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Quest Means Business
After A Hail Of Criticism From Democrats And Republicans, President Trump Tries Damage Control From His Meeting With Vladimir Putin By Claiming He Misspoke; Goldman Sachs Picks A New Boss To Remix Wall Street; Netflix Shares Get Stuck In The Upside Down; The British Government Has Won Just About A Crucial Brexit Vote; Obama Warns About Strongman Politics; Seventeen Men Arrested Over Rape of 11-Year-Old Girl in India; Cuba Plane Crash Blamed On Crew Error; Storms Cause Flight Delays on U.S. East Coast; Embraer, United Airlines Sign 25-Plane Deal; Amazon Recovers from Prime Day Glitches; NASDAQ Hits Record High; Amazon Prime Day Sales Soar Despite Rough Start; Amazon Workers Across Europe Strike on Prime Day; Apple Releases New Icons on World Emoji Day. Aired: 4-5p ET
Aired July 17, 2018 - 16:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
BIANNA GOLODRYGA, CNN CORRESPONDENT: There are more records on Wall Street as trading comes to an end. It's Tuesday, July 17th. Tonight, Goldman
Sachs picks a new boss to remix Wall Street. Netflix shares get stuck in the upside down. And if you can't beat them, join them. The CEO of
Embraer tell us about his new deal with Boeing. I'm Bianna Golodryga and this is "Quest Means Business."
Good evening. We'll have the day's top business stories in a moment, but first tonight, after a hail of criticism from Democrats and Republicans,
President Trump tries damage control from his meeting with Vladimir Putin by claiming he misspoke. Moments ago, Mr. Trump said he accepts the U.S.
intelligence agency's conclusion that Russia interfered in the 2016 Presidential election.
It was ultimately this line in Helsinki on Monday that caused the biggest uproar.
(BEGIN VIDEO CLIP)
DONALD TRUMP, PRESIDENT OF THE UNITED STATES: They said they think it's Russia, I have President Putin. He just said it's not Russia. I will say
this. I don't see any reason why it would be.
(END VIDEO CLIP)
GOLODRYGA: After those comments sparked global outrage, top national security officials huddled at the White House 24 hours later to develop a
response. They decided the President would need to acknowledge the criticism and finally, this was the explanation.
(BEGIN VIDEO CLIP)
TRUMP: The sentence should have been, "I don't see any reason why it wouldn't be Russia." Sort of a double negative.
(END VIDEO CLIP)
GOLODRYGA: The double negative excuse. CNN Senior Political Analyst, Mark Preston joins me now. Mark, 24 hours later, the President in the meantime
had been tweeting sort of doubling down on what he had said in Helsinki and now, it was "would" instead of "wouldn't." What do you make of this
response?
MARK PRESTON, CNN SENIOR POLITICAL ANALYST: Well, I mean, certainly, I will suspect that someone very close to him; perhaps, his children got to
him and said that you need to back off this. We are in a no-win situation here. Bianna, as you know, in the United States, we had a very polarized
political environment, Democrats and Republicans were just taking sides on any issues, not getting along on just about anything.
But what we did see by and large was a unified voice that came out from both Republicans and Democrats condemning what the President said. Now,
world leaders have got to be wondering what is going on in the United States and I wish I could tell them what is going on in the United States
so you can make some sense of the senseless right now.
But what we've heard from the House Speaker just a few short hours ago was that he is calling on more investigations into seeing if there can be more
sanctions put on Russia, if the U.S. Congress could put more sanctions on Russia to really show a commitment to the worldwide community, that in fact
that the U.S. will stand up to Russia despite of what the President says.
GOLODRYGA: And nonetheless, many would say the damage was done by the President's demeanor, his comments standing right next to Vladimir Putin,
making him a co-equal, a global leader in Helsinki, basically pitting Vladimir Putin's word against his intelligence community's word and at best
saying, "You know what? They may both be right," one can't help but think that this is still considered a victory for Vladimir Putin.
PRESTON: Oh, there's no question and if you go back and look at the pictures from yesterday as well, the first thing that I've caught my eye
was not what was said, but look at where the flags are positioned. Could you see where Vladimir Putin is, right behind him is the United States flag
and right behind Donald Trump is the Russian flag.
Now, if you are Estonia or Latvia, if you are a NATO nation, if you are the U.K., are you thinking to yourself, "What is going on? Like what bizarre a
world could we possibly be living in?" And again, I wish that we could explain what is happening back here, but we really can't, other than the
fact that Donald Trump seems to have the support of Republicans in this country by almost 90 percent.
GOLODRYGA: We heard from Mitch McConnell and Paul Ryan today. Paul Ryan yesterday issued a statement. We heard him speak out today and once again,
defend NATO and call Russia a foe. I mean, these do not seem to be big steps away from what is typical U.S. policy, yet for 24 hours, this is what
we've been talking about. Mitch McConnell coming out and finally showing some defiance against the President's comments as well. How unusual is
that from Mitch McConnell?
PRESTON: Well, Mitch McConnell is certainly one of the quietest but most deliberate politicians here in the United States. He doesn't talk as you
know without having some meaning behind it, that's why you don't often see him on the television. You see him once a week when he does a news
conference, but for him to come out and say what he said, actually does say something.
Now, Republicans here in the United States feel that they're handcuffed because Donald Trump has the support of everyone in their political party
it seems, you know, at this point, but the buck has got to stop somewhere.
[16:05:07]
PRESTON: And I do think that the pressure is on Congress right now to do something but Paul Ryan said today, the House Speaker, "What can we do
other than try to add more sanctions."
GOLODRYGA: Mark, many people were reminiscing about Charlottesville and comparing the President's performance in Helsinki, sort of suggesting that
both sides, the U.S. and Russia are at fault and thinking back to what he said after Charlottesville as well. He ultimately issued a walk back
statement after, and it's similar fashion that we saw today reading from a prepared statement, didn't seem to have as much enthusiasm and even
commitment, I would say to what he said yesterday and comparing that to today, so is this over? Are we moving on to the next issue or do you think
that this has a different sort of resonance in Washington?
PRESTON: I think it has a different resonance, but you're making good point because, is it over in the sense, will this be a scandal that could
take down President Trump? That's not going to happen. We already know that, but it is something that is going to play out because the long term
ramifications are still unclear.
And even short-term ramifications at this point, we don't know how this will play out, but I think when you look at what the world is thinking
right now when you see the leader of the free world, President Trump standing beside Vladimir Putin and basically, giving the cold shoulder to
NATO, to the E.U. at the same time while embracing Vladimir Putin, you really have to wonder whether that title of leader of the free world is
going to stick with the President of the United States.
GOLODRYGA: Yes, and you heard serious minded people suggest that maybe those in the intelligence communities top advisers should consider stepping
down following what we saw yesterday. Maybe there were some pressure on that end as well. Mark Preston, great to have you on. Thank you so much.
PRESTON: Thanks so much.
GOLODRYGA: We're going to turn to our business agenda now. Goldman Sachs is mixing it up with a new CEO, Lloyd Blankfein kept the music going
through the final crisis. In October, David Solomon will take Blanfein's place at the top of the org charts. Goldman made the announcement as it
released earnings. The organization's chart, I should say, the bank beat expectations, a different tune from the other Wall Street banks we've heard
from last week.
But investors reaction, the proverbial record scratch. The stock fell as much as two percent before bouncing back. If you're wondering what all of
those music metaphors have to do with the world's most powerful investment bank, it's this. When night falls, David Solomon, the future CEO of
Goldman Sachs, he becomes a DJ. DJ D-Sol is what they call him. Clare Sebastian joins me now.
Many people would see him during the day in his business suit looking very professional, someone say conservative; different man at night.
CLARE SEBASTIAN, CNN CORRESPONDENT: Yes, absolutely. He's a man who has a very well publicized extracurricular activity and he has spoken about it
publicly. He said like this is about combining what you're passionate with, with your work, and I think it's interesting given this is now a new
era for the company. Will it mean a change in direction in terms of policy? Or is this just about style and culture. Take a look.
(BEGIN VIDEO TAPE)
SEBASTIAN: Putting a new spin on a Wall Street icon. This is DJ D-Sol. The alter ego of Goldman Sachs' new CEO designate, an investment banker
with a taste for electronic dance music. David Solomon has big shoes to fill. Over the past 12 years, Lloyd Blankfein led the bank through the
financial crisis and a long road to recovery.
LLOYD BLANKFEIN, CEO, GOLDMAN SACHS: I haven't felt this good since 2006.
SEBASTIAN: Under Blankfein, Goldman reported net profits of more than $4 billion last year, though it struggled in the Fed's latest round of stress
tests and will be forced to raise more capital. Experts say Solomon will provide continuity and substance that perhaps not in style.
ART HOGAN, MANAGING DIRECTOR AND THE CHIEF MARKET STRATEGIST FOR B. RILEY FBR, INC. AND WUNDERLICH SECURITIES: But he's got a bit of a rock star
reputation, interestingly enough. Not an Ivy leaguer, so sort of bootstrap guy. He has started at Drexel Burnham as a junk bond guy which -
transitioned into asset banking and at the same time, have a real national human side that people can really relate to with his DJ side gig, which I
think is an amazing story. I think the important thing to take away from this change of leadership is the direction of the company probably stays
the same. And I think that's probably a good thing.
SEBASTIAN: Solomon is in his mid-50's, young enough to spend a decade or more at Goldman. He became partner in 1999 and is currently the company's
sole President, but the particular interest in how tech can transform economies.
DAVID SOLOMON, INCOMING CEO, GOLDMAN SACHS: The growth that's going on in the tech world is really significant and really meaningful. The technology
and the software that these companies are deploying is disrupting or dislocating more traditional businesses.
SEBASTIAN: And he made it clear in a podcast interview last year, he is a banker who believes in work-life balance.
SOLOMON: If you can't find a way to have passions and pursue those passions, and mix them into your professional life and your personal life
in some way, shape or form, it's just harder to have the energy to keep on doing this.
SEBASTIAN: Passion and profit. Advice from a man who knows all about getting the right mix.
(END VIDEO TAPE)
[16:10:12]
SEBASTIAN: Now, Bianna, this is not to say, of course that he won't face some serious challenges as he takes over Goldman Sachs. He said in an
interview, a joint interview with the "New York Times" he said, "Organizations to move forward have to evolve. They have to change. They
have to adapt." Of course, Goldman Sachs has changed unrecognizably almost since the financial crisis, but it still has more work to do. You can see
that in the stock price since Blankfein took over, it's gained about 50 percent, but most of that was in the last two years, and it's really
underperformed some of its rivals over the past year despite of course, that boost from the tax cut and deregulation that we're seeing.
GOLODRYGA: Yes, and leadership at the company as we know has changed throughout the years, so I think this is the first time it's been passed
down to a part-time DJ, DJ D-Sol. We will see if that side gig will continue in his new role as DJ. Maybe he will be spinning through the
earnings calls. That would be fun.
SEBASTIAN: On his feet, yes.
GOLODRYGA: Clare, great to have you on. Thank you. Well, it's a busy day of business news and we're celebrating World Emoji Day, too. We have
Netflix shock a mix in subscriber numbers tanked the stock, it's been the slow climb back. Also, later on, better together. Embraer CEO tells us
how his company's marriage with Boeing will play out. And Amazon, it's cleaning up the mess from its prime day dog debacle. We'll have non-emoji
reports on all of that later in the hour.
First, Netflix has pared back some of its losses that saw its shares tumble as much as 14 percent earlier on Tuesday. Stock of the streaming giant
finished 5 percent lower after the close of trade on Monday. It said its subscribers number rose in the latest quarter, but not as much as investors
had hoped. Samuel Burke is in London with the details and Samuel, I guess there had been some concern about a streaming bubble. How realistic is
that?
SAMUEL BURKE, CNN CORRESPONDENT: Well, Bianna, if I could just change the emoji for a second because it was down as much as 13 percent, just 5
percent now, so maybe from the shocked emoji to just the emoji with kind of the flat lips, no smile or anything, but let's be honest here, Bianna. At
the end of the day, any Hollywood or media company would kill for these numbers.
They added five million more new paying subscribers. Yes, it was one million less than what they had hoped for and what Wall Street had hoped
for, but when you are as big as Netflix is, when you have the expectations that they have, of course, if you miss by a million, it's going to go down
a lot. But, at the end of the day, Netflix has a strategy like many streaming companies, they are turning to the stars.
(BEGIN VIDEO TAPE)
OPRAH WINFREY, AMERICAN ACTRESS: Please welcome home President Barack Obama and First Lady Michelle Obama.
BURKE: They were once best friends, forever. Now, the battle of the O's had begun. Obama and Oprah had signed multiyear deals in the hottest
corner in content, streaming.
BARACK OBAMA, FORMER PRESIDENT OF THE UNITED STATES: We answer with one voice, "Yes, we can."
BURKE: The ex-President is producing shows for Netflix --
WINFREY: And now, I'm thinking, "Oh."
BURKE: And the woman who has pondered the presidency will jump start Apple's hush-hush streaming project.
PETE PACHAL, TECH EDITOR, MASHABLE: It's clearly like this tech battle of the titans trying to big names attached to their projects.
BURKE: Streaming companies are signing up stars at a furious pace in their bid to hang on to a still growing subscription base.
UNIDENTIFIED MALE: I think we should break up.
REESE WITHERSPOON, AMERICAN ACTRESS: What?
BURKE: Actress Reese Witherspoon was the jilted girlfriend in "Legally Blonde," now she's legally committed to DIRECTV where she'll launch two
unscripted shows and an on-demand channel. AT&T is the parent company of Direct TV and CNN.
Sasha Baron Cohen, the brains behind "Borat" and "Ali G" is heading to Showtime. The taxi driver dream team of Scorcese and De Niro --
ROBERT DE NIRO, AMERICAN ACTOR: You talking to me? Well, I'm the only one here.
BURKE: Are on board for Netflix film, "The Irishman." And David Letterman --
DAVID LETTERMAN, TALK SHOW HOST: I'm not as dumb as I look.
UNIDENTIFIED MALE: How could you be?
BURKE: Has an interview show deal with Netflix. Netflix remains the crown jewel of streaming, but fears about growing competition will only increase
after its latest results. Even Netflix sites' competition as a rising concern, a fierce battle for subscribers could force Netflix to spend even
more to sign up the superstars to stay ahead. Investors may even demand it.
UNIDENTIFIED MALE: Once you get a user on board, that's recurring revenue. Recurring revenue adds up really fast, Wall Street love recurring revenue.
BURKE: A stable subscription base also gives companies more user data, covered by advertisers.
UNIDENTIFIED MALE: Where are we going with all this? We're going to a place where 24 hours a day, there's going to be brand new content for us to
watch.
BURKE: As they say, content is king.
UNIDENTIFIED MALE: Long live Queen Elizabeth.
BURKE: And many times, queen.
(END VIDEO TAPE)
BURKE: Bianna, we don't talk about the competition enough, for instance, over in the United States, you have Hulu, which is really putting up a good
fight against Netflix. Here in the U.K., we have Now TV that is owned --
[16:15:16]
BURKE: -- by Sky. A lot of HBO content is seen on that platform, so I really think we have to focus on them more because those are the reasons
that Netflix isn't quite meeting those numbers all of this time, and even Netflix admitted that they see competition coming from our new bosses,
AT&T. They say, they know that they have a streaming product coming, which will have CNN on it, of course, and of course, it will have HBO as well,
now that that is part of the AT&T family, and we've heard reports about AT&T wanting to push that product even further.
So, there are a lot of competitors out there that we have to keep our eyes on if we are going to be investing in Netflix and especially if we're going
to be talking about Netflix as much as we do because I think we talk about them too much sometimes, and not enough about the other competitors on the
horizon.
GOLODRYGA: Yes, and an optimistic point we should make that the more competition there is, typically, that's better for the consumer. We
appreciate having you on, Samuel. Great to see you.
BURKE: Absolutely.
GOLODRYGA: We're running out of time and running out of patience. The Airbus CEO tells us he's working on a Brexit Plan B. And Theresa May
scrapes a win in Parliament despite yet another big challenge. We'll be live in London with the latest on where Brexit is heading.
The British government has won just about a crucial Brexit vote. A loss for Prime Minister Theresa May would have committed her to keeping Britain
in a customs union with the E.U. with no alternative deal were agreed. The vote came as more business leaders expressed frustration over Brexit
uncertainty. The latest one was the CEO of airplane engine maker, Rolls Royce.
Bianca Nobilo is outside Parliament with more. So, Theresa May dodges a bullet, how significant was this breather that she got tonight?
BIANCA NOBILO, CNN CORRESPONDENT: It was very significant. I am sure it seems like a familiar refrain by now, late night discussion outside
Parliament talking about Theresa May dodging another bullet, but this one was particularly important.
We always knew that the customs union was going to be a very contentious part of this process and when the Brexit bill itself was being debated,
there was always sort of a tough acknowledgment that that discussion would really be had later and we've had it tonight. This was the bill which
potentially with this amendment could have tied the Prime Minister's hands, forcing her to either negotiate some form of free trade arrangement which
would allow free movement of goods between the U.K. and Europe by January next year and this not then the backstop would be remaining in the customs
union.
And Theresa May had explicitly said that that's not what she thinks that British people voted for when they voted to leave and it's not what she
understands Brexit to be. So, had that passed and it was very close. The government only managed to escape that by a majority of six. She would
have been in an impossible position, and it's also important to note, Bianna, that she managed to narrowly avoid this defeat, thanks in large
part --
[16:20:15]
NOBILO: -- to the fact that some labor MPs, the opposition voted to support the government. Twelve members of her own Party rebelled.
GOLODRYGA: So, short term let's say lifeline right now for the Prime Minister, what's the next hurdle on her agenda?
NOBILO: The next hurdle really is getting through to recess, so that's when the Parliament will rise and actually, the government had proposed a
motion to try and speed that up. They wanted to bring it five days early. The thinking behind that was it would reduce the opportunities for there to
be a vote of no confidence in the Prime Minister and tomorrow, Wednesday, we will see Prime Minister's questions potentially an opportunity for the
ex-foreign secretary Boris Johnson to make a resignation speech, a tradition which in the Tory Party can conjure feelings of dread because of
that famous resignation speech of Geoffrey Howe, which ultimately destroyed then Prime Minister Margaret Thatcher. That could possibly come tomorrow.
And also, it's the informal deadline for letters to be sent to the 1922 Committee which in the Conservative Party, is the mechanism by which the
leader can be challenged, so if 48 letters are received, that could trigger a leadership contest within the Tory Party and the specter of that has been
looming over the British government and Theresa May, for a very long time. She was keen to avoid actually trying to speed up the process before
recess, but that was actually ultimately dropped by the government today because the optics of that looks like a real abdication of duty if the
government were to try and speed up the process by which they could go on their summer holiday when there's all of this Brexit chaos and confusion.
So, she is safe for now, yet again, and she can breathe a sigh of relief, but it is a febrile atmosphere. I've been out here on Abington Green
speaking to politicians from labor, from the Tory Party and that is the refrain I am hearing from all of them, that they've never known a time like
it, a time that is so volatile and indeed exciting and unpredictable.
GOLODRYGA: Constant uncertainty in unchartered territory. Bianca Nobilo in London, thank you. Well, the CEO of Airbus says, time is running out
for a Brexit deal. Tom Enders told Richard that the company has to prepare for the worse.
(BEGIN VIDEO TAPE)
TOM ENDERS, CEO, AIRBUS: We are not playing politics. We are just looking at what's in the interest of Airbus and if we are damaged by Brexit, it's
not only our British partner that will be damaged, but the entire company would be damaged.
RICHARD QUEST, CNN INTERNATIONAL HOST: What's your time scale for having to make decisions even if they are only proactive decisions in the event of
a hard Brexit?
ENDERS: Right now, we have contingency plans. We hope for the best, but we have to prepare for the worst also. I mean, that's still a possibility,
so right now, we are throwing up contingency plans for ourselves, for our suppliers. I don't want to detail that, but this has to happen now because
time is running very short now. We have 4,000 suppliers in the U.K.. We have just in time production, we have lots of stuff moving both ways over
the channel and even slight hindrances introduced, border crossings et cetera could really damage our supply chain.
So, if she can differentiate between goods and services, and that in terms of goods, we have something like a customs union going forward, that would
go some way to address our concerns.
QUEST: How much pressure if such would be, will you put on the other side? On Angela Merkel? On Emmanuel Macron?
ENDERS: Well, I don't know. I wouldn't overestimate it, but I mean, you know Airbus, you know me. We will not be shy to make our words through,
also in Brussels and Paris and in Berlin. As a matter of fact, we did it already.
QUEST: So you are prepared to put some weight on both sides in terms of advancing your argument?
ENDERS: Sure. Sure. Absolutely.
QUEST: The deteriorating trade relationship, trade wars, we can semantically debate whether we're in a trade war or not. It seems like we
are. You could get well and truly caught up in the middle of this if tariffs - tariffs on the steel that you use, tariffs on the planes that you
sell, the avionics, you could be well and truly caught up. How worried are you?
ENDERS: Well, to tell you the truth, I am not so much worried about tariffs on materials et cetera. That will be relatively minor. I am more
worried about a situation of escalating trade wars, protectionism, the effect it has on aviation at large, because aviation as you know -
international aviation is volatile. Oil price hikes, military conflicts and trade wars can have an impact here, so I really hope that the situation
can be controlled.
The best hope by the way is American companies to convince the American administration that they are on the wrong war path.
QUEST: They are trying, but they are not succeeding.
ENDERS: Well, I hope they - you know some of them have spoken up. Some of them - that they can --
QUEST: Would you like to see more American --
[16:25:16]
QUEST: -- CEOs tell the White House, "Stop this."
ENDERS: Oh, absolutely. I mean, I'd like them to be as vocal as we are over here with Brexit. Yes, indeed.
(END VIDEO TAPE)
QUEST: Andrew Bridgen is a British member of Parliament for the Conservative Party. He voted in favor of Brexit and joins us now from
London. Andrew, thank you so much for joining us. I'm not sure, were you able to hear that interview Richard just conducted?
ANDREW BRIDGEN, PARLIAMENT MEMBER, U.K. CONSERVATIVE PARTY: Yes, and I think that's a fair assessment of the situation in Westminster tonight.
GOLODRYGA: So, tell me about your reaction when you hear this concern, not just from one CEO, but multiple CEOs about the future of their business
post-Brexit?
BRIDGEN: Well, before I was a politician, actually, I was in business for 25 years, a serial entrepreneur. I know that business hates uncertainty,
but we've got a mandate to deliver Brexit. We've got to get the best deal we can for the country and it's a deal that's going to have to go on for a
very long time. It's going to be a treaty deal, and it's hugely important.
And one thing your business audience will know about is about negotiations and it tends to be that negotiations are finalized down to the wire, that's
why we need a wire and they will understand that these negotiations with European Union are going to be a fairly bumpy ride, but we're in a good
place. We are the customer. We buy over a hundred billion pounds worth of goods more from the E.U. than we sell to them. We will be the biggest
market for E.U. goods outside the European Union when we've left. I think we've got a lot of cards to play.
First, we're willing to pay 40 billion pounds in so-called divorce bill which the E.U. desperately needs because they can't borrow money for their
inter-year budgets. They can borrow money to bail out Portugal, Spain, Greece, but they can't borrow money for their inter-year budgets. They
need that 40 billion pounds and it's a huge card we've got to play.
GOLODRYGA: So, correct me if I am wrong, but watching this from across the Atlantic, you talk about looking for the best deal. It seems like the
disconnect maybe that there are multiple ideas of what a best deal looks like. Can you get to that one best deal when you have multiple options out
there?
BRIDGEN: Well, I am not in favor, I've not supported the Prime Minister's Chequers proposals, the white paper. I think that's a very poor deal for
the U.K.. In fact, I've got on the record and said that I wouldn't support that if the European Union were paying for it, and if we accept the
Chequers proposals, what that will mean and President Trump was absolutely right, his first remarks, we will not be able to do a proper trade deal
with the United States. We won't have recognition of equal standards. The only we can do a deal with the United States is if you work to the E.U.
common rulebook and you're not going to do that, neither will Australia, neither will New Zealand.
The main benefit of Brexit is that we will be able to sign up free trade deals with growing economies around the world where 90 percent of the
world's economic growth is going to be over the next 20 years. It's not going to be in the European Union, and so we must protect our ability to do
that and quite also, the Chequers' agreement will keep the U.K. as a captive market for overpriced European goods in perpetuity, and I am not
going to let that happen.
GOLODRYGA: So, quickly, final question, can you get to that, quote unquote, "best deal" with Theresa May as Prime Minister?
BRIDGEN: Well, I have actually put a letter of no confidence on the Prime Minister. I am one of the potential 48 letters that would need to trigger
a leadership challenge, and it was nothing personal. I think the Prime Minister is a great lady with great resilience, but if she backs the
Chequers' agreement when she does, I have no confidence in that, that's not the deal that we want for the U.K., and it's also not the deal we promised
the people of Britain and is about the future of our government, the future of our country, and the future of our democracy because people have got to
believe that politicians are telling them and they're going to deliver, and we're not delivering with Chequers.
GOLODRYGA: So that would be a no. Andrew Bridgen, thank you so much for joining us. On World Emoji Day, we will tell you what's after the
headlines in the form of emojis. Coming up, we'll be looking at more aircraft at the Farnborough Air Show. And Amazon suffers problems slowing
down its Web site on prime day. Has it cost the company money?
(COMMERCIAL BREAK)
[16:30:00] GOLODRYGA: Coming up in the next half hour of QUEST MEANS BUSINESS, Amazon says sales are looking good for prime day. Now, some of
its biggest rivals want to get on the action.
And sometimes you just have no words, I'll be joined by the creator of the World Emoji Day, but first, these are the top news headlines we're
following on CNN this hour.
U.S. President Donald Trump delivered remarks just hours ago as he faces criticism over comments made during his summit with Vladimir Putin. Mr.
Trump is now voicing full support for U.S. Intelligence agency, and claims he misspoke Monday, and meant to say that he didn't see any reason why it
wouldn't be Russia who interfered in the 2016 election.
Former U.S. President Barack Obama spoke out pointedly Tuesday against the rise of what he calls strongman politics. Obama was in Johannesburg to
deliver the annual Nelson Mandela lecture. He warned against those who would keep the trappings of democracy but undermine its most foundational
institution.
And he bemoans what he sees as a growing tendency of politicians to lie. Seventeen men have been arrested over accusations they raped a 11-year-old
girl in the India city of Chennai. Police say the raids have been taking place since January, it's the latest in the string of rape controversies
involving young girls in India.
Data from the black box flight recorder of a plane that crashed in Cuba back in May shows that crew error was the cause of the accident. The
airline that owned the plane said the pilots took off at too steep an angle. The crashed killed 112 people and left one survivor.
Storms on the East Coast of the United States are causing misery for business travelers. The average delay at airports here in New York is four
or five hours. Tom Sater is at the World Weather Center. So Tom, another Summer storm, what can travelers expect today and tomorrow?
TOM SATER, CNN METEOROLOGIST: Oh, and it gets much better tomorrow. We need the storms were coming, Bianna, but what we did not expect was just
how early in the day the wait times for delays and cancellations were just going to mount up.
This line of severe weather is hundreds of kilometers in length, and long before the line of severe weather even moved into the major cities, we
started to see these wait times. Thirty minutes, sure, that's OK, at Reagan International in Washington or two hours in Logan in Boston.
But this is something that doesn't happen very often. Currently, we've got a ground stop, that means no in-bound flights, no departing flights for the
following airports all at the same time. Logan in Boston ground stop, JFK, LaGuardia in Newark, Philadelphia ground stop, head down to Baltimore, BWI,
Reagan International, Dallas International, nothing is coming in or departing.
[16:35:00] Now, the severe weather is starting to retreat somewhat, but the wait times continue to tick upwards. Newark, five hours, 25 minutes, BWI
is almost five and a half and those numbers are just going to go up. But now we're watching the severe weather line slide to the east.
The Arlington Police Department is now reporting that the roads in-bound to get to Reagan National are now under water by about half a meter. So the
water is over many of the -- the entire(ph) and some are stranded, so that's going to add to wait times in just getting to the airport.
All international flights coming at across the Atlantic from Europe and the U.K. will take precedent on arrivals, so if they're not diverted to another
airport, things should get better, but you can see the number of cancellations and those numbers of delays will just be added to that.
But it is going to improve in the coming hours, so look for some of these ground stops here to start to be released and we'll start to see our
trucks(ph) get back on the road, but as you know, it will take a while --
GOLODRYGA: Yes, I just feel for those commuters, I've been in their --
SATER: Yes --
GOLODRYGA: Shoes stuff at an airport, it is not fun. Looking forward though to tomorrow --
SATER: Yes, much better --
GOLODRYGA: Always being optimistic -- better weather tomorrow, Tom Sater, thank you so much. Well, Embraer has signed a contract to supply a billion
dollars worth of planes to United Airlines. The deal is for 25 E175 jets. Delivery begins in the second quarter of next year at the Farnborough
Airshow.
The company signed commitments for 300 aircrafts. At the show, Embraer CEO defended the commercial partnership with Boeing unveiled by the two
companies last month. Richard asked him if the deal was inevitable once Bombardia and Airbus announced their tie-up.
(BEGIN VIDEO CLIP)
PAULO CESAR DE SOUZA SILVA, CHIEF EXECUTIVE OFFICER, EMBRAER: This deal is as a result of conversations with Boeing, announced a collaboration for
many years, right? So Boeing and Embraer have been developing joint efforts in engineering, flight operations, eco-fuel and things like that.
QUEST: But it proves the point that the adverse Boeing duopoly cannot really be challenged. The moment yourselves and your competitor went into
that small to medium-size aircraft, challenging them, it was -- it was game over.
SILVA: Yes, it's much challenge of course. We also want to grow our business, right? And in order to grow our business, it's important to have
a partnership like this one. But what's important however, is that this deal is completely different from the other deal with the other
manufacturer.
Because this deal is about a strategic partnership, very deep. It's not about a one program only, right, one aircraft program. So it's about the
whole company, engineering, manufacturing, provision, supply chain. This deal is much more deeper, much more strategic than the other deal that the
other manufacturer announced last year.
QUEST: Yes, but you don't expect Boeing to start moving into your defense area.
SILVA: No, but we'll have a joint venture for the defense aircraft. The right KC390 will be in a second, JV, with Boeing, and Boeing will help us
to sell these aircrafts globally.
QUEST: It comes back to this point of the -- of the strength of Airbus and Boeing in aviation. It's impossible to disrupt that strength, do you
accept that?
SILVA: I accept that if we go -- if we move into their line of products, yes.
QUEST: You must be sad to be leaving -- to losing this part of the company. There must be a sadness to it.
SILVA: Well, it's yes and no. Because this is the opportunity for Embraer to grow in Brazil. So we will have much more access to market. So we will
sell more of these machines here that came into the market just now, they are tools, which are unbelievable aircraft, very efficient.
So with Boeing, we will just complement right, their line of products, and that we will go now have access their clients.
QUEST: How worried are you, on more general issues, the deteriorating trade relations within the world at the moment. Obviously, prefaced by
Donald Trump and his tariffs seemingly against everybody and anybody for global companies like yourselves. How worrying is this?
SILVA: Yes, of course, this is not good, so we are worried, I think that it does affect business in general, life in general. As far as Embraer is
concerned in Brazil, we don't believe that we would be in Brazil much too much impacted.
However, aviation, right, can be a big deal, more important.
QUEST: When you look at the campaigns -- I mean, I don't want to drag you, just lost a campaign again with JetBlue, that must be very disappointing.
[16:40:00] SILVA: Very disappointing, yes --
QUEST: When they don't have -- not only did they not take your new aircraft, they go to their principal competitor.
SILVA: Yes, I mean, sometimes we win, sometimes we lose, right? But we are market leaders right in the segment, so we are the market leaders right in
the segment move to 156. And it's disappointing -- well, that's -- we are sure that we have an excellent product. They too are the best aircraft
right in the category.
QUEST: Is the battle now on? I mean, Embraer, Boeing, Bombardia, Airbus, this is an absolutely titanic --
SILVA: Yes, we are together and we will fight together and the life will continue.
(END VIDEO CLIP)
GOLODRYGA: And still to come, from a dog's breakfast to top dog, Amazon stocks makes a recovery hours after a massive technical glitches hit Sunday
shoppers.
(COMMERCIAL BREAK)
GOLODRYGA: When markets opened, it didn't look like they would end this way. Green lights all around in a new record for the Nasdaq. It's the
Nasdaq's 24th record this year. Now, it's partly thanks to Amazon, Facebook and Alphabet which all hit records.
The Dow and the S&P got a boost from the Fed Chairman Jerome Powell, he told lawmakers that the Fed will take a cautious approach to raising
interest rates. Amazon stock has been boosted by soaring sales on its annual prime day.
Users still have a few hours to grab a bargain, and some might need that extra time after what Amazon called a rough start to the big day. Instead
of deals, many customers saw pictures of cute dogs, Amazon's standard arrow message.
Our Clare Sebastian spoke to the vice president of Amazon Prime who says there's more to it than just boosting sales.
(BEGIN VIDEO CLIP)
CEM SIBAY, VICE PRESIDENT, AMAZON PRIME: The goal still remains the same, it's really a round engagement, introducing customers of benefits that they
may not be aware of, and really allowing them to be able to find great deals.
It's also a perfect time for families to be able to do back to school shopping as well. Last year for instance, we sold more back to school
supplies like pens, papers, pencils, back packs than any other day as well. So yes, it's intended as a solitary event, yes, it's intended to engage as
many members as possible as well.
And in this year in the U.S., that includes 400 -- four food stores nationwide. But it's -- you know, we've just really been humbled by the
response that we've got from customers.
SEBASTIAN: I want to ask you about Whole Foods because this is the first year that Whole Foods, obviously this is the first year since the deal was
completed, but it's the first year that you're incorporating Whole Foods.
And I think the speed of the integration has surprised many. How important was it to use this day to drive traffic to the Whole Foods stores?
SIBAY: I said this when we launched the better as well. The launch of the Whole Foods benefit was the most important benefit we've launched since can
video in 2011 as well. In response, we've gotten from customers who have been phenomenal.
[16:45:00] The engagement numbers that we've seen has been faster than any other benefit that we've launched. Members have already saved millions of
dollars and they're really responding positively to saving hundreds of items -- 10 percent off hundreds of items on a weekly basis as well as deep
discounts on seasonal favorites.
SEBASTIAN: I just want to ask you because it's not all excitement across the board about Prime Day. There are strikes going on in Spain, Germany
and Poland, people complaining about working conditions and pay. What is the company doing to address these concerns as people walk out on Prime
Day?
SIBAY: I've been at Amazon since 2005 and I've had the opportunity to visit tens of our fulfillment centers globally. Have had the opportunity
to work side-by-side with many of our associates as well, and I can tell you, I have not see anything that I would be proud of talking to my mother,
my parents in general, my kids.
So I'm not sure what to make of those reports, we offer very competitive wages and benefits.
(END VIDEO CLIP)
GOLODRYGA: Amazon is now single-handedly setting the online shopping agenda. Various companies plan their own sales around Prime Day. These
are just some of them in the U.S. British retailers including Currys and Argos also launched flash sales.
The new crop of shopping events are catching up with longer established ones. Last year, shoppers flashed billions of dollars on Prime Day, Black
Friday and Cyber Monday that was at war by Alibaba's Single Day in China which raked in $25 billion.
Barbara Kahn is a marketing professor at the University of Pennsylvania, her book, "The Shopping Revolution" has just come out. She's joining us
from the university campus. Great to have you with us, so let's talk about the evolution of consumer shopping behavior.
Because you look at Amazon Prime Day, seven hours of a technical glitch that in the past could have brought down a company, at the end of the day,
they still hit record revenue. What does that tell you?
BARBARA KAHN, MARKETING PROFESSOR, UNIVERSITY OF PENNSYLVANINA: Yes, that's really interesting, there's no question that Amazon has changed its
shopping experience. And by really focusing on their customer experience.
So what Amazon has done is figured out a way to remove the pain from shopping. And they're -- what they do is they focus on making things super
easy and they make things come into the very good price. And Amazon Prime Day is a very good example of both of those things.
The Amazon Prime Program, the loyalty program is the fly wheel of Amazon, they bring people in, they're very loyal, they make their customers stay
with Amazon, they have very high retention rate, and then they offer these amazing deals.
GOLODRYGA: And you look at competitors trying to just stay afloat and compete with some of these offers from Amazon. Who are the ones that are
getting it right?
KAHN: Well, I think Wal-Mart is doing a nice job. Wal-Mart comes in from a different position of strength, they have a lot more physical stores,
they have a lot more sales associates, they're the largest private employer in the U.S., and they're leveraging those assets to deliver an easy
shopping experience, you know, shop online but pick up in the store, those kinds of things.
Obviously, they purchased jet.com to really continue the online piece of it all, and so they're really doing some amazing things there. And they're
also trying to improve their private line -- their products line with a lot of acquisition of interesting partners.
They purchased Bonobos, Mudd Club(ph), they're doing a partnership with Lord and Taylor. So they're really trying to come in, in all different
directions to compete wholeheartedly against Amazon.
GOLODRYGA: And so, you know, when we have so many of these "special days", Prime Day, Black Friday, Cyber Monday. Are we going to get to the point
where it's just your typical Monday where you're going to have great sales. Now, there's nothing that --
KAHN: We're having much --
GOLODRYGA: Right, but are we going to see more as we see more competitors?
KAHN: Well, I mean, one thing that's really interesting of that Prime Day. First of all, it is interesting that other retailers are jumping on the
bandwagon, even though the name of the day is Prime Day. There had been plenty of endorsement for Amazon, so that's kind of interesting.
But the timing of Prime Day is a very good timing, it's the beginning of that Discosis (ph) which is the second biggest shopping period, second only
to the holiday season. And so there's something about the timing also. And we also know that when you have spikes, the surges in, you know, price
promotions and things like that, that really attracts attention and it gets people thinking about shopping again.
GOLODRYGA: Yes, I believe was it Macy's that --
KAHN: So I don't think that this one is too many, I think it's well placed, you know, and I think it's an isolated time in the beginning of the
summer, and I think this one makes sense. If we had tons as you suggested, yes, they'll lose their meaning, I don't see that happening yet.
GOLODRYGA: Well, I thought it was interesting how Macy's addressed it, I believe it was Macy's Prime Day by offering all of their products that are
under $119 and of course it costs $119 to be an Amazon Prime member.
So everyone --
KAHN: Right --
GOLODRYGA: Is trying to individualize their sale --
KAHN: You don't have to, some of the other retailers, you don't have to belong.
GOLODRYGA: Yes, exactly. Barbara, thanks so much, enjoy --
KAHN: Bye --
GOLODRYGA: Having you on.
KAHN: Oh, sure.
[16:50:00] GOLODRYGA: Well, it's World Emoji Day, and for those in the dark, they are the little images which takes the place of words in text
messages. After -- there you go, there you see the smiling faces, the frown, the heart. Well, after the break, we will have our Emoji translator
who will dethrone these from the (INAUDIBLE).
(COMMERCIAL BREAK)
GOLODRYGA: Apple has unveiled a bunch of new emojis to coincide with World Emoji Day. Seventy new characters will come in a free software update
later this year, better representing people with red hair, grey hair, curly hair and no hair.
There are also new food options. From text messages to marketing emojis are increasingly common. Jeremy Burge is the creator of World Emoji Day.
He's also the chief emoji officer at Emoji PDM. Great to have you with us.
JEREMY BURGE, CHIEF EMOJI OFFICER, EMOJIPEDIA: Happy World Emoji Day.
GOLODRYGA: Hi, happy World Emoji Day to you, I'm just waiting for the president to tweet an emoji any day now, right, never say never. But it's
funny because my teenage step kids, I have to decode their messages because they speak to me in emoji.
This has really taken on a life of its own. Talk to me about the sustainability and the significance that emojis have on consumers now.
BURGE: So the interesting thing on emoji is that this is the first time we've actually had a universal characters that works across phones, across
devices, across apps. So it means that in the past, we used to have them segmented in one app or another app where it is now, this is something that
we can all use.
And what happens is different parts of the population end up using them in different ways. You do get teenagers that come up with a different meaning
often with a particular angle on how they'll use it, and then you find that other people will use them in completely different ways.
GOLODRYGA: And of course, people looking to see if there's a business to be made from emojis. I mean, what kind of a business model are we seeing?
BURGE: There's always people trying to make money, right?
GOLODRYGA: Right --
BURGE: Emoji itself doesn't make anyone money, it sells devices. If you update your iPhone or your android phone, that might make you buy a new
device if you want to get the new updates. The trouble with people is what they do is they at least stick a patch or they might sort of brand those
emoji.
You know, like emojis, but we can't sell the real emojis, how about we make stickers and things like Kim Kardashian's emoji has earned sticker packs,
they make hundreds of millions of dollars. So it's a real business in visual communication.
GOLODRYGA: Yes, and you're actually going to translate an emoji sentence for us. I don't mean to put you on the spot, I was told that you came
prepared.
BURGE: Well, I was hoping that you might be able to help us as well, we've seen what we've got. Here's a sentence that we put together early on. I
think it goes across -- too faint(ph), I was quite quick to see, wasn't it?
GOLODRYGA: Oh, no, and barely --
BURGE: Yes --
GOLODRYGA: Speak much lower emoji --
BURGE: On the first and there was an Apple and there was a foreign, if it's Apple, foreign, there was an (INAUDIBLE) of foreign saying --
GOLODRYGA: I think we're going to restart it --
BURGE: Yes, I just want to look at them --
GOLODRYGA: Yes, you know, the beauty of live TV --
BURGE: Yes --
GOLODRYGA: There again, here we go.
BURGE: There's an Apple and an iPhone, let's look --
GOLODRYGA: OK --
BURGE: At a few on this, good day, what about the rest? Have you got any good ideas on how the coffin and then --
(CROSSTALK)
[16:55:00] There was a coffin and there was like a scroll --
GOLODRYGA: OK --
BURGE: And there's a will, Apple's iPhone --
GOLODRYGA: Apple iPhone will get a new emoji soon --
BURGE: Get emojis --
GOLODRYGA: I guarantee you, if my 16-year-old step son were here, he would have gotten that in a heartbeat.
BURGE: Straight away --
(CROSSTALK)
That's why we made it so quick right?
GOLODRYGA: Like it's a different language.
BURGE: To check the skill.
GOLODRYGA: And I want to show off your emoji on sample, you've got smiley face -- or no, all different kinds of facial expressions on yourself, you
got the emoji tie --
BURGE: Let me show you, I don't know whether it is --
GOLODRYGA: Emoji cufflinks --
BURGE: Notice, ticks up there, but they are one of the more popular ones, but it's the pile of proof.
GOLODRYGA: Yes, I'm not going to say that, you can show it off, but what is your favorite emoji?
BURGE: I like the upside down one, it's quite flexible, it's the smiling face that's upside down. Kind of it's friendly, but still a little bit
playful, you're not necessarily saying anything. I'll sit quite like that, the man in the trucks --
GOLODRYGA: Yes, I like the face -- I like the face pump --
BURGE: Yes, that one is good --
GOLODRYGA: I really like that one too --
BURGE: That one is good --
GOLODRYGA: It's like it can apply to so many --
BURGE: I know --
GOLODRYGA: Even anything --
BURGE: You can only send that -- when Facebook came out with some new stats for World Emoji Day showing 900 million messages sent everyday on
Messenger without any texts, just emojis.
GOLODRYGA: It's a universal language, right?
BURGE: Well, you can use it, any country can use it. I consider your face pump if you speak a completely different language to me.
GOLODRYGA: I love face pumps.
BURGE: Yes --
GOLODRYGA: My favorite. Well, great to have you on, thank you for being daring enough to wear this on -- those were just circles, and then I see
the smiley face --
BURGE: Once a year, it's only a --
GOLODRYGA: You wear it well --
BURGE: World Emoji Day once a year --
GOLODRYGA: Happy Emoji Day --
BURGE: You too --
GOLODRYGA: Thank you so much. Well, if you want to keep on top of the day's business headlines in just 90 seconds, then try our daily briefing
podcast. It's updated twice a day before the start of trade, and after the closing bell rings on Wall Street.
You can ask Alexa or your Google home device for your CNNMoney flash briefing every day. And that's QUEST MEANS BUSINESS, I don't have an emoji
for you, so I'm going to send you a big smile, I'm Bianna Golodryga in New York. Thanks for watching. The news continues here on CNN.
(COMMERCIAL BREAK)
END
