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Quest Means Business

Major Averages Lower Despite Strong Jobs Report; Tourism Sector Feels Inflation Squeeze; African Union Leaders Meet With Putin To Discuss Grain Blockade; Queen Elizabeth Misses Thanksgiving Services At St. Paul's; Prince Harry And Meghan Cheered, Booed By Jubilee Crowd; Consumers Expected To Spend $356M On Jubilee Goods. Aired 3-4p ET

Aired June 03, 2022 - 15:00   ET

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

[15:00:20]

ALISON KOSIK, CNN BUSINESS HOST: It's an ugly end to a volatile week for the markets. The Dow is near session lows as we enter the final hour of

trading for the week.

The NASDAQ seeing the biggest losses here, down about two and a half percent. Those are the markets and these are the main events.

Good news for the labor market is bad news for Wall Street. Stocks tumble as strong jobs numbers raise expectations for more Fed tightening.

Elon Musk says he's got a super bad feeling about the U.S. economy and warns of layoffs at Tesla.

And as the conflict in Ukraine marks its 100th day, the Biden administration may be turning to Saudi Arabia to help ease the global

energy crisis.

Live from New York. It's Friday, June 3rd. I'm Alison Kosik, in for Richard Quest and this is QUEST MEANS BUSINESS.

Good evening.

Tonight, U.S. President Joe Biden says the country's latest jobs numbers show a strong stable economy, markets though, they appear to disagree. All

three major indices are lower. They're set to give back some of yesterday's gains that we saw even though job growth beat expectations. The U.S. added

390,000 jobs in May. That's slightly lower than in recent months.

Mr. Biden says it's a sign the U.S. economy is entering a new phase.

(BEGIN VIDEO CLIP)

JOE BIDEN (D), PRESIDENT OF THE UNITED STATES: And as we move to a new period of stable, steady growth, we should expect to see more moderation.

We aren't likely to see the kind of blockbuster job reports month after month, like we had over this past year, but that's a good thing. That's a

sign of a healthy economy with steady growth, rising wages for working families, everyday cost easing up, and shrinking the deficit.

That stability puts us in a strong position to tackle what is clearly a problem inflation.

(END VIDEO CLIP)

KOSIK: I never have seen CEOs have expressed their anxiety about slowing growth, inflation, and the direction of the U.S. economy.

Reuters saying Elon Musk sent an e-mail to Tesla executive saying he has in his words, a super bad feeling about the economy.

And he's not alone, at a conference this week, Jamie Dimon of JPMorgan Chase told analysts to brace for an economic hurricane. Goldman Sachs'

President John Waldron says tough times are ahead.

Let's get to Rahel Solomon, she is live for us in New York. Rahel, great to see you. You know, it's interesting to see the richest man in the world,

also having this anxiety being concerned about where the economy is heading and he is not just taking out his crystal ball and saying it, he is

actually taking action. It looks like layoffs are in Tesla's future.

RAHEL SOLOMON, CNN BUSINESS CORRESPONDENT: Yes, it does look like that, right, Alison. And we've seen that across some other tech industries as

well, that layoffs could be on the way.

It almost feels as if it is a whisper that is growing louder about the "R" word or recession, right, where the clouds to borrow from Jamie Dimon's

expression, the clouds are growing darker.

Let's take a look at the jobs report though and put that in perspective in terms of the larger economy. So the 390,000 it was slightly cooler than we

have been seeing, the average has been about 400,000. It is however, the lowest number we have seen in the last 12 months. So that is a sign of some

slight cooling in the economy.

When we look at where the jobs are, broad-based, Alison, leisure and hospitality adding about 84,000 jobs in May, professional and business

services 75,000, and transportation and warehousing 47,000. There is certainly a lot of pessimism, certainly with inflation being as high as it

has been and has been. Inflation of course, the elephant in the room in the midst of this strong jobs report.

But look JPMorgan, we also spoke with JPMorgan this morning, one analyst telling us that the jobs market and the unemployment rate hovering around

3.6 percent, which it has been at for about three months now could actually be a positive sign for the Fed and its outlook for raising rates. Take a

listen.

(BEGIN VIDEO CLIP)

MICHAEL FEROLI, CHIEF U.S. ECONOMIST, JPMORGAN: To the extent we didn't see that further decline in the unemployment rate, it may reduce some of

the odds that they have to go 50 or half percent in September. And to the extent the Fed can go a little more gradually that would reduce some of

those recession odds --

(END VIDEO CLIP)

SOLOMON: And Alison, I think, gradual is the right word. That's sort of what the market is hoping for. Right? I think everyone can agree that

inflation is far too hot. But can the Fed pull off this soft landing as it is often called, essentially raising rates without tipping the economy into

a recession? And a sign of gradually easing, it could be the way the Fed does it.

KOSIK: And then it's what everybody is wondering. Rahel Solomon, thanks so much.

[15:05:10]

Michelle Meyer is the Chief U.S. Economist at Mastercard Economics Institute, and she joins us from New York.

Great to see you. And I want to hear your initial reaction to the May jobs report. What do you think it says about the economy?

MICHELLE MEYER, CHIEF U.S. ECONOMIST, MASTERCARD ECONOMICS INSTITUTE: Well, the labor market is still very strong 390,000 jobs created is an

impressive pace of job creation. So we still have a lot of momentum in the economy. Is it starting to show some signs of slowing from the exceptional

growth rate we had throughout last year? I would say yes, but really only on the margin.

So it's an economy that was you know, running really, really, really hot, stimulus induced, starting to see this rebalancing, this normalization of

growth. But there's a long path ahead, before we're at a proper equilibrium in the economy.

KOSIK: Don't we want to see consumers pull back on spending? And are we seeing it yet? We did see consumer confidence slip in May.

MEYER: Well, what we want to see is an economy that's functioning properly, where at the simplest demand is matched with supply. So the

amount of goods and services that consumers are looking to spend on that there's an appropriate amount of supply for that. And the problem is, is

that that's been a big imbalance, there's been way more demand that there has been supply because of supply chain issues, because of this mismatch in

terms of how consumers were spending post COVID period.

So we want to see these things come together. We want supply to pick up, but also some moderation to me and it is quite appropriate in terms of

trying to ease back some of this inflation pressure that's built because of this disequilibrium in the economy.

KOSIK: Do you think some of this talk about a recession becomes a self- fulfilling prophecy where you hear the heads of big banks talking about it, you hear about inflation every day and the impact it has on the economy? At

what point is the consumer pullback, you know, too much where it does go ahead and put the economy in a recession?

MEYER: Well, I think what you're getting at is this idea of behavioral elements of the economy, behavioral economics, where you know, animal

spirits really matter. Consumers are trying to plan ahead for what their wages might look like, what their wealth might look like, and what their

future purchasing power will be.

So they're taking into account a lot of different factors, and they are trying to determine, what is their job security? You know, how much can

they be spending? How much should they be saving? So you know, if you look at the Consumer Sentiment surveys, University of Michigan being one,

Conference Board being another, sentiment is down from the high, there is concern out there.

But you still have an environment where consumers have a lot of savings on their balance sheet, they have access to take on more debt, and those

dynamics are playing a role and continue to support spending.

So I think that there is an awareness, there's a concern out there, but at the moment, you still have a very strong trajectory for spending.

KOSIK: Yes, your numbers from SpendingPulse, the measure of sales in stores and online retail sales of all forms of payment, they show that

retail sales actually increased.

MEYER: That's exactly right. And so thank you for flagging that. Mastercard SpendingPulse has been very strong. And you know, there are

shifts happening. You're seeing more spending in store, especially in the last few months where the online sales activity has stalled out a bit more

after, again, a period of exceptional growth.

You're certainly seeing this reengagement in travel and lodging. We just recently published a comprehensive piece in the state of travel, which is

the data we're looking at shows it is still very, very strong.

So there's these changes happening certainly within the profile of how consumers are spending, but the aggregate numbers show there is still a lot

of power out there to continue to go out and spend.

KOSIK: All right, Michelle Meyer, Chief U.S. Economist at Mastercard Economics Institute. Great to have your analysis.

MEYER: Thank you.

KOSIK: The hospitality industry added more jobs last month than any other economic sector. It comes as hotels, bars, and restaurants begin to recover

from pandemic losses. The hospitality sector added 84,000 jobs last month.

Leisure and hospitality still remains 1.3 million jobs though below pre- pandemic levels.

The tourism industry being squeezed on two fronts. Inflation is hurting tourists, pocketbooks, and finding workers to fill new jobs is becoming

increasingly challenging.

Vanessa Yurkevich has more.

(BEGIN VIDEOTAPE)

BRIAN KNOEBEL, CO-OWNER, KNOEBEL'S AMUSEMENT RESORT: We've got a steam powered carousel and a food stand and a couple of games of chance. And

little by little, we're now 60 rides.

VANESSA YURKEVICH, CNN BUSINESS AND POLITICS REPORTER (voice over): Since 1926, Knoebel's Amusement Resort in rural Central Pennsylvania has been a

summer tourist destination.

[15:10:05]

KNOEBEL: See the train slowing down so there should be some squirrels over here.

YURKEVICH (on camera): Little chipmunks, oh, little chipmunks.

YURKEVICH (voice over): The park is free to enter and rides like the Pioneer Train are pay as you go, but even prices at this family-run park

surrounded by idyllic farmland aren't exempt from high inflation.

KNOEBEL: The rising cost of everything from gasoline, to chicken, to rolls, electricity, we had to increase our prices.

YURKEVICH (voice over): Inflation is gripping the nation's pocketbook with prices at a four-decade high. A pain point for President Biden as most

Americans are sour on the economy.

Still an estimated 39 million Americans were expected to travel Memorial Day weekend, most by car up from last year.

KNOEBEL: When I hear inflation, that is where we're going to spend our ad dollars more locally. So that's where we're going to be focusing on the

backyard tourists, the locals. We will spend more reaching people within a two to three-hour range.

YURKEVICH (voice over): People like Rebecca Kent, who usually makes a day trip from Philadelphia. She says gas prices won't cut her summer plans.

They'll just be scaled back.

REBECCA KENT, TOURIST: The one year we were coming up here, I think we made it up here 26 times in the summer.

YURKEVICH (on camera): Do you think you're going to dial it back a little bit?

KENT: Not 26, but probably pretty close to a dozen or more.

YURKEVICH (voice over): Valerie Bloom says she's being mindful of higher prices elsewhere like groceries so she can still give her kids a great

summer, meaningful after two years of COVID.

VALERIE BLOOM, TOURIST: What are you going to do? I mean, like you've got to live. You've got to have, yes, fun in the summertime.

YURKEVICH (voice over): But more customers means the need for more workers. Despite rising wages, labor shortages persist with a near record

11.4 million open jobs in the U.S., and inflation is hitting employees here, too. So the park is launching a cost effective shuttle to save

employees gas money and ensure the park is staffed.

KNOEBEL: So it's more money on the employees' pockets.

YURKEVICH (voice over): In smaller communities, places like this are economic drivers, supporting other businesses in town.

KIMBERLY COOPER, DOLLAR GENERAL MANAGER: For our success here in town, it is pretty critical. All of our sales will go up once they start.

YURKEVICH (voice over): And despite also having to raise prices in store, Kimberly Cooper says the crowds are still coming and buying.

COOPER: It doesn't seem to have made a difference here so far this year.

(END VIDEOTAPE)

KOSIK: One hundred days into Russia's war on Ukraine, President Zelenskyy says his country will be victorious over Vladimir Putin's troops.

Next, the heavy toll the invasion is taking on Ukraine and how it is impacting the entire world.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

[15:15:32]

VOLODYMYR ZELENSKYY, UKRAINIAN PRESIDENT (through translator): We have been defending Ukraine for 100 days, victory shall be ours. Glory to

Ukraine.

(END VIDEO CLIP)

KOSIK: Ukrainian President Volodymyr Zelenskyy vowing his country will ultimately defeat Russian forces, but months of fighting has taken a

devastating toll.

The International Red Cross says the scale of destruction defies comprehension, and the U.N. Refugee Agency estimates one-third of all

Ukrainians have been forced to flee their homes.

The Kremlin says after 100 days, certain results have been achieved and that the war will continue until all its goals are met.

It may not have been Vladimir Putin's goal to upend the global food supply, but his war is doing just that. President Zelenskyy says 22 million tons of

grain, nearly half of the country's grain export supply is being held up by Moscow's blockade in the Black and Azov Seas.

The head of the African Union is meeting with Putin today asking that he release those shipments which are desperately needed in Africa.

Our David McKenzie is following this story from Johannesburg and he joins us live.

So David, I'm wondering first of all, good to see you -- I'm wondering what's the likelihood that Putin will go ahead and open the ports to allow

these shipments through?

DAVID MCKENZIE, CNN INTERNATIONAL CORRESPONDENT: Alison, I think, in the short term, that's probably unlikely, but that certainly was the push from

the head of the African Union and President of Senegal in the meeting with Putin in Sochi on Friday, and I think it's significant because many

countries in Africa and parts of the Middle East and Central Asia are very heavily dependent on grain from both Ukraine and from Russia.

And because of this conflict, and that blockade that you described, that grain is not getting out, certainly not from Ukraine and from Russia, there

are complications because of the sanctions put in place. Just earlier this week, the head of the African Union was complaining about the sanctions on

particularly the SWIFT payment system, which they say are complicating exports out of Russia of both grain and sunflower oil and fertilizer into

the African continent.

Several countries in Africa, particularly North Africa, and the Horn of Africa, some of which, for example, Somalia, 90 percent of their wheat

needs are maintained from Russia and Ukraine. So, this conflict as it drags out is having a potentially very big impact on global food security.

Now at that meeting, in the readout from the Kremlin, they said that the head of the African Union was calling for that blockade to be eased, but

also, there is a sense of some chinks in the armor of the united front against Russia because while NATO is pushing these sanctions and these

actions and arms shipments to Ukraine against Russia, the African continent is much more ambivalent, on average, against Russia on this.

And this meeting itself showed that Putin still has people willing to talk to him, including the head of the African Union. So that is a significant

coup, I guess, for the Russian side of this.

In the short term, you're going to see a rise in prices, say economists because of the squeeze on the grain supply in the medium to long term if

this conflict should, drag up for several more months. You could even find an impact on the supply of food to these countries, and on the back of an

increased inflationary environment, this is potentially very dangerous for many countries in this region, and that is why the head of the African

Union is there in Russia to try and persuade Putin to ease off on some of those restrictions that they've put in place with the conflict -- Alison.

KOSIK: Okay, David McKenzie, live for us from Johannesburg. Thanks very much.

A food crisis isn't the only global problem stemming from the war in Ukraine. There's also a growing energy shortage that could reshape U.S.-

Saudi relations.

Sources tell CNN that U.S. President Biden and Saudi Arabia's Crown Prince could meet in the coming weeks. Mr. Biden has been critical of the Saudi

government. In 2019, he said the country should be made a pariah because of its human rights record. He may need to change that stance as he looks for

new sources of energy and for help isolating Russia.

Speaking to reporters, Mr. Biden did not rule out a visit to Riyadh during his upcoming trip to the Mideast.

[15:20:10]

(BEGIN VIDEO CLIP)

BIDEN: I'm not sure whether I'm going. I have no direct plans at the moment. But let me tell you that I have been engaged in trying to work with

how we can bring more stability and peace in the Middle East.

I'm not going to change my view on human rights, but as President of the United States, my job is to bring peace if I can.

(END VIDEO CLIP)

KOSIK: CNN's Matt Egan joins us now. Matt, good to see you.

So this word of a U.S.-Saudi meeting, what is it looking to accomplish here? What can it achieve?

MATT EGAN, CNN REPORTER: Well, Alison, I think, in a lot of ways, this shows the difference between campaigning and governing because candidate

Biden did say he wants to make Saudi Arabia, a pariah in particular over the human rights issue and the murder of "Washington Post" journalist,

Jamal Khashoggi, U.S. intelligence has assessed that the Saudi Crown Prince approved of the operations to kidnap or kill the journalist.

And so that's what candidate Biden was upset about, but President Biden is acknowledging that he may very well meet with Saudi leaders, and a lot of

this does have to do with the fact that we're dealing with record high gas prices in the United States and a 40-year high of inflation.

You know, Saudi Arabia is the leader of OPEC, and one of the reasons why gas prices are so high here is that OPEC has been slow to return the supply

that it took offline in the spring of 2020. And so that is clearly a driving force here.

But you know, there is no secret that it has been pretty frosty relations between Washington and Riyadh during the Biden era, but there are the signs

of a thaw in this tension now, because we have -- we've had a series of U.S. officials go into Saudi Arabia, Saudi officials coming to Washington,

and then a big moment yesterday, when OPEC finally announced that it will ramp up oil production.

I mean, it hasn't really done anything to cool off oil prices. In fact, U.S. oil just closed at the highest level in nearly three months. But it is

important symbolically, and perhaps a sign Alison, that, you know, ties between the U.S. and Saudi Arabia are going to improve, if not for

idealistic reasons, for realistic reasons. And, you know, concerns about the economy.

KOSIK: And as you said this increase of oil supply coming out of the Saudis, really more symbolic than anything. And now we have officials

warning of a 1970-style energy crisis. I mean, how bad could this get? Could it get to those long lines that as kids, we remember seeing?

EGAN: Let's hope not, Alison, you know there are growing concerns about an energy shortage. We've already had spiking oil prices, gasoline, diesel,

jet fuel, natural gas, a big one, and even coal. And the head of the IEA was out earlier this week telling a German media that he is worried about

an energy crisis that would actually be worse than the 1970s.

And I reached out to former and current energy officials to see what they thought about this and I was alarmed by how alarmed they were. Because all

of them pretty much said, yes, we are concerned about this. The problem is that, you know, it's not just oil today, it is also a natural gas shortage

and there are electricity issues. And the concern is that the war in Ukraine, on top of years of underinvestment in the energy industry, are

going to cause some major problems here.

I talked to Joe McMonigle, the Secretary General of the International Energy Forum, and he said, quote, "We have a serious problem around the

world, and I think policymakers are just waking up to it. It's kind of a perfect storm."

And you know, there are major consequences here if this energy crisis gets worse, because you have to worry about social unrest, implications for the

climate crisis, and, of course, the economy and inflation.

Economist Mark Zandi, he told me today that he is feeling better about the economy, but the one catch he said would be if oil prices go up $150.00 a

barrel because he said at that point, all bets are off, and unfortunately, we would head into a recession.

KOSIK: Well, all right, Matt Egan, thanks for all of that great context.

EGAN: Thank you.

KOSIK: India ramped up Russian oil purchases last month and shows no signs of slowing down. It's one of the few major economies still buying Russian

energy, helping shield the Kremlin from international sanctions.

Anish Shah is CEO of the Mahindra Group, the automotive and technology conglomerate. He spoke with Richard Quest last week at the World Economic

Forum in Davos.

(BEGIN VIDEOTAPE)

ANISH SHAH, CEO, MAHINDRA GROUP: I view India as very well-poised today. The government is being very proactive on a number of fronts. We've seen

various challenges over the last two years, but India has dealt with them very well as we look at demand from consumers across 20 industries that we

are in.

We are seeing a fairly strong demand, things really haven't impacted the consumer as much, despite the high commodity prices, despite some level of

inflation, though inflation in India hasn't gone up as much as it has in some of the Western countries, so all of those things bode well for India

right now.

RICHARD QUEST, CNN BUSINESS ANCHOR, QUEST MEANS BUSINESS: Which begs the question yet, it hasn't gone up yet. But if, for instance, the U.S., Europe

all slow down, higher energy costs, higher inflation in those countries, and you start to see that in other parts of Asia, you won't be able to

withstand those pressures.

SHAH: We will obviously feel them. So, it hasn't gone up as yet, you're right about that. But there have been a number of proactive actions taken

already. The Central Bank has raised rate 40 basis points, the government has taken a number of different actions to help bring down prices across a

whole series of goods.

And therefore, my sense is that will help. But beyond that, what we sense at least, is that the underlying demand is fairly strong. Now, if

geopolitical issues last longer, we will have much more problems.

But assuming the world gets to a better place in the next three months, I would say that India is very well positioned, I'm cautiously optimistic.

QUEST: Of the geopolitical issues, the war, obviously is the most prominent and the most distressing. But you also have, for example, the

lockdown in China, which continues, and you have the issues with Russia generally. Which of them do you see as the risk for you and your company?

SHAH: I would say that anything that's prolonged is a risk.

QUEST: Right.

SHAH: So the lockdown in China, if it's again, for a reasonably short period, there are buffers and backups that can take care of it. If it

becomes more prolonged, then we will see more supply chain disruptions.

QUEST: So those supply chain disruptions that we're already seeing, how damaging are they to you?

SHAH: Today, they've eased up significantly. So it's about 10 to 15 percent of our auto production that's impacted by it. During the COVID

days, there were a couple of months where it was much worse and part of it is because there was a single dependence on certain plants that made

semiconductors, and a part of it also is that our teams have found a way to find alternate options.

QUEST: So you took office at the beginning of the pandemic, what have you learned?

SHAH: What I've learned is that the VUCA world was an understatement, right? We are in a much crazier world, we have to be prepared for shocks,

you've got to be resilient about it. Think of various what if scenarios and make sure that we are ready to address them.

QUEST: But you can't think of the what-ifs. Can you have a what-if? What if something happens that I have no idea what if?

SHAH: And we do talk about that as well. Right? Because the most damaging things are things that you don't think of today.

QUEST: What did you learn about yourself during the pandemic? You're obviously top executive, senior executive, but you find his role. During

the pandemic, we all had a moment of introspection. We all had a moment where we thought either, I can't do this or I can do this. I need to learn

this. What did you learn about yourself?

SHAH: What I learned about myself is that you have to focus on the present. There is no point thinking about it could have been this way or if

things had happened this way. You have to think about the present. You have to think about options you have at hand and make a decision on that.

Yes, there will be consequences of that, things can get worse at times, but all you need to do is think about the present.

(END VIDEOTAPE)

KOSIK: The U.K.'s Platinum Jubilee celebrations are missing the star guest, Queen Elizabeth II sat out today's Thanksgiving Service and the

Palace says we won't be seeing her tomorrow either.

What we know, after the break.

(COMMERCIAL BREAK)

[15:32:16]

KOSIK: Welcome back. I'm Alison Kosik. Day two of Queen Elizabeth's Platinum Jubilee celebrations is carrying on without her. Her family

attended the Thanksgiving service at St. Paul's Cathedral while she watched it on T.V. from Windsor palace. Buckingham Palace said the queen

experienced some discomfort during Thursday's act -- festivities. It says the queen will also forego attending the Epsom Derby on Saturday.

Prince Harry and wife Meghan Markle did attend Tuesday -- today's service. It was their first public appearance in Britain since stepping down for

moral duties. Max Foster joins me now from the festivities in London. Max, great to see you. You know, the celebrations obviously going on without the

queen. It's raising questions though about her absence, about how much longer she'll actually play an active role in public life.

MAX FOSTER, CNN ROYAL CORRESPONDENT: Yes. They're literally taking it day to day now. So we've heard that they are canceling the Epsom races and

she'll carry on princess and will go in her place. So, that's typically what's happening now. She's not going to go to the races and she's really

disappointed about that because she's going to watch it on TV just as you watch the Thanksgiving service today on T.V. at Windsor Castle.

It's pretty clear that she's not going to be able to make the concert which is going to happen at the palace behind me tomorrow night either.

Rehearsals currently underway, a big extravaganza outside Buckingham Palace, but she doesn't live at Buckingham Palace anymore, require her

coming into town from Windsor and then sitting through a long concert. And, you know, if she over exerted herself yesterday on the balcony, I think

everyone's decided probably the medical device decided that she won't be able to sit for a longer concert.

They don't want to take any risks with her. She doesn't want to take any risks. But it's pretty clear she wanted to come to all of these events.

She's disappointed not to go to them. But there's no sense of concern about her health. I think this is just a 96-year-old having to be careful and

pulling back when she's overdone it and I think that happened yesterday.

KOSIK: Max, Meghan and Harry, does this represent a thawing of relations with the family as they make this appearance?

FOSTER: Well, it's difficult to tell. They've always kept a strong relationship with the queen and this is a key moment in the queen's reign.

They came over in reverence for the queen really. It must have been quite difficult for them to walk into St. Paul's today. They haven't appeared

together as a couple at a royal event since -- for a couple of years since they left their royal roles.

And there they were right in the middle of it again, walk down that very long aisle. Everyone's heads was turning around. People have been quite

judgy about them and the impact they've had on the British monarchy, but they're quite boldly went into that event. They didn't interact with senior

royals and the tension if there is any is with senior royals namely Prince Charles and Prince William.

[15:35:04]

FOLLMAN: We didn't see them interacting. They were with more junior members of the royal family who we know they've got -- continue to get a

relationship with. And also Charles and William are right at the front because they are representing the queen. So, clear detachment there. You

know, whether or not there are meetings behind the scenes, which will work towards the thawing of the relationship. We don't know.

I think if they're happening, we'll probably find out later on in the weekend. We don't know whether or not we'll see the Sussexes again during

these events. We're also finding out that that day to day. It's all very sensitive, but so far, I think the queen could be pretty pleased with how

it's played out.

KOSIK: OK. Max Foster, thanks for breaking down all the activity going on there at the Jubilee. The queen's Jubilee is making a global splash and

companies are intent on cashing in. In the U.K. alone, consumers are expected to spend $356 million on Platinum Jubilee goods. Memorabilia

ranges from the classic tea cup to much more bespoke items. Here we have a jubilee refrigerator by Samsung, a Barbie doll of the queen and even royal

Krispy Kreme Doughnuts to keep those who do eat them.

Hmm. U.K. pubs are also getting a boost as Britain celebrate. The industry anticipates nearly half a billion dollars additional sales over the long

weekend. Ethan Boroian is an ambassador for Moet Hennessey's U.K. branch. The spirits company is releasing a limited edition champagne bottle in

commemoration of the queen's Platinum Jubilee. Welcome to the show, Ethan.

ETHAN BOROIAN, AMBASSADOR, MOET HENNESSEY: Alison, thank you so much for having me. I'm delighted to be here.

KOSIK: And, you know, what better time to have a glass of champagne than during the Jubilee. You know, how important is it for Moet to carry on this

tradition with the Jubilee in its creation and release of Moet and Chandon Imperial Brut Platinum Jubilee Limited Edition bottle.

BOROIAN: Absolutely. Well, for us, this isn't really something too new. You know, we've been associated with royalty since the beginning of the house.

You know, since the house was founded in 1743. We were actually one of the official suppliers to the Royal Court of France by 1748. Now our story with

the U.K. happens a little bit later in 1893 when we were warranted the royal warrant and continuously renewed ever since.

We've made very special bottles of champagne for what we would call Coronation Cuvees for King Edward VII, for King George V, for King George

VI. And of course in 1953 for Queen Elizabeth II.

KOSIK: I'm curious how the Jubilee edition of your champagne is helping to drive overall sales for the brand. And also, just in general, because I

know you've partnered up and branded many champagnes, depending on, you know, the events. What's been your best selling edition?

BOROIAN: I think time will tell, you know, in terms of Jubilee editions that we've had, this is -- this is -- again, this is our current edition

that we've created. The first would be the silver jubilee edition that we launched in 1977. We also had the Golden Jubilee edition which we launched

in 2002. And then more recently, we actually had the Diamond Jubilee which I actually have here. And this was to celebrate the 60th anniversary of the

reigning monarch.

And then more importantly, today, we actually have the Platinum Jubilee Cuvee to celebrate the 70 years. So, I think time will tell with sales, but

it's just fantastic to see that with Moet and Chandon which is the champagne of celebration and the most loved champagne brand in the world

that hopefully will be spreading the joy and love and with many glasses of champagne raised to the queen over the weekend.

KOSIK: Ethan, something tells me that I think everywhere you go you take a bottle of champagne from Moet with you. I feel like you never show up

without a bottle of champagne. I'm curious if you know the exact brand that the queen is using to toast her Platinum Jubilee. And, you know, is it

champagne? Is it sparkling wine?

BOROIAN: I'm most certain that there will be some champagne in her glass over the weekend. And hopefully it will be Moet and Chandon.

KOSIK: You know, there is this huge relationship and unique relationship between champagne and royalty as you explained. But what about trying to

get consumers to try to enjoy champagne not only on milestone occasions?

BOROIAN: Well, again, this is something that is -- that we've been doing for many years now. When we think of champagne, we think about the drink of

celebration, of course, but it's also been an incredible milestone for amazing things. You know, your job promotions, your engagements, your

weddings, these are just friends getting together. I think that we're seeing more and more people enjoy champagne and more of a relaxed fashion

rather than saving it for let's say a Thanksgiving or Christmas because it's delicious wine at the end of the day.

KOSIK: OK. I appreciate your time today and it's nice to know that you sort of move around with lots of bottles of champagne, Ethan Boroian. Thanks

very much for coming on the show today.

BOROIAN: Alison, thank you so much for having me.

KOSIK: And let's take a quick market check before we go. Now that we got the jobs report for May, earlier today we did see the Dow turn red -- into

the red as it continues. The Dow down 315 points.

[15:40:02]

I think you're seeing investors concerned that it was actually a strong jobs report and there is concerned that they will not see any kind of pause

in the Feds raising of interest rates. And this of course is a reversal from the gains that we saw earlier in the week.

And that's QUEST MEANS BUSINESS. Go ahead and follow me on Instagram and Twitter at Alison Kosik. I'll be back at the top of the hour as we make a -

- the dash to the closing bell. Up next, Marketplace Europe.

(COMMERCIAL BREAK)

[15:58:34]

KOSIK: Hello. I'm Alison Kosik. It's the dash to the closing bell and we're just two minutes away. Wall Street is shrugging off surprisingly strong

U.S. jobs growth, which could lead to more tightening by the Fed. The Dow is down almost a full percentage point actually over one percent. It said

to close lower on the day and on a shortened trading week. The NASDAQ is suffering the worst of it. Tech is leading the downward charge.

Apple shares down more than four percent. The S&P 500 is down over 70 points. Investors have suffered through weeks of market volatility driven

by growing uncertainty about the economy. MasterCard's Michelle Meyer told me where she hopes it's headed.

(BEGIN VIDEO CLIP)

MICHELLE MEYER, MASTERCARD CHIEF U.S. ECONOMIST: What we want to see is an economy that's functioning properly where at the simplest demand is matched

with supply. So, the amount of goods and services that consumers are looking to spend on that there's an appropriate amount of supply for that.

And the problem is is that it's been a big imbalance. There's been way more demand that there has been supply because of supply chain issues. Because

of this mismatch in terms of how consumers were spending post-COVID period.

(END VIDEO CLIP)

KOSIK: All right. Let's go ahead and take a look at some Dow components that caught our eye today. Energy seems to be defying the downward trend

that says oil prices go up. Chevron is up about a point. It's not a great day for bank shares though. We're looking at shares of Goldman Sachs down

more than 1-1/2 percent. Shares of JPMorgan Chase, they're down almost a whole point. Retailers oh yes they're feeling the hurt as well.

[16:00:08]

Looking at shares of Nike and shares of Wal-Mart, they are down heavily as well. Lots of red on the screen. And that's your dash to the closing bell.

I'm Alison Kosik. The closing bell is about to ring on Wall Street. "THE LEAD WITH JAKE TAPPER" begins right now. There you go with the bell.

END