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Quest Means Business
U.S. Jobs Report Shows Slower Job Growth in September; Oil Price Rise amid Global Fuel Crunch; China Orders Coal Mines to Increase Production; ISIS-K Claims Responsibility For Suicide Blast In Afghanistan; Journalists Awarded 2021 Nobel Peace Prize; U.S. Submarine Hits Unknown Object In South China Sea. Aired 3-4p ET
Aired October 08, 2021 - 15:00:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
ALISON KOSIK, CNN BUSINESS HOST: The Dow is heading for its fourth straight gain of the week. Those are the markets and these are the main
Joe Biden says the U.S. economy is losing its edge after a disappointing jobs report for September.
Oil prices jumped to $80.00 a barrel while China tells its coal miners to ramp up production.
And Elon Musk checks out of California moving the Tesla headquarters to Texas.
Live from New York, it's Friday, the 8th of October. I'm Alison Kosik, and this is QUEST MEANS BUSINESS.
Good evening. Tonight, the summer of recovery that stalled, dismal U.S. jobs numbers reveal an economy still looking for solid ground and a
President looking to move on his agenda. September was the weakest month for U.S. job growth so far this year. It continues to trend from August as
the delta variant continues to persist, at least the concern to. The economy created just 194,000 jobs last month, far less than the half
million economists had expected.
The monthly unemployment rate though did drop to 4.8 percent. President Biden warned that the jobs numbers show the U.S. risk losing its edge if it
didn't move on his spending agenda.
(BEGIN VIDEO CLIP)
JOE BIDEN (D), PRESIDENT OF THE UNITED STATES: The jobs numbers also remind us that we have important work ahead of us and important investments we
need to make. America is still the largest economy in the world. We still have the most productive workers and the most innovative minds in the
world. But we risk losing our edge as a nation if we don't move.
(END VIDEO CLIP)
KOSIK: Let's take a look at the breakdown. Private sector job growth was at 317,000 in September, the government lost 123,000 jobs. The leisure and
hospitality sector added just 74,000 jobs. It added 400,000 in July and was averaging almost 200,000 a month this year. That's more than the total
number of jobs added to the economy in September.
Clare Sebastian joins us live from New York and John Harwood is with us in Washington.
John, I'm going to go to you first because you know the President clearly - - these weren't the numbers that the White House really wanted to hear. He pinned the big miss of the jobs report on COVID. And throughout the speech,
it felt like he was pretty defensive.
JOHN HARWOOD, CNN WHITE HOUSE CORRESPONDENT: Well, look, he was trying to emphasize the positive in the jobs report. You mentioned the unemployment
rate down to 4.8 percent. You've also seen wages rising in this report, hours worked rising. Those are positive upward revisions from previous
But the miss of more than 300,000 in the number of jobs was clearly a setback for the administration and he addressed that by saying as is
commonly believed among economists, that this reflects the continued grip that the coronavirus pandemic has on the U.S. economy. When it eases, when
the pandemic gets better, the economy gets better. When it gets worse, the economy gets worse, and that's what we saw from the delta variant.
The positive for the administration is not in these numbers, but looking forward because as you know, Alison, some of the public health people are
looking at the declining cases, hospitalizations, and deaths occurring right now, and forecasting that the delta variant is fading. That would
suggest next month may have better news for the administration.
KOSIK: So Clare, you know, looking at these numbers, do you think they are actually representative of what's happening? Or is this report an
aberration? I mean, how much did seasonal adjustments contribute to the big miss on especially that headline number?
CLARE SEBASTIAN, CNN BUSINESS CORRESPONDENT: Yes, Alison. So I think the trend as John was laying out there is that as virus numbers rise, job
growth slows, and it's worth pointing out that the survey week that was used for this report was around September 13th, so there is reason to hope
that in the second half of the month, as the virus started to come down, the news started to get a bit better, and that we might get something
better in October.
But look, there are elements of the report that the Biden administration -- that President Biden emphasized as a good thing, things like wage growth
that might actually be a cause for concern when it comes to inflation. Wages went up by 19 cents -- hourly wages. So that was quite a big jump.
And in terms of seasonal adjustment you talk about, one of the big areas of decline that we saw was in state and local government education where
usually, you see the seasonal hiring patterns of increases in jobs in September as people go back to school. That didn't happen this year.
So when you get the seasonal adjustments, that led to a decline, so that is something to watch going forward and that disproportionately affects women
in the workforce who are sort of heavily employed in education.
KOSIK: Right, right. Yes, exactly. Women lost 26,000 jobs last month. John, let me ask you this, because, you know, you're talking about moving it
forward. The President certainly made a push for his legislative agenda in this speech coming after, of course, the jobs report.
HARWOOD: There really, Alison, two imperatives for the Biden White House coming out of this disappointing report. One of them is the need to
continue to press forward on the vaccination campaign that has gotten more aggressive from the administration lately. Instead of encouraging people to
get vaccinated, he is pushing vaccine mandates both for the Federal government and encouraging private businesses to do the same, many of them
are, and the overall vaccine vaccination rate has ticked up. That's critical to controlling the pandemic since that's the key to economic
The second part is the economic agenda that he is pushing, both the infrastructure bill, bipartisan bill that's already passed the Senate,
which would invest in roads, bridges, broadband internet, and the reconciliation bill, the budget bill that has a lot of social spending,
things like child tax credits, aid to struggling families, also some action on climate change.
He is trying to push hard to get that done this month before political momentum fades, and what that requires, is getting his party all on the
same page. We've seen that he does not have a 100 percent of his party in the Senate, which is what he needs on the same page. They're working at it,
hope to get it done within the next few weeks.
KOSIK: And Clare, I do want to go back to the last point that you made about women losing jobs last month while men gained jobs. Can you tell me
what's going on here?
SEBASTIAN: Yes, Alison, this was not great news. Women actually lost 26,000 jobs in this report, and perhaps more important to look at the fact
that 309,000 women actually dropped out of the labor force all together, whereas almost 200,000 men entered the workforce.
This is really a sign of what we've been talking about, the resurgence of the delta variant over the second half of the summer that has led to school
closures, children having to quarantine. Women do seem to be bearing the brunt of that. So, that's something definitely to watch going forward.
And certainly that will be something that the Fed is watching. Jerome Powell, very clear that he wants the growth in the labor market that comes
off the back of this pandemic, to be inclusive, to try to reverse the unequal nature of this recovery. So that is something that we will be
But in terms of the big question for the Fed, whether this report meets the bar for that expected November taper that they've been sort of trailing,
most analysts believe that it just about does.
KOSIK: And we will certainly be watching to see if that indeed is the case. Claire Sebastian, John Harwood, thanks so much for all that great
And today's jobs report also showed wages continuing to go up. This, as job openings have hit a record high. There were 10.9 million job openings in
the U.S. at the end of July compared to 7.7 million unemployed in today's jobs report, 2.7 million are long-term unemployed, looking for at least six
months. More than two million are permanent job losses, meaning job seekers whose employment ended involuntarily.
Christy Hoffman is the General Secretary with UNI Global Union, and she joins me live. Great to have you with us today.
CHRISTY HOFFMAN, GENERAL SECRETARY, UNI GLOBAL UNION: Thank you. Thanks, Alison.
KOSIK: So why are companies having trouble hiring when millions of people are still unemployed?
HOFFMAN: Well, you know, there's a lot of reasons for this, mismatches and misalignments between where people are unemployed and where the jobs are.
But I think in general, we have to just think about it as a great reassessment of work in America because more than a labor shortage, there
is a shortage of decent wages, decent work, workplace safety, and support for childcare.
And I think that, you know, there just aren't enough good jobs. And one of the things that we look at is that there is just so far to go for a jobs
recovery, is it reality? You know, because the jobs aren't good enough, we still have 40 percent of workers who are working, earning less than $15.00
an hour, a quarter of them with no sick leave.
We need more dignity on the job, more collective bargaining if we want to rebalance the economy, but also if we want to get people that come back
into the labor force, because that's a big piece of it.
You just talked about how so many women had dropped out of the labor market. We need more support for long term care and childcare. The high
cost of care is a big obstacle for many women to return to work. I think, eight million women altogether are out of the job market because of
inadequate care options.
And we also need -- go ahead.
KOSIK: Finish your thought. Finish your thought, please.
HOFFMAN: Well, I was just going to say, the other piece of it -- and that can be addressed through some of the legislative proposals on the table.
The other thing is that we've got to get more collective bargaining back into the picture if we want to rebalance the economy. We need a fair
process to establish unions at work, and that means passing the Pro Act, and those are two important legislative pieces that are going to bring
people back into the labor market.
KOSIK: You know, especially over the past 18 months, it seems some companies seem like they're trying to improve, at least in the wage
department. You know, they're giving increased pay, like Walgreens, McDonald's, Chipotle. Why is raising wages, which was a huge fight before
the pandemic, why is that not enough anymore?
HOFFMAN: Well, I think the reality is we are hearing a lot of anecdotes about raises, you know, increases that are going up, and it is -- some are
increasing slightly. But let's say if you look at grocery store workers, for example, that's a seven percent increase since the beginning of the
pandemic, that's not very much for low wage workers.
So you know, the wages aren't really increasing that much. I think the numbers today were 4.7 percent year-on-year. That's not that much for
workers who were earning poverty wages to start with.
I mean, we can look at some workers who -- no wonder they're not excited to return to unsafe jobs, $10.00 an hour, irregular hours, no one to take care
of the kids. This is the reality for non-union work in private sectors in the U.S., and I think that you've got to look at where you do have workers
laid off, who are sort of protected in a union environment, they are coming back to their jobs.
But security and cleaners in New York City, for example, or the workers at United Airlines, they've been laid off, they're all coming back. There is
not a question in that kind of environment.
And you also --
KOSIK: I'm sorry to interrupt, I want to be -- we are running out of time - - I do want to get one last question in and your thoughts there really taken, I promise.
To the entertainment industry in the U.S., because there were results from a survey that your organization conducted that chose 60 hour workweeks are
the norm in the TV-film industry. The results were published in support of UNI's U.S. affiliate, the International Association of Theatrical Stage
Employees, which voted in favor of a strike if there's no agreement on working conditions with the Alliance of Motion Picture and TV Producers.
First of all, how are negotiations going?
HOFFMAN: I don't know the answer to that. It's been quiet. So one can only assume when negotiations are quiet that that they are in hard bargaining.
But I would say that these issues have been on the table for a long time, and they haven't made progress.
So let's hope they are making progress now after this terrific show of support through this strike authorization vote, which, frankly, is the
first vote of this kind since World War II. It's really remarkable.
But we have these very, very basic issues on the table -- the right to take lunch breaks, and you know, have a reasonable working day and it is
striking that in 2021, we're still fighting about the length of the day at work, but that's where we are.
So again, let's hope they're making progress.
KOSIK: Are you hopeful that it will end up the way you want it to end up?
HOFFMAN: I'm hopeful. I'm very hopeful because this union is completely united around these set of demands, which are very basic. You know, it's
not -- there's economics on the table, of course, but it's not simply economics. It's really about the right to have a reasonable working day
that have some breaks, and that just shouldn't be so difficult to achieve.
This is a really profitable industry right now, and these streaming giants have done very well during the pandemic. We've all enjoyed our Netflix, but
it is time to get back to the workers and also allow them to have a dignified time on the job.
KOSIK: Christy Hoffman, thanks so much for the conversation. And thanks for your time.
HOFFMAN: Thank you. Yes.
KOSIK: Well, the Senate has voted to extend the U.S. debt ceiling until mid-November. The Treasury Secretary Janet Yellen says that just having a
debt ceiling is becoming increasingly damaging to the U.S. economy.
Speaking to Erin Burnett, Yellen said the debt ceiling was creating an impossible situation.
(BEGIN VIDEO CLIP)
JANET YELLEN, U.S. TREASURY SECRETARY: I think it has become increasingly damaging to America to have a debt ceiling. It has led to a series of
politically dangerous conflicts that have caused Americans and global markets to question whether or not America is serious about paying its
It is flirting with a self-inflicted crisis, and it really involves evolves the government giving to their Treasury Secretary and their President
conflicting sets of instructions. Congress would have instructed me to make the payments to cover the expenditures they authorized, to collect the
taxes that they have legislated, and then on top of that, set a requirement that can't let the debt run above a given level.
And those three things, all valid laws, can come into conflict. It's an impossible -- it's an impossible situation. Congress needs to debate these
issues when they are deciding on spending and taxation, not to every several years, put a hard stop and say, well, now, we're not going to let
the Treasury Secretary pay the nation's bills.
KOSIK: Still ahead, there are questions over how to solve the global energy crunch. We look for the answers, next.
KOSIK: Oil prices are surging this hour, part of a wider crisis in the fossil fuel industry. This is how prices stand right now after crude broke
the $80.00 mark. Oil and gas prices are at their highest level in seven years, and there are fears a barrel could end up costing $100.00.
Matt Egan is here with more. You know this is a global issue. So, it's not just predictions of $100.00 oil. It is huge increases in natural gas
prices, even coal costs are skyrocketing. Walk us through first what's causing this and if there's an end in sight.
MATT EGAN, CNN REPORTER: Well, Alison, like everything else right now, supply is just not keeping up with demand. We've seen demand for energy
return because people are flying more, they are driving more, they are commuting.
The problem is that whether it is coal or natural gas or oil, supply has not kept up, and I think there's a lot of reasons why. On the supply front.
Let's look at oil first. OPEC is still holding back a lot of barrels. It took off an unprecedented amount of production back in March and April
2020, and it's been gradual, very slow to return those barrels. The same thing with U.S. oil. It's also been slow to return production.
EGAN: When you look at coal, we know that coal has fallen out of favor with many governments around the world, and it just is not viewed as economical,
and we've seen a lot of power plants shift away from coal. They've gone to natural gas and renewables instead. And so now, there is actually more of a
need for coal, so we've seen coal prices spike up, and then there's, there's natural gas. Part of that is the fact that oil production is down.
And when you produce oil, you produce a certain amount of natural gas.
Also, we've seen weather related events, there hasn't been as much strong wind in Europe. And so that has hurt the generation of wind, and the other
thing with natural gas, is to remember that, you know, Russia is a huge player on the natural gas front. And Russia is actually exporting less
natural gas today to Europe than it was in 2019. And the IEA recently, basically called out Russia, and said Russia can do more. So we have to see
if Vladimir Putin decides to try to send some more oil, certainly more natural gas to Europe or not.
KOSIK: And a global energy crisis can certainly become a political problem as well, right, especially here in the U.S.
EGAN: Yes, that's right. I mean, voters do not like high gas prices, and here in the U.S., we are looking at $3.20 a gallon plus national average
gas price, up more than $1.00 a gallon from a year ago. Some states like California and Colorado, and Illinois are paying a lot more.
And, you know, fair or not, voters tend to blame whoever is in the White House. So, this is a problem for President Biden, and it is even a bigger
problem because there is really not that much he can do about it.
Option one, the best option was really energy diplomacy, to try to get OPEC to pump more oil and that has so far failed. Plan B was floated this week
as maybe tapping America's Strategic Petroleum Reserve. The Energy Secretary mentioned that that was a possibility. But the Energy Department
later walked that back.
And a lot of the analysts I talk to don't really think that the SPR would really do that much because of the size of the supply shortfall. One
analyst told me this would be like bringing a squirt gun to a fight.
Another idea that's been floated is maybe the United States could ban oil exports. But again, the Energy Department said that there is no immediate
plan to do that. And Goldman Sachs put out a report this week saying, listen, that would actually backfire, because gasoline trades off of world
oil prices, Brent crude, and if you cut off U.S. supply to the rest of the world, then Brent would actually go higher, so that would actually
So that brings us back to energy diplomacy, and Alison, of course, the problem with energy diplomacy and asking OPEC to pump more oil is because
that would interfere with climate diplomacy. World leaders are meeting in Glasgow later this month to try to talk about weaning off fossil fuels. So
clearly, all of this shows that the energy transition will not be easy.
KOSIK: All right, Matt Egan, thanks so much for all that great perspective.
EGAN: Thank you.
KOSIK: China is ordering coal mines to ramp up production as people face power shortages due to the fuel crisis there. In some places, the
government is rationing energy during peak hours. Selina Wang has more.
SELINA WANG, CNN CORRESPONDENT: China has ordered 72 coal mines to boost production by nearly 100 million metric tons according to Chinese state
media. That figure is equivalent to about 30 percent of China's monthly coal production. And it's an example of China's struggle to balance its
aims to tackle the climate crisis while also using coal to keep the lights on.
Power shortages in China have spread across most of the country in recent weeks. It has forced the government to ration electricity in some factories
to suspend production. It's also disrupted people's daily lives.
Some areas have dealt with complete blackouts. Stores have had to shut down earlier or resort to candlelight. Traffic lights have stopped working in
some areas leading to severe traffic jams.
Coal is still China's main energy source, but in a push to reduce carbon emissions, China has shut down hundreds of coal mines earlier this year.
But experts say that in the short term, China has little choice but to increase coal consumption to meet demand.
This current energy crunch is the result of a perfect storm of factors. You have demand for Chinese goods surging as the world emerges from the global
pandemic and that increases the use of China's electricity hungry factories that is sending energy prices skyrocketing.
But since electricity prices are regulated in China, some power companies are losing money and hesitant to boost production. At the same time, China
is trying to meet these ambitious climate targets to be net zero by 2060, and for carbon emissions to peak by 2030. So local officials rationing
power to meet those targets.
All of that just puts more downward pressure on the Chinese economy with economists slashing their estimates for China's GDP growth.
Selina Wang, CNN, Tokyo.
KOSIK: The seafood business can be as murky as the ocean depths and what you pay for might not be what you're eating even at the fanciest
restaurants and markets.
But a Dubai based startup is thinking big to keep your fish honest. CNN's Anna Stewart explains.
MARCO ACQUAROLI, EXECUTIVE SOUS CHEF, JUMEIRAH AL NASEEM: This one is a Turkish seabass and this one is French seabass. This one is well -- caught,
this one is farmed, so the one caught can be the double price per kilo, but yes, the farm is still a very nice quality and the average person cannot
spot the difference.
ANNA STEWART, CNN REPORTER (voice over): And that's the problem. Fish stamped as red snapper, but in reality, cheap tilapia. Frozen seafood
sometimes weeks old, masquerading as fresh off the boat. Often you can't tell the difference.
For decades seafood supply chains have been poorly enforced, but Chef Marco says that is slowly changing. His restaurant on Dubai's coast is partnering
with Seafood Soup, a company using technology to eliminate seafood fraud.
SEAN DENNIS, CO-FOUNDER AND CEO, SEAFOOD SOUQ: Seafood is an industry that is wrought with not necessarily fraud, but opacity or darkness within the
supply chain. It is very difficult for buyers to know where they are getting their seafood from.
STEWART (voice over): At its core, Seafood Souk is a marketplace connecting fish suppliers with restaurants, hotels, and supermarkets around the world.
The company developed a proprietary algorithm called SFS Trace, which records every detail of the fish's journey from the exact time it was
caught to the type of ice and temperature used during its transport.
DENNIS: We have the ability with technology, with marketplace, with SFS Trace to eliminate the possibility of fraud whether intentional or
STEWART (voice over): SFS Trace was originally designed for catering and hospitality to track orders. Now, consumers are benefiting from the
Today, Seafood Souk is using Chef Marco's restaurant to launch SFS Trace to the customer for the first time.
DENNIS: We, at the end of the day as consumers are the most powerful direction drivers for businesses to make sure they make ethical decisions.
STEWART (voice over): In Chef Marco's kitchen, orders are piling in.
ACQUAROLI: So we are very happy now especially because we can -- with a QR code we're going to put in place, our guest is 100 percent sure from where
the fish was in the last 24 hours.
STEWART (voice over): With the use of technology and a conscious appetite. Thankfully, at Chef Marco's restaurant, the only thing fishy is the meal on
Anna Stewart, CNN.
KOSIK: Tesla is charging toward Texas. Still ahead, why Elon Musk says he is moving its headquarters out of California.
KOSIK: Hello, I'm Alison Kosik. There's more QUEST MEANS BUSINESS in a moment when Tesla says it's moving its headquarters to Texas, blaming
California's high cost of living for the switch.
And the CEO of AIG tells Richard revenues won't get back to their pre- pandemic levels next year. Or even the year after that. Before that the headlines this hour.
ISIS-K is claiming responsibility for suicide bombing in northern -- ISIS-K is claiming responsibility for suicide bombing in northern Afghanistan. At
least 46 people were killed when the blast ripped through a Shia mosque in Kunduz. 143 others were wounded. It was the deadliest attack in Afghanistan
since the withdrawal of U.S. forces.
This year's Nobel Peace Prize has been awarded to journalists from the Philippines and Russia. Maria Ressa and Dmitry Muratov were recognized
today for their efforts to defend press freedom. For years they've been exposing government abuses in the face of legal and physical threats.
A mysterious incident in one of the world's busiest and most sensitive waterways is increasing tensions between the U.S. and China. An American
nuclear powered submarine hit an unknown object in the South China Sea last weekend. Several sailors were injured. Beijing is demanding answers and
wants to know why the sub was there.
U.S. President Biden is praising today's announcement from the Organization for Economic Cooperation and Development. It says all 136 countries
involved have now agreed to tax large multinationals at a minimum rate of 15 percent and require companies to pay taxes in the countries where they
Goodbye, California. Hello, Texas. Tesla is moving its headquarters from Palo Alto in the San Francisco Bay area to the Texas capitol of Austin.
That's what company founder Elon Musk said Thursday at a shareholders meeting. He said Austin is a much more affordable place for employees to
live. What real estate site says the median home price is about five times cheaper than Palo Alto. Musk also said easier commutes and more growth
opportunities factored into the decision.
(BEGIN VIDEO CLIP)
ELON MUSK, CHIEF EXECUTIVE OFFICE, TESLA: It's tough for people to afford houses and let people have to come in from far away there's a limit to how
big you can scale in the Bay Area. So, we're -- here in Austin and, you know, factories like five minutes from the airport, 15 minutes from
(END VIDEO CLIP)
KOSIK: Even though Tesla is moving its home base musk says the company still plans a big expansion in California. Paul La Monica is here now with
more details. So what's really behind this decision, Paul? am I right to assume that moving to headquarters also has to do with more than just -- I
don't know, housing prices and commutes to the airport?
PAUL LA MONICA, CNN DIGITAL CORRESPONDENT: Yes, Alison. I think that that is definitely a part of it. But it is worth noting that when you look at
Texas spell that out and what's an anagram? Taxes, and they are significantly lower in the Lone Star State than they are the Golden State.
Texas does not have a personal income tax. There is no corporate income tax, so it's going to be cheaper also for many of Tesla employees to move
to Texas and live there.
And I think that is a driving factor as well for Elon Musk even though he - - you know, I think he's right to cite housing affordability which is gotten out of hand in the Bay Area and is not really as problematic in
LA MONICA: Even though Austin is obviously a burgeoning Metropolis as well.
KOSIK: He almost comes off like a star CEO who's really looking out for his employees.
LA MONICA: Well, let's maybe not go that far. I think he's probably looking out for himself of course, as well. But yes, this is a move that other tech
companies have made because they are growing tired of the expenses in California. You have Hewlett Packard Enterprise, a company that's
synonymous with helping to start Silicon Valley. They've moved to Texas, you have Oracle moving to Texas as well.
So this is a trend and I expect that many other companies will probably leave the Golden State for taxes too.
KOSIK: You know, a big focus of his is SpaceX and moving to Texas provides a place for him to have a launch site for, you know, in Boca Chica, Texas
for his -- for his endeavors.
LA MONICA: Yes, that's a great point as well. Austin and Boca Chica are still a little far away when you look at the Texas map because it's such a
huge state just like California, but it's about a six-hour or so drive from Austin to Boca Chica and also only a little more than about an hour flight
to the local airport close to Boca Chica which is, you know, right down south, on the Gulf, Boston being more in the central part of the state.
KOSIK: OK. Pau La Monica, thanks so much for your reporting. To call this a tough week for Facebook, it would be an understatement. First, the
whistleblower telling U.S. lawmakers the company put profits over people, including children. Then the social media platforms worst outage in more
than a decade. Now Facebook and its founder are on the cover of Time Magazine and it's not flattering.
Big tech was one issue that CNN's Julia Chatterley talked about with the E.U.'s competition Commissioner. Here's part of their conversation.
MARGRETHE VESTAGER, EXECUTIVE VICE PRESIDENT, EUROPEAN COMMISSIONER FOR COMPETITION: I hope that everyone saw the needs. So the need for an open
markets where there was room for more than giants. Because if you get too dependent on a giant, well, if the giant fails, what are you left with?
JULIA CHATTERLEY, CNN INTERNATIONAL CORRESPONDENT: You know, your second point was also important, and that sometimes just physically talking
offline talking is better. But the challenge, I think, is it costs more. And I think that's the balance, or it can cost more. The balance that you
have to find when you're tackling a company that has great utility value, but also drawbacks. How do you find the balance?
VESTAGAR: Well, I think it's important also to be really precise, about what -- what's the cost, because I think also a lot of time is wasted in
checking if there is an updates, as someone said something spectacular. I think there's a lot of distraction of time being wasted, not being able to
concentrate anymore. And I think there is something, you know, fundamental in being willing to disturb one another by taking a normal call.
Because during COVID, you know, I realized I don't use my phone for calling. I would send people a photograph or a text message, but I don't
call them. And I think it's important that we are willing to disturb one another to say, I would like to speak with you right now, of course, you
can say that you're busy. But I would like to get in touch with you. And I think it's important that we have that human interaction and show that
we're willing to disturb one another, instead of just relying on something that can be dealt with whenever you have time for that because we need to
make it a priority to have time for one another.
CHATTERLEY: I want to move on to a different topic because as much I want to get your view on. Some E.U. nations are concerned in terms of what we're
seeing in rising energy prices that Russia is using its leverage in terms of natural gas supplies and energy supplies to propel prices higher and
have raised concerns with the E.U. Can I ask where the European Commission? Can I ask where you stand on this and how concerned you are?
VESTAGAR: Well, I'm really concerned about the spike in energy prices. Both of course of course for industry but also for households who lives on a low
budget where the energy bill is really -- it takes a toll on what they have to do with. So, this is a very important point. And what we see is that
we're still very affected by the prices of imported fossil fuels. So for the long term, it's really important to have more renewables that are -- so
to speak native to Europe that'd so -- that'd be water, that'd be a wind in order not to have this vulnerability from imported fossil fuel.
And second, to make sure that we make the most of the market design that we have where the cheapest energy production is being put into use first, in
order to make full use of the renewable production that we have already. We will launch next week sort of a catalog, a toolbox of what member states
can do in order to soften, to cushion what vulnerable households are experiencing right now.
But also, of course, we ask some of the great energy providers like gas from what it is that is happening, because it is indeed important for us
also as a -- as a low enforcing competition authority to take a keen interest in the market developments with the big providers.
KOSIK: All this week, Richard has been hearing from the world's top airline executives about when things could return to a pre-pandemic normal. Next,
the head of British Airways parent company says it may be several years before revenues fully returned.
KOSIK: Welcome back. The chief executive of international airlines group says revenues won't get back to their pre pandemic levels next year or even
the year after that. The group which owns British Airways, Iberia and Aer Lingus among others is facing uncertainty about the future. Luis Gallego
told Richard it will have to learn to be smaller for a while.
LUIS GALLEGO, CHIEF EXECUTIVE OFFICER, INTERNATIONAL AIRLINES GROUP: I think since the beginning, what we decided is that we needed to be more
flexible, because there is a lot of uncertainty about the future. We all know what's going to happen with the revenues, with the corporate graphic.
We have assumed that in 2023 we are going to have less revenues that we have in 2019 even fly in the same capacity.
So, we launched a plan to reach what we call the full potential of the group. And we have 21 initiatives affecting all the operating companies but
also the center because, you know, that we have a unique model. We're operating companies. They are accountable for the P&L but we need to help
from the center and we help with synergies sharing best practice, et cetera.
GALLEGO: So we are developing the group to that full potential. And with that, the idea is that we are going to come back to the profitability
levels that we have in 2019 in 2023.
RICHARD QUEST, CNN INTERNATIONAL ANCHOR: The great part about being able to be face to face is I can look into your eyes. And I can ask you, Luis, what
is your big vision for the future of IAG? In a sense, really, put the thing together and then he added on Aer Lingus and a couple of other things.
What's your big vision? Do you want to grow it? Do you want to add more carriers to it? Where -- what's your vision of it?
GALLEGO: OK. I think the group always has being a platform for consolidation. And that's something we have always in mind. We have a
portfolio of companies that we consider can provide value to the group and that we can provide value to them. In the short term, the next 12 months
first of all, we need to repair the balance sheet and we need to come back where we were because now we have a huge amount of that.
So we are going to be smaller for a period of time. So -- and the group I think we are going to have opportunities of consolidation. But the
opportunities also can be because some of the players they are not going to have the capacity to repay the huge amount of debt that they have because
of the crisis. So I think we arrived to this crisis in a very strong situation, we are going to emerge stronger.
And because of that, and because we are not going to have governments inside, we are going to have flexibility to take the opportunities that
we're going to have.
KOSIK: Coming up after the break. Earning millions is child's play. Why South Korean Squid Game could be Netflix's biggest yet.
KOSIK: A T.V. show about crippling debt is on track to become one of Netflix's biggest earners. The company says Squid Game is pushing past
Bridgeton as its most watched program ever. Paula Hancocks has more on the South Korean phenomenon.
PAULA HANCOCKS, CNN INTERNATIONAL CORRESPONDENT (voice-over): On social media these images are everywhere. On television.
JIMMY FALLON, TELEVISION HOST: -- I'm here with the cast of Squid Game.
HANCOCKS: Everyone is talking about it.
HANCOCKS: Amazon's Jeff Bezos tweeted, I can't wait to watch the show. Already hitting number one in 90 different countries on Netflix. Squid Game
is a South Korean T.V. show where 456 debt ridden contestants compete in childlike games for a prize of nearly $14 million. But the penalty for
losing is death. Show creator Hwang Dong-hyuk wanted to make this show for more than a decade, but studios rejected it.
HWANG DONG-HYUK, SQUID GAME CREATOR (through translator): When I showed it to people, a lot of them said that it was unfamiliar. It's strange and
unfamiliar. What is this? What the hell is this? They said this in a negative way.
HANCOCKS: South Korea already has a strong film industry with deep talent pools and large profitable studios. But it's T.V. shows were predominantly
romantic soap operas until Netflix arrived.
HWANG: I suddenly thought will I be able to bring the show to life as I wanted if Netflix is involved? I took that script from 10 years ago and
showed it to them. Netflix said they loved it.
HANCOCKS: Netflix says it has already invested some $2 billion on Asian content and will invest another half a billion on making new Korean content
alone this year.
UNIDENTIFIED FEMALE: I think in the past couple of years we've seen Korean content viewing grow four times in the region.
UNIDENTIFIED FEMALE: Parasite.
HANCOCKS: This is a golden age of Korean cultural exports. One when after another. Music, films, T.V. shows, dubbed Hollyu or Korean wave and it's
swept far beyond Asia, where it's been popular for the past two decades. Hwang says that this shows message resonates around the world.
HWANG: The world is getting much harder to live in. Even in the last 10 years, wealth disparity is growing. Nations are facing economic strife and
the added element of the COVID pandemic has made the wealth gap even worse.
HANCOCKS: Social disparity mirrored in Oscar winning Korean film Parasite. Film experts say that content from South Korea with its turbulent history
of war and military dictatorship traditionally carries a strong political message.
HYE SEUNG CHUNG, PROFESSOR OF MEDIA STUDIES, COLORADO STATE UNIVERSITY: Media is not just means of entertainment, like in the United States or in
the West. Or media has been always considered a very important tool for political incitement or political resistance.
HANCOCKS: But it's not all politics.
HYE: It is still relatively cheap to produce some dramas in South Korea compared in America. In the Squid Game, each episode cost less than $2
million which is half of the price Netflix invested in each episode of House of Cards.
HANCOCKS: And the younger generation is far more open to foreign language content.
JASON BECHERVAISE, PROFESSOR OF ENTERTAINMENT, SOONGSIL CYBER UNIVERSITY: If you look at those who watch Parasite, a big number of the kind of
audiences, or the audience that went to see Parasite in the United States was younger people. And they were -- they've been really keen to kind of
break that one-inch subtitle barrier.
HANCOCKS: The success of squid game is already helping other Asian content to trend on Netflix while other streaming platforms are looking to
replicate this enormous success. Paula Hancocks, CNN Seoul.
KOSIK: Sustainable building practices are driving this year's Expo 2020 World Fair in Dubai. With that in mind, some of the country's pavilions
have been constructed to remain on site long after the expo ends. Eleni Giokos explains.
ELENI GIOKOS, CNN CORRESPONDENT (voice-over): At Expo 2020 legacy has been at the center of every planning decision. And it's at the Moroccan
pavilion, where you'll find the idea of legacy everywhere. Taking inspiration from its ancient villages using rammed earth construction
techniques. Its pavilion merges the classic and the contemporary.
TARIK OUALALOU, ARCHITECT, MOROCCAN PAVILION: Rammed earth construction is really the oldest construction technique that humans ever used. What we
wanted to do is to lift this tradition from the vernacular into almost an industrial dimension to propose rammed earth as an alternative to concrete.
GIOKOS: As the tallest country pavilion. It is also according to its designers, the largest rammed earth facade of its kind.
OUALALOU: It's built like a village, it's 22 houses stacked on top of each other. It's a building experience where all of these houses are connected
through a single winding Street. To building that has 10 gardens that show all of the ecosystems of Morocco.
GIOKOS: Standing as a country pavilion for now, in six months time, it will take on another lease of life.
OUALALOU: We've actually designed two buildings in one, this will be transformed as housing, which is your reason why we've developed this
notion of a village.
OUALALOU: Each of these volumes that you see will transform into apartments. Then the sense of community we're creating will then last
GIOKOS: And leaving a lasting legacy, Morocco won't be alone. As the whole Expo site has been planned as a future and smart city.
AHMED AL KHATIB, CHIEF DEVELOPMENT AND DELIVERY OFFICER, EXPO 2020: We are leaving an entire city as a legacy of Expo. A city that is totally
redefines urban planning is totally redefines the sustainability, minimal use of water, different ways of building roads from recycled tires. The
layer of technology is extremely beyond any other cities across the world.
GIOKOS: Leaving behind one of the world's most technologically advanced cities, Expo 2020 is hoping it will continue to drive innovation long after
its welfare ends in six months time. Eleni Giokos, CNN Expo 2020, Dubai.
KOSIK: There are just moments left to trade on Wall Street. We'll have the final numbers and the closing bell right after this.
KOSIK: There are just moments left to trade on Wall Street. Here's how the Dow is doing. It's been pretty much a flat day to day after a jobs report
that was weak but wasn't weak enough to change expectations about the feds tapering policy. Surging energy prices that's also been weighing on
investors' minds. Let's look at the Dow components. These were some of the day's weakest or some of the day's biggest winners and losers.
There were gains for Chevron as oil prices rose. Home Depot is in the red a couple of days after announcing it will hire local delivery drivers from
Wal-Mart. Merck and Verizon are also down. And this was the picture in Europe. Stocks ended the week mixed. There were gains on the FTSE but
elsewhere, stocks were down or flat. An end to a turbulent week for markets all around. That's it for the show. Be sure to connect with me on Instagram
and Twitter at Alison Kosik.
The closing bell is just about to bring on Wall Street and "THE LEAD" with Jake Tapper starts right now. I hope you have a great weekend.