talked about with Brian Stelter, we can talk in many ways as we did on Friday about sexual harassment. But
reputationally, the damage it causes and the damage it causes the company involved, even if that's the only reason you do the right thing, boards of
directors need to say hang on, we could get clobbered for serious amounts of money.
Fox has had to pay $100 million in settlements, it' s reputation is in shreds and the Skye deal worth billions may not go ahead. The Weinstein
Company doesn't exist except in name only. Amazon is being clobbered for what they did in terms of Roy Price,
Is it worth it? Until that argument goes to the fore with boards of directors, this will not change. There has to be an economic recent before
they will do right thing. And that's QUEST MEANS BUSINESS for tonight. Whatever you' re up to in the hours ahead, hope it's profitable.
END
