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Quest Means Business
Sweden And Finland Receive Invitation To Join Alliance; Secret Service Official Disputes Hutchinson Claim; Norse Atlantic Competes For Summer Travelers; Central Bankers Say High Inflation Here To Stay; IAC Chairman Slams Predictions Of Recession; Call To Earth: BirdLife; Aviation Challenges; Profitable Moment. Aired 3-4p ET
Aired June 29, 2022 - 15:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
RICHARD QUEST, CNN BUSINESS ANCHOR: Look at the markets and you will see a choppy trading day on Wall Street, a bit all over the place.
I mean, the graph doesn't really show that sort of the full magnitude in a sense, but we are up now, a fifth of a point, 65, whether we hold that or
not, who knows? Not huge, massive changes.
The markets and the events of the day are dramatic in a sense.
An historic expansion for NATO, Sweden and Finland now formally invited to join NATO.
Jerome Powell is warning the geopolitical divisions are going to slow down global growth.
And a new low cost carrier is now part of the transatlantic fray. There is it is Norse flying the Atlantic. The CEO of Norse Atlantic joins me live
We are in London tonight, but I'm in London anyway, Wednesday, June the 29th, I'm Richard Quest, and in London, I mean business.
Tonight, NATO stands on the cusp of its most consequential expansion in decades. Leaders at the NATO Summit in Madrid have now officially invited
Finland and Sweden to join the Alliance.
The two Nordic countries overcame Turkey's objections to their membership. The US said it will be moving more forces and military equipment to Europe.
NATO branded Russia the most significant threat to our security and its Secretary-General Jens Stoltenberg said the group's unity and resolve is a
rebuke to Moscow.
(BEGIN VIDEO CLIP)
JENS STOLTENBERG, NATO GENERAL SECRETARY: President Putin has not succeeded in closing NATO's door and he is getting the opposite of what he
wants. He wants less NATO, President Putin is getting more NATO by Finland and Sweden joining our Alliance,
(END VIDEO CLIP)
QUEST: Nic Robertson is in Madrid.
Nic, I question the decision by Turkey to allow them to go ahead. It's a sort of a bit of a fudge and a bit misty, isn't it? Because I can't help
feeling that whatever Turkey thinks it's going to get as relates to the PKK and all these other things, Sweden and Finland may not be on quite the same
NIC ROBERTSON, CNN INTERNATIONAL DIPLOMATIC EDITOR: Yes, we heard from the Finnish President yesterday saying that there was no need to change any of
the national laws in Finland because their laws there already deal with terrorists and terrorist organizations and the PKK that the Turkish
President, President Erdogan said that he wanted their leaders in any of those PKK people residing in Finland or Sweden to be sent back to Turkey to
face trial, internationally recognized terrorist organization, the PKK, it doesn't seem that there's going to be a great deal of change because
they're going to run by -- the Swedes and the Finns are run by the laws that they've had in place for a long time.
And I think there was a sense here, you know, President Biden called President Erdogan, late yesterday, during the conversations that were
ongoing with the Finns on the Swedes, between President Erdogan's Foreign Minister and President Biden's meeting late today, much later time with
President Biden as well, there is a sense from some leaders here that that President Erdogan was really using this situation to gain leverage over
other issues. And that was certainly the view of the Icelandic Prime Minister, Katrin Jakobsdottir, who I spoke to earlier.
(BEGIN VIDEO CLIP)
KATRIN JAKOBSDOTTIR, ICELANDIC PRIME MINISTER: When we said we will support Finland's and Sweden's application, we did that unconditionally,
out of respect for their democratic wishes.
And I think actually, what we have seen is that Turkey has been taking unrelated matters and putting them in as conditions. I think it's -- yes,
that's not the right way.
(END VIDEO CLIP)
QUEST: Nic Robertson, if we look at the totality of events today, Finland and Sweden joining, but NATO also saying it is going to be sending more.
You've got these greater commitments.
In your view, and you've seen this sort of things over the years many times, are we looking at NATO escalation here? Is this a case where the
military involvement is getting larger?
ROBERTSON: That is certainly the way that President Putin is likely to view it from Moscow who has got 101,300 kilometer extra border with NATO.
He's got a much greater presence of NATO troops along his border.
The United States is going to put a headquarters for its Fifth Army in Poland. It is sending two squadrons of F-35 state-of-the-art fighter jets
to the UK. It's moving a brigade to Romania, all the nations here, contributing additional military hardware to make sure that NATO's eastern
flank is shored up. So, certainly that's the case.
But I think even if you look more broadly, NATO leaders here are looking a long way ahead with the strategic reshaping that they're going through.
It's not just Russia they see now, China not as an adversary, but China as a country that is against the values of security and stability of NATO
nations, and they see a greater alliance awakening between Moscow and Beijing, and therefore, what we're witnessing here is a greater
But President Putin will bear the brunt of it in the short term, because he didn't want NATO. That was his whole prerequisite. Less than a year ago,
six months, seven months ago, he said that he didn't want NATO expanding. Well, it's expanded and it's grown and it's got stronger on his border.
And the Icelandic Prime Minister, who I asked what do you think President Putin is going to do next? She said, look, we really don't know. This is
uncharted territory. We can't tell.
I asked her about President Zelenskyy saying he expects the war to be over by the winter, or at least hopes it well, she said again, you know, we just
don't know how this is going to go.
The reality here is we're seeing a much greater polarization and divisions around the world, between nations, major powers, getting cemented here.
QUEST: Nic Robertson, thank you, because as you were saying, as Nic Robertson was saying, NATO may be bringing and closing together and at the
same time that disunity is unraveling economic ties.
Western trade with Russia has now collapsed. India and China have stepped, in taking up the slack to some extent. And then a conference in Portugal,
top Central Bankers discussed this shifting landscape with the US Fed Chair saying long-term costs are on the cards.
(BEGIN VIDEO CLIP)
JEROME POWELL, CHAIRMAN, U.S. FEDERAL RESERVE: If what we see, for example, is the re-division of the world into competing geopolitical and
economic camps, and a reversal of globalization that certainly sounds like lower productivity and lower growth in many parts of this side of that, you
see, you see aging demographics, so a shrinking workforce, and you see economies that are growing more slowly and those workforces are not
So that's certainly a possible outcome, and I think, probably, to some extent, a likely outcome.
(END VIDEO CLIP)
QUEST: Professor Sachs is with me, the Columbia University Professor and Director of the Center for Sustainable Development, author of the book,
"The Price of Civilization."
Jeffrey, I read your views on this and you certainly have some important views in terms of how NATO's expansion has taken place, and in your view,
but now we are where we are and it is a question of getting out of this before any more lives are lost, or what long term economic damage done.
JEFFREY SACHS, DIRECTOR, CENTER FOR SUSTAINABLE DEVELOPMENT: Well, Jay Powell has it exactly right. The world is falling into fragmented groups,
and there will be extraordinarily high costs from this.
The sanctions that the United States and Europe have put on have done a tremendous damage to Europe and the United States and to much of the rest
of the world and we are feeling the brunt of now a strong stagflation, which was the main topic facing the Central Bank leaders that were in
This is likely a hard landing in much of the world coming up in the next months. I think that our foreign policy strategy both towards China and
towards Russia has been provocative and divisive for a number of years. This didn't just start now.
There was already the US trade wars on China, and then the technology wars, the financial sanctions and all the rest. We've divided the world, and now
we're paying a strong, heavy cost for that.
QUEST: Right. Let's put blame where blame lies. Surely, whatever NATO's expansion may have been about in the 1990s, et cetera, it doesn't justify
and I see your views, yes, what Putin did in Ukraine, and there had to be a strong response to that, surely.
SACHS: Of course, but there should have been negotiation in 2021 when Putin said NATO should not expand to Ukraine and Georgia. I would have been
the first one to say "absolutely correct."
Why do something so provide vocative, something akin to the Crimean War back in 1853, we shouldn't be having a Black Sea confrontation, so we
should have been prudent.
Putin said last year, negotiate over the non-enlargement of NATO; Biden said, absolutely not. That's off the table, we are going to expand. We're
committed to having NATO not only in Ukraine, but all the way across to the eastern edge of the Black Sea in Georgia.
This is a huge expansion of NATO. NATO was a defensive alliance of Western Europe against the Soviet Union, a defensive alliance against a country
that doesn't exist, and yet we said it will continue to expand all the way to the eastern edge of the Black Sea and Russia kept saying no, for 30
years, I was there at the beginning, when this discussion started.
Russia was saying don't do that. Gorbachev was saying don't do that. Hans- Dietrich Genscher, the German Foreign Minister in 1999 said, don't worry, we won't move one inch.
Now, this isn't to say that -- this isn't to say that that is what started the war. The war was started by Putin. But the United States has been
provocative. Provocative, also towards China, and my point, Richard, is we're paying a heavy economic cost. That cost is likely to rise. NATO today
is 12.2 percent of the world population, and much of the --
QUEST: But Jeffrey, let me jump in here.
SACHS: Sure, sure.
QUEST: Surely, you can't deny now, however, right that your argument might or might not be, and I'm sure there'll be people who will take issue with
it. But you couldn't deny Sweden and Finland now the right to have the protection of the NATO umbrella having seen what Putin can do.
Bearing in mind, he told us straight to our faces, I have no intention of invading Ukraine, up to the very moment that the tanks went over the
SACHS: What is absolutely remarkable is that at the end of March, negotiations were advancing for a neutral Ukraine, and for an end of the
war, and then Ukraine walked away from the negotiating table at the end of March and the reason is that the UK and the US pressed them, you can win on
the battlefield. You don't have to negotiate non-enlargement of NATO. This was a big mistake.
My point is simply that we need this war to end with Russia leaving Ukraine and NATO saying we're not going to fill in the void. Ukraine is going to be
neutral, and this is how we could also save the world economy, as well as saving Ukraine.
It's very straightforward. Russia needs to leave, but the United States doesn't need to fill in afterwards. That's the basic point. We need a
QUEST: We'll talk more about it. Jeffrey, I'm grateful to have you tonight.
QUEST: Thank you, sir. Always.
QUEST MEANS BUSINESS tonight, we are in London and there is a new competitor on the transatlantic -- Norse Atlantic now flying across. Can it
succeed where its predecessor in kind, Norwegian failed low-cost, long- haul, medium-haul. The CEO is Bjorn Tore Larsen and he will be with us after the break
QUEST: One of the most dramatic parts of yesterday's testimony at the January the 6th hearing was an allegation that President Trump lunged to
grab the steering wheel of a car that he was in, in the Beast and then almost throttled a member of the Secret Service who refused to take him to
the Capitol, but wanting to take him back to the West Wing. It was dramatic and it garnered much attention.
Now, a member of the US Secret Service disputes that claim by the White House aide. He says the aide was not told that former President Trump had
tried to forcefully steer a vehicle to the Capitol that day.
The DHS Homeland Security says agents are prepared to testify under oath that the incident never occurred. The former aide, Cassidy Hutchinson,
well, her version -- she is quite clear about the whole thing.
(BEGIN VIDEO CLIP)
CASSIDY HUTCHINSON, FORMER WHITE HOUSE AIDE: The President reached up towards the front of the vehicle to grab at the steering wheel. Mr. Engel
grabbed his arm, said "Sir, you need to take your hand off the steering wheel. We're going back to the West Wing. We're not going to the Capitol."
Mr. Trump then used his free hand to lunge towards Bobby Engel and Mr. Ornato had recounted the story to me, he had motioned towards his
(END VIDEO CLIP)
QUEST: Brian Stelter, chief media correspondent is with us.
When you have the Secret Service saying those involved are prepared to say on oath, it didn't happen. Her credibility is shot.
BRIAN STELTER, CNN CHIEF MEDIA CORRESPONDENT: I don't know about that. Richard, I think it's time for another hearing. If these agents are going
to testify, let's see them do it under oath and let's find out exactly what they say was incorrect about Hutchinson's claims.
Look, the substance of most of what she presented yesterday is not being challenged or contradicted. However, this claim is, the secondhand claim
that she made, that she shared, apparently is being challenged according to anonymous sources, and now a Secret Service statement saying these agents
are willing to testify.
So we will see if they do testify. But I have to wonder, Richard, if Committee wanted this to happen. After all, they set Hutchinson up to talk
about this secondhand account. Maybe the Committee wants these secret service agents under oath. Maybe this committee wants to hear more from
them, and maybe they think it will actually damage Trump.
QUEST: So much of Hutchison's testimony was secondhand, bordering on hearsay that would not have been admissible elsewhere.
STELTER: It would not have been admissible in some respects in a court of law, but this is not a court of law and I think the focus on her secondhand
experience takes away from what she knew firsthand, that she was in the room where it happened. She was the gatekeeper for Trump's gatekeeper, Mark
Meadows, talking about -- talked about them all by their first names, knew all of the major players.
She did have a lot of firsthand knowledge. However, she is being attacked by the pro-Trump media completely rejected. They are saying her story has
been debunked. They are saying it was meaningless and they are moving on.
So did it change any minds yesterday? Well, not among the pro-Trump media. However, there might be folks on the edges who were persuaded.
QUEST: So let's talk about the edges or the middle, if you will. The hard on the left and the hard on the right are not going to change their views
one jot. But is there any evidence that the middle is starting to reverse?
Look, the whole point of this, let's get down to the brass tacks, Brian, the brass tacks of this is not only what happened, but whether or not what
we're now hearing could scupper Donald Trump in an attempt for him to go for the presidency next time round.
STELTER: Right, and any day that he is in the news with relation to this hearing is a bad day for Donald Trump's political future. Any day that
Merrick Garland of the Justice Department is hearing more about the alleged crimes of 1/6 is a bad day for Donald Trump and his political future.
It's also a good day for Ron DeSantis and others that might want to run in 2024. Bret Stephens, the Republican columnist, the conservative columnist
from "The New York Times," a critic of Trump have said of course, he wrote today, will these hearings start to steer members of the Trump cult away
from the "cult" and deprogram them?
Those are the words he was using, some strong language, but an interesting way to frame this conversation. Are people that are so committed to Trump
ever going to be persuaded? And his suggestion is, maybe not, and I think that's the conventional wisdom.
But there's a big, big group of Republican voters in the United States that may just be tired of hearing about all this. That's certainly what we see
in polling, Richard. We see there are a lot of exhausted people, what I like to call the exhausted majority in both Democratic and Republican
Parties that don't want to hear about the Donald Trump years anymore, and that may be ultimately why this matters.
QUEST: I love that phrase, Brian, "exhausted majority." Thank you, sir.
QUEST: Delta Air Lines is trying to get ahead of the holiday travel woes in the United States by offering free flight changes over the Fourth of
July weekend. Not only can you change your ticket free, but even if the replacement ticket is at a different grade or different booking code,
higher booking code, you can still do it and that's very unusual for flight changes.
You've just got to avoid the holiday period. It's going to be the busiest since before the pandemic.
Summer travel's badly disrupted cancellations, more than 500 flights canceled in the US, 2,000 delays, not much better in Europe, where if
you've lost your bag, as a friend of mine has in Amsterdam, you may not see it again this side at Christmas.
Norse Atlantic Airways has entered the market in time for the surge to low- cost long-haul airline. It began its first flights. It's the newest iteration, I should say, of the old Norwegian. Same senior management or
some senior management, different model, different planes.
This is how the flights look and bearing in mind, we've tried to get this lighter. Norse Atlantic will fly you across one way for $247.00. We
deliberately went for one way, deliberately for one way. Norse will do it for $247.00. United wanted $810.00. SAS which has clearly had a rush of
blood to the head, nearly $2,000.00 and then Delta will do it at $788.00.
So if you're one of those passengers that suddenly has to fly last minute, one way, that's what you get.
Bjorn Tore Larsen is the founder and CEO of Norse Atlantic, he joins me from Arendal in Norway.
I'm going to say what I said last time, I really hope you succeed. I think it's extraordinary, so congratulations.
BJORN TORE LARSEN, FOUNDER AND CEO, NORSE ATLANTIC: Thank you very much.
QUEST: A new airline. Absolutely. Congratulations on getting into the air. Now, you've just got to stay flying. So, what's the next move, sir? What's
the next move?
LARSEN: Well, thank you very much for the congratulations, Richard, and the next move is that we will carry on what we are doing today. We are
bringing more aircraft into the sky and more happy passengers on board.
And as you say, we have very good fares, obviously the best fares, they go first and there is an element of dynamic pricing, so the last seat might be
a little bit more expensive, but it's still a great value for passengers. And we just want to concentrate on exactly what to do.
QUEST: How are you going to avoid the problems over the summer? You know, when large network carriers -- I flew across last night on United for New
York to London. The flight was late out. We arrived okay on time, because of the winds, but you know, you are going to be so much more susceptible to
the vagrancies of the summer problem.
Because if your flight is delayed or your baggage is mislaid, you do not have the depth to recover.
LARSEN: Well, we do. I mean first of all we do have -- we are flying nonstop. So the chances that we lose the luggage is very, very slim. But
should it happen, it's our duty to bring it to you and we have a network that will be able to do that and we have also cooperation with others, so
that portion I think we are not in a worse situation than any others.
And so far, all our flights we have a very good record of not losing luggage.
QUEST: When are you going to address the issue of FID at both ends to try and otherwise you do -- you're relatively limited because for a passenger
buying two tickets that could misconnect et cetera et cetera, luggage and all of that, so when are you -- when this FID become important to you?
LARSEN: Very good question, Richard, and that's going to be the next two or three weeks. We have made arrangements and we are now doing the testing.
So watch out, within at least the second half of July, we are going live with the FID as well.
QUEST: Sir, grateful to have you with us today. I will be trying it out. We will be aboard the aircraft, it was just, the schedule wouldn't allow us
to come on the inaugural, but we will.
We're very much looking forward to flying Norse and we congratulate you again. It is an achievement to be launching an aircraft in any environment
particularly this challenging one. Thank you, sir.
So now, just into CNN, we're learning the sentence for the disgraced R&B singer, R. Kelly, 30 years is what he's been given after being convicted on
nine counts, including racketeering and sex trafficking charges.
In the hours ahead, we will have more details and we will have the reaction, 30 years to R. Kelly -- for R. Kelly.
The central bankers from the world's top economies are facing the same challenge of high inflation. They shared their plans when they gathered in
Portugal. We'll discuss.
QUEST: Hello, I am Richard Quest. Together, we have a lot more QUEST MEANS BUSINESS. I'm going to tell you about the global central bankers meeting in
Portugal. Inflation is their number one bogeyman and how to prevent it becoming entrenched.
And the Turkish -- the new Turkish Airlines Chair and CEO on the airline's recovering fuel prices. You're going to hear from him on tonight's program.
It's only after the news headlines because, of course, this is CNN and here, the facts come first, always.
Ukrainian officials have announced the largest exchange of prisoners of war since the Russian invasion. They said that they secured the release of 144
Ukrainian soldiers, 95 of them have been amongst the defenders of the Azovstal Steel Plant in Mariupol.
They were exchanged for an equal number of prisoners from Russian-backed breakaway region of Donetsk.
Colombia's Truth Commission has completed its landmark report on the government's long war with armed rebels. The report explored the human
rights abuses committed over five decades of fighting. It called for sweeping reforms to the country's military and its war on drugs, which it
had said, helped drive the conflict.
After the biggest trial in modern French history, the only known surviving suspect in the November 2015 terror attacks on Paris has been found guilty
on five charges and that includes murder.
He was sentenced to life without parole, it's the most severe punishment in the French judicial system.
QUEST: Melissa Bell is in Paris for us this evening.
Good evening, Melissa. The details on the verdict, please.
MELISSA BELL, CNN CORRESPONDENT: It was Salah Abdeslam and the sentence that would be handed down that everyone was looking. At remember as you
mentioned a moment ago, this is the only surviving member of that commando of 10 Islamist terrorists that caused those terrible killings.
It was Friday, November 13th, 2015, 130 people died. What we've seen over the course of the last 10 months in this extraordinary trial that has
involved 333 lawyers, more than 1,000 victims, is France go back amid its traumatic events of that night.
Salah Abdeslam had been the subject of a manhunt for months. He'd been captured in Belgium. At the beginning of the trial, he had not spoken
terribly much, apart from claiming his allegiance to Islam and its values.
The last few months, Salah Abdeslam asked for clemency, saying he was sorry, he was repentant, asked for the forgiveness of his victims and their
families. In the end, it was that sentence that the prosecution had sought, life in jail without parole.
Only four times since that sentence was created in 1994 has it been handed down. Tonight, just now, Richard, it was handed down to Salah Abdeslam.
QUEST: The attack was seminal, in a sense, wasn't it?
It changed the way people in Paris viewed terrorism and the threat they faced.
BELL: It wasn't the first. You will remember that terrible spree of terror attacks we had here in France. "Charlie Hebdo," of course. But this one, it
was the nature of it, the fact that it was on that night between, just after 9 pm and midnight, that spree of attacks that killed 130 people, that
targeted bars, restaurants, the Stade de France, the Bataclan that had so shaken France.
The outpouring of emotion around the Place de la Republique afterwards. It was a country shaken to its core that understood that its values were under
attack. We've spoken to some of the victims ahead of this trial, one of whom has said, look, I really wanted to start. But I'm really looking
forward to it ending.
Over the course of last 10 months, this was closely followed by the French press. They have had access to it. It was carried out in the greatest
transparency. One of the dangers had been, given the emotion here in France, the prosecution worried that it might not be carried out in the way
that everyone could see was transparent, according to French law.
So a lot of effort was put into making sure that was clear, that this was carried out according to French law. It involved, of course, listening to
audio from that night, to seeing videos, to having the victims who had survived come and speak about what they had seen and lived through.
It was traumatic for those involved, traumatic also for the country. Tonight, really, everyone looking to see what sentences would be handed
down. Beyond Salah Abdeslam, there were 19 other people on trial, 14 of them had appeared in court, Richard.
Six of them were tried in absentia, including five people who are believed to have died in Syria. You have to cross your mind back to that time to
remember that the French president at the time had said this was an attack that was prepared in Syria, organized in Belgium and carried out on French
It had been extraordinarily violent. Over the course of the three or so hours that it had happened, there had been a great deal of anxiety, anyone
who turned on their TV or had heard what's happening outside in Paris, would've been terrified.
So a lot of attention paid to the details of this. But it is the fate of Salah Abdeslam that was most interesting, I think, to the French. In the
end, he had said -- and remember of all those 10 men who carried out the attacks themselves, he was the only one who survived. His vest did not
He said he disabled. It French prosecution alleged on the contrary that it simply failed to function. Tonight, he's had the harshest sentence that the
French judiciary could possibly hand down.
QUEST: Melissa Bell in Paris. Thank you.
The pandemic may have fetter all (ph) to the economy according to the chair of the Federal Reserve. The global central bank is meeting in Portugal,
saying high inflation is not going away. And Russia's invasion of Ukraine has drastically changed the landscape.
(BEGIN VIDEO CLIP)
CHRISTINE LAGARDE, PRESIDENT, EUROPEAN CENTRAL BANK: I think it's a very healthy exercise, to actually assess why you were off the mark. If all of
you actually do the same exercise, you will probably realize, most of you, that, actually, energy was vastly underestimated.
Bottlenecks were also expected to clear much faster than everybody expected.
AGUSTIN CARSTENS, GENERAL MANAGER, BANK FOR INTERNATIONAL SETTLEMENTS: Now we find that, you know, there are many different hidden relationships or
very key aspects about inflation expectations, expectation for nations, situation in labor markets, that can give you nonlinearities (ph).
ANDREW BAILEY, GOVERNOR, BANK OF ENGLAND: We've been in a world where we've had a series of supply shocks. It's how you deal with that series of
supply shocks, large supply shocks with no air gap between them, which, of course, feeds through into expectations with it because, put them all
together, they are not transitory in the traditional sense of the term.
JEROME POWELL, CHAIRMAN, FEDERAL RESERVE: One way to say it would be we -- I think we now understand better how little we understand.
(END VIDEO CLIP)
QUEST: Rahel is with us.
Rahel, is this a case of the central bankers basically saying, "I don't know what happened, wasn't my fault, I didn't really understand it, well,
that could have been -- well ..."
I mean, are they justifying the fact that they have let inflation get out of control?
RAHEL SOLOMON, CNN CORRESPONDENT: I think in a word, yes. There was a little bit of, well, there were these things that happened and they're not
in our control, which some would argue, they are not.
But they were also like, OK, well, we are learning from it. That's a great exercise. It's going to feel like you've got a C or a D on a project, it's
like this is a really great learning exercise about failure.
That said, what I thought was also interesting, Richard, was this idea that we may not get back to where we were in terms of really low inflation
before the pandemic. Also, I think it was Christine Lagarde who mentioned this, the idea of maybe the way we interact globally might look different
once we get past the volatility of all this.
SOLOMON: We may start to question --
QUEST: Hang on. Hang on.
SOLOMON: OK, all right.
QUEST: Hang on, Ms. Solomon. They spent the last part of God knows how many years telling us that they are fighting inflation, that we knew what
to do, we knew how to do it.
Now I understand all the monetaries and the kiwi, the pandemic, I get all of that. But only last year, they were telling us it's transitory.
I mean, their credibility is shot.
SOLOMON: And I think what they are doing now is damage control, right?
They are trying to manage expectations that we may not get back to inflation the way it was but also sort of explaining, perhaps, some of the
things they have learned. Powell just said that, right, we now know how little we knew about inflation.
But look, I think it's also really interesting, learning the lessons we do take from this. What Christine Lagarde was saying in the sense that,
companies may have to rethink how they do business, in the sense that we have learned that supply chains are very vulnerable to shocks, like the
pandemic and the war in Ukraine, war in general.
So companies may have to start to think about where they are. Of course, cost will be a factor of that but also thinking politically, geopolitically
about where they are, if that makes sense. I thought that was very fascinating, Richard.
QUEST: Rahel, we will talk more about this. I'm not sure I fully am with you on -- it's one form to get back to New York to have the discussion.
SOLOMON: Just like Christine Lagarde and Powell, we can agree to disagree, Richard.
QUEST: I would never disagree with either of those two. But I take your. Point good to see. you Thank you.
The chair of Expedia and the media giant IAC is calling predictions of recession hogwash, saying he believes the economy will get back on track,
despite the current challenges. It's Barry Diller. He compared the uncertainty right now to the so-called phony war in the early days and
early months of World War II, when there was lots of talk and little fighting.
(BEGIN VIDEO CLIP)
BARRY DILLER, CHAIRMAN, IAC & EXPEDIA GROUP: I think we're in a phony peace. right now, meaning some -- some huge shoe is going to drop. At least
that's everybody's sensibility. Everybody is actually, even though, on the ground, yes, our are paying more for gas and other things.
But you're flush with all this money that was pumped in. And there's no real pain right now. And yet everybody is worried. And they are worried
because everything is so chancy, if be, semi destabilized.
QUEST: Are you worried?
DILLER: I'm -- no, I'm hopeless. I really am. I'm just optimistic. I figure, somewhere there is a pony. I mean, we will find a way out or
whatever. I do think, I don't think the next period is going to be euphoric.
But the predictions of recession, to predict a recession, saying, well, it's coming in the winter. Oh no, it's coming the second or third quarter
of '23. Oh, maybe that whatever. But it's coming into this. I think it's all -- first of all, it's all hogwash.
I mean, yes, probably, maybe, given inflation and fighting it, whatever, something's going to happen. But this noise that surrounds everybody is
scaring everybody to friggin' death.
QUEST: What's fascinating is the irrepressible optimism that you --
DILLER: I can't help. That's biology. It is not some sort of -- it's not Larry Summers deep thought.
QUEST: Barry Diller. And more on him when we present our program from Little Ireland in New York as part of our summer Friday series.
Reports of some of the concerns of the economics and what we have from central bankers to the new chair of Turkish airlines who said he's already
has an advantage with higher fuel prices -- in a moment.
QUEST: Throughout the week, "Call to Earth" is looking at how to protect nature's highways in a range of stories, amazing feats of animal migration
from our guest editor. The chief executive of BirdLife International, Patricia Zurita, she's working to protect the world's flyways. For those of
us who enjoy eating strawberries, you will think twice.
PATRICIA ZURITA, CEO, BIRDLIFE INTERNATIONAL (voice-over): Birds connect us to life.
The mere fact that they can fly and the fact that there are 11,000 species and all types of shapes and sizes, what is not to love about them?
I'm Patricia Zurita, the chief executive of BirdLife International. We are in a magical place. It's called Donana National Park. We are in the
southern part of Spain. It's one of the most important wetlands in the whole of Europe and it's truly a safe haven for birds.
You have, they say, 2 billion birds using the African Eurasian flyway, that's the flyway that goes from southern Africa all the way up to Europe
and Asia. This is the pit stop. Donana is the place where you fuel up. These are highways that are being used by these birds --
(voice-over): -- every single autumn and every single spring because they need to find safer places to nest and warmer places to winter.
When we catch them on the net, we are able to wing them. We can monitor how many birds are coming, what's type of species are coming and then make
inferences about populations.
This helps us understand how many birds are using Donana when they're migrating.
This is the kind of warbler that came from sub-Saharan Africa.
Go to Europe.
Yes, Donana is a huge jeopardy (ph). First you have climate change. This last drought has lasted 25 years. And the wetland is not replenishing. But
also industrial agriculture that is sucking up too much water from the aqueduct, creating an absolute crisis in this incredibly important space
These types of extensive and intensive agriculture is completely counter to what a natural system is. You have rows and rows of strawberries. Yes, all
of them look incredibly delicious. But it's like a moonscape. This is not nature.
We are seeing populations of birds not being able to breed anymore, zero breeding for the last two years with katerns (ph) for example. They used to
have thousands, thousands of babies here, five years ago. That's not happening anymore.
What we need to do is just step back and rethink the system so we can put it back in balance. And this is exactly the type of agriculture that we
need to maintain the health of these wetlands like Donana.
So we're maintaining the productivity of the flyway through maintaining this traditional way of producing vineyards. There's no irrigation lines
here. They don't need harmful pesticides. And they are producing this amazing product that is actually economically viable for the local
And it's the home of these amazing migrant birds that are coming from Africa. These amazing places can recover. But the minute that you give
nature a chance, it bounces back. But we just have to give it a chance. Then we will make it happen. I just hope it is not going to be too late.
QUEST: Fascinating. Patricia is (INAUDIBLE) is a conservation corridors under threat from whale sharks traveling on Belize barrier reef to grizzly
bears moving from Yellowstone to Yukon. Look forwarded to that later in the week.
And as always, #CallToEarth for your contribution.
QUEST: Europe's energy commissioner is telling CNN the E.U. has cleared a path and a plan to slash etudes (ph) from Russian energy. Brussels said it
will cut its demand of Russian gas by two thirds this year alone.
Kadri Simson was talking to Becky Anderson and outlined the conservation as an important part of that.
(BEGIN VIDEO CLIP)
KADRI SIMSON, E.U. ENERGY COMMISSIONER: First, we must use less energy. Yes, it is impossible to fully replace the 155 billion cubic meters of gas
that we receive from Russia each year. And we must continue to fill our gas storage. This gives us buffer.
But second, we must replace gas with other sources of energy, if it's possible. So we are accelerating renewal of this deployment.
And third, of course, there are other gas producers. So we have set up the E.U. energy platform to pool our demand. We are negotiating with our
partners. And we are ready to launch joint purchases.
(END VIDEO CLIP)
QUEST: Now rising oil prices has made a change for all airlines and the chairman, the new chairman of Turkish says they prepared by investing in
more efficient aircraft. I spoke to Ahmet Bolat during IATA in Doha.
He told me the company is in good position to welcome back travelers.
AHMET BOLAT, CEO, TURKISH AIRLINES: It's a big demand. We are about to 2019 figures, around 10 percent. And seems that it will continue because we
realize that people really realize the value of the line. And they want to travel. And in my opinion, this behavior will continue.
QUEST: If we've seen the congestion and the problems in European airports, now whether or not you have -- just the sheer getting the number of staff
back again, have you found that difficult?
BOLAT: No, because we never laid off anybody. People continue to work in Turkish. We lowered their salaries instead of laying off people. We lowered
salaries and we kept everybody.
And of course, you know, the cargo business was active. So our pilots remained flying. Our ground staff remained working on the aircraft. And
therefore, we had a hybrid system, actually. And two, three days they were working from their home and the remaining days in the office. So people, we
kept the same pace.
QUEST: And are you seeing numbers come back, passenger numbers?
BOLAT: Passenger numbers are coming back. We are in need of capacity. If you look at it and we already bought six A350s and we leased around 30 MAX
and NEOs to fulfill the capacity gap. And it appears that this trend will continue for the next coming years.
QUEST: So higher fuel prices is hitting everybody. You have lots of large aircraft that fly really long distances, where fuel is a high component.
Your fuel bill must be massive and growing.
What will you do about it?
BOLAT: If you look at it for the last 3-4 years, we were investing on the new technology aircrafts, like 787-350s, MAXs and NEOs. So in this respect,
I think we are in better position than our competitors. Additionally, I am not afraid if everybody is in the same boat because the fuel price is
QUEST: In terms of on board, do you intend to continue spending on the product?
BOLAT: For the comfort, we are going to invest on the business class seats. They have a very good economy seats, which is flying in our
aircrafts, also it's flying in some of the airlines aircrafts. We will but focus on the business class seats.
We have 357s came like 10 years ago. We have 330s. We are going to change business class on these aircrafts and also they're going to provide these
business class seats to the market. Because if you look at it now, there are not much alternatives in the seats.
QUEST: The role that you see the airline playing for your country, the role that you see Turkish for Istanbul, for Turkiye, is what?
BOLAT: If you look at some of the airlines and some of the cities, they combined three products. I don't want to name it but you can easily guess
it. Airline, airport and the city, combined together.
If one of them loses on the total sum, if the sum is positive, they continue. So they don't care which part is losing the money.
But in our case, it's not like that because Istanbul is a very natural city. It has culture, history, everything, gastronomy (ph), visitors,
shopping, it has everything. And Istanbul is very much developed, if we look at the last 10 years. Therefore, in this triplet, we don't have to
have anybody losing. All triplet win.
QUEST: The new chair of Turkish Airlines.
We will take a "Profitable Moment" after the break.
QUEST: Tonight's "Profitable Moment": we have the CEO of Norse Atlantic Airlines on the show. It's always good to have a new carrier across the
Atlantic. But the problems that Norse Atlantic is going to face are so well-known that perhaps we don't need too much repeating.
The reality is that you can make money in the summer. But what you do with your aircraft during the winter months and at a time when, yes, you may
have some cheap seats to sell. But then all the other carriers that run the same route reduce just a few of their seats to put you out of business or
at least to get a competitive advantage.
That's what happened with Lakers (ph), with People Express, we've seen it time and again. We saw with Norwegian. Eventually, the sheer weight of the
GDSs, the distribution systems and the airline's frequent flyer programs and the corporate deals, all of those things count against airlines like
So whilst I fully understand their new model and I recognize their lower costs and I wish them the very best of luck -- and we'll be trying them out
so you can see what it's like on board -- well, there's a long way to go to be profitable and successful.
And that's QUEST MEANS BUSINESS for tonight. I'm Richard Quest in London. Wherever you are up to in the hours ahead, I hope it's profitable. The
closing bell on Wall Street is ringing.