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Quest Means Business
Trump Now Says I Don't Blame China for Trade Gap; AT&T CEO Disputes Claims He Offered to Sell CNN; Kevin Spacey Cut from New Movie; Louis C.K. Accused of Sexual Harassment. Aired 4-5p ET
Aired November 09, 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] ZAIN ASHER, CNN HOST: All right, that sound marks the end of yet another trading day on Wall Street. The Dow end the day almost down
triple digits, almost down about 98 points or so. The big concern, the major concern for Wall Street right now is how long is it going to take to
pass tax reform. Wall Street investors have been so excited about the potential for a massive new tax plan. Now it appears it could take longer
than expected.
My friends, it is Thursday, November 9th. Pivot and deal. President Trump changes his tone on China, as both countries announce mega deals. We will
go live to Beijing, and we'll hear from one U.S. state that is set to benefit.
AT&T's CEO says he's ready for a court fight. Randall Stevenson says selling CNN is too high a price to pay for Time Warner. And Spacey
replaced, he's out of an upcoming drama. We'll look at companies and the employees that Kevin Spacey and Harvey Weinstein left behind.
Hello, everyone, I'm Zain Asher and I too mean business.
Welcome, everyone. I'm Zain Asher. The Dow has been falling as investors fear a delay in cutting corporate taxes. Take a look here. The Dow down
about 101 points. And earlier today, it was actually down as much as 250 points. So, it's recovered slightly, but still down triple digits. What
we're looking at is the biggest drop in two weeks. In terms of tax reform, that is what investors have been focused on. That is what they have been
salivating over the past -- literally, the past year.
Paul Ryan is saying, trust me, reforms will get done.
(BEGIN VIDEO CLIP)
REP. PAUL RYAN (R), U.S. HOUSE SPEAKER: We are doing this the right way. We're doing this the regular order way. It takes time, but trust me, we're
going to get this over the finish line. We're going to get this over the finish line, because we need to get this done for American families. We
need to get this done for people who will be helped by simpler, fairer taxes. And today we're taking one big step closer to fulfilling that goal.
(END VIDEO CLIP)
ASHER: All right. So, Paul Ryan there clearly quite hopeful, quite optimistic. The market doesn't seem to be quite as optimistic as Paul
Ryan, though. We are covering this story from all angles. We've got economists Peter Morici whose life for us in Washington. Ted Weisberg --
I'm going to go to first -- he's the founder and president of Seaport Securities. He joins is live now from the floor. Ted, when you look at
the market reaction today, it was pretty much losses all day, down triple digits most of the day, ending down 101 points. Is the market finally
realizing that there might be bigger road blocks to tax reform than investors have first thought -- I can't get my words out, sorry -- Had
first thought.
TED WEISBERG, FOUNDER AND PRESIDENT, SEAPORT SECURITIES: Well, I think, clearly, that was the negative event du jour for today. But the fact is,
the devil is going to be in the details. But bottom line is, this is a very positive thing for the American public, for the -- and for the U.S.
economy. And perhaps for the world's economies.
You know, it's a timing issue. We've been waiting months for this to kind of see the light of day. And, you know, things don't happen very quickly
in Washington. But hopefully there will be a positive conclusion, and sooner rather than later. But overall, I think it's quite positive. The
market was kind of poised for a selloff. So, today's excuse clearly was, you know, some of the stuff around the tax bill. But overall, I don't
think it's a negative.
ASHER: You don't think it's a negative, but just in terms of a delay, I mean, for investors, especially when you consider what happened with health
care, that is a negative.
WEISBERG: Well, Yes, listen, there's no question there a risk that nothing gets done. And I think even the secretary of the treasury said, well, if
it doesn't happen, it's going to be a negative for the market. You know, there's no one thing that investors, you know, tend to focus on. Clearly,
this is an event du jour for the moment.
But let's put this into context of a stock market that's been basically, on a tear for the last 12 months. I mean, the market is way up. We haven't
had any kind of meaningful correction. So, they don't ring a bell. They don't tell us what the excuse is going to be. And yes, you're right. If
this gets delayed, perhaps it creates, you know, a negative vibe for the market. But overall, I don't see this intermediate or long term as a
negative, assuming, in fact, the tax bill does see the light of day and does happen.
[16:05:00] ASHER: That's a big assumption, by the way. But, you know, when you look at, as you mentioned, the Dow being up 30 percent so far,
this year, just are we on par for a correction? Or is this just a minor glitch in the system.
WEISBERG: Well, you know, only time will tell. But I would point out to you that 65 percent of all stocks for this year are actually down. So,
there's a real disconnect between where the popular averages are and what the overall market has been doing. So, yes, by certainly one very visible
measure, the markets have had a tremendous move. But that move has been led by a relatively narrow group of stocks. If 65 percent of stocks were
down for the year, in spite of what the averages are telling us, it hasn't been a great year for a lot of people.
ASHER: All right. Ted Weisberg, live for us there. Thank you so much.
ASHER: And Peter, if I could just bring you in, when you look at the difference between the Senate bill or potential tax reform bill and the
House version, does that really bode well when both versions are so different?
PETER MORICI, PROFESSOR, INTERNATIONAL BUSINESS, UNIVERSITY OF MARYLAND: I don't think there is different as we look at, at first blush. Today when
they published the reports, they focused on the differences. But the basic structure of the two bills remains. Especially on the corporate side and
that's what matters to the markets. We're still going to lower the rate to 20 percent. My feeling is the differences between the two bills could be
compromised, as long as the bill passes the market should be all right.
My feeling is, for example, they could make the tax cuts effective July 1. So, you get half the tax cut, corporate rate, July 1, and the rest of it,
you know, at the beginning of 2019. As far as the market goes, you know, the price earnings ratio today, especially after today's close, is the same
as it was a year ago. The markets been driven by rising profitability. And the forecast -- you go to FactSet, look at that. The analysts are
saying that profits over the next three quarters are going to be up over the previous year, 10 percent, 11 percent and so forth.
So, my feeling is that the fundamentals under the market are very strong. What's more, the price earnings ratio for the S&P 500, 80 percent of the
publicly traded companies by value is in line when it's an historical average. If they don't pass the tax bill, then we've got a problem. And
the difference between the two bills, they can be compromised.
ASHER: And one of the key differences, I should say, is the timing. The Senate version is about a year later, compared to the House version. But
are you as optimistic as Paul Ryan that this deal is going to pass and before the end of the year.
MORICI: Well, Paul Ryan's paid to be optimistic. That's his job. So, I can't be as optimistic as Paul Ryan. You know, if these were two separate
bills, I'd say I'm really confident the corporate tax cut will pass. The real problem is, they only put a bad light, 270, $280 billion into personal
tax cuts. And when you want to reform the system, not just reduce rates a bit, but you want to reduce rates a lot on the bases of eliminating
exemptions and credits and things like this.
There are still going to be some losers. And the opposition has made a big deal out of the losers. And, of course, they apply math friendly to their
position, so the world is going to come to an end. So as a consequence, only about a third of the American public favors the entire package
overall. They've had the life scared out of them by the progressives. My feeling is that there's a decent chance this will pass, but it's going to
come down to the same thing we had on health care. You only have 52 votes in the Senate. Are Murkowski, Capito and Collins, the three liberal
Republicans. Who are really Democrats when it comes to social programs -- going to block this thing. Is Murkowski willing to come up and say, look,
it's not perfect but this is good for the country. Same think with Caputo. Is she willing to be a Republican? I don't mean to be partisan about this,
but that's my analysis of it.
ASHER: Yes. If they lose three Republican senators, it's basically over.
MORICI: But those are the three senators to worry about. I mean, others might bolt on top of them, like McCain, because he's always offended by
Donald Trump or Rand Paul, because he's always offended, you know, by Donald Trump. But in the end of the day, you have to look to the more
liberal senators like Portman, for example. Is he going to bolt? Those are the ones to worry about.
ASHER: The moderate Republicans. OK, Peter Morici, we have to leave it there. Thank you so much.
MORICI: Take care.
ASHER: All right. Let's talk about Donald Trump's trip to Asia. He certainly had -- we'll be making jokes about this in the press. He
certainly had a complete about-face when it comes to China's trade policy with the United States. You might remember -- let me jog your memory.
Back on the campaign trail, he had some, shall we say choice word for the Chinese. Among many other things Mr. Trump accused China of raping the
United States and unfairly manipulating its currency.
(BEGIN VIDEO CLIP)
[16:10:00] DONALD TRUMP, PRESIDENT OF THE UNITED STATES: We can't continue to allow China to rape our country. And that's what they're doing.
TRUMP: China's is taking our jobs, our money, our base, our manufacturing.
TRUMP: What they've done to us is the greatest single theft in the history of the world.
TRUMP: The greatest abuser in the history of this country.
(END VIDEO CLIP)
ASHER: President Trump alleged that all that led to the $347 billion trade deficit between the two countries. That was Trump then. This is Trump
speaking now in Beijing.
(BEGIN VIDEO CLIP) TRUMP: I don't blame China. After all, who can blame a country for being able to take advantage of another country for the benefit of its citizens.
I give China great credit.
(END VIDEO CLIP)
ASHER: What a difference a year makes. So that's the blame. Now let's talk about the benefit. Trump and Xi announced a series of deals between
their two nations. The headline number that everybody is talking about is $250 billion. So, let's look beyond just the headline and sort of peel
some of the numbers back. China says it could pump $100 billion into two U.S. energy projects, one in West Virginia and one in Alaska. The fine
print is that it's spread over 20 years, over two decades. And the deals are only a memorandum of understanding. So, there's no guarantee that they
will indeed go through.
China says it's buying 300 planes from Boeing, as well. More fine print. It's unclear how many these orders are new. A similar deal was announced
in 2015 and Qualcomm, the U.S. chipmaker, says it will sell more parts for Chinese phones. The fine print again, it is nonbinding, and China already
counts for half of Qualcomm's sales.
Steve Roberts is the president of West Virginia's Chamber of Commerce. West Virginia would get an $84 billion investment for shale gas
development. So, Steve, I'm sure you're very happy about that. But, you know, one thing our audience might not know or realize is that West
Virginia is actually one of the poorest states in America. When you think about all of the thousands of coal workers who have lost their jobs over
the past decade or so, does this deal do anything to help them.
STEPHEN ROBERTS, PRESIDENT, WEST VIRGINIA CHAMBER OF COMMERCE: No, it really does. Because in West Virginia, we are all neighbors. Those things
that help some of West Virginia help all of West Virginia. And we are seeing plants of this type go in and surrounding states, Ohio has announced
a dozen in just the last two months. Pennsylvania is also building or has under operation a number of plants of this type. So, we know that we're in
the region where we have great deposits of natural gas. We know it's going to be developed. And this is sounding like a very good partnership.
ASHER: Donald Trump himself -- I mean, we'll talk about shale gas development in a second. But back to the coal miners job, because Donald
Trump himself had promised to put the miners back to work. I'm sure you remember last year, that was a key campaign promise. Do you see that
actually ever happening? Do you see Donald Trump's promise coming to fruition?
ROBERTS: Yes. In the last -- just the last year, coal production has increased. And we have added well over a 1,000 mining jobs to the mining
employment of West Virginia in just the last six months. Coal prices are up. Coal production is up. So, what we're really seeing is that about a
third of the electricity in the United States is generated by coal. About a third of the electricity generated by natural gas. And we have both coal
and natural gas. So, it looks as though we're going to be able to continue to spot coal and do that with coal miners who are increasingly coming back
to work. And add to the country's energy mix by being able to use more natural gas. So, it's more a win-win then a win-lose.
ASHER: So, 84 billion spread out over 20 years. From the election last year, 2016, 70 percent of West Virginians voted for Donald Trump. Is this
deal the first piece of concrete evidence that he's actually coming through for you?
ROBERTS: Well this is certainly the biggest since things have really started happening. Especially in the energy production and development.
This is news that has really reverberated through West Virginia today. Our phones have been ringing off the hook. We're pleased about that. We're
happy to hear such great news for people who will be working in the natural gas industry and in the mining industry. Because now both industries see
the opportunity to have more production and put more people to work. And that, of course, adds to our tax base and also helps support our nation's
energy.
[16:15:03] ASHER: All right. Steve Roberts, appreciate you joining us. Thank you so much. And I guess congratulations is in order. Thank you.
Traditional retailers may be facing a challenging holiday season. The latest retail earnings reveal that shoppers have actually been staying away
from the malls in this country. Macy's stock jumped on an upbeat forecast for online sales and is upbeat also about holiday sales. But sales overall
dropped for an 11th quarter in a row. Kohl's posted a disappointing earnings forecast, as well. And Nordstrom is reporting this hour in a few
minutes. Let's digest all of this with Clare Sebastian. So, Clare, the big question is, how on earth do you survive a retail apocalypse?
CLARE SEBASTIAN, CNNMONEY CORRESPONDENT: Well, Zain, what we're seeing here is, you call it an apocalypse. People call it various things.
ASHER: Am I being too harsh.
SEBASTIAN: It's a transition. That's what it is. These department stores are having to kind of downsize their physical footprint and at the same
time upsize their digital footprint. And while doing that, you do see a significant amount of pain. We just had Nordstrom out. They actually beat
67 cents a share versus 63 expected. But same-store sales, that key metric, that fell 0.9 percent. So, it's always a mixed bag. That's what
we're seeing this earnings season, just as they're trying to kind of right- size the physical footprint, as I say and upsize the digital footprint.
ASHER: It's interesting, because you, and I were speaking about this in "QUEST EXPRESS," and you were mentioning that expectations have gotten so
low. That, you know, now we actually saw -- even though Macy's missed, there stock price actually jumped. Partly because expectations are just so
low.
SEBASTIAN: Well, and their stock price by about 10 percent today, as did JCPenney. Macy's had the power to take the rest of the sector with it.
But again, it's all relative. You know, JCPenney is still worth less than three dollars. Macy's down 45 odd percent this year. There's a lot of
concern about this in the market. And I think there's a lot of concern going into the fourth quarter, because, of course, with the holiday season,
that is where it's really crucial that they get those sales, that they beat off the competition and they create that momentum going into the next year.
ASHER: Yes, and I'm sure a lot of these CEOs, particularly the CEO of Macy's, is probably thinking, ooh, at least we have the holiday season.
Let's just focus on that. Hopefully that will be a chance to save ourselves. A little bit in the short-term.
SEBASTIAN: I think we are going to see a Darwinian back I'm afraid for the holiday season.
ASHER: Oh, my goodness.
SEBASTIAN: The question, of course, can they afford to keep descending.
ASHER: All right, Clare Sebastian, life or is there. Thank you so much.
Conflicting reports are casting doubts on one of the biggest mergers of the decade. AT&T is trying to buy Time Warner. That is the parent company of
CNN. The CEO spoke today. We will bring you his comments, next.
(COMMERCIAL BREAK)
[16:20:00] ASHER: AT&T CEO, Randall Stephenson, says he did not and does not now have any intention of selling off CNN. AT&T is attempting to buy
Time Warner, which is the parent company of this network. Conflicting reports suggested the U.S. Department of Justice, wanted CNN to be divested
on antitrust grounds as part of the deal. Today at a "New York Times" conference, Stephenson said that can completely be taken off the table.
(BEGIN VIDEO CLIP)
RANDALL STEPHENSON, CEO, AT&T: First and foremost, irrespective of what you read yesterday, I have never been told that the price of getting the
deal done was selling CNN. Period. And likewise, I have never offered to sell CNN. And I'll repeat what I said yesterday. There is absolutely no
intention that we would ever sell CNN.
ASHER: Brian Stelter was actually at that "New York Times" conference. He joins his life now. So, Brian, I don t think I've ever really seen this
this sort of back and forth, out in the public, between the Department of Justice and a corporation. When it comes to, well, you said this, and I
that. I've never seen that before.
BRIAN STELTER, CNNMONEY SENIOR MEDIA CORRESPONDENT: It is very, very unusual. And it's happening because we're in this unusual situation where
the president of the United States frequently attacks this channel, CNN, which is now subject to a merger review. On the campaign trail, right when
this deal was announced last October, the president said he would vow to block the deal. Since then, there's been speculation that maybe he's been
trying to interfere behind the scenes. Although the White House denies that. And Stephenson also said he has no reason to believe that. But we
can show you what Stephenson said when I asked about that today.
(BEGIN VIDEOTAPE)
MAKUN DELRAHIM, ANTITRUST DIVISION, DEPARTMENT OF JUSTICE: Just the sheer size of it, and the fact that it's media, I think will get a lot of
attention. However, I don't see this as a major antitrust problem.
(END VIDEO CLIP)
STELTER: Sorry about that. I tossed to the wrong element. That is actually an interesting element, as well, though. That's from the person
who is now in charge of the antitrust division. This is the man who's having to decide what to do about the deal. When this deal was announced
in October 2016, he said I don't see any major problems with the AT&T/Time Warner deal. Now he is apparently holding it up, demanding big changes.
Maybe the divestiture of Turner or DirecTV. So, the question is why did he change his mind?
ASHER: Well, also, but normally there isn't necessarily this amount of headache or problems when it comes to a vertical integration.
STELTER: That's right. That is the overarching ministry here. Why is it that the U.S., Department of Justice, which is CNN's business-friendly pro
merger environment, thanks to President Trump? Why is it that the DOJ has so many concerns about a vertical merger? Vertical merger meaning we're
not seeing two people who make the same product trying to get together. We're seeing two different companies that make different products trying to
merge. This is AT&T, a wireless phone company, a distributor, trying to buy Time Warner, a content company.
Normally these deals are approved with some conditions. What's difference now is, it seems the DOJ wants big parts of Time Warner to be sold off as a
condition for the deal being approved. And the question is why? Is it because these regulators just have a different way of viewing the world?
They want to see drastic action taken? Or is it, as some Democratic lawmakers think, because President Trump is interfering.
ASHER: Could it be political. And I've been told in my ear that we actually do have the clip of you asking a question to AT&T CEO, Randall
Stephenson. Let's listen.
(BEGIN VIDEO CLIP)
STELTER: Brian Stelter, from CNN. I had a feeling that would be a laugh line.
STEPHENSON: Can we find somebody else?
STELTER: Let's confront the Trump --
STEPHENSON: You're probably bold while you're not in the family, aren't you?
STELTER: You haven't spoken about president Trump. And the theories from Democratic lawmakers and from public interest groups that his interference,
his hatred of CNN, could be affecting what the DOJ is doing. Do you have any reason to believe that there's a Trump factor?
STEPHENSON: I have no reason to believe that.
(END VIDEO CLIP)
STELTER: He has a little bit and said it's possible.
ASHER: He has to be very careful.
STELTER: Yes, very careful on this. It's possible, but he would have no evidence of it. It's nothing that there's any evidence of. And that's
true. If indeed President Trump is privately trying to influence the Justice Department, there wouldn't be proof of that. However, we know
President Trump publicly has said he's troubled by the Justice Department, frustrated by Jeff Sessions. We know that President Trump expresses how he
feels publicly. He doesn't have to do it privately.
ASHER: And we don't have short-term memories at this network. We certainly remember what he said on the campaign trail about CNN. And I do
want to talk about Disney, because this is actually not the only potential media merger. Disney earnings are out. Shares are actually down in
afterhours trading. I believe they're down about 4 percent. So, the big focus for Disney is the fact it was actually going purchase some of Fox's
assets. Just walk us through, you know, even if that deal makes sense, why the hesitation?
[16:25:00] STELTER: For one thing, there may be a pause as AT&T CEO, Randall Stephenson, said at this conference today, a pause on any media
merger activity because of uncertainty involving the AT&T/Time Warner deal. Because there is some confusion in marketplace about why AT&T is being
challenged. Perhaps other deals are going to be slower to come to fruition. Perhaps someone like Murdoch or Bob Iger are wary about going
down that path. But it is interesting to see Fox and Disney releasing earnings this week. Fox said nothing about the possibility of a sale
yesterday. And now today, it's Bob Iger's turn. We'll see if Iger addresses this on his earnings call. But the earnings are disappointing
from the past few minutes. Revenue down, missing expectations. The only part of the company that actually outperformed were the parks. Disney
parks. But on the cable side, studio side, disappointing earnings for Disney today.
ASHER: One thing I know for sure, is that this media landscape that you continue to do an excellent job reporting on is changing.
STELTER: Changing.
ASHER: And changing very quickly. Brian Stelter, life for us, thank you so much.
Let's talk about U.K. politics now. There is a lot more turbulence for the British government the international development secretary has been
replaced. The U.K. Prime Minister is trying to stabilize the government after a second -- a second cabinet minister fell to political scandal.
This comes at a very tricky time for Theresa May. Brexit talks are underway in Brussels. Bianca Nobilo is there. So, Bianca, when you think
about this nightmare of a year -- I guess is the perfect description for it -- that it has been for Theresa May, are we witnessing the beginning of the
end for her? What are your thoughts?
BIANCA NOBILO, CNNMONEY PRODUCER: It's quite surprising that she's been managed -- managing to last as long as she has, Zain. Because as you say,
this year has been a nightmare. In fact, if we look back to when the Brexit referendum happened, the EU was concerned that that it might
splinter. It was concerned about populous movements in the Netherlands, in Austria and in France. In Britain was looking fairly together. And
Theresa May was quite popular. Well, that's completely reversed now.
As you mentioned, she's lost two cabinet members. And, in fact, her first secretary of state, Damion Green, which is the de facto Deputy Prime
Minister is under investigation. So, there's a possibility that she could also lose him. Negotiating Brexit with this wafer-thin majority and this
level of instability in the U.K. government is just a gargantuan task. So, it's really a question of how much longer she can last. In fact, the only
reason I think she has lasted as long as she has is because her party discipline is holding. Because the conservative our aware that if a
general election was called now, they don't think they'd win.
ASHER: And actually, aside from that, I'm not even sure of the British people actually have an appetite for another election. There's been so
many referendums and elections, I've lost count. But for EU officials, as they look at Theresa May and see just how much of a weak position she's in,
they see that, and they think what?
NOBILO: Well, the EU always keep very quiet when it comes to the internal affairs of member states like the U.K. So, they haven't commented openly
about the level of instability in the U.K., of course. But what we can see is a frustration on the EU side that the U.K. is not living up to its
commitment to want to accelerate the talks. That could well be because they have been distracted by domestic affairs at home. In fact, today at a
press conference, Michel Barnier, the EU's chief negotiator, said to an audience in Rome, that he wanted the U.K. to hurry up. He actually said
that, Zain. He said, hurry up, we're ready to progress to the next stage of negotiations. But you have to come to the table with some kind of
methodology to work out the Brexit bill or a number. So, the EU really trying to push forward in the negotiations. But the U.K., whether it's
because they're distracted because of all these domestic scandals and instability or otherwise are not moving at the same pace. And that's a big
problem for the EU.
ASHER: All right. Bianca Nobilo, life or is there in Brussels. I understand that you will have more from Brussels for everyone tomorrow,
thank you, Bianca, so much.
All right, $100 billion Saudi Arabia says that's how much the kingdom has lost through corrupt royals and officials. This man, the Crown Prince, is
leading the investigation. We'll have the latest after the break.
[16:30:00] (COMMERCIAL BREAK)
ASHER: Hello, I'm Zain Asher. There's more QUEST MEANS BUSINESS in a moment. When President Trump has a change of heart on China, we will go
live for you to Beijing. And Hollywood's sexual harassment scandal grows larger before that, though, these are the headlines at this hour.
President Trump's former security chief, Keith Shiller, security chief, Keith Shiller, has testified he rejected a Russian offer to send five women
to then private citizen Trump's hotel room during their 2013 Trump to Moscow for the Miss Universe pageant. According to multiple sources
Shiller testified he took the offer as a joke
Top U.S. Republican lawmakers say Senate nominee Roy Moore should step aside if allegations of sexual misconduct against him are true. The
"Washington Post" report says Moore is said to have initiated a sexual encounter with a 14-year-old girl when he was 32.
Three other women say Moore pursued them when they were teens, and he was in his early 30s. Moore denies the allegations.
The Syrian military says it has recaptured the last Syrian city held by ISIS with help from allied forces. Abu Kamal in the countryside of Deir
ez-Zor Province near the border with Iraq. The terror group still controls towns and villages in the province.
Saudi Arabia and Kuwait are urging citizens to leave Lebanon and the United Arab Emirates is urging citizens not to go there. The Saudis accused
Lebanon of declaring war on the kingdom, citing the presidents of Iran backed Hezbollah in the Lebanese government. Saudi Arabia and Iran are
locked in a proxy war.
The scale on Saudi Arabia's clampdown on corruption is becoming clear. Hundreds have been called in for questioning, and billions reportedly lost
from the kingdom's economy. CNN's John Defterios has more.
(BEGIN VIDEOTAPE)
JOHN DEFTERIOS, CNNMONEY EMERGING MARKETS EDITOR: The government of Saudi Arabia providing some clarity about the scale of its corruption probe. It
claims there is at least $100 billion of what it calls systematic corruption and embezzlement. The attorney general's office saying a total
of 208 individuals have been called in for questioning. To date, seven been released. That is four times the number we have been working with.
It went on to say the evidence for wrongdoing is very strong. Confirming the original suspicions. Another standout item from the latest statement,
the attorney general said the investigation started three years ago. This means it predates the reign of the King Salman and his 32-year-old son now
leading the probe, the Crown Prince Mohammed bin Salman.
And it's the first time we found out Saudi Arabia is investigating bank accounts beyond its border, asking the UAE central bank to probe the
holdings of the wealthiest princes, former ministers and businessmen being detained. The scale of this investigation is not only rattling Saudi
markets, but Middle East stock markets as well. Seeing losses this week of 5 percent. With oil hovering near a two-year high. John Defterios, CNN
money, Abu Dhabi.
(END VIDEOTAPE)
[16:35:00] ASHER: Egypt is pledging support to Saudi Arabia over its standoff with Iran. The head of Egypt's tourism board says the country is
working hard to fix the way it's received by tourists worldwide. Hisham El Demery spoke with Richard at the World Travel Market in London. He said
stability an Egyptian economy is absolutely crucial.
(BEGIN VIDEOTAPE)
HISHAM EL DEMERY, CHAIRMAN, EGYPTIAN TOURISM PROMOTION BOARD: Tourism stability comes after political stability, and comes after social
stability, economic stability, and what the country has observed during the past two years is encouraging to portray the right image of the country on
the right position. The grand perception of the country is affected negatively over past six to seven years. That's why we work very hard in
order to get this corrected. This was a major chance for us.
QUEST: So, the shift in the grand perspective comes on the grounds not only of the revolution that took place and the change that took place, but
also, of course, several terrorist activities, which have also influenced and defected, which is difficult. We know tourists come back. What
message can you send?
EL DEMERY: I can say that Egypt is like any other country in the world. Tourism right now is starting to the attacked everywhere in the world. So,
whatever happened in any part of the country, this country is fighting this enemy on behalf of the entire block. And Egypt, we are having some
regulation. We're trying to get compliant with in order to get aligned with these standards. But there are -- let us turn this question the other
way around. But there are many evidences showing the country is safe and stable and on the right track.
QUEST: I understand that. But, for instance, the blowing up of the plane that left, the questions of aviation security, the questions that -- the
legitimate questions that people say have you put the house in order? Have you put things right?
EL DEMERY: This is exactly what we are saying, we are not customizing whatever regulation we are putting for every single country. There is some
international regulation, some international standards when it comes to the safety and security. And unlike any other country, we our compliant with
the standards. Yes, there are some norms with country. Why? There are many indications, some reports, from the International Civil Aviation
Organization showing that everything important.
QUEST: If you look for example at your numbers, moving back up?
EL DEMERY: Definitely. This year we are experiencing over 55 percent increase compared to last year. Some markets have reported significant
increases, even higher than 2010, our bench mark year, 2010 was the highest ever in the tourism industry in Egypt. So, there are many positive and
many good indications that everything is really back. Tourism, we do have many things to be proud of, many things to share with others and really
things are coming back.
QUEST: Finally, what do you think is in the space that they've discovered in the pyramids? What do you think is in there? Will they find something,
or will it just be an empty room?
EL DEMERY: They will find something. And still, this is will not be the last one. I believe there so many discoveries coming up in Egypt. Egypt
has thousands of treasures that we are really proud of.
(END VIDEOTAPE)
ASHER: Returning now to President Trump's first trip to Asia as commander- in-chief, in a few hours he is set to depart for Vietnam. Trade ministers there are discussing a reworked TPP, the Trans-Pacific Partnership without
the United States. That's the massive trade deal Mr. Trump famously pulled out of when he took office.
Kaitlan Collins is in Beijing now. So, Kaitlin, let's just start with this headline announcement to come out of China. That is the $250 billion worth
of deals between China and the United States. Does that mean that Donald Trump no longer sees China as an economic enemy as he said in the past, a
year ago?
KAITLAN COLLINS, CNN WHITE HOUSE REPORTER: Well, that's certainly not -- even the Secretary of State, Rex Tillerson, told reporters today this is
relatively small in the scale of the trade deficit that the United States has with China, which is something the president has made the centerpiece
of his presidential campaign in 2016. He constantly railed against China for this trade imbalance, saying they were, quote, raping the United
States, and said that as soon as he got into office, he would label them a currency manipulator.
Now, we know that he did not do so, label them a currency manipulator, and then today overnight in Asia, we saw the president really change his
language towards China, and instead tell them that he doesn't blame them. And, in fact, praised them and gave them credit for it. Now he's faulting
past administrations for that trade imbalance. So, we saw a very different tone from the president on that.
[16:40:00] Now we're getting reports about this new deal, and it really calls into question this whole power dynamic between the United States and
China as the president was here, we really saw a newly empowered President Xi Jinping especially if you go back to the joint press conference with
both leaders, offered today where they didn't take any questions from reporters afterwards. And we asked the White House why did the President
Trump not insist on taking questions from reporters? As you know, China is a very press adverse nation and the White House said it was because the
Chinese insisted upon it.
ASHER: You know what's interesting, is that, you know, Donald Trump, just in terms of this deferential attitude, he has this reputation that is
formed over the past year of being super nice, super sweet in person, and deferential in person, then when he leaves, going back to his old ways. Is
this sort of new-found friendship with China here to stay? What are your thoughts?
COLLINS: Well, it's certainly a chemistry and a friendship that the president is trying to tout. He constantly talks about what he sees a
great relationship with President Xi. But what this is all going to boil down to is all of this pomp and circumstance and pageantry we have seen
over the past two days while the president was here. That includes dining in the Forbidden City with President Xi and his wife. Seeing Chinese opera
in all of this.
What that calls into question is will that translate into a different policy on North Korea. Because regardless of friendship putting that
aside, the president came here with two main objectives, and one was to get China to exert more pressure on North Korea. And the second was to notch
some trade wins for the United States. But clearly it was North Korea that dominated the talks over the past 48 hours. So, we're going to wait to see
if that really calls -- if it really translates into any new policy for China in regard to North Korea.
ASHER: And that is the big question. Will something concrete come out of this? And the president is actually going to be in Vietnam tomorrow, and
we will on this show be there live. Kaitlan Collins, live for us there. Thank you so much
All right. So, to tick or not to tick. Celebs, journalists and politicians, they usually get -- I'm sure you've noticed this. They
usually get a blue check on their Twitter accounts to let us know that it is actually them. So, what about an account belonging to a white
supremacist? That story next.
(COMMERCIAL BREAK)
ASHER: Donald Trump has one. And so, do I. The problem for Twitter is who else is getting coveted blue badge. The tick symbols let people know
if an account -- there is mine and Donald Trump's side by side. The check mark basically let's people know if the account is authentic, if it's
really you. But it has triggered a huge controversy for the platform.
[16:45:00] Samuel Burke his life for us in London. So essentially, the problem is, Twitter is now giving these coveted or has given, rather these
coveted checkmarks to white supremacists. You can't really talk about combatting hate speech one day and then giving out authentications to neo-
Nazis, can you?
SAMUEL BURKE, CNNMONEY TECHNOLOGY AND BUSINESS CORRESPONDENT: What were they thinking? That clearly goes under that category, you can file that.
Maybe some people don't realize why that little blue checkmark is so important, especially for us journalists when going to look at what a
politician said. You want to be sure that's the politician who has verified their identity with Twitter, same goes for celebrities and other
governmental figures.
So why would they give it to one of the people who is the organizer of that terrible white supremacist rally in Charlotte? Well, even Twitter doesn't
have a good excuse. Let me put up on the screen what they're saying. They're saying they're just going to pause this whole system now, because
they realized, quite frankly, they've screwed up here, so Twitter posting verification was meant to authenticate identity and voice, but it is
interpreted as an endorsement or an indicator of importance.
We recognize we have created this confusion and need to resolve it. We have paused all general verifications while we work and will report back
soon. You still have that blue check there. The president still has the blue check there. That's going to stay for now. But it's a new system. I
have to tell Zain, we have interns sometimes that get the blue checkmark were an executive producer doesn't.
A lot of us have known this system doesn't work. But it's actually incredibly important.
If you're in a breaking new situation and you want to make sure, OK, that really is Donald Trump or if you're just a layman who is trying to use
twitter for your news, this is actually very important. Another big mess up for Twitter.
ASHER: You know, I'm curious, though what the reaction has been. What are people n Twitter saying about this Twitter mess up. Because when you think
about the racial issues in this country, especially with the protests that you mentioned, you know, how could Twitter make such an obvious mistake?
What are people saying?
BURKE: I think it's because people say such terrible things on Twitter it takes racism to the next level, because there's that cloak of anonymity.
People think, oh, I don't have to look at them face-to-face. And you probably know even better than I do that people will say things on Twitter
they would never say to you in real life. But I think to your point, this tweet summed it up best for me from a prominent Twitter user who said
verifying white supremacists reinforces the increasing belief that your site is a platform for hate speech.
This is why Twitter hasn't been acquired by big companies that were after it. Because at the end of the day, even though that stock price is so low,
people said, we can't have this mess on our hands. And, again, you and I talk about how Uber is always in the news. Twitter, no matter what the
situation is, they think, oh, we are not going to be involved in this one. The Harvey Weinstein scandal somehow or another Twitter ended up getting
involved in that mess when they took down the account of one of the women who alleged wrongdoing, to say the least, by Harvey Weinstein. You know,
every step of the game, they're always involved in a way they don't want to be over at Twitter.
ASHER: And in terms of people saying or getting -- trying to get away with saying whatever on Twitter, whenever people are mean to me or rude to me on
Twitter, I always say the same thing. Thank you so much for watching.
BURKE: Kill them with that kindness. Keep those viewers in.
ASHER: All right. Thank you so much.
We've been speaking this week about Snap's troubles, partly due to Instagram, which has more than 500 million daily users. Top brands are
courting the Insta stars especially in South Africa. Thanks to an explosion in cheaper smart phones. Anna Stewart went to Johannesburg to
meet the influencers.
(BEGIN VIDEOTAPE)
ANNA STEWART, CNN CORRESPONDENT: Posing for an Instagram picture is not as easy as you might think. Turn both feet slightly more that way. At least
if not if you are an Instagram like Nteta and Keegan Kinsley. Both are paid to post dazzling photos on Instagram, by mega brands in South Africa.
Nteta strikes poses for the beauty brands, including DKNY. Kingsley works for Rayban. Research firm Worldwide Works says Instagram users in South
Africa increased 32 percent between 2016 and 2017, a trend in line with a rapid rise in smartphone users.
Woolworths is one of South Africa's biggest companies, selling everything from food to fashion.
UNIDENTIFIED FEMALE: We try to localize our content in South Africa. And in that we use a whole bunch of influencers
UNIDENTIFIED MALE: Overall, those influencers, they have to speak and resonate to our product, to our brand stories, to our brand DNA, to our
values. That I think is the most important one.
STEWART: Being seen as authentic is crucial for influencers to maintain their fame, and keep the cash coming. Here's the big question.
[16:50:00] How much are your Instagram's worth?
NTETA: In a basic Instagram posting for me. I would charge anywhere around R5000 a post, which is about $375.
STEWART: OK, Keaton, are you cheaper or more expensive?
KINSEY: I'm definitely more affordable, because I've got a much smaller following then she does, it depends, usually it's around 1,000, 2,000 rand
a post.
STEWART: Just under $200?
KINSEY: Yes.
STEWART: Many taste-makers in South Africa agree that brands have much work to do when it comes to targeting Instagramers.
NTETA: Instead of asking who has got the biggest following, what can we get out of you, they're asking who is right for the brand, who is going to
be believable. Who can we build a bigger relationship with.
STEWART: A relationship that will bring both the brands and the influences to the global spotlight. Anna Stewart, CNN, Johannesburg.
(END VIDEOTAPE)
ASHER: And you can see much more of all of that on my show, which is all about business in Africa, marketplace Africa. That airs this Friday 3:15
PM London time.
Still to come on QUEST MEANS BUSINESS, more on the crumbling career of a Hollywood power player. Kevin Spacey has been cut and replaced in a movie
that's about to hit theaters in about six weeks. As new sexual allegations
against him continue to surface. That's next.
(COMMERCIAL BREAK)
ASHER: Kevin Spacey is being cut out of Ridley Scott's finished film. "All the Money in the World." Two sources close to the movie telling CNN,
Scott and his producers reportedly made the decision amid revelations of sexual assault allegations against Spacey. CNN's Chloe Melas is following
developments.
These allegations against Kevin Spacey, I think there is a new one out every single day, this movie was actually supposed to hit theaters in about
six weeks. Ridley Scott basically had no other choice.
CHLOE MELAS, CNN ENTERTAINMENT REPORTER: Well, you know --
ASHER: What else could he have done?
MELAS: This is the bottom line. So, this movie, all the money in the world, that has Mark Wahlberg, Michelle Williams, big names, starring in
this movie. You have Kevin Spacey as a supporting role in the movie, playing this oil tycoon. The movie is set to come out in six weeks. Sony,
in an unprecedented move, I can't remember anything like this ever happening before in the film industry, where they are cutting Spacey
completely out of the movie.
They have recast his part with Christopher Plummer. They are reshooting the scenes and scrambling to get this done, spending a ton of money, along
with the production company and the original investors, to get this done all in six weeks, edited, done, signed, sealed, delivered, ripping down all
of posters and promotional materials.
And to come back and do these scenes again. So, it is, again, something that I have never seen before in the film industry.
[16:55:00] But they are doing this because this movie is one of the big movies for the award season, as we are about to enter for the Golden
Globes, the Oscars, there was going to be a big push for Kevin Spacey to possibly be nominated for supporting actor. Not anymore.
He has won two Oscars previously. But they wanted people, according to sources I spoke to at Sony, to go into this movie with an open mind and not
having these Kevin Spacey allegations swaying them from what was a labor of love doing this movie.
There were over 800 people, Zain, that worked on this film. So, you know, why throw out the entire bushel of apples for one rotten one is what their
attitude is. So, they're spending a lot of money, but they feel it will be worth it in the end.
ASHER: And now they're getting more revelations about another Hollywood actor- comedian? Louis C.K.
MELAS: Yes, so the "New York Times" published a bombshell report this afternoon that actually we knew was coming and we were making calls all day
on it, Louis C.K., the actor comedian known for his vulgar standup comedy, five women have come out, four on the record, one anonymously saying that
Louis C.K. masturbated in front of them or on the phone.
It was nonconsensual. And, you know, it's very explosive, and Louis C.K.'s team has not responded to the "New York Times," hasn't responded to me or
CNN for comment at all. You know, and this is all coming at a time where people in Hollywood are feeling more emboldened to come out against these
big stars and say that we aren't going to stand for this.
And, again, like Sony, pulling Spacey from this movie, it's people like that who are at the top that are setting the bar so things like this don't
happen. So, people keep asking me, is anything going to change? Yes. It is. If companies like Sony keep doing stuff like this and saying we're not
going to stand for it, that where things change. And also, all of this is really great, because people are feeling empowered to speak out against
this as well.
ASHER: They feel empowered, but I can't imagine the emotional earthquake of having to come out in public and tell your story. As you mentioned
changes coming, Chloe Melas, thank you so much.
CNN is taking a closer look at sexual harassment in a special town hall moderated by a colleague, Alisyn Camerota, called "Tipping Point: Sexual
Harassment in America." This airs Thursday at 9:00 p.m. on the east coast. That's Friday, by the way, 2:00 in the morning in London, only on
CNN. And that, my friends, is QUEST MEANS BUSINESS. I am Zain Asher in New York, news continues right here on CNN.
END
