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Quest Means Business
737 MAX Returns To The U.S. Skies; Top Republican Senator Blocks Plan To Increase U.S. Stimulus Check; Rescuers Searching For Earthquake Survivors In Croatia. Aired 3-3:30p ET
Aired December 29, 2020 - 15:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
ZAIN ASHER, CNN INTERNATIONAL HOST: It's been an up and down day for U.S. stocks. Wall Street is teetering from record highs. Let's take a look and
see what the markets are doing right now. The Dow is down about 75 points or so as hopes in terms of those $2,000.00 stimulus checks appear to be
Those are the markets and this is the day so far. Investors are keeping a keen eye on Washington and the potential size of those stimulus checks. The
politics could not be more delicate, as I speak, in the U.S. Senate.
And back in the eye of the storm, the U.K. continues to break its own COVID records and new vaccine approval could come any day now.
And after nearly two years, multiple setbacks and a leadership change at Boeing, the 737 MAX flies again in the United States. Surveys show though,
the plane still has a major PR problem. Coming to you live from New York, it is Tuesday, December 29th. I am Zain Asher, in for my colleague, Richard
Quest, and this is QUEST MEANS BUSINESS.
Tonight, the plan to boost stimulus checks for cash strapped Americans appears to be in jeopardy. Senate Majority Leader Mitch McConnell blocked a
move to quickly increase the checks from $600.00 to $2,000.00. House lawmakers overwhelmingly approved that plan on Monday.
McConnell is caught between his party's deficit hawks, who of course want to limit relief spending and the republican President whose call for bigger
direct payments aligns him with left-wing Democrats, like for example, Bernie Sanders. Take a listen.
(BEGIN VIDEO CLIP)
SEN. BERNIE SANDERS (I-VT): The leaders of our country, President Trump, President-elect Biden, Minority Leader Chuck Schumer, the Speaker of the
House, Nancy Pelosi are all in agreement. We have got to raise that direct payment to $2,000.00.
UNIDENTIFIED FEMALE: Is there objection to the request for modification?
SEN. MITCH MCCONNELL (R-KY): Object.
UNIDENTIFIED FEMALE: Objection is heard.
(END VIDEO CLIP)
ASHER: And we'll have the latest from Capitol Hill in just a moment. But first, let's start with U.S. markets. Stocks fell after McConnell blocked
plans to quickly increase stimulus checks.
The Dow, NASDAQ and S&P 500 are all lower though; they are still though near record highs as the prospect of more stimulus actually outweighs dire
warnings of a worsening pandemic.
Kristina Hooper is Chief Global Market strategist at Invesco. She joins us live now via Skype from Greenwich, Connecticut. Kristina, thank you so much
for being with us.
So, early this session, we did see stocks near record highs or at record highs, rather, because a lot of investors were hopeful about these
$2,000.00 direct payments to ordinary Americans. Then those hopes faded and we saw markets go down again.
But overall, when you take a step back and you look at the year that was, 2020, we have seen stocks on a tear, particularly the NASDAQ. Why the
disconnect between Wall Street and Main Street at a time when so many Americans are struggling to buy groceries, we're seeing the NASDAQ in
particular, up by 44 percent. Explain the disconnect.
KRISTINA HOOPER, CHIEF GLOBAL MARKET STRATEGIST, INVESCO: Well, I think there are two reasons for it. First of all, we typically see stocks
discount future economic growth, and so the stock market is looking ahead six to 12 months, and it sees broad distribution of the vaccine and a
strong economic recovery.
But also, there's something else at play, which is even more powerful and that is the level of rates and the role that the Fed has played in all
this, just as we saw on the global financial crisis. Valuations are impacted by interest rates and the lower rates are, the more forgiving
investors are with stock valuations.
And so that has enabled stocks to rally especially those that are perceived to be more expensive, but also offering secular growth potential like
ASHER: You know, just speaking of technology, obviously, this has been a banner year for certain tech stocks that have really, I guess, profited
from people being at home, for example, the likes of Amazon. Zoom has also done relatively well, as well.
What happens when there's a vaccine? What happens to the NASDAQ? To various tech stocks when the vaccine comes out and eventually life returns? Normal
people start working from the office again.
HOOPER: Zain, I think that's a great question. And I think what we'll see even in advance of the broad distribution of the vaccine is an expectation
and then of course, an actual rotation so that we see cyclical parts of the market perform better.
HOOPER: But that doesn't mean that tech will be left behind. In fact, a lot of the trends that we saw during the pandemic were present before the
pandemic, but just accelerated like online shopping.
So I expect this to be something of a pendulum swinging situation where we went from the pendulum being here to swinging out here, in terms of the
adoption of technology during the pandemic.
I think it comes back a little bit, but many of these habits have been formed and I would expect continued usage of a lot of technologies, as has
been the case during the pandemic to continue afterwards.
ASHER: We've talked a lot this year about a K-shaped economic recovery. Obviously, America is extremely divided just in terms of wealth and income.
And obviously, there are certain sectors of the population in this country that are suffering a lot more because of the pandemic than others, in fact,
certain wealthy people are actually doing relatively okay. Some people are even thriving this year.
You know, in terms of next year, do you anticipate that gap between the haves and the have nots in this country will only get wider? Do you think
it will get narrower? If so, why, and what will a vaccine and things coming back to normal has to do with that?
HOOPER: Both. But there's a sequence to it. I expect it to widen early in 2021 because the same conditions are present that were present in 2020 in
terms of some parts of the economy being hit hard. And of course, many lower income Americans are impacted by that.
But I think once we see that broad distribution of the vaccine, we are likely to see a strong rebound that is far more inclusive than the economic
recovery we saw during the global financial crisis.
So first, a widening of that K, and then a narrowing of it.
ASHER: And obviously, as I mentioned, just when I introduced you, the market initially today was excited about the prospect, the possibility of
those $2,000.00 direct payments to ordinary Americans that looks increasingly unlikely at this point.
But how much would $2,000.00 to ordinary Americans -- how far would that go? And actually not just leveling the playing field, but actually helping
the economy, particularly consumer spending. Do you think that people would actually spend that money and actually help boost the economy? Or will they
save it, which sort of goes against what the intention would be?
HOOPER: I think that the people who would be receiving these payments, for the most part would be spending it. What we're hearing, of course, is this
large portion of Americans that have been so negatively impacted by this crisis.
And so I think, so many of those people are desperate for that check and will automatically spend it, so I think it would achieve the goal of having
a multiplier effect in terms of making it back into the economy for most, if not all Americans.
ASHER: You look at the stimulus package overall, $900 billion, just in terms of how much the country has been impacted by the pandemic, you know,
it's no small number, obviously, it helps certainly in terms of averting a Q1 recession. But how long does that really help keep the country afloat
for until there is a vaccine?
HOOPER: So that's a great question. And I think we need to think about fiscal stimulus in terms of tranches, almost like coupon payments on a
bond. Fiscal stimulus should occur regularly until we have broad distribution of the vaccine because there are parts of the economy and many
American households that need that help that need to get by or otherwise we'll see more economic scarring, which is something that the Fed has
ASHER: All right, Kristina Hooper, live for us there, thank you so much.
HOOPER: Thank you.
ASHER: Phil Mattingly is live for us in Capitol Hill. So Phil, obviously, you know, Kristina and I were just talking about this, that there are so
many Americans in this country who are desperate for those $2,000.00 checks. If the President really, really wanted ordinary Americans to have
access to that money, why didn't he fight harder during the negotiations?
PHIL MATTINGLY, CNN U.S. CONGRESSIONAL CORRESPONDENT: That's the million dollar question and I'm not trying to pick upon there a $2,000.00 question
if you wanted. Zain, the reality of the course of the last seven or eight months, which obviously ended in a coronavirus relief package ended in a
deal, signed off by both parties and eventually the President was that the President was a non-player in any of those negotiations having covered
every minute and stood outside of every closed door meeting here on the Capitol.
The President was not a player. The President didn't get involved. The President may have been briefed on what was going on, but his particular
issues, what he was interested in what he was willing to push for never really came out and I think there was a -- there's a clear sweet spot
earlier in the summer, probably August-September timeframe where if the President really got his back into this, if he really put his shoulder into
his party, his party that didn't want to go anywhere above $500 billion on a top line for any deal, he could have forced them across the finish line
into something more along the lines of what House Democrats are pushing for.
MATTINGLY: He chose not to. The deal did not have a number that he wanted in terms of direct payments, and now here we are. The deal has been signed,
and he is pushing belatedly for something that he probably could have gotten just a few months ago.
ASHER: Obviously, the President, you know, has a lot of influence over the Republican Party. You know, everyone has talked about getting more than 70
million votes in the election and him being a player, perhaps in 2024.
But how often has the President, just looking back on the last four years - - how often has he actually been able to get Senate Republicans to change their mind on policy, policy that they deeply believe in? Is the President
actually able to do that?
MATTINGLY: You know, I think one of the most interesting elements of the last four years I think people have, will, and will continue to write books
about this specific issue, at least from my vantage point on Capitol Hill has been how unwilling the President has been to understand how Congress
works, and that can work against you in major ways.
Now, when the President wanted money for his border wall, he got Republicans behind money for his border wall. If the President had specific
issues that he was tweeting about or that he was angry about, I would walk up to a Republican senator or a Republican Member of the House, and odds
are they would agree with the President no matter what the issue was.
But when it came to actually substantive, tangible legislative action, the President never really kind of, I don't want to say understood, but he
never really figured out how to use the levers in order to get things done, whether it's through spending bills, or whether it's through which
committee to focus on, which Chairman to focus on. It just wasn't something he was willing to dig into.
And I think his legislative agenda suffered because of that and largely was driven by Senate Republicans. If you look at the President's biggest
accomplishments on the legislative side, Senate Republicans and House Republicans wrote the major 2017 Tax Law, the conservative justices and
judges that he was able to get confirmed that just reshaped the judiciary in the United States and on the Supreme Court, that was almost all Senate
Republicans as well.
So he largely was willing to give that out to Members of Congress and therefore, didn't really have the leverage if he wanted something
specifically. I'd say, if he wanted something specifically and asked for it, Republicans were more likely or not to give it to him because he is so
powerful with their base. He is so powerful with their constituents.
He just never really followed through beyond maybe 280 characters and a rant on FOX News.
ASHER: Okay, so with these $2,000.00 checks, he certainly could have fought harder. Phil Mattingly live for us there. Thank you so much. Appreciate it.
In Croatia, scenes of chaos and destruction following a powerful earthquake. Rescuers are urgently combing through the rubble searching for
survivors. The 6.4 earthquake happened southeast of the capital, Zagreb and was felt throughout the country.
In Petrinja, the mayor was holding a news conference when the Earth actually began to move. He says much of the city has been demolished and
his town is now going through hell with no running water, no electricity.
At least six people were killed in the quake including a 12-year-old girl, a reporter with CNN affiliate, N1 in Croatia describes the aftermath.
(BEGIN VIDEO CLIP)
HRVOJE KRESIC, CNN NEWS CHANNEL AFFILIATE: Petrinja is one of the poorest cities in Croatia, it was heavily hit during the Homeland War 30 years ago
in Croatia and unfortunately, some scars and underdevelopment from the time remained. There are many old buildings, buildings that are built over a
hundred years ago still in the Austria-Hungarian Empire and these buildings have been most hardly hit.
Yesterday they suffered damage and this today was completely devastating.
(END VIDEO CLIP)
ASHER: The 737 MAX is back to the skies here in the U.S. We'll talk about its long journey back to commercial service and why it might not quite be
over yet. That's next.
ASHER: American Airlines has become the first U.S. carrier in nearly two years to fly the Boeing 737 MAX. The planes were grounded after two deadly
crashes; one off the coast of Indonesia, another in Ethiopia. Between the two, 346 people were killed.
Those disasters dealt a huge blow to Boeing's safety record and of course, its reputation as well. It cost the company's last CEO his job. Now that
the plane has been recertified, Boeing is of course looking to rebuild trust with passengers.
More than half Americans who have been surveyed say they're unlikely to fly in a 737 MAX today, but almost 40 percent say they are comfortable perhaps
boarding one six months from now.
Brian Sumers is editor-at-large for the travel outlet, "Skift," he joins us live now from Los Angeles. So it took Boeing two years to get this plane
recertified, back into the skies here in the U.S., but I imagine winning over public trust and changing their reputation will be a little bit more
complicated than that. How do they go about it?
BRIAN SUMERS, EDITOR-AT-LARGE, "SKIFT": Yes, look, I don't know that that's necessarily true. The vast majority of people, certainly Americans
generally have no idea what type of airplane they're flying on.
I understand that folks are telling pollsters that they're going to be apprehensive to get on this airplane, but the bottom line is that majority
of people make decisions about which plane to fly based on price and schedule, and it's mostly price.
I think this is probably much ado about nothing, but we're going to have to find out and see.
ASHER: So you're right, most people are not going to look at the type of aircraft flying and they look at price. They look at schedule. They look at
time they are leaving and that sort of things.
However, the airlines have actually come out and said, listen, if you find out, if you book with us and you find out that you are flying on a 737 MAX
jet, and you don't want to, that's fine, we'll give you a credit so that they are aware that perhaps for the customers that are in the know, that do
know about the history of the 737 MAX, the airlines are aware that that could be a problem.
SUMERS: Oh, absolutely. I mean, airlines have a general idea that some people may be wary. They want to make it as easy as possible for people to
We also happen to be in the worst financial crisis, pretty much in the history of aviation, airlines need every dollar that they have. And if
somebody says, you know what, I don't want to fly in a MAX, I want to fly in a regular 737, airlines are going to make that possible.
Pretty much all the major U.S. airlines have come out and said you want to change your ticket, you could do that for free, even if it's one of those
tickets that people buy that isn't normally changeable.
ASHER: Yes, as you mentioned, it has been a horrific year for airlines. That's no exaggeration. So what does that mean in terms of airlines
actually ordering the 737 MAX and Boeing actually being able to get the plane off its hands and actually sell it to airlines?
SUMERS: Well, it's funny that you say that because there's nothing airlines like more than a deal and there's a lot of airlines all over the world that
are in trouble, airlines that got a lot less government handouts than U.S. airlines that ordered these airplanes and might even want to fly them, but
they can't afford them.
So you've got airlines all over the world and lessors that can't take delivery of these aircraft. And a couple of U.S. airlines are actually
going in there and swooping in and saying, we can get a killer deal on these aircraft. The most recent airline to do this was Alaska Airlines.
They topped off their order a couple of weeks ago and they're going to get more MAXes than they expected.
So believe it or not, this is a hotter airplane then you would expect, but it's mostly because the pricing is insane. I mean, you know, people know
this when they buy a car, nobody else wants the car, you can get a screaming deal. That's what airlines are seeing right now.
ASHER: Of course, I see. They are getting a bargain. So just in terms of for the passengers who you know might be a bit wary about traveling on a
737 MAX jet, just walk us through what the certification -- recertification process was for this aircraft in the past two years? Just the revamping of
the inside of it. The pilot training that went into this, the rewiring and that sort of thing.
SUMERS: It's certainly unprecedented that Boeing and these airlines would take two years to get a plane safe for flying. Most of the big safety
regulators in the world have looked at the airplane. They think it's safe. It's flying first in the United States.
United Airlines says that for every plane they take out of storage, there's going to be a thousand hours of work that goes into making it safe. That
includes extra pilot training and things like that.
This has probably been the most looked at aircraft again in the history of aviation. I would certainly fly on it. And just to give your viewers an
idea, I am somebody who has not been on an airplane in nine months, because I am too nervous about flying in the pandemic. To me that is unsafe. But
this I believe is a safe aircraft.
ASHER: Wow, you really put it in perspective. Brian Sumers, live for us. Thank you so much. Appreciate it.
SUMERS: Thank you.
ASHER: The European Union is buying another 100 million doses of the Pfizer-BioNTech vaccine. Its vaccination campaign started Sunday in the
midst of a surging pandemic. The U.K. started weeks earlier, but that hasn't stopped the current crisis.
Selma Abdelaziz has more from London.
SALMA ABDELAZIZ, CNN REPORTER: Health officials here are ringing the alarm as this country faces unprecedented infection rates. For the second day in
a row, the U.K. broke its record of new daily COVID-19 cases and that's not the only warning sign.
There are now more patients in hospital with coronavirus than at any point before and the London Ambulance Service, they say they are receiving a huge
volume of calls, thousands a day, nearly as much as the first wave of this pandemic in the spring.
Now doctors, nurses, and healthcare officials pleading with the public to please follow the restrictions. Please follow the rules. They say hospitals
Take a listen to what the Chief Executive of the National Health Service had to say.
SIMON STEVENS, CHIEF EXECUTIVE, N.H.S. ENGLAND: This has probably been the toughest year that most of us can remember. That's certainly true across
the health service where we've been responding to the worst pandemic in a century.
And now of course again, we're back in the eye of the storm with a second wave of coronavirus sweeping Europe and indeed this country.
ABDELAZIZ: A very stark warning there and fears from experts that the worst is yet to come. Health officials expect a spike due to Christmas time
celebrations to hit the hospitals next year.
At the same time, many healthcare workers are having to call out sick having to isolate, so we're looking potentially at hospitals teetering on
the edge in the New Year.
But there are signs of hope, signs of progress. A new vaccine by Oxford University and AstraZeneca is set to be approved by British regulators
anytime now and it will be rolled out as early as January 4th.
Salma Abdelaziz, CNN, London.
ASHER: Now to a story CNN has been following closely that I want to update you on, Russian authorities are launching a new criminal investigation
against opposition leader, Alexei Navalny and his anti-corruption foundation. Officials say the charges involve fraud, quote-unquote "fraud"
on a large scale.
Navalny and his organization have been targeted by the Kremlin many times before in what he says are politically motivated probes. Navalny was nearly
killed earlier this year. A CNN exclusive report uncovered how he duped a Russian agent into admitting to an operation that poisoned him with that
A CNN investigation also found evidence that an elite security force specializing in nerve agents had monitored Navalny for years prior to his
poisoning in August. The Kremlin has denied all responsibility.
Coming up in Japan, people in one small town are trying to preserve a unique tradition without harming the environment and they are turning to
the mountains for help.
ASHER: This week on Eco Solutions, it is all about the food we eat and how we eat it. Japan uses more than 19 billion chopsticks a year, mostly
imported from China. In one town, a growing number of people are preserving a unique chopstick making a tradition; one they say is better for the
planet. Selina Wang explains.
SELINA WANG, CNN CORRESPONDENT (voice over): These forests in the mountains of Yoshino, Nara Prefecture were planted by hand around 500 years ago. They
have supported the town's local industries ever since, including the craft of making disposable chopsticks known as waribashi.
Today craftsmen like Yoshihiro Takeuchi continue the tradition. He makes his waribashi out of wood leftover from building houses. Takeuchi says the
trade has survived because the people of Yoshino get back what they take.
YOSHIHIRO TAKEUCHI, CRAFTSMAN, TAKEUCHI CHOPSTICKS FACTORY (through translator): It's a cycle where we use trees from the mountains and return
them to the mountains by planting more.
WANG (voice over): Akimoto Nakai is the town's mayor and the seventh generation guardian of the forest, known as a Yamamori.
AKIMOTO NAKAI, MAYOR OF YOSHINO AND YAMAMORI (through translator): Broadly speaking, a Yamamori's job is to plant trees, namely Cedar and Cypress.
WANG (voice over): Nakai makes sure only the small trees are cut down to give the bigger ones room to grow. The demand for quicker and cheaper
options has led customers to look elsewhere. Around 97 percent of Japan's disposable chopsticks are now imported, Nakai says mostly from China.
There, the chopstick industry claims millions of trees a year.
Tokyo based designer Eko Hayashi hopes to shift the focus back to Yoshino without harming the forest.
EKO HAYASHI, DESIGNER, HAMIDASHIMONO (through translator): If you see a bunch of chopsticks in a convenience store, you just think it's fine to
pick them up and throw them away. But I believe your perception of the product will be totally different if you actually see the workshops in
Yoshino and discover the various steps in the process of making waribashi.
WANG (voice over): In late 2019, Hayashi co-created Hamidashimono, it is a waribashi making kit, including tools and upcycled Cypress, sourced from
the Yoshino artisans who get a third of the profit.
She hopes it will attract a new audience to Yoshino's waribashi past and like Takeuchi says, the profit goes back to the back to the mountains.
Selina Wang, CNN.
ASHER: I am Zain Asher, "Marketplace Africa" is up next.