Return to Transcripts main page

Quest Means Business

U.S. Stocks Go Positive For 2020 Despite Virus Calamity; Disney Adapting To New Normal As Florida Park Reopens; Heathrow Airport's CEO Now Saying Job Losses Could Be Coming; One In Every 100 Americans Has Now Contracted COVID-19; Thousands Protest In Israel Over Govt. Economic Response; Israel Boosts Stimulus Measures As Second Wave Swells; White House Pushing For Schools To Reopen In Fall. Aired 3-4p ET

Aired July 13, 2020 - 15:00   ET

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

[15:00:32]

RICHARD QUEST, CNN BUSINESS ANCHOR, QUEST MEANS BUSINESS: The unreal nature of the world today. Well, take a look at the markets. You wouldn't

know that there was a pandemic crisis that's getting worse, it would seem.

The markets at 1.5 percent, strong gains. The Dow is positive. The NASDAQ, the S&P 500. In fact, the S&P 500 is going positive for the year overall.

And these are what's going on.

Tech stocks are dragging the market higher. This is despite a dire warning from the W.H.O.

Disney is reclosing its park in Hong Kong whilst trying to reopen in America.

And Israelis are unhappy with the state of their economy.

The Israeli Central Bank Governor is on the program tonight.

Live from London, it's Monday. It is July 13th. I'm Richard Quest, and in London, I mean business.

Good evening. The health warnings are dire. The market gains are dramatic. U.S. stocks are soaring. This is what's happening as we take a look at the

markets and how the three major indices are moving.

They're up very sharply, but not so much for the NASDAQ, but they are up sharply. The Dow is up 1.5 percent. The S&P is positive for the year.

And all this whilst there is a stark assessment from the W.H.O. Director General who says the global response to the pandemic is falling short and

is warning of consequences.

Joining me now is Clare Sebastian to discuss and tell me more about the reasons why the market should be rallying so sharply when, at the end of

the day, things are not looking good economically.

CLARE SEBASTIAN, CNN BUSINESS CORRESPONDENT: Yes, the markets are looking at this in a slightly different way, Richard. I'll tell you, there was a

short-term trigger today and that was that we had some good news on vaccines.

Two of the vaccine candidates from Pfizer and the German company, BioNTech were given fast track status by the U.S. Food and Drug Administration so

that again revives these hopes that we keep seeing ebb and flow over coronavirus treatment or vaccine coming through.

So that started off the day. We also got a big deal -- the biggest so far of the year -- between two chip makers, but this is how the markets are

looking at this.

Yes, they see the rising coronavirus cases. Yes, they know that Florida, for example, slashed all previous records of positive cases in a day for a

state on Saturday, but they also see that the death rate isn't rising as fast and perhaps you could look at it as the worsening situation in the

U.S., it increases the argument for greater stimulus, both fiscal and monetary.

Plus, of course, we are going into earnings season. It is going to be ugly. We've got the big banks tomorrow. But investors have pretty much already

discounted that. They don't really care about the second quarter. That's backward looking anyway.

What they're really going to be focused on is how fast we're going to get past this. What is the guidance for the rest of the year and especially

into 2021 and beyond -- Richard.

QUEST: All right, but the way the markets are moving, there is almost a perversion that the U.S. market should be so ebullient when, I mean,

whatever the technical reasons are, when the actually economies are looking so dreadful.

SEBASTIAN: You know, I think this is going to be something that characterizes this crisis. I think it's baffling to those of us looking in,

but I think this market has been looking all along, Richard, especially for the past few months, for a reason to go up, be it the Fed, be it fiscal

stimulus, be it the prospect of better earnings in the future and the prospect of treatments for this disease.

Look, I think there are some risks of this disconnect that we see between the stock markets and the economy. The stock markets could be getting too

high. I think some analysts are saying that there's too much froth in the market now.

Certainly, if you look at a stock like Tesla, which has something like a 13 percent swing intraday today, there is a lot of volatility out there, a lot

of sort of movements that you wouldn't usually see, so I think, you know, it does warrant caution, but overall, these markets are proving, you know,

astonishingly resilient in the face of this situation.

[15:05:17]

QUEST: Clare Sebastian, thank you. Now, a stark warning from the W.H.O. exactly about the future direction of the pandemic. The W.H.O. now says

that the global response is falling short and is warning of the consequences.

(BEGIN VIDEO CLIP)

DR. TEDROS ADHANOM, DIRECTOR GENERAL, WORLD HEALTH ORGANIZATION: Let me be blunt. Too many countries are headed in the wrong direction. If the basics

aren't followed, there is only one way this pandemic is going to go. It's going to get worse and worse and worse.

I want to be straight with you. There will be no return to the old normal for the foreseeable future. I repeat, there will be no return to the old

normal for the foreseeable future.

(END VIDEO CLIP)

QUEST: No return to the old normal. That is the most worrying part of what we're being told. The warning comes as there's an alarming surge in U.S.

and in Asia.

Florida has now recorded the most new daily cases of any U.S. state since the start, more than 15,000. If it were a country in its own right, it

would rank fourth in the world.

In Hong Kong, the lockdown measures re-imposed as the city battled a third wave of COVID cases. And in the U.K., new studies suggest antibodies could

fade within weeks, which is calling into question the whole concept of herd immunity.

Professor Linda Bauld is with me, the Professor of Public Health at the University of Edinburgh. Professor, explain as best we can what's gone

wrong. Is it as simple as these places tried to reopen too soon? Because I can see that with the United States, but this resurgence that we're seeing

in parts of Asia, particularly Hong Kong, what is the common factor in all of this?

LINDA BAULD, PROFESSOR OF PUBLIC HEALTH, UNIVERSITY OF EDINBURGH: I think the common factor is that it's a global pandemic and it's incredibly

difficult for countries to keep their borders completely sealed. So let's take the case of australia, which have done absolutely brilliantly well and

then of course the outbreak we've seen in the State of Victoria was due to people coming back into Australia, Australian nationals, and then

quarantine not being closely followed.

And then even in New Zealand, which has basically eliminated COVID-19, the pressure, the lobbying to open up their air space and their hospitality

industry again is ferocious. So, it's really difficult when we're in a connected world, even for the countries in Southeast Asia that have done

amazingly well.

Hong Kong is redoing -- Singapore, South Korea, even in those places, we're seeing issues. But let's be frank. In those countries, they are able to

deal with those spikes far more effectively than many other countries in the world.

QUEST: Are you -- is this the inevitable of what we have to expect? That we will -- I mean, a vaccine or not -- that we never actually manage to get

on top of it? There is always the risk not just of a hot spot, but of it getting out of control. Because if that is the case, then we have a very

grim few years ahead of us.

BAULD: Actually, I'm more optimistic than that. So, I think what the Director General of W.H.O. was saying is that countries need to -- those

that can -- try and launch a robust public health response and I still think they're doing that in Southeast Asia.

We've seen it in Germany. We've seen it in Croatia. We have seen it in many countries, actually. And I think they will be able to contain it so that

some reasonable approach to opening up the economy happens.

But I think we have to put our faith in research. So, we forget, we have infectious diseases for which we don't have a vaccine, many of them.

Tuberculosis, 10 million cases a year, but the reason we've been able to contain tuberculosis in many countries, not all, is because we have

effective medications.

So there's two routes out of this. There's a vaccine. There's effective medication. And there's also a third one for some countries to keep their

cases so low that they can't open up again, so I'm not without hope, but what I would say is that there are quite a few countries that were

complacent and didn't realize the big numbers of cases we're seeing in Latin America, I was speaking to colleagues in Gambia this morning who are

very worried about the situation in Africa, and it's been spreading around the globe.

And I think the next few months, I would agree with the Director General, are going to be really tough.

QUEST: Right. And now, this antibodies research in the U.K., so, I'm one of those that is, I thought, fortunate to have antibodies. I has just being

retested and I'm waiting for the results of those antibodies.

But by all accounts, it's not going to -- it will help me, but it's not going to last very long.

[15:10:16]

BAULD: Well, that's what the study from Kings College London suggests. I would emphasize this is a small study, and also we know that there are

multiple different types of immune response, so even if not picking up the antibodies, it doesn't look that promising, it doesn't necessarily mean

that if somebody comes into contact with the virus again, they won't have some form of immune response and indeed that they might not react so

negatively the second time.

So I just would emphasize, there's a lot we still need to know about immunity and also the testing we have for immunity. Some of that is not

specific or sensitive enough.

But again, this is an area of science where things are moving at speed, and I think we will see more promising results in the future.

Just to emphasize, we need to remember there are lots of infectious conditions. The flu, for example, which does change, but when we come into

contact with those viruses again, often the outcomes are not as bad for individuals. So, that's another positive, you know, note just to pass on.

QUEST: I'm grateful for your positivity in an otherwise evening which seemingly does not have much good news on the virus front.

Thank you, Professor. It is good to see you.

The plight of one entertainment company shows exactly how difficult this all is. On the one hand, Disney is opening -- reopening -- I beg your

pardon. On the one hand, Disney is closing a park that they reopened whilst on another part of the world, they are aiming to open a park.

You get the idea. You'll see what we mean. You'll see the different parts of the world after the break.

(COMMERCIAL BREAK)

QUEST: Disney says its theme parks are responding and adapting to what's called a new normal. It's moving ahead with reopening plans. However, one

park has been forced to close this week.

So, despite the surge in Florida cases, Disneyworld parks have reopened; Disneyland in California remains closed, Shanghai and Tokyo is open; Paris

to open on Wednesday, which is the same day that Disneyland Hong Kong will shut down again.

CNN's Cristina Alesci is with me. I mean, Disney seems to have had a bit of a difficult time of it. The decision to close Hong Kong again, this is, of

course, because the region is having to have a further lockdown because of the resurgence of the virus.

[15:15:10]

CRISTINA ALESCI, CNN BUSINESS POLITICS AND BUSINESS CORRESPONDENT: That's right. A Disney spokesperson telling me that it was really the government's

decision to go ahead and force a shutdown of the park there in Hong Kong. Really, in sort of a direct contrast to what's happening in Florida. There,

cases of the coronavirus are surging, and the government, both the state and local authorities are allowing Disney to reopen its parks as it did

over the weekend, both Magic Kingdom and Animal Kingdom reopened.

And those parks sit in what's called Orange County, and in Orange County alone, 19,000 people have been infected with the coronavirus, 560 have been

hospitalized.

So, it just really goes to show you how different parts of the world are dealing with this, and the bigger theme here is the difficulty that

businesses are going to have.

This is not going to be a story of shutdown and reopen, especially with high contact businesses like the one that Disney runs out of its parks

unit, which is an extremely important unit for the company.

Last fiscal year, it generated $26 billion, and we saw the last quarter that it reported for which was the first three months of the year, not even

the full-time that all of its parks were closed around the world were closed, their revenue from that -- sorry, profit from that unit fell nearly

60 percent, Richard.

So this is high stakes for Disney all around.

QUEST: The question, of course, is Florida in the sense that they've gambled, and, well, they would say they've taken -- they have taken all the

necessary risks into consideration.

But the reality is, when you look at the number of cases in Florida and you think that they are opening a massive theme park, albeit under new

conditions, that must surely be a gamble.

ALESCI: Absolutely, and what we've heard from the company is that it's taking all the necessary procedures to ensure the health and safety of

guests and workers.

But look, Richard, when you talk about social distancing and wearing masks and sanitizing your hands, those are all things that guests have to do.

It's on the guests.

So how does Disney actually enforce that? Are they going to toss people out of the park if they don't socially distance at an appropriate way? These

are all questions that we've been asking the company, and it's really hard to see how they can essentially ask a guest to leave the park, for example,

if they aren't wearing a mask.

What we do know is that a Disney spokesperson over the weekend told my colleague, Natasha Chen, that it's asking guests to self-monitor for

symptoms and leave the park if they have them. However, if a guest shows up sick at one of the first aid stations, they will be asked to leave.

But how this plays out and how it rolls out, these safety mechanisms, it's really hard to see how the company has direct control over individuals'

behavior -- Richard.

QUEST: I'm guessing they don't. Cristina Alesci, thank you.

Let's take what Cristina was saying and put it to the CEO of somebody who is actually in the hot seat, the CEO of Hard Rock Hotels and Casinos.

They've started welcoming customers back, but they face exactly that issue, particularly in hotels as to what do you do and especially in a place like

Florida.

Jim Allen is the Chairman of Hard Rock International. Jim is with me now. What do you do where you have a resurgence, as we are seeing? You're

seeing, of course what Disney has done, opened Hong Kong, now closing it again. How are you balancing that really very, very difficult decision?

JIM ALLEN, CHAIRMAN, HARD ROCK INTERNATIONAL: Well, first of all, Richard, thanks for having me. And you're a hundred percent right. You know, every

day it's a new set of circumstances.

But what we did, really, about three months or so ago was, we said we're going to evaluate this from a technology standpoint. So we invested in the

equipment for body imaging, you know, contact tracing, facial recognition, and frankly, we don't allow anyone to even come in the facilities if they

do not go through this particular test.

And if someone registers a body temperature of over 100.4, we allow them the opportunity to have a second test, but more in a little bit more of a

private area. This technology we purchased, we can literally be looking at anywhere from 15 to 24 people at a time. So, it's a continuous movement of

our patrons. And frankly, it's been working very, very well.

In regards to the question about how will Disney enforce, I can tell you how we're doing it. If someone refuses to wear their mask, we politely ask

them to please place it on. If they refuse, then we politely ask them to leave the facility.

There is a zero tolerance in this particular area.

[15:20:27]

QUEST: Jim, you can control a huge amount in your own area, but when the city or the locale where you're based is facing a resurgence, such as

Florida, such as Hong Kong, Northern Spain has some, what do you do then?

Because you know, whether it's somebody who is asymptomatic, just the sheer numbers, how do you manage the reality that you may have to close again?

And are you prepared to take that decision?

ALLEN: Well, it's -- once again, excellent question. I would say, probably the middle of last week was the first time since we started reopening our

properties at the end of May where that conversation is now coming up on a daily basis.

In fact, this morning, I had some conference calls with our Senior Vice President of Marketing, and we were specifically talking about that. Are we

getting or are we approaching this particular point?

Unfortunately, as we all know, some of the numbers can be evaluated depending upon what one's personal or political point of view is, and we're

truly trying to be open-minded to both sides of, obviously, the economic impact of keeping all of our employees working and the significance of

that, whether it be health insurance, and obviously, in many cases, food on the table.

But certainly, like when you reference the State of Florida, you know, the other day, over 13,000 cases in one day, and then if we look at South

Florida, specifically in Miami-Dade and even to a lesser extent Broward County, I think it would be unfair to not suggest that, yes, it is starting

to become alarming, and something like reviewing a potential -- taking a major step back or even an additional closure is something that we're going

to be talking about on a daily basis.

QUEST: So, it comes down to that point, even though it would be very difficult for you and your partners and your colleagues, you are prepared

to close down again?

ALLEN: We certainly are evaluating it. I think when we look at Florida, you know, basically, half the cases now are people in that 21 to 27, 28-

year-old age category, and is I saw it firsthand.

I was a little surprised at some of the restaurants, say, in the Fort Lauderdale area that opened, and frankly, you would have thought it was

business as normal. You know, DJs, no one wearing masks. So, it did not surprise me.

We took the direct opposite approach. We were very and still are very, very diligent on the issue of, you're going to wear a mask. We don't have any of

our nightclubs. There's no live music, DJs, none of those things are happening.

Certainly, the hotel rooms are available. Certainly, some of our restaurants are available, and then we look at a market like, you know,

say, Atlantic City in New Jersey where the state has mandated that there is no indoor dining. Period.

So, while we do have outdoor dining, we look at each market in its own geographic context, if you will, to make sure that we're doing the right

thing from a safety standpoint but also trying to balance, you know, a business that's in 76 countries around the world.

The situation in Florida is obviously much different than, say, the situation in Barcelona.

QUEST: Jim, let's keep talking over the summer, if we may, sir, so that we can find out exactly how it is. It's going to be a difficult summer for

everybody and we want to keep abreast of how your company is performing. Jim joining me from Hard Rock International. Thank you.

ALLEN: Thank, Richard.

QUEST: Now, as I said at the beginning this evening, I'm in London tonight doing my quarantine here in the United Kingdom before going off filming

elsewhere in Europe.

The flight from New York to London is one that I have taken more than dozens of times, several hundred times, over 40 years. In fact, in 40

years, I don't think I've ever had a gap of four months when I haven't flown -- until now, and getting back in the air, I discovered it was

emotional and it was very different.

(BEGIN VIDEOTAPE)

QUEST: So, my first flight in nearly four months, which is the longest separation from aviation that I have had in, oh, I don't know, 35 to 40

years.

The airport is quiet, but not unduly quiet. There is definitely a heightened sort of expectation, tension, apprehension, whatever you want to

call it of exactly what to expect at each different piece of the puzzle.

The airport is pretty sparse. All the restaurants seem to be closed, or at least it's not immediately obvious where you can get something to eat.

[15:25:28]

QUEST: Everything is getting ready and perhaps will be, but it's not there yet.

I have done this flight so many times, and yet it does feel different, knowing the circumstances, knowing the paler state of the airline industry,

being aware of the number of flight attendants and crew that are going to lose their job.

Something that has been so normal for me, so special, now very different.

If you look at a flight as being the plane took off, the engines kept going, and the pilot knew the way, then it was pretty much like any other

flight.

But it was far from that. I got quite emotional. For somebody who travels so much, like me, it really was quite an experience. The first flight after

four months, and everything is totally different.

The vast slip stream sculpture at the Queens Terminal. So, I arrive at Heathrow and the start of what I'm pretty sure will be many flights in the

weeks and months ahead.

It is all very different. I can't exactly say it's a particularly pleasant experience. But we will get used to it, and we will start traveling again,

and soon, you'll wonder, well, this is just the way it is. Richard Quest, CNN, Heathrow Airport, London.

(END VIDEOTAPE)

QUEST: And the fact that that is just the way it is has Heathrow Airport's CEO now saying job losses could be coming.

They won't be reopening all the terminals until next year. They've consolidated into just two. And I asked the CEO, how long did he think it

would be before passengers came back?

(BEGIN VIDEOTAPE)

JOHN HOLLAND-KAYE, CEO, HEATHROW AIRPORT: Effectively, nobody has been flying for the last few months for understandable reasons. The only people

flying have been either people who are repatriating because they've been stuck in the wrong country or they've been having to get somewhere for

medical needs. So, it's been really minimum level of flying.

And then of course we've had a quarantine in place for the last month, which has meant that most countries have been closed off unless you're

prepared to self-isolate for 14 delays.

Now, of course, that is starting to change and we're starting to see a slow return of passengers to air travel.

QUEST: What's the biggest problem you're facing at Heathrow? Because you're working with very low numbers at the moment and I think it was you

who basically said social distancing can't really be done in an airport with the best will in the world, and you're right, you were the one who

spoke the truth, but dare not speak it. You can't socially distance in an airport.

HOLLAND-KAYE: You can't. And so, instead, we put in other measures to keep people safe when they're traveling, and now there are standards that are

agreed by the Centers for Disease Control, which will keep people safe while they're going through an airport and on the plane, so people can be

confident while they are traveling.

The big challenge is getting people traveling again, being -- opening borders again, which is why we need to think ahead to how do we make it

possible that you can -- when you board a plane in New York, you can travel, knowing you'll be able to get on to a destination.

QUEST: You moved terminals, you've shut some terminals. I assume you're a long way from thinking about moving them all back into -- so this is going

to be a while. What about your own ability? I mean, you make money from retail and from landing fees and from charges and parking charges. They are

not happening.

HOLLAND-KAYE: Well, we made money -- all of our revenue is tied to passengers. If people aren't flying, then we make no income and that's

basically where we've been in the last few months.

So as a business, we have been cutting our outgoings. We've cut them from about 250 million pounds a month down to about 150, so that's taken a lot

of action. We've reorganized our company. We've tried to avoid job losses through that, but we're coming to a point where we may need to do that. So

it's been really challenging from a business point of view.

But we can't cost cut our way out of this crisis. The only way to come through this for the entire aviation sector is to get people flying again

as long as it is safe to do so, which is why we need to focus on putting measures in place which will keep people safe not just on the plane and in

the airport, but when they're crossing the border as well.

QUEST: And what is your -- what is your time scale, or barometer, for reopening the closed terminals?

[15:30:35]

HOLLAND-KAYE: We don't think we'll be opening terminal four until sometime next year. Terminal three, we could be opening later this year. Really,

depending on demand. And I think the test will be, when we think we'll see more people coming back to fly in the summer to go on their summer

holidays. And so, we expect to see an uplift there.

Will they then come back and fly for business in September and October? That's the critical time. And we won't know until we get there.

The lead time for booking flights has come down. Most people aren't booking more than two weeks in advance. And so, we'll have very little visibility

about what future demand is. Actually, the best way to get a sense for what future demand is, is to look at web searches.

And if you look at the single purchase, that is a lead indicator of whether people want to go fly or not. And that suggests that people do want to fly.

QUEST: We'll have a "PROFITABLE MOMENT" on flying and the first flight back after all the time -- at the end of the program. This is QUEST MEANS

BUSINESS tonight, coming to you from London.

(COMMERCIAL BREAK)

QUEST: Hello, I'm Richard Quest. There's more QUEST MEANS BUSINESS with you in just a moment. The central bank governor of Israel will be with us, as

the country is rocked by protests and soaring unemployment. And the President of the Ivy League, Cornell University joins me. Now, the students

are coming back in the fall, but how? What about those students, those overseas students, who will may or may not be able to stay? We'll hear

about that. This is CNN, and on this network, the news always comes first.

[15:35:03]

The United States is reporting more than 3.3 million cases of COVID-19. It means one in every 100 Americans has now contracted the virus. The country

has far and away the most cases in the world and nearly as many as the next three combined. Speaking in a moment ago, President Trump claimed that only

because people in the country was testing so many people.

(BEGIN VIDEO CLIP)

DONALD TRUMP, PRESIDENT OF THE UNITED STATES: As an example, we've done 45 million tests. If we did half that number, you'd have half the cases,

probably around that number. If we did -- if we did another half of that, you'd have half the numbers. Everyone would be saying, oh, we're doing so

well on cases.

(END VIDEO CLIP)

QUEST: 18 U.S. states are suing the Trump administration over its new policy on international students. Immigration officials said last week, the

U.S. will deny student visas to people who are only taking courses online. The states are asking a federal judge to stop the rule from taking effect.

Known as controversial team names, the U.S. pro sports has to go away. The Washington Redskins football team says its rebranding. The move follows

years of criticism that both its name and its logo are offensive to Native Americans. Sponsors have recently joined the call for change. No new name

has been announced yet.

President of Brazil Jair Bolsonaro is doing well according to his doctors. The President is in semi-isolation after testing positive for the virus

last week. His doctor told CNN Brazil, that Mr. Bolsonaro would take another COVID test in the next few days.

The International Monetary Fund has downgraded growth forecasts for the Middle East and North Africa. The number -- new number now, it's a drop of

5.7 percent. The reason according to the fund is the unusually high levels of uncertainty due to the pandemic. It's also warning the IMF of rising

poverty and inequality that could increase the odds of social unrest.

Israel -- in Israel, thousands of people have taken to the streets over what they say is the government's mishandling of the coronavirus pandemic.

Israel appeared to do quite well at the beginning. And then, in recent days, has seen a massive reversal. We see -- now seeing record numbers of

infections. Some say the situation is out of control. In a moment, the governor of the Bank of Israel. First though, our correspondent Oren

Liebermann setting the scene from Tel Aviv.

(BEGIN VIDEOTAPE)

OREN LIEBERMANN, CNN JERUSALEM CORRESPONDENT: On the streets of Tel Aviv, the numbers are going up. First, there's the number of protesters. Police

say more than 10,000 people filled Rabin Square to demonstrate against the government's handling of the Coronavirus crisis; demanding economic aid and

held signs that read, "economic war" and "free the money."

YIGAL SHILOAH, TOURISM CONSULTANT: I don't feel that they're doing enough to support us. We eat our savings. We don't get any money.

LIEBERMANN: Then there's unemployment, which hit 21 percent this week, according to the Israel employment service. Over the weekend, 1,250

citizens returned to work, but more than twice that number filed for unemployment.

MAAYAN ELIASI, ACTRESS: I can't train. I can't prep. I can't work. I can't get money from the country. My clients can come and train, and I had enough

of it.

LIEBERMANN: And there's Coronavirus, which has surged to record numbers of new cases a day. Israel is struggling to contain in July what it thought it

had under control in May. The numbers have all put pressure on Prime Minister Benjamin Netanyahu, who promised up to $2,170 and soon to

unemployed and business owners who qualify.

BENJAMIN NETANYAHU, PRIME MINISTER OF ISRAEL (through translator): This support, this grant is not dependent on legislation. And we ordered that

will be acted already today. The button will be pressed so the money will arrive in accounts in the next few days.

LIEBERMANN: One number that is falling, Netanyahu's approval rating in the handling of the Coronavirus crisis. From 74 percent in May to 46 percent

now. Last week, Netanyahu held a Zoom call with business owners, trying to placate their fears. Instead, he became the target of their anger.

My husband and I, we don't know what to do. How are we going to live? This woman tells the Prime Minister, we never got anything in the first round or

the second round. There's nothing that we can do. We need a serious solution. Politically, Israel's longest serving Prime Minister faces no

real threat from the right or the left, but he has to contend with a second wave of Coronavirus on a tide of economic hardship.

(END VIDEOTAPE)

QUEST: Now, Amir Yaron is the Governor of the Central Bank of Israel. The governor joins me now from Tel Aviv. I'm grateful to you, Governor. And I

will say straight at the outset, of course, that you're not a political post as such, so we won't expect you to take us down the political road.

[15:40:05]

However, on the economic front, I noticed some of the actions that you've taken most recently, announcing that you're going to buy corporate bonds.

And like other central bankers, I'm wondering, are you just about out of ammunition?

AMIR YARON, GOVERNOR, CENTRAL BANK OF ISRAEL: First of all, good evening to everyone. And thank you for having me, Richard. We are doing whatever we

can, as far as the Bank of Israel on the monetary side, to support the economy in terms of -- first -- the first thing we did, obviously, was to

make sure that financial markets function well. We did that decisively very early on. And now, we're working primarily on making sure credit is

available as much as possible. And the last step you mentioned, is one of those steps that's supposed to lower spreads, and ultimately, help through

monetary policy filtering to all the segments and ultimately, help in terms of employment and other segments of the economy.

QUEST: Right. By your own admission, you -- the health of this -- of the economy is becoming more severe. And there's a risk of additional

deterioration is what you said. So, where -- who and where does more help come from?

YARON: Well, as you mentioned earlier, we started out very well, in terms of our starting point, our economy had high growth, low unemployment, high

FX reserves. And we basically made very quick and decisive steps in terms of lockdowns. We flattened the morbidity curve, and then we went out very

fast. There was a lot of significant economic uptick in economic activity, but the infection rates have gone up, partly because of gatherings, et

cetera. Large gatherings and right now, what we put in place in -- on the health front is primarily partial lockdowns and more restrictive measures

such as restaurants, gyms, et cetera.

And the hope is that in the next two weeks, we will see some kind of fruits to that and we will see the curve are starting to flatten out again.

Meanwhile, everyone, not just Israel, has to learn how to live with the -- with the coronavirus while having economic activity side to side. You are

right, if at the beginning, we thought this was some kind of a V-shape effect, that's going to basically end around June. Now, this is more like a

Nike logo that has a long tail. And part of what the government did today, which was a second major fiscal plan was to give some kind of certainty all

the way out basically to employers and to workers until June 2021. And we hope that with that, once we also add fiscal stimulus, this will help us

get out of the crisis in a better shape.

QUEST: Is the -- is the moral of this, don't reopen too early and do it with greater care?

YARON: I think there is a lesson here, especially don't -- open up carefully, have clear instructions about large gatherings. For example,

we've had wedding, where there were large infections. And this is one of the -- one of the lessons from what happened in Israel. We believe that

through the measures that we're taking now, as I said, we will be able to flatten the curve, and with it, come back to economic activity. I think

Israel fundamentally is a very dynamic, creative, innovative economy, has a lot of tech sector in it, which primarily is not as exposed to some of the,

let's say, old technology that might be reallocated once the pandemic is over.

And therefore, once we are over this, I see that, at least, we should be in reasonable shape coming out of the crisis, assuming we can find this steady

state of -- for a while until there is a vaccine to have strong economic activity as much as one can. And the right health measures side by side.

[15:45:05]

QUEST: Governor, grateful to talk to you, sir. As the pandemic continues, we will -- we will talk more about it. This is QUEST MEANS BUSINESS. We're

back in a moment.

(COMMERCIAL BREAK)

QUEST: U.S. universities are now deciding how and when to reopen in the fall and whether or not to have in classes where students actually turn up

or whether it should all be online. If it is online and that has implications, of course, for those overseas students who may then have to

leave the United States.

There are many issues to talk with Martha Pollack. Cornell is preparing for on-campus learning. And Martha Pollock is the president of Cornell

University. She joins me from Ithaca in New York via Skype. Madam President, thank you for being with me.

So, first of all, how many students do you now think or what percentage of classes do you think you will be able to have in-person next fall?

MARTHA POLLACK, PRESIDENT, CORNELL UNIVERSITY: Well, we're still working that out. But when we did a survey for our faculty a few weeks ago, about a

third said they wanted to teach in person, about a third said they were preparing to teach online, and a third, we're still deciding. So, it's

going to be somewhere between one and two thirds in person.

QUEST: Now, the implications for those overseas students who would -- if they're only enrolled in online classes, how are you supporting them, and

are you joined in the fight against the administration over this?

POLLACK: Yes, we absolutely are. We partnered with 58 other universities in the amicus brief along with -- in the case that MIT and Harvard are putting

forward. We believe at this moment that because we are having this hybrid education, that most of our students will not be affected by this, at least

not to the extent that they would have to leave the country, but it could cause them to have to choose different classes say, than those that are

best for their education.

There are just a range of really terrible outcomes that could happen. And we are absolutely partnered, as I say, with 58 other major institutions of

higher university in fighting this really unprecedented and hard to understand decision.

QUEST: It's also -- I mean, it is extraordinary that at the -- at the time when people need assistance most, support in what they're doing, that the

rug was pulled out from underneath them on this immigration question. Do you expect to lose many students because of it if any?

[15:50:18]

POLLACK: We hope not. We hope not. As I say, because of our going back with online and in-person courses, we don't believe it will affect them. But it

is -- it will be a problem for other universities if the decision is not overturned in the courts for sure.

QUEST: And on the actual situation, you're making plans for some in-person learning, but at best they can be tentative in the sense that a resurgence

of the virus, such as in Florida or elsewhere, would have you rethinking things all over again.

POLLACK: No, that's right. That's right. And that is one of the problems with this ruling is that all of us have worked extraordinarily hard to put

in place plans based on the best public health that we understand. But you're right, things could cause us to have to change. We've got to be

nimble, we've got to be willing to change if the situation gets much, much worse.

QUEST: And to those people who say, well, you should lower your tuition -- you're familiar with the argument.

POLLACK: Yes.

QUEST: We're not getting full classes. We're not getting full in-person classes. A Zoom tutorial is not the same thing but you're still charging

full whack.

POLLACK: Yes, well, we are working extraordinarily hard to provide the best education we possibly can. As I say, many of our classes will be in-person,

we're standing up safe alternatives for extracurricular activity. And in fact, we're spending an enormous amount of extra money to have the safest

possible experience.

In addition, in addition, we meet the full financial aid of our -- need of our students. And the needs of our students is going up enormously. That's

the biggest financial hit that we're going to take next year, because so many families have seen economic displacement. So it's costing us a lot to

stay open, to say open to all of our students across the socioeconomic spectrum and provide them with the best possible education we can.

QUEST: President Pollack, I'm very grateful for your time this afternoon, busy time for you. And I'm grateful that you took some of it to give to us.

Thank you for joining us.

POLLACK: Thank you.

QUEST: As we continue, you know, you've listened to the program closely so far, and you've heard the sort of dreadful situation everyone is in. And

that begs the question why the markets doing so well, and they are. The markets are considerably higher today. This is QUEST MEANS BUSINESS live

tonight in London.

Hang on, they were -- that seems to have disappeared. Sorry. I'm just seeing that number at the same time that you are. A gain of 400 points has

now dwindled to four. We'll have some analysis and discussion on that in just a moment. Thank you.

[15:55:00]

(COMMERCIAL BREAK)

QUEST: Now, as I was saying, as we were just looking together at the way the market is suddenly falling quite sharply. It is off now. If you look at

-- it's the text that's on the damage. The NASDAQ which have been up not maybe not as much as others, but the NASDAQ is now down two percent. The

Dow is just reaching around, but it's the NASDAQ that's done the damage over. Now worries and great concerns, particularly Facebook is giving some

concern as well.

Now Pepsi, in terms of earnings, Pepsi was the first stock to deliver its earnings. It was flat on the day. Their revenue slumped in the second

quarter. On "FIRST MOVE," Pepsi CFO told Julia Chatterley the company had adopted.

(BEGIN VIDEO CLIP)

HUGH JOHNSTON, CFO, PEPSICO: I think our portfolio actually manages well through the crisis. Well, what we've seen is as lockdowns happen, we tend

to see the stack in food business lift up a little bit. The beverage business obviously doesn't do as well because of lack of mobility.

Then as mobility becomes more positive, we've seen the beverage business pick up. The food business loses a little bit but also stays quite

positive. So as we look at it, the portfolio does work well in what's obviously a very challenging environment.

(END VIDEO CLIP)

QUEST: We will take "PROFITABLE MOMENTS" after the break. This is QUEST MEANS BUSINESS.

(COMMERCIAL BREAK)

QUEST: Tonight's "PROFITABLE MOMENT," I flew across the Atlantic on Friday night on U.A. 14, United Airlines. The flight was -- well, it was

different. Of course, you saw my report on exactly how it was different and how things have changed. But one thing I noticed was the crew and the staff

on board.

Bearing in mind that these people were facing, potentially losing their jobs in the next three to six months, it was remarkable the good spirits,

good-natured, the friendliness, the good service that I got. That anybody should be facing their job having to be lost, and at the same time going to

work every day and having to keep smiling and offering service is remarkable.

But then the travel and aviation industry is a bit like that. They've had bad times before. They'll probably never have them quite as bad as this

again, but there's definitely a change taking place. Many jobs will go, some will be left, and the travel industry will restructure like we've

never seen it before.

Thank goodness for those who I saw so far, and those who shepherd me across the Atlantic. It was a pretty good evening all around. And that's QUEST

MEANS BUSINESS -- QUEST MEANS BUSINESS for tonight. I'm Richard Quest in London. Whatever you're up to in the hours ahead, I hope it's profitable.

I'll see you tomorrow.

END