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Quest Means Business

Larry Kudlow Says Impeachment Won't Stop The Stock Market As Donald Trump Beefs Up His Legal Team; Tech Shares Surging in 2020 On Trade Optimism; China's GDP Grows At Slowest Pace in 29 Years; U.S. Says 11 Troops Were Injured in Iran Missile Attack; Rain in Fire-Ravaged Australia Brings Relief; President Trump Adds Big Names to Legal Team for Impeachment Trial. Aired 3-4p ET

Aired January 17, 2020 - 15:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

[15:00:14]

RICHARD QUEST, CNN INTERNATIONAL HOST: As we head towards the closing bell in an hour's time, the last hour of trade at the end of what's been an

extremely interesting week.

Dow Jones Industrials will close at a record if it holds the gains. But the gains have been evaporating, so small gains there. And across the major

markets, the narrow, the broad and the tech, you see we have three records at the moment. Let's see if they hold between now and the close in 60

minutes' time. Those are the markets, and these are the reasons why.

Larry Kudlow says impeachment won't stop the stock market as Donald Trump beefs up his legal team.

There are warning signs from China. It is posting its slowest growth in almost 30 years.

And Boeing discovers a new issue with the 737 MAX and Boeing shares are down two percent.

Tonight, we are live from London on Friday. It's January the 17th. I'm Richard Quest, and of course, I mean business.

Good evening. Tonight, Donald Trump is preparing for battle in the U.S. Senate, and he is doing so by bulking up his legal defense team ahead of

next week's impeachment trial.

Three seasoned attorneys are being brought on. The constitutional lawyer, Alan Dershowitz; Kenneth Starr, whose own investigation led to President

Clinton's impeachment; and Starr's successor as the Office of Independent Counsel, Robert Ray.

Now, the stock markets at record highs, the White House adviser, Larry Kudlow says the President's legal troubles have no effect on the economy.

(BEGIN VIDEO CLIP)

LARRY KUDLOW, DIRECTOR, WHITE HOUSE NATIONAL ECONOMIC COUNCIL: The impeachment trials have no impact at all, on the economy or the stock

market, none, zero. That's a function of good policies and a free market country and brilliant entrepreneurs.

I sometimes get a little annoyed that impeachment and all the theater going with that could be an effort by the other side of the aisle to obstruct and

obfuscate the economic progress we're making.

(END VIDEO CLIP)

QUEST: So, CNN's Kevin Liptak is in Washington. Interesting the way they brought out Larry Kudlow today to sort of redress the balance on the

economy on a day of course, when markets are at record highs.

KEVIN LIPTAK, CNN WHITE HOUSE PRODUCER: Yes, it certainly is and it comes a day after the President made a big deal about the passage of his NAFTA

replacement and two days after the China trade signing at the White House, and I think that's the underlying dynamic that you're going to see over the

next weeks, months, even the next election year is the President trying to really highlight and underscore a booming American economy in the face of

this impeachment predicament that he finds himself in.

And you've already seen the President describe it as a hoax. You've seen him describe Democrats as trying to undermine his achievements on the

economy. Trade deals, chiefly among them -- Richard.

QUEST: But interesting, though, Kevin, I'm pleased you mentioned that because to be even handed, of course, the President does have real economic

achievements to trumpet. You know, we may -- the critics may say it's not much, but he did get Phase 1. He did get USMCA. Markets are at record

highs, and the unemployment rate is at a record low.

LIPTAK: Yes, and this is all this stuff that his campaign and the President are going to be trying to counter program this impeachment trial with.

You're going to see him do these big campaign rallies in early voting states, even states like Iowa and New Hampshire, where he's not actually on

the ballot. Those are where Democrats are voting, but he is still going to hold these big campaign rallies in those states to try and stay on message,

stay on people's minds.

Everyone is going to be focused on the impeachment trial in Washington in the President's argument, and his team's argument is that Americans care

about a lot more and mainly among those things is the economy. The President feels that Americans feel like they're doing better.

More Americans have jobs than they've ever had and these trade deals, I think are what he will use to try and bludgeon that point home. We expect a

big signing ceremony for USMCA when that eventually gets to his desk. He'll eventually go to China to start this next phase of negotiations on the

China trade deals.

So these are all items that the President thinks will counter program impeachment. Whether or not that's the case, whether or not that breaks

through remains to be seen and a big part of that is whether the President can stay on message.

[15:05:10]

QUEST: Kevin, right now, just remind me, the tick tock, if you like, for next week. It's still supposedly that the trial begins proper on Tuesday.

Is that still the latest?

LIPTAK: Yes, that's what we're hearing from Capitol Hill. The trial will start in earnest on Tuesday where we expect to hear opening arguments from

both sides. That's where this new legal team will come into play.

We still expect the White House counsel, Pat Cipollone, the President's personal attorney, Jay Sekulow to deliver those opening statements, but

these other lawyers that have been brought in, Ken Starr, Alan Dershowitz. The other names that you didn't mention, Pam Bondi. She is the Florida --

former Florida Attorney General, they will also have speaking roles on the Senate floor.

Now how long this last? That's still an open question and a lot of that has to do whether or not the Republicans cede to these requests to have

witnesses. If there are no witnesses, the trial could last fewer than a couple of weeks. If there are witnesses, it could go on much longer.

Now, one dynamic in all of this, and I think this is probably on your mind, Richard, too, is that the President is supposed to be at Davos next week.

He is supposed to arrive at Davos on Monday. The trial starts Tuesday. That will provide a very interesting dynamic as this trial gets underway, the

President is on the world stage touting the American economy. Again, will that message breakthrough impeachment? It remains to be seen.

QUEST: It will be surreal, I think, Kevin to see next week the President of the United States in Davos, glad handing it up a Swiss mountain whilst the

impeachment presses. All right, good to see you, Kevin. Thank you.

We'll continue this theme of U.S. markets going up. The Dow marginally today, off the highs, but let's not be mealy mouthed about those sessions

over the course of the week. We're on track for a good one and a half percent gain over the course of the week.

So, although it's off the highs of the day, shares of Boeing stock are dragging it down after Boeing saw new software issue on the 737 MAX. It's

not quite clear just how serious or how long lasting it will be.

Still, all three indices are at a record. Google's parent company, Alphabet, is now worth more than a trillion dollars. Its stock hit a new

record high this session, and its shares are already up nearly 10 percent for the year so far -- bearing in mind we're only at the 17th of January.

Also, other tech shares have risen as investors grow more hopeful about the outlook for world trade.

Take a look at Wall Street's most valuable companies. The top six are all tech: Apple, Microsoft, Alphabet, Amazon and Facebook -- together $5.2

trillion, nearly, a fifth of overall value for the S&P 500.

Paul La Monica is in New York. Does it dramatically skew the market when you do have these four or five behemoths in value? Because I am just

pondering whether in a previous era, it would have been an IBM, a GE, a GM -- the ratios may be different, but there would always be those big

companies?

PAUL LA MONICA, CNN BUSINESS REPORTER: Yes, I think there are some people that I talk to that are a little concerned that there's so much

concentration in a handful of companies that are in similar, if not exactly the same business lines, even though they're all broadly tech, especially

when you look now, Richard, how so many investors are in passive ETFs that they're buying S&P 500 index funds thinking that they're diversified.

They've got the broader market exposure, but in reality, they have heavy exposure to those five tech companies.

The good news obviously, is that all five of them are doing extremely well. Their earnings are great. They're not overly valued, but they may be a

little rich in terms of their valuations. And they all have very strong balance sheets with a lot of cash and little debt.

So, unlike maybe 1999 when you had a lot of tech companies that were overvalued and had flimsy fundamentals, these are companies that are

arguably the strongest in America and the world and the market is rewarding them.

QUEST: Right. Let's talk about Boeing if we may.

LA MONICA: Yes.

QUEST: There is another software problem. It doesn't sound to be terribly serious with the MAX, but I suppose anytime you put something into the

microscope like this, more things will become clearer.

At the moment, Boeing is down two and a half percent. It's sort of the lowest point that it's been, that stock. Paul La Monica, "The Daily Beast"

has an article saying Boeing is totally screwed as orders plunge and customers switch to Airbus.

That is a reference to earlier in the week when we had a total orders number. But, but have they got a point?

[15:10:03]

LA MONICA: I think it's a bit hyperbolic to say that a company of this size and then as diverse is totally screwed. Yes, the 737 MAX is a huge black

eye for Boeing. It is unclear when that plane is going to be cleared to fly again.

But Boeing obviously makes other planes not just the 737 MAX, as you well know. Boeing, last I checked also has a pretty big defense unit that sells

to the Department of Defense, the Pentagon and other governments around the world that's not really being affected by this.

So, I'm not trying to brush this off and say that Boeing's in great shape, but I don't think they're at death's door.

QUEST: All right, and it is going to require ingenuity and innovation. I mean, assuming they get the MAX back in the air at some point in Q1 or Q2

of this year, they then have got the trust problem, which because you've got your order book, but you've got to get people to buy more.

LA MONICA: Yes, you have to get more global carriers to feel that they can fly these planes safely, and actually, you know, put them back in the

fleet. But I think another question, I know a lot of average consumers don't necessarily look and see what plane, what model a plane, what

aircraft maker, they're going to be flying on. They're choosing airlines because of credit cards and, you know, points and things of that nature.

But these two crashes have generated such negative headlines for Boeing. It wouldn't shock me if some more savvy flyers are wary of flying a 737 MAX

because of the history with this plane.

QUEST: Paul La Monica, thank you. Good to see you, sir. Have a good weekend.

LA MONICA: Thank you. You too.

QUEST: QUEST MEANS BUSINESS tonight in London. In just a moment, Microsoft makes a major commitment on tackling climate change.

(COMMERCIAL BREAK)

QUEST: Welcome back. The U.S. highway safety watchdog is reviewing a petition that's calling on the agency to investigate possible defects in

half a million Tesla cars.

Apparently, the cars reported incidents of unintended acceleration, a hundred crashes supposedly have resulted 50 injuries. Now, despite a small

difference in the price, today, Tesla stock has been skyrocketing, more than doubled in the past three months.

Dan Ives is an analyst at Wedbush Securities. He joins me now.

[15:15:10]

QUEST: Let's dispose of these allegations about unintended accelerations. Is this likely to go anywhere?

DAN IVES, ANALYST, WEDBUSH SECURITIES: Yes, I think it's more noise ultimately. I mean, obviously it's headlines. It could ruffle the feathers

of Ambassadors. But really, if you look for a percentage of what they're seeing, relative to the overall volume, I don't really see this going

anywhere. I view it more as noise ways rather than true worries that there will be a broader investigation.

QUEST: Let's get to Tesla there. Now, look, the stock had been at around say $350.00, nearly heading towards $400.00 when it had all its problems

with the CEO, Elon Musk and all those things, and then it dropped back. Now, it has roared back up again. Is this sort of the fair value of where

it should be?

IVES: Look, I think there's really a massive inflection in EV demand, especially in China. And I think that's really been a key. Or if you look

at China, the Giga 3 factory in Shanghai and overall demand, you're starting to see an inflection point. I think right now that's worth about

$75.00 to $100.00 of the stock.

I think in a bull case, you could see a $650.00 to $700.00 stock in Tesla. They could hit a speed bump and obviously the stock sells off, but I think

right now, it's really fundamentally starting to see an inflection in terms of everything Musk and Friedman are doing.

QUEST: All right, now this is interesting because what I'm -- what we're getting to is, what is the fundamental price? Whether you want to base that

on technical and results and things like that, versus the speculative price, or the price that gets affected by the antics of the CEO? What do

you think the fundamental price is?

IVES: Yes, I think fundamentally, the price if you look at a base case, it's somewhere probably in the $370.00 to $400.00 range in terms of base.

Now, if they're successful in China, which all indications look like they are, then you are looking somewhere at a $600.00 to $650.00 price. So, I

think that's where right now the bulls see it, and I think if they come through with good numbers, there's just a guidance around China and there's

a stock that has a six in front of it.

QUEST: I mean, it is fascinating the way in which it has doubled in the course of three months. But it just -- but, you know, you know, better than

anybody, Dan, markets swing. They swing to extremes on either side, before hitting the equilibrium over time.

IVES: No doubt and I think you saw some darker days earlier this year, and you've definitely seeing a short covering, you know, in terms of a historic

one, but I think it's really fundamental. And I think the game changer for Tesla is China.

I mean, China is really the fuel in the engine that can add 150,000 units. If they're successful there, that's really where you have a global

inflection point, especially for Tesla.

That's why right now these next few quarters are going to be key, but I do think the stock is starting to get to maybe fundamentally where it belongs

given the $15.00 to $20.00 of earnings power when you look at the next four or five years?

QUEST: Dan, great to have you. Thank you, sir. Much appreciate it. Have a good weekend. Thank you.

Now an impeachment trial in Washington and the slowing growth in China can't stop Wall Street's record run. The stocks are hitting all-time highs,

even as a crucial engine of global growth seems to be losing momentum.

Record highs in the U.S., but China, the second largest economy, its slowest pace of growth in nearly 30 years. Beijing says its economy grew

6.1 percent last year in line with expectations, but a long way from the years of double-digit growth it reported; for example, 14 percent in 2007.

And officials in China say growth will stabilize this year. China and the U.S. have signed the long-awaited Phase 1 trade deal.

Speaking to me on the "The Express," Brookings Institute's, David Dollar, said the slowing investment in China is a good sign.

(BEGIN VIDEO CLIP)

DAVID DOLLAR, SENIOR FELLOW, BROOKINGS INSTITUTE: It's a healthy thing that investment is slowing down in China, but that's a big part of GDP. So most

of the decline in the GDP growth rate is the slowdown in investment. Consumption is held up very nicely, and that can give them sustainable

growth in the five to six percent range, but consumption is not going to get them back up to those numbers of the past.

(END VIDEO CLIP)

QUEST: So, what are the issues? What are the Chinese problems that the economy faces? First, debt has been piling on left, right and center. Two,

tariffs. It had a dampening effect, but billions of dollars' worth of goods are still subject.

[15:20:07]

QUEST: And China's birth rate, record low, shortages of young people. The demographics. Max Baucus is the former U.S. Ambassador to China. He joins

me now.

Apologies, sir, that I'm not with you in New York. I'm on the other side of the Atlantic tonight ahead of Davos. Ambassador, China's willingness to

make real concessions, which they didn't really do in Phase 1, did they?

MAX BAUCUS, FORMER U.S. AMBASSADOR TO CHINA: Not really, no. They did address the structural problems that very much concerned us and United

States and the west, but they were not addressed in any significant way.

QUEST: All right, and I mean, as I read it in many of the briefing notes, all they did was, all that they really did was repackage many things that

have either been agreed before, or we're already under negotiations.

BAUCUS: That's correct. Yes, for example, eliminating some of the caps on equity investment in China. Now, an American company can own them 100

percent. Financial services got big breaks in China. Credit cards and banks and so forth. Now, these were already agreed to, but still, that's

progress. It's good that that's happening.

QUEST: All right, so how difficult is it going to be to do Phase 2? And is Phase 2 important? I mean, what is the core of Phase 2?

BAUCUS: Well, first of all, it was addressed in the second year of Phase 1. China agreed to purchase about 60 percent increase in U.S. products over

the average of the past five years. That's huge in 2020 and 2021. I don't know if that can happen.

But if China did make that commitment, it's also kind of interesting that President Trump is pushing managed trade, not free competition with this

deal, that is the sketch and that he got them to agree to buy all the stuff, so that's interesting.

Phase 2, well, we'll see. That depends very much on the good faith of China and the good faith of the United States. It depends on the details in this

agreement, too, which we have not yet seen.

QUEST: And the China GDP growth, which was the slowest in three decades. Now, on "The Express," David Dollar was saying it's all because of the

structural problems, the debt problems within China, they're not being resolved, or are they?

BAUCUS: Not really. I think, you know, 6.1 percent is still very large compared to the United States. That's 61.1 percent at a very large base.

So, 6.1 percent for 1.4 billion people is significant growth rate. No, I think that China is challenged. David Dollar has mentioned some of the

challenges. You did in your show, but I've got to tell you, I've got a huge healthy respect for the intestinal fortitude of the Chinese. They're tough.

They'll figure out how to deal with those challenges. They basically believe, you know, their time was back after thousands of years of history,

they were the center of the universe, and they were backed up for a couple hundred years, now they're back. They're very tough. They'll find a way to

deal with those challenges.

QUEST: That's interesting, because what you're talking about, in some ways, is very -- I mean, not over the same longevity, but that's very much the

same view that President Trump takes, a pursuit of the United States, that after years of slothful misdirection, the U.S. is back.

BAUCUS: Well, I don't know. I mean, that's very short term. We think short term in the U.S. We're very ad hoc. When we deal with China, we're very

reactionary. We have no long-term strategic plan for China.

It is true, the economy is doing better now in the U.S. than it was a couple of years ago, certainly, after the financial collapse, but we're

very short term. China is long term. And for this Phase 2 to work frankly, our country has to begin to develop a long-term strategic strategy towards.

I agree with what we can -- tell China what it can agree to and not agree to and go ahead. Another thing hereto, we've got to decide to do, we want

to work with China, or do we want to contain China?

There are many in this administration who want to contain China, stop China's rise, and if China gets a whiff of that, if China thinks that's the

U.S. policy, then Phase 2 can go out the door, and we're going to be in a world big world of hurt if China feels that the United States is trying to

contain them.

QUEST: You talk about a long term strategy for China, but the reality is, it's very difficult for the United States to have anything like that,

simply because of the quadrennial election system where at best, a single President trying to get a doctrine gets eight years, of which two of them

or three of them are spent worrying about reelection and the legacy.

BAUCUS: You're right. It's a huge challenge. Mr. Churchill touted that the values of democracy, and he was right; on the other hand, currently dealing

with China, a democratic form of government and all of our wonderful intrinsic values of free speech, et cetera. independent judiciary make it

very difficult for us to develop a longer term plan, but we have to try.

[15:25:18]

QUEST: Ambassador, we do indeed, and we thank you. As always, we wish you a good and pleasant weekend.

BAUCUS: Thank you.

QUEST: Now, a new book says President Trump may want to roll back an anti- corruption law. It says he wants businesses to be able to bribe foreigners. We'll talk about it after the break. Its QUEST MEANS BUSINESS live tonight

from London.

(COMMERCIAL BREAK)

QUEST: Hello, I'm Richard Quest. There's more QUEST MEANS BUSINESS as we continue. We will be in Ukraine, where the Prime Minister has offered to

quit after claiming the President doesn't know how to run the economy -- that's one for you.

And we'll be in New Delhi as Amazon promises to generate a million jobs in India.

Before all of that, this is CNN, and on this network, the facts always come first.

Iran's Supreme Leader led Friday prayers for the first time in eight years, after days of public anger of protest over Iran's mistaken shooting down of

a passenger plane last week, killing 176 people on board.

The Supreme Leader delivered ta he defiant message. Ayatollah Ali Khamenei, slammed U.S. officials as clowns and said European leaders are their

servants.

China's economy grew at its slowest pace in nearly three decades last year. GDP up 6.1 percent. China is facing rising debt and fallout from the trade

war with the U.S.

However, China's officials expect a stable economy this year considering the signing of a Phase 1 of that trade deal with Washington.

[15:30:10]

The U.S. Military now says 11 American troops were injured about those Iranian missile strikes on a military base in Iraq. The troops were treated

for concussion symptoms. Initially, the U.S. had said no one was hurt. But a defense official says symptoms did not emerge until days later.

There's much needed rain in Australia, and it's helping to fight the fires across New South Wales. It creates its own challenges though such as

flooding. That's the south in Melbourne, there was clear skies and sunshine, and officials there say the Australian Open Tennis Tournament

will go ahead despite concerns over air quality.

President Trump is bringing in big names for his legal defense team, and they include Kenneth Starr; a former independent counsel, and Alan

Dershowitz; the former Harvard law professor. It's in preparation for a Senate impeachment trial which begins in earnest on Tuesday.

Microsoft just made a major climate pledge, promising to go carbon negative, not neutral, negative by 2030. And Microsoft says it will remove

more carbon from the atmosphere than it emits. It's putting money into it, investing a billion dollars to help develop clean technology. Speaking to

QUEST MEANS BUSINESS last year, the president of Microsoft Brad Smith said tech companies are in a unique position to help solve climate crisis.

(BEGIN VIDEO CLIP)

BRAD SMITH, PRESIDENT, MICROSOFT: I think those of us from the tech sector have a special responsibility and also a special opportunity. We have a

heightened responsibility because technology companies have become among the largest consumers of electricity in the world. That's what modern data

centers do.

But I also think we have maybe a unique opportunity, because as we're finding in Microsoft, we can put artificial intelligence and digital

technology to use, not just to make ourselves more efficient, but to help our customers in every part of the economy and every part of the planet

become more sustainable themselves.

(END VIDEO CLIP)

QUEST: May Boeve is the executive director of 350.org, with me now, you see an international climate campaigning group, May joins me from San

Francisco. What do you make of it? I mean, a billion dollars hard cash on the table and its commitment to be carbon negative by 2030.

MAY BOEVE, EXECUTIVE DIRECTOR, 350.ORG: Well, look, we're seeing increasing signals throughout the economy that the climate emergency that we're

clearly living through has hit home, and there are commitments across the investment community, across the tech community that signal to the fossil

fuel sector that the glory days are over.

QUEST: The glory days may be over, but you've still got to run businesses, and you've still got to employ people, and you've still got to get power.

And that at the moment, yes, fossil fuel usage is -- will have to decline, but it is still the principal form of fuel.

BOEVE: Well, exactly. And that's why these kinds of decisions are so important. One piece of extremely good news on this front this week was the

announcement from BlackRock, of course, the largest asset manager in the world, making a very significant shift to how they think about climate

change. And that's the kind of signal that we know points to the fact that investors are seeing that they have to demand more from companies.

And job creation and rebuilding the economy could not be more important, but what we need to look to are the business of the future. And this

announcement is some of the biggest news for anyone who cares about our chances in fighting climate change.

QUEST: Now, have a listen to what Greta said about Davos, we'll all be there next week, and of course, climate change is at the top of the agenda.

Listen to Greta.

(BEGIN VIDEO CLIP)

GRETA THUNBERG, CLIMATE CHANGE ACTIVIST: To the world leaders and those in power, I would like to say that you haven't seen anything yet. You have not

seen the likes of us. We can assure you that. And that is the message that we will bring to the World Economic Forum in Davos next week.

(END VIDEO CLIP)

QUEST: It's an easy -- it's a good message in that sense. But as organizations like yourselves know, it's fine to say something must be

done, but if you don't want massive dislocation, if you don't want economic upset, it has to be managed.

BOEVE: Well, exactly. And so let's talk a little about what this announcement from BlackRock really means, because it points to how this

transition is really going to take place. So, again, largest asset manager in the world making a commitment to move their active funds out of coal.

[15:35:00]

Now, this is a first step, we have to do the same for oil and gas, and we also have to look at the massive portfolio of passive funds that are

managed by BlackRock. But these kinds of --

QUEST: Right --

BOEVE: Shifts and these kinds of decisions point the way to how this is going to actually play out in the real economy.

QUEST: Do you think that despite the fact many climate enthusiasts decry the capitalist system, do you think that perhaps it is through market

economics where investors representing shareholders representing concerns of people, companies recognizing their obligations could actually be the

key to unlocking this, not governments?

BOEVE: Well, it's a very good question because there are not a lot of inspiring examples of leadership coming from government right now, at least

at the national level. Certainly, cities are doing tremendous amount of work, but as people concerned about the fate of the planet and the people

who live on it, we have to be seeking action everywhere.

And so that includes the financial sector, which is a major driver currently in the wrong direction, lending to new oil, coal and gas

projects. But these kinds of announcements and -- look, BlackRock is not the only one moving, there's been pressure on --

QUEST: For sure --

BOEVE: Pension systems, trustees, insurers, commercial and central banks like a lot of new work on chase for example. So, it's happening in a lot of

places and we need every success we can possibly get to send these kinds of signals, and they also influence government --

QUEST: Right --

BOEVE: Probably more than they should, but we know that heads of state pay attention when the market moves in this way.

QUEST: Good to see you, May, thank you for joining us tonight. I appreciate it. Now, Microsoft's rival Amazon, is vowing to help create a million new

jobs in India over the next five years. The company's promise is also to invest a billion dollars to help small Indian businesses get online. Chief

Executive Jeff Bezos spent the last week in India where he faced protest from Indian shop keepers who say they can't compete with Amazon's

discounts.

The demonstrations were organized by the Confederation of All Indian Traders. And Praveen Khandelwal is the group's Secretary General, he joins

me now from Delhi. Sir, you can't -- I mean, I feel a bit like I've heard this before in other countries, including the U.K., when Amazon came in,

small shop keepers said we can't compete. But consumers voted with their wallets and their mouse on computers.

PRAVEEN KHANDELWAL, NATIONAL SECRETARY GENERAL, CONFEDERATION OF ALL INDIA TRADERS: Richard, first of all, my greetings to you and your viewers from

these -- on behalf of 70 million small traders of -- and answer the question that is asked by you, relates a little bit to consumers, then we

need to understand -- but a little bit of consumers but at what cost? And up to how long?

Will we allow the companies to plow the policy and law be -- and then given -- and then give up benefits to the consumer or for a long-lasting business

activity, so you can get --

QUEST: Right --

KHANDELWAL: Healthy competition in the market, and of course, then the consumer will be more benefited. So in the case of Amazon, since then --

into India, they are indulging into all kinds of malpractices including predicting pricing, deep discounting, loss funding, then exclusivity --

QUEST: Right, but so --

KHANDELWAL: And everything, yes --

QUEST: So, who do you see -- who do you see as being the responsible agency that needs to rein in Amazon as you see it?

KHANDELWAL: Well, just a couple of days before, the Regulatory Competition Commission of India has issued an order asking the director general to

investigate into the business module of both Amazon and Fliptod(ph) and also --

QUEST: Right --

KHANDELWAL: Their investment pattern and disburse a lot of investment. I mean, in India, under FDA rules, they are allowed to operate as a

marketplace. That is their --

QUEST: Right --

KHANDELWAL: Facilitate the technology and people will dig(ph) independently either for buying or for selling --

QUEST: Good --

KHANDELWAL: They are the days of Amazon, they are controlling everything, they are controlling the plantations, and everything they are controlling

which goes against the basic fundamentals of FDA policy.

[15:40:00]

QUEST: Good to talk to you, sir, we will talk about this more. We'll follow closely how Amazon comes into your country and how it does business. Thank

you now. Still to come tonight, Ukraine's president says he's given the country's Prime Minister a second chance after leaked recordings landed him

in hot water.

(COMMERCIAL BREAK)

QUEST: Since 1977, there's been a sword hanging over those who do business overseas with America. It's called the Foreign Corrupt Practices Act, which

prohibits American companies from bribing overseas officials to win business. It is a draconian piece of legislation, and just about any U.S.

salesperson overseas is well aware of the Foreign Corrupt Practices Act, the FCPA.

A new book says Mr. Trump was talking about scrapping the FCPA two years ago, and the White House adviser Larry Kudlow says there are still

discussions about it.

(BEGIN VIDEO CLIP)

KUDLOW: We are looking at it -- I was just going to say, we are aware of it and we are looking at it, and we've heard complaints from some of our

companies. So, I don't want to say anything definitive policy-wise, but we are looking at it.

(END VIDEO CLIP)

QUEST: Paul Callan is senior CNN legal analyst. He joins me now from New York. We're all aware the FCPA, it's one of the things we've all done --

we've had to do seminars and those about -- tutorials to know what you can and you can't do. What do you think when you hear him say the

administration is looking at getting rid of the FCPA?

PAUL CALLAN, CNN LEGAL ANALYST: Well, it doesn't surprise me. I mean, for you know, the administration is very pro-business, and you know, businesses

were used for a long time to kind of be totally freewheeling in other countries, bribing people and doing whatever the local economy required to

get the business.

And now of course, they could be prosecuted under U.S. law, it's illegal. So businesses would probably like to see a change made. And the one thing

that the president has always said is that he is pro-business and pro- helping businesses expand. So --

QUEST: But it would arguably be -- arguably be a retrograde step in the sense that if you didn't put in its place, something equally serious and

severe.

[15:45:00]

CALLAN: Oh, absolutely, and you know, the law came in for a good reason. And I think a lot of responsible business people were very happy to see the

law come in because it prevents their competitors from acting improperly by bribing people to get the business, and now you're competing on the merits

as opposed to on the basis of their illegal activity.

QUEST: Right --

CALLAN: So, there's a real downside to letting that law go.

QUEST: Let's talk impeachment if we may. Next week, the trial starts. And it's going to be a far -- it's going to be a very serious business. But for

those who are expecting courtroom dramatics with the Chief Justice of the United States being the Judge Judy for the Senate, I think they're going to

be seriously disappointed.

CALLAN: Yes, he's not going to transform into Judge Judy. That's for sure. You know, she's very powerful, all powerful in her courtroom. And Chief

Judge Roberts will really have very little power, the Senate has all the power. This is one of the strangest forums because the judge in this case

can be overruled by the jury.

The senators by majority vote can pretty much overrule any ruling that Roberts makes on the law. So you really are in a strange place that's not

like any courtroom anybody has ever seen.

QUEST: And the idea that we're going to see witnesses -- I mean, we had test -- we had depositions with Clinton, and of course, there's nobody

around who remembers Jackson's. So in this case, I mean, they're going to - - are they going to stay close as possible to the Clinton model?

CALLAN: Well, I think that the Clinton model is very favorable in the eyes of the Republicans because the Clinton model was a very limited

presentation of evidence, and it moved the trial pretty quickly. And also in the Clinton model, you had opening statements by either side which went

on for about 48 hours, and then a vote was taken as to whether any witnesses need be called.

And of course, if the Republicans stay together on that vote, there will be no witnesses, there will just be a motion to dismiss the charges and that

will be decided --

QUEST: Right --

CALLAN: By majority vote.

QUEST: Paul, good to see you, sir, I'll need your help next week understanding Judge Roberts and what's going on, thank you sir --

CALLAN: Oh, good to be back with you, thank you, Richard.

QUEST: Indeed. Now, in Ukraine, the President Volodymyr Zelensky says he's decided to give his Prime Minister another chance, saying it's not the

right time to unsettle the country by quitting. The Prime Minister had submitted his resignation, a day after a leaked recording appeared to show

him criticizing the president's understanding of the economy.

Our CNN international correspondent Sam Kiley joins me from Kiev. So what is it that the Prime Minister said that the president has decided to turn

the other cheek and forgive?

SAM KILEY, CNN SENIOR INTERNATIONAL CORRESPONDENT: Well, Richard, he gave - - he was recorded it would seem illegally, and indeed, there's now a two- week investigation going to be conducted by the Interior Ministry here into how that recording was made and how it was leaked and why?

But he was recorded a wide range of criticisms aimed at President Zelensky who after all is a former comic actor on a popular TV show in which he

played the Ukrainian president, a role that he has now been elected to, much to the frustration of some of the mainstream politicians here.

So, the Prime Minister essentially dissing his chief executive, the president --

QUEST: Right --

KILEY: Particularly on his capacity to understand economic principles, Richard.

QUEST: Now, the current situation would tax even the most senior and seasoned politicians. But Zelensky is neither, and he's facing not only

being at the storm over impeachment and the phone call, but also the shooting-down of the plane. How is he handling it all?

KILEY: Well, he's also got on top of that, Richard, which sometimes almost gets -- forgotten a war going on in the east of the country against rebels

backed by neighboring Russia, one that has brought him into conflict with a lot of his own supporters. He's been suggesting that they need to move

forward to some kind of peace agreement, perhaps some level of regional autonomy for what's known, broadly speaking as the DUNBATs, the east of the

country as you say.

The Ukraine lost a large number of people in the Iranian tragic shoot-down of the airliner, and it is right at the center of the impeachment storm

with the latest pieces of tit-bits of text messages between two associates of Rudy Giuliani, and one of his associates, and Robert Hyde, a potential

Congressman which have suggested that perhaps there was some kind of illegal surveillance on the U.S. ambassador here, Richard.

[15:50:00]

And the Ukrainians have launched a formal criminal investigation into whether or not there was spying on Americans by Americans on their

territory, something that's really beginning to rancor --

QUEST: All right --

KILEY: I have to say here in Kiev, where they really feel being sucked into something pretty irrelevant to their real pressing problem which is war

with Russia.

QUEST: Sam Kiley who is in Kiev for tonight for us. Thank you, sir, thank you. Now, still to come -- oh, the sounds of London, but leaving the EU

with a bang and bong. Yes, we'll look at the battle after ringing Brexit with London's iconic Big Ben.

(COMMERCIAL BREAK)

QUEST: Bong, oh, the bongs of Big Ben. Westminster chimes as they're properly known, instantly recognizable and expensive. Parliament says if

you want to hear a bong, while Big Ben is out of commission, it will cost you half a million quid, about $600,000, $700,000. Anna Stewart has more on

the battle to get Big Ben ready to bong for Brexit.

(BEGIN VIDEOTAPE)

ANNA STEWART, CNN REPORTER (voice-over): His name is Ben. He has four faces. And a lot to say at the top of every hour. At least he did. He is

under renovation and has temporarily lost his voice. Brexiteers want to see it restored on January 31st when the U.K. will leave the European Union.

(on camera): The government says it won't pay for it to ring, so Big Ben buff Boris Johnson; the Prime Minister came up with his own idea.

BORIS JOHNSON, PRIME MINISTER OF UNITED KINGDOM: It only cost 500,000 pounds --

UNIDENTIFIED MALE: Yes --

JOHNSON: At least because --

UNIDENTIFIED MALE: That's pretty costly bongs --

JOHNSON: Yes, but we're working up plans so that people can bong a bob for being dead bong. If there -- because there's some people who want to --

UNIDENTIFIED MALE: There's a bong --

JOHNSON: But I haven't quite worked that --

UNIDENTIFIED MALE: Right, but I love the fact that you're developing policy live on television --

JOHNSON: No --

STEWART (voice-over): His plan for crowdfunding raised over 200,000 pounds, and Brexit supporters are clamoring for a vote in the House of Commons.

Yet, the House of Commons Commission said accepting public funds would be unprecedented. And the Prime Minister's spokesman said Johnson's office was

now focusing on other events to mark January 31st.

[15:55:00]

(on camera): Brexit supporters have approval for a party here in parliament square. So, well, it's unclear whether Big Ben will bong, there'll

certainly be a dance and sing song. I'm Anna Stewart outside parliament in London.

(END VIDEOTAPE)

QUEST: And we've got just seconds to tell you what's happening in the markets. Bong! The records because we're up across 43 -- 42 points on the

Dow, so that is at a record. The Nasdaq is at a record, and the S&P 500 I believe is also at a record. These says the best of today, Boeing,

unfortunately, we know why? We talked about it earlier in the program, that's at the bottom. In the middle, more green than red. The market will

be much higher if Boeing wasn't off 2.25 percent. We will have a profitable moment after the break. Bong!

(COMMERCIAL BREAK)

QUEST: Tonight's profitable moment. So, Davos, the World Economic Forum celebrates its 50th anniversary next week and we'll all be at the Swiss

Mountain. We'll probably won't be able to bring too much of it to you because of course, we'll have live coverage of the impeachment trial of the

president of the United States, who in a quirk of fate will also be in Davos at the same time.

You can't make this stuff up. But I've just been thinking, I've been getting leaflets and e-mails about how to get to Davos. Chauffeur-driven

car companies is telling me that they use the most efficient vehicles, fuel-efficient vehicles, even blade helicopters, telling me that they use

the most efficient helicopters to get you from Zurich to Davos.

And they're leaving off set, which is really extraordinary why anybody would take a helicopter or a car, a chauffeur-driven car when there's a

perfectly good train service that goes from Zurich to Davos, admittedly, you have to change trains -- it's got a 6-minute dash at Landquart. But it

makes the point, this week in Davos or next week in Davos, how many of those elites who will prague along, lecture and pontificate about the

environment will have taken private means to get from Zurich to Davos, when there's a perfectly good train service, and even first class seating too,

if that's what you want.

We'll be there next week. And that's QUEST MEANS BUSINESS for tonight, I am Richard Quest in London. Whatever you're up to in the hours ahead, I hope

it is profitable. The bell is ringing, there are records all over the place. The week is done.

(BELL RINGING)

END