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Quest Means Business
Stocks Fall On Suggestion Of 2022 Rate Hike; Wall Street Employees Seek Work From Home Flexibility; E.U. Lifts Travel Restrictions On U.S. And 13 Other Countries; Biden Marks 300 Million COVID Shots In 150 Days; China Will Soon Administer Its One Billion COVID Vaccine Dose; Israel Jet Strikes Gaza For Second Time This Week. Aired 3-4p ET
Aired June 18, 2021 - 15:00:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
ISA SOARES, CNN INTERNATIONAL HOST: There is no Friday feeling on Wall Street. Let's have a look at the big board this hour and see how it is
fairing. It is down 458 points, one and over a quarter percent.
Those are the markets and these are the main events for you.
Fears of a rate hike sent global stocks plunging. Now, the Dow is heading for its worst week since January.
The E.U. says it is time for some travel restrictions to be lifted, while Italy adds news measures for U.K. arrivals.
And it is election night in Iran. We will be live in Tehran where polls are about to close.
Live from London, it is Friday, the 18th of June. I'm Isa Soares and I too mean business.
A very good evening, everyone. Happy Friday.
Tonight, U.S. markets are tumbling on a new possibility that interest rates could start rising sooner than expected. St. Louis Fed President, James
Bullard, says an initial rate hike could come late next year, not in 2023 as the Central Bank suggests, if you remember, on Wednesday.
Well, the Dow was down more than 500 points as session lows on track really for its worst week since January. The VIX volatility index spiked as much
as 10 percent now that's just over 12 percent. And just a little perspective because I think this is really important here. The Dow is about
three percent off its record close just six weeks ago. It's still up, though, nearly nine percent on the year.
Let's put this all into perspective, Paul La Monica is here to break it all down. And Paul, it has been a bruising week. You and I have spoken pretty
much every day this week about these market movements.
Explain some of what we are seeing, why are we seeing banks, why are we seeing energy, industrials taking such a hit if finally now, we have some
sense of clarity from the Fed?
PAUL LA MONICA, CNN BUSINESS REPORTER: Yes, that's a great point, Isa. I think that what is happening is investors had been flocking back into a lot
of those, quote-unquote, "value stocks," many of those sectors like banks and oil and away from Big Tech.
Now that there is this expectation that maybe rates are going to climb, people are looking for things that might benefit even in a rising rate
environment, and that's rotation back into the growth stocks like tech.
Although today, notably, no one is rotating into anything. They are just getting out of stocks. Every stock with the exception of Caterpillar in the
Dow is currently lower.
SOARES: Yes, and tech stocks were doing well, but as you are talking, we're looking at the Dow now down 428 points or so.
From the investors you've been speaking to, Paul, are they more worried about weaker growth or inflation? What is their overall concern?
LA MONICA: The concern is definitely more about inflation, and I think it's because growth has been so strong. We've had this rapid re-opening of the
economy in the U.S. and many other parts of the globe, and what that has left us with in a good way is that many companies are reporting very strong
sales growth, and very healthy earnings growth, but because of that, you are starting to get some fears that maybe the economy and inflation might
heat up a little bit too much, and that the Fed just has to reign things in by starting to taper first and then eventually raise rates.
Although, I don't think a rate hike is as imminent as people seem to believe today because of James Bullard's comments.
SOARES: Yes. You say it is inflation, but help me to understand this. If every time, you know, investors get, you know, get a whiff -- the Fed gets
a whiff of inflation, it seems they pretty much -- they just slap it down.
Why would investors, Paul, why would they get so worried about it if the signals we're getting from the Fed is, if it's bad, we're dealing with it.
We are putting that away, don't stress about it. Why are we seeing this discrepancy?
LA MONICA: Yes, I don't think that it is that investors are necessarily worried about inflation in of itself, per se. But what the Fed will need to
do as a result of inflation and if that means rate hikes sooner rather than later, then this zero percent interest rate party that we've been having
for the past few years, that finally starts to end. It's the proverbial taking away of the punch bowl.
SOARES: Yes, and that's why James Bullard's comments, really, the prospect of even earlier interest rate really sent a bit of a shock wave through the
LA MONICA: Yes, I think so. But it is important to note that even though he will be a voting member next year, he is not currently -- he is saying a
rate hike is possible in 2022, but he is just one of the so-called dots on the Fed's dot plot.
And the last I checked, Jerome Powell is still the Fed Chair, I think he has more weight than James Bullard, no disrespect to the St. Louis Fed
SOARES: Of course, but you know, at this moment the markets are looking for any sign, right? Thanks very much, Paul. Great to see you. Happy Friday.
Let's get more on this. I am joined now by, Ann Berry. She worked at Goldman Sachs for 11 years and is now Chief Investment Officer at
Wheelhouse. Ann, I am not sure if you were listening to the conversation we were just having. But I want to get really your sense of how you're reading
this week's market moves.
Do you expect markets to remain volatile?
ANN BERRY, CHIEF INVESTMENT OFFICER, WHEELHOUSE: I do. And I think that's really a function not so much of what the Fed is doing, but more continuing
to track the impact of COVID on things like supply chains, continuing to track whether the U.S. labor force is going back to work in full, which is
partly a function of some of the short-term stimulus, and also looking too at what some of the earnings trends are and what real shifts in consumer
behavior there are.
So, volatility, really because I think now, we are moving to a period of coming to an end of a re-opening transition and moving to look at what some
structural changes that could be more long-term might be.
SOARES: Yes, that makes sense because I suspect really the difficulty in all this is knowing whether inflation is fleeting, you know, mainly because
they are trying to predict what the economy will look like post-pandemic. It's almost like an impossible job here.
BERRY: I think it's impossible, and I am not going to be a Fed apologist, I think they have done a very good job. We had unprecedented depths of
shutdowns at an unprecedented speed. We had a completely unpredictable path to re-opening, which has now happened; really, in a snap back in huge
swathes of the country here as vaccination rates have come up, this is totally unchartered, and I think the Fed has said we're going to watch, we
are going to wait.
We are not going to have knee-jerk reactions and I think they've done exactly that. They have watched and they started to signal out that they
will move if they will have to.
SOARES: I would love to get you switch gears and really get your thoughts. You know, you spent 11 years at Goldman Sachs. I'm sure you heard about
James Gorman's comments, the CEO of Morgan Stanley who said the day before yesterday, if staff can go out for dinner in New York, then they can come
into the office.
How is that stern message you think -- how will that be received?
BERRY: I think it will be received a little bit differently depending on which audience is receiving it at the big banks. I think, certainly, at the
most senior levels, there is a sense that folks had undertaken the apprenticeship I did. I was always in the office as a young person learning
the trade. Different perhaps from some of the folks who are more recent hires where this period through COVID of working from home is in many ways
sort of the normal that they've experienced.
I think on this one having grown up in the financial services, learning the trade is a little bit like playing jazz. You need to learn the instruments
and you've got to learn to improvise with people. It's quite hard to do that if you don't know other people's cadence at least at the outset. And I
think that's what the banks are focusing on, getting people together to learn each other's cadences and their teams before being more flexible
about dispersing again.
NEWTON: Yes, it is probably difficult to do advice. I want you to listen to this. I spoke to Kate Lister, the President of Global Workplace Analytics.
This is what she said about working from home. Take a listen.
(BEGIN VIDEO CLIP)
KATE LISTER, PRESIDENT, GLOBAL WORKPLACE ANALYTICS: Eighty percent of the workforce says they want to work from home at least some of the time, and a
third say that they would quit if their employer didn't allow it. We're already seeing in our clients' people quitting because the organization
hasn't declared what they're going to do.
(END VIDEO CLIP)
SOARES: So, Ann, I mean, she also told me, Kate, that the banks will be facing a rude awakening. Do you think banks fear losing talent because of
BERRY: I think banks have had to wrestle with other places that talent can go for quite a long time, whether it's been in tech, that's been a debate
that's been around for quite a while. Now, certainly in the industry I am in, which is where content and commerce and tech come together, it is a
very intersectional place. There are different levers on quality of work/life beyond working from home.
It's about how interesting is the work, how much creativity is involved in the work. I think through COVID, people have taken stock and asked what
really motivates them. I don't think it's just about stay at home, I think the banks will have to think about what are the different levers they can
pull to retain great talent.
SOARES: You know, being in New York, you probably -- and given your financial background, you've probably got your ear to some of those who are
still working very much on Wall Street. Is there -- are they seeking from what you're hearing, Ann, are they seeking a culture change here?
Just taking and putting aside the financial aspect on what bosses want, from an employee perspective, do they want to see a change or some sort of
flexibility here when it comes to working from home or being in the office?
BERRY: I think there's been some generational change. For sure, I've spoken to some young people who are in industry. And while some of them have
enjoyed working from home, others had said, you know what, Ann, I basically live at work. There is no space either physical or from an hourly
perspective between the time I get out of bed to the time I hit my laptop and start doing my work.
So, in theory, folks are looking for flexibility, but they're looking for community and they are also looking for some real-life interaction with
peers and have those relationships built at the same time.
SOARES: It's such an important point, Ann. It really is a personal choice, isn't it? It is not -- you know, it doesn't fit everyone to play by the
rules, but you make a very important point there. Ann Berry, great to have you on the show. Thanks very much.
Now, coming up right here on QUEST MEANS BUSINESS, it's one step forward and really one step back on the road to international travel. The E.U. is
ready to start welcoming back U.S. tourists as Italy tightens restrictions on U.K. travelers. We'll bring you that story, next.
SOARES: Now, tonight, the E.U. lays out the welcome mat to lucrative American tourists. Washington says it's not ready to do the same.
More than a year after shutting its borders to nonessential travel, the E.U. is recommending member states should lift COVID restrictions for 14
countries even for the unvaccinated. It is a milestone and a step forward saving the ailing of course, summer travel season.
There are, though, several caveats. Each E.U. country will still have the option to impose additional requirements such as like mandatory
quarantines, PCR tests or proof of vaccination. So, the patchwork of rules and regulations of course will continue.
Let's get more. Cyril Vanier is in London. And Cyril, I mean, there is no - - it's no doubt really that this is a significant milestone if you're looking in the broader re-opening of travel between the U.S. and Europe.
But break this down for us because there are still major limitations here.
CYRIL VANIER, CNN CORRESPONDENT: Yes, absolutely. Look, I think for -- you know, and we have international viewers who tend to travel a lot and who
will be interested in this news, and I think the way for them to look at what happened today is, as a general statement of intent from one of the
European Union's governing bodies, the E.U. Council, which has recommended scrapping travel restrictions that were implemented a year ago at the
beginning of the pandemic.
Now, as you said, major caveat, you hit the nail on the head, they are not the ones ultimately who decide border policy and how border controls are
carried out country by country, right? Each individual member state of the European Union is responsible for that.
And that is why you've seen major European leaders such as French President Emmanuel Macron once again today call for more harmonizing, standardizing
of the travel policies in each country because some have already gone their own way.
VANIER: Greece, as early as last month, opened its doors to a number of countries, provided they could show a negative test. Spain has opened its
doors to vaccinated third-party travelers. France is also now already welcoming for instance, American travelers, but they have to show -- well,
France is a different system. You are speaking -- you are talking about patchwork travel policy.
France has its own tiered system, and depending what country you're coming from, there are different requirements. Either a proof of vaccination or
proof of vaccination plus a negative test. So, the bottom line is that for any traveler wanting to come into the E.U., you have to look at the rules
that apply to the specific European destination you're going to -- Isa.
SOARES: And you might not want to do multiple stops if all these regulations are so different and all of the quarantines or anything else in
between each one. But it is, Cyril, welcome news for airlines. Although having said that, it's only one way right now because Europeans cannot
holiday in the U.S.
So, what are you hearing from the European side? Is there an expectation that the U.S. will reciprocate?
VANIER: The glass is half full as far as airlines are concerned. I think for Europeans and for European leaders in particular and especially those
countries around the Mediterranean, whether it's Greece, Spain, Italy, France, that are highly dependent on tourism, what really mattered to them
was opening the doors so that you can get more tourists in this summer than you did last summer, and that will help the beleaguered European tourism
Whether or not the French can travel to the U.S. is a different matter, but economically what they need is to get the tourism dollars into their
borders. That is their priority.
As far as their criteria are concerned, yes, they would like reciprocity, but for the moment, the economy is going to have to take priority and
that's why they've opened their doors one way even though the U.S. haven't yet opened their doors to European travelers -- Isa.
SOARES: What about the U.K.? Because the U.K. is not part of this. How are they feeling?
VANIER: No, absolutely. Look, the U.K. is getting a different treatment because of the delta variant, partly because of reciprocity, but mostly
because of the delta variant. The U.K. was best in class as far as handling COVID for the last few months.
And now that has suddenly flipped over the last few weeks with the delta variant increasing exponentially week on week to the point where almost
every infection in the U.K. now, 99 percent of infections are due to this delta variant originally identified in India.
And I'll tell you, countries on the continent are very afraid that this is what's coming their way, and that is why many of them are now shutting
their doors to nonessential travel from the U.K. even as they are opening their doors to, say, Americans, Australians, or Israelis.
So, they are trying to contain this delta variant. Italy just announced that starting Monday, travelers coming from the U.K. will have to
quarantine for five days in addition to taking a COVID test, which funnily enough, Isa, is exactly what the U.K. has been doing, right, for most
inbound travel for months, and that has not stopped the delta variant from setting in here.
SOARES: Yes, concern no doubt for Europe, but also for the United States from what I have seen. Cyril Vanier there for us, thanks very much. Cyril,
you and I rocking on a Friday night. Great to see you, my friend.
Now, French President Emmanuel Macron has called for stronger coordination between E.U. member states, and that is on the re-opening of borders. And,
as one travel corridor moves closer to opening, another is closing.
The U.K. was left off as you heard there from the E.U. white list. Now, Italy is re-imposing tight restrictions on British travelers. From next
Monday, people coming from the U.K. will face a mandatory COVID test and a five-day quarantine as you heard Cyril say there.
The U.K. has seen an uptick in cases over the last month driven by the delta variant. It's been described as like COVID on steroids. We will have
much more with Sanjay Gupta on that.
On the travel though, let's speak to Ivan Bassato, he is Executive Vice President of Rome Airport, and he joins me now. Mr. Bassato, thank you very
much for joining us. What does this decision mean for Italy and indeed for your airlines? How important is this?
IVAN BASSATO, EXECUTIVE VICE PRESIDENT, ROME AIRPORT: Thank you, Isa. Buonasera from Rome.
BASSATO: Today, we had an announcement from our government with a new regime coming into force next Monday. Actually, Rome is in Italy, it is
open to tourism from the United States, Canada, and Japan through an innovative protocol that we invented basically in Italy and Rome back last
Christmas. We started experimentation of a protocol that implied two tests, one before departure and another one repeated right after arrival at the
airport in Rome.
BASSATO: We have been more than welcoming more than 30,000 passengers from the United States during this period of six months. Initially, it was just
for travelers with essential reasons. It proved very successful, very robust, and so our government decided to extend in May also for tourism,
passengers that are traveling also from different regions apart from business or emergencies, specific emergencies. Since the beginning, there
was no confusion --
SOARES: If I -- let me just interrupt you.
SOARES: On that point that you've made and the changes that you've made and the changes you made in the last few weeks and months, in fact, how
important are these changes? How important is the decision that you've heard for U.S. tourists? How important is that to Italy? To Italian
BASSATO: Absolutely. The external borders of the European Unions have been closed since the beginning of the pandemic. The market, the air travel
between North America, the United States especially, and Europe, Italy, is a very important market. So, we wanted a safe protocol to reactivate
partially air mobility between the United States and Italy.
So, we identified and we started experimentation as a setback, at Christmastime, we continued very cautiously without taking the risks, a
strong cooperation with the authorities, the protocol proved to be successful and a very good data is coming in. So, slowly and gradually, the
Italian government decided to extend it.
In May, as I said, back in May, there was the decision to extend that for almost six months of testing. There was the decision to extend it also to
tourists and we are receiving tourists.
This protocol will stay in place until this Sunday, this coming Sunday because today, the announcement of the government was that the framework of
the digital COVID certificate of the European Union will be applied also to passengers arriving from the United States, Canada, and Japan, the G7
countries. It's a big change.
At the same time, the government had to take the decision that we introduce again -- that was removed in May -- but we are having again a short
quarantine for passengers arriving from the U.K., as you said earlier.
Back to the U.S., I mean, this morning we had more than 1,000 passengers arriving from the U.S., and the passengers from the U.S. are interested in
visiting Italy under certain conditions. Safety, of course, is aspect number one, and throughout this pandemic, the air travel, the aviation
industry, airports, ICAS, I think they proved to be very serious about that. And now passengers know that under certain conditions, traveling is
safe again, and we are waiting for more visitors this summer.
Cautiously, but with very rigid and stringent protocols with the implementation of digital certificates from this Monday, big change.
Passengers then will prove to be vaccinated -- fully vaccinated -- will not need to retest at Fiumicino, at our airport, and they will be able to enter
Italy by showing the proof of vaccination.
It has really -- a change towards normality, and we are looking forward to a summer. The situation that is still far from normality, but we are
looking to a summer where we have also tourists back to Italy. This is very important to us.
At the same time, we are pushing on innovation and we will not only have the digital COVID certificate implemented in Italy and Rome, but we will
also have at the Aeroporti di Roma, this is quite important drive, we will also have the utilization of biometrics as of the second week of July for
seamless and effortless travel, so we are looking at the implementation of new technologies to make travel, air travel not only safe but also easy for
passengers, and I'm strongly committed to that.
So, we are looking forward also to a summer to a period where there is smart utilization of these innovative tools.
SOARES: Thank you very much, Ivan Bassato there. Thank you for taking the time to talk to us here on QUEST MEANS BUSINESS, sir. Best of luck.
BASSATO: Thank you very much. Thank you for the invitation.
SOARES: Now, the world is trying to open up, as you just heard there from Ivan, but the travel uncertainty is really exacerbated by concerns over
this highly contagious delta variant that Cyril was talking about, that our guest now, Ivan in Italy was talking about. Ninety nine percent of new
COVID cases in the U.K. are the delta variant and it's specifically hitting younger age groups according to the U.K. Health Security Agency.
The World Health Organization's chief scientist now says, it is well on its way to becoming the dominant variant globally.
Let's get more of this. Dr. Sanjay Gupta, CNN's chief medical correspondent joins me now.
Sanjay, it's great to have you on the show. We heard Public Health England saying, you know, the delta variant now accounts for 99 percent of all new
cases. Given the transmissibility of it, how worried should we be at this stage?
DR. SANJAY GUPTA, CNN CHIEF MEDICAL CORRESPONDENT: Well, I think it comes down very much so to, as your other guests have pointed out, whether or not
you're vaccinated. I mean, this has become a very clear line. If you're vaccinated, you should feel pretty comfortable in terms of your level of
protection against getting sick, against getting infected, and against being contagious.
But this is much more transmissible. You know, I want to show this graph, we put this graph together by basically looking from the last week of
January to now and what has happened with the variants. And we know that the U.K. variant called the alpha variant, that's in red. And the left side
of your screen, you can see how dominant it was.
Look what has happened. Two things have happened. Obviously, you see the delta variant becoming the predominant variant as you point out. But also,
you see the line starting to creep up for the first time. It was going steadily down. So at the time the delta variant became more dominant, you
started to see increasing case numbers.
Still much smaller than what the previous surges were, but that graph really sort of paints the picture of the concern here.
SOARES: And, Sanjay, when I look at that graph, if we can bring it up again, my concern is of course, okay, U.K. vaccinations are going well. The
United States is doing well -- Europe. What about the rest of the world? Parts -- Africa, two percent are vaccinated. We were talking about this
variant, this is a huge concern for those countries where vaccinations are just not going as fast as they ought to be.
GUPTA: Absolutely. There is no question about it. It raises two significant concerns. One is that, this is a more transmissible variant, but it also,
it tends to make people sicker. This is a variant that tends to be stickier to the receptors in the body, which is why it's more transmissible, but
also more likely to replicate in the body, and people get sick.
So, if you're not vaccinated -- there's no question, your point is a very valid one. There's a second concern as well, which is that as the virus
continues to circulate more and more, particularly in these unvaccinated populations, you'll get new mutations. This is 60 percent more
transmissible than the U.K. variant, which was 50 percent more transmissible than the variant before that. So you get the idea. It becomes
increasingly transmissible potentially -- potentially -- with these new mutations.
SOARES: I heard Dr. Fauci say that he wasn't worried about the delta variant. But, you know, given that we are now well over a year into this,
the concerns -- many people probably would be screaming at us now Sanjay, basically saying, well, but virus keeps mutating, strains are getting more
severe. How can you not be worried about this?
GUPTA: You know, I think what Dr. Fauci is basically talking about is the current status of the vaccines. I think that he is talking about it really
from a United States perspective or countries at least that have a lot of vaccines, I should say, and we now have data.
I think we can show this as well. How effective are these vaccines against the variants? That's the question, right? We know that it does drop off a
bit with the delta as compared to the alpha. But still, you know, very effective. Keep in mind just to give you context, the F.D.A. would have
authorized 50 percent effectiveness out of the gate, and even with these variants, all these vaccines are more effective than that.
But I think, you know, there is a larger issue here, which you're raising. And I think it's very important for the world as this virus circulates more
and more, the concern is that it will accumulate more mutations. Most of those mutations may be innocuous or harmless, but it may start to get
mutations that could lead to increasingly contagious strains of the virus.
It may become more contagious and less lethal. The concern is that it would develop more attributes of both. So, that is a concern. That's why we need
to get vaccination programs everywhere around the world to slow down the fire with which this is burning.
SOARES: Yes, so, given that image you just painted, Sanjay, are you worried at all that vaccinations are dropping, vaccine hesitancy, is that a
GUPTA: Yes. It is a concern. I mean, if you look at the United States, it's sort of this interesting bifurcation that's occurring. People keep thinking
you have a vaccinated population, you have an unvaccinated population.
What it's becoming increasingly is vaccinated and infected, because you get these strains that are so contagious that at some point, all of the things
that you sort of got away with, you think, you know what, I never became infected this entire year, that's fine and that's good obviously.
But, these new variants are far less forgiving. So even casual sort of things that may not have been a source of spread before for you will become
a source of spread. So that is a concern.
I mean, you know, if you look at the United States, what it's sort of this interesting bifurcation that's occurring, people keep thinking, you have a
vaccinated population, you have an unvaccinated population. What it's becoming increasingly is vaccinated and infected, because you get these
strains that are so contagious that at some point, all the things that you sort of got away with, you think, you know what, I never became infected
this entire year. That's fine. And that's good, obviously.
But this, these new variants are far less forgiving. So even casual sort of things that may not have been a source of spread before for you will become
a source of spread. So that is a concern. And then again, this large point, which you're raising a very good one, you want to just slow down the spread
because each time this thing spreads, you potentially could get induced these mutations which could be more problematic.
SOARES: Sanjay Gupta, always great to have you on the show. Thanks very much, Sanjay.
GUPTA: Yes. Thanks, Isa.
SOARES: Now, on Election Day, some Iranian said there's no point in heading to the ballot box. We'll have a live report from Iran as Iran gets ready
for a new leader. That is next.
SOARES: Hello. I'm Isa Soares. There's more QUEST MEANS BUSINESS in a moment when we'll be live in Iran where polls are due to close on election
that many say has already been decided. And Victoria Secrets that is changing its image reflect real everyday women. Before that the headlines
for you this hour.
President Joe Biden calls you a truly American accomplishment. He's commemorating 300 million private shots administered in the United States
during his first 150 days in office. Mr. Biden says 65 percent of American adults have gotten at least one vaccine dose.
China is on track to administer its one billion dose of COVID vaccine by the end of the week. That numbers triple the number delivered in the United
States and represents nearly 40 percent of the 2.5 billion shots given globally.
SOARES: For the second time this week, Israel has bombed what it calls Hamas military targets in Gaza. It was in response to a series of
incendiary balloons launched across the border into Israel. That caused dozens of fires the first wave of balloons came amid chooses marched by
Jewish extremists in Jerusalem.
Now, Iran is in the midst of a crucial presidential election that officials have tipped in favor of a hardline candidates. They're allowing the polls
to stay open past midnight if needed, but turnout is still expected to be low. Many voters especially younger voters, appears have been put off by
the lack of really of candidates, the ultraconservative candidate Ebrahim Raisi is widely expected to win and most of his main challenges were barred
You're getting the picture. He's a close ally of Iran Supreme Leader Ayatollah Ali Khamenei who urged people to head to the polls. Take a
(BEGIN VIDEO CLIP)
AYATOLLAH ALI KHAMENEI, IRANIAN SUPREME LEADER (through translator): Each vote is important. One should not think that nothing will happen with a
single vote. Even a single vote is on significance. Each single vote can form the collective votes of the nation.
(END VIDEO CLIP)
SOARES: Now, rise is expected to take over the presidency at a crucial time. Iran faces a crippling economic crisis made even worse by the
pandemic. As you can imagine, his government will have to deal with skyrocketing inflation since April 2020 that the Riyal has lost half its
value. U.S. sanctions restrict Iran's access to reserves abroad. And of course, all this as the pandemic pushes more and more families into
Let's bring in Frederik Pleitgen who's joining us live from Tehran. And Fred, you've been at this polling station throughout today. Give me a sense
of the mood because what I had read is that many people felt this spirited because they felt this is a one horse race. What have we -- what have they
been telling you?
FRED PLEITGEN, CNN INTERNATIONAL CORRESPONDENT: Hi there, Isa. Well, we were -- we were at this polling station. We were to other polling station
also in Tehran. And I have to say there were actually more people there than many people I think had expected. And if you look at the case of
what's going on right here, right now, I'm going to get out of your way a little bit, you can see that there are still people coming in to vote.
There's actually still a lot of people also outside. And the interesting thing about the phase that we're in right now is that this polling station,
all the polling stations were supposed to actually close almost 10 minutes ago. All candidates have asked for the polls to stay open longer, which
would be until about 2:00 a.m. Iranian time. That has not officially been approved yet. But it certainly looks like from what we're seeing right now
of the polls are remaining open.
So, there are people coming in and voting. There's a lot of people coming in and voting. How high in the end the turnout is going to be, obviously,
we're going to have to wait and see. So far, we haven't gotten any indication from the authorities as to what sort of percentages of people
they actually expect. But of course, you're absolutely right. There are people who believe that maybe turnout would be low, especially after those
candidates were disqualified.
And one of the really interesting things that happened is that the Guardian Council, which is the body here that that's the candidates that aren't
allowed to run, they did disqualify a lot of candidates and the moderates felt a lot of their candidates. And in the end, there were seven candidates
who were left over. And of those seven candidates, three candidates then also dropped out making Ebrahim Raisi even more likely to win the
Which of course, would shift Iranian politics to a much more conservative branch than it has been over the past eight years when you've had the
relative moderate Rouhani government. Now, in terms of actual policy, obviously, it means a lot here internally in Iran. But it was interesting,
because I was able to speak to the head of Iran's national supreme Security Council earlier today.
And he said, for instance, as far as negotiations are concerned about reviving the Iran nuclear agreement, he said that that would totally remain
on track because the Supreme Leader backs the fact that Iran wants to get into full compliance with that agreement again, but of course, first wants
the U.S. to come back into that --into that agreement as well, Isa.
SOARES: And Fred, you know, critically, Iran, as we pointed out, as you pointed out, really want sanctions to be lifted. You've been to Tehran
numerous times for CNN. I would love you to give me a sense of give our viewers a sense of the economic misery that people are facing there.
PLEITGEN: Well, you know what, when we say that Iran has been hit by crippling sanctions, especially over the past couple of years of the Trump
administration. It's absolutely true. And it really is something that affects almost everybody that we've spoken to here over that period of
time. And the sanctions that were put in place by the Trump administration. They're not only sanctions that hit people directly. Obviously, many people
have lost their jobs.
Obviously, many businesses had to close simply because they couldn't get the goods anymore that they wanted to sell. Iran couldn't really sell that
much oil anymore.
PLEITGEN: That obviously made it even more difficult to provide services. But there's also secondary effects that we've seen here as well. For
instance, in the medical sector on the face of it, there are no sanctions against the medical sector. But it's very difficult, for instance, for
hospitals here to get a lot of the drugs, a lot of the machines that they need, simply because companies abroad are afraid to sell them these things,
or because they can't pay for them, because Iran is not part of the electronic international payment system.
So, it's had effects pretty much in every part of life of people. And when we talk to people here who are coming to the polls, when we talk to people
outside in the streets as well, improving the economy and getting rid of those sanctions is certainly a large part of the decision making process.
And what they think about when they go here to the polls, and when they think about which candidate they would like to have.
And there is also -- there is also a good deal of disillusionment, I think, with the Rouhani administration and the perceived inability to at least get
that under control to a certain extent. Of course, they're up against something very difficult with those tough sanctions levied by the Trump
administration. But there are also a lot of people here who feel that to a certain extent, the Rouhani administration could have done a better job
SOARES: Yes. It seems as that it's not just sanctions. Sanctions that have been exacerbated by the pandemic. Fred Pleitgen for us there in Tehran
where poles, you're saying this could be open for probably another two hours also. Great to see you, Fred. Thanks very much. I want to stay in the
Middle East when we half the world is struggling with water shortages. Innovators are developing creative new methods to find sustainable drinking
Here's a look at one company that's harvesting water right out of the air.
ANNA STEWART, CNN REPORTER (voice-over): In the deserts surrounding Dubai when it rains only 25 days on average per year. Water sources are hard to
come by. The one company says it's producing 1-1/2 million liters of drinking water right here every year. By making water out of sunlight and
UNIDENTIFIED MALE: Welcome to the Source water farm.
STEWART: Aims to provide clean drinking water to the more than two billion people living in countries experiencing water scarcity. Dozens of
businesses around the world are working on technologies that use air to make drinking water but sources its process is completely sustainable.
The big idea behind source is to perfect drinking water for every person and every place.
To do this source developed a technology they call hydro panels. The device uses solar energy to power a fan that draws in air. This air is then
channeled into a sponge like material, where water molecules are absorbed to be distilled and collected.
UNIDENTIFIED MALE: These hydropanels are effectively producing high quality drinking water day in day out without requiring any infrastructure, any
power, or any type of grid.
STEWART: Currently operating in 48 countries, Source chose Dubai to be their largest water farm. The company established itself here in 2017
because it says the region is keen to invest in these solutions.
UNIDENTIFIED MALE: What attracted us to Dubai is first of all the fact that it is a hub for the Middle East-Africa region. It also is a center for new
innovations for key sectors such as agriculture and water.
STEWART: Experts say one of the biggest challenges facing this tech is the difficulty of wider distribution (INAUDIBLE) believes a bigger hurdle is
getting people used to the idea.
UNIDENTIFIED MALE: As with most disruptive technologies, it's initially people are hesitant to change, they're reluctant to try something new. And
the same holds for the water sector. People here are accustomed to the staple solution for water generation. And what we're proposing is a kind of
a diversified menu effectively.
STEWART: In Dubai Source operates in this desert camp popular with travelers, but the company's ambitions stretch far beyond tourist
attractions. They're already present on five continents, and say they're working with schools, hospitals, hotels and communities. And since Source's
starting point is just the sun and air, the sky might be the limit. Anna Stewart, CNN.
SOARES: Now Taiwan is short on COVID vaccines and suffering its worst outbreak yet. Up next, an exclusive look at the Taiwanese company offering
a solution to the prices. You are watching QUEST MEANS BUSINESS.
SOARES: Now Taiwan has just received nearly a quarter million doses of Moderna's COVID vaccine as it battled his worst outbreak yet. The
vaccination rate there is only about six percent. A Taiwanese vaccine maker hopes to address that shortfall. CNN's Will Ripley has this exclusive
report for you.
WILL RIPLEY, CNN INTERNATIONAL CORRESPONDENT (voice-over): At Medigen Vaccine Biologics Corporation.
You must be so busy right now.
UNIDENTIFIED MALE: Yes, sure.
RIPLEY: You can feel energy in the air. This company is the first in Taiwan to submit its COVID-19 vaccine to government health officials for emergency
use authorization. Taiwan's president, Tsai Ing-wen hopes locally made vaccines will be ready for the public by late next month. Taiwan is
battling its most severe outbreak of the pandemic. The government is struggling to get enough foreign vaccines in a region where China often
calls the shots.
Cross strait tensions are high. Taipei accuses Beijing of blocking access to foreign vaccines. A claim China denies. That makes the work happening
(on camera): This is the room where they package and label box after box of these single-dose syringes. Each box contains 100 of these. And the company
says they can scale up production and eventually produce 40 to 50 million doses a year.
CHARLES CHEN, CHIEF EXECUTIVE OFFICER, MEDIGEN VACCINE BIOLOGICS: On one hand, I feel exciting that the vaccine is coming but on the other hand, I
also feel very sad even one month earlier, maybe we are able to save more people's lives.
RIPLEY (voice-over): This is Medigen CEO Charles Chan's first interview since his company applied for emergency use authorization.
What would you say to people here in Taiwan who might be reluctant to take a domestically produced vaccine?
CHEN: That once the data and a resort is transparent and convincing, I think people are very much then being convinced.
RIPLEY: Chen says that data shows their vaccine is safe. It produces antibodies in 99.8 percent of patients. What they don't know is the
efficacy rate. Taiwan had almost no active cases until just over a month ago.
How do you develop a vaccine when you don't have active cases?
PAUL TORKEHAGEN, DIRECTOR, OVERSEAS BUSINESS DEVELOPMENT: This is a difficult question.
RIPLEY: Overseas Business Development Director Paul says Medigen finished phase two clinical trials.
TORKEHAGEN: So what we did was we designed a really, really large phase two, usually a phase two is about a few 100 people. Our phase two was 3800
participants. So we wanted a very large amount of safety data.
RIPLEY: Since you don't know efficacy, is it too soon to get emergency use and start vaccinating people?
TORKEHAGEN: What's the consequence of not vaccinating and being not protected.
RIPLEY: Will you be getting your vaccine, your company's vaccine when it's available?
RIPLEY: No question.
CHEN: No question.
RIPLEY: But there are questions, how effective is Taiwan's vaccine? Here, it's a matter of life or death. Will Ripley, CNN, Taipei.
SOARES: Now, Victoria is looking for a new secret. The iconic brand is leaving its past behind. Clare Sebastian has all the details, next.
SOARES: Now, Victoria's Secret is coming down to earth. The large rebrand is dropping its Angel supermodel line, replacing it with brand ambassadors
known for advocacy work called the V.S. Collective. It includes soccer player Megan Rapinoe, South Sudanese model Adut Akech, and actress Priyanka
Chopra Jonas among others. Clare Sebastian has more on the story. And Clare, it is a huge rebrand. It's almost like 180.
They're getting rid of the angels, they're getting rid of the wings. They're getting rid of the fantasy brass. Why now? I mean, what's the
CLARE SEBASTIAN, CNN INTERNATIONAL CORRESPONDENT: Well, I think this has been a long time coming, Isa. Some would say it's even -- it's even too
late. But certainly it is a major turnaround. This is using the -- these women who are not just models, they have many of them other careers.
They're very successful. They have a history in most cases of advocacy for body positivity and for women's equality and things like that.
I think it will be telling to see what they do with this right now. They've just announced that these women will be helping sort of develop the brand
and product providing sort of consultation and all of that. It will interested to see what kinds of products they start to develop around these
ambassadors. How they develop their marketing strategy because of course, this is in many ways coming quite late to an industry that has already
started to adapt.
We see the rise of Briana's, you know, underwear brand, it -- with a -- with a principle of inclusivity. There's Aerie from American Eagle which
has a policy of not using airbrush models and using sort of people with real physiques. And all this coming, of course, about four years after we
saw the MeToo Movement. So I know in many ways, they're quite late, so they really do have to prove themselves here.
SOARES: And it is, like you said, it is what consumers want. They want diversity and they want representation and the fact that they're so behind,
it's a huge floor no doubt for the company.
SEBASTIAN: Yes. But look, it is a -- it is a good signal today -- well, this week when they announced as it is a good start.
SEBASTIAN: We've heard, you know, previously from the CEO that they really are starting to take this seriously. According, Isa, from their recent
earnings call from the CEO of Victoria's Secret, Martin Waters, he said that part of the reason why they have actually seen a bit of a rebound in
sales recently is because of the -- what he called the improved brand positioning, moving from a position of frankly being irrelevant to being
For being for him to for her and being more inclusive rather than exclusive. That's the other part of this is that previously Victoria's
Secret had always marketed women's underwear is something for men, this is a wholesale change. They've also brought in new members of a board for
what's going to be a standalone public company when they -- when they spin off from the parent company L Brands out of seven -- six women. So that is
also a good start here.
SOARES: And so, it's not just a change of the image but also within the company, you know, itself. The importance of adapting and -- because we
don't adapt, of course, it becomes a fatal flaw. Isn't it, Clare?
SEBASTIAN: Well, like I mean, this is still a huge player in women's underwear. They have gone down in market share from about 32 percent in
2015 to about 19 percent at the end of last year. But they are still a major force, 19 percent not to be sniffed out. But of course, some work to
be done to get back to those past levels.
SOARES: Clare Sebastian, thank you very much, Clare. And there are just moments left to trade on Wall Street. We'll have the final numbers as well
as the closing bell right after this.
SOARES: There are just moments left to trade on Wall Street. Let me show you the big board and it has been read hours all across the wall today. And
if we look at the big board down again, more than 400 points, 476. It was done more than 500 as a possibility of rising interest rates really
That's the concern. If we have a quick look at the Dow components, again, what we've been seeing and what we heard from our correspondent (INAUDIBLE)
show was really a sea of red with Chevron, Goldman and Walgreens really sinking to the bottom.
And that sell off what that's taking place in Europe. Two concerns over those interest rates we heard from the Fed. We saw red across the major
averages. FTSE in England, the DAX, CAC (INAUDIBLE) in the continent all finished down today. So, not the upbeat picture to end the week. But that
does it for us. Thanks for much for watching.
SOARES: I'm Isa Soares in London. "THE LEAD" with Pamela Brown start right now.