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Quest Means Business

US Stocks Rise As Inflation Slows In July; Trump Says He Declined To Answer Questions In Probe Of Company; US Stocks Face Strong Headwinds; Over 60% Of The EU And UK Suffers Drought Conditions; U.S. Set To Sign Inflation Reduction Act Into Law. Aired 3-4p ET

Aired August 10, 2022 - 15:00   ET



PAULA NEWTON, CNN INTERNATIONAL HOST: All right, just one hour left on the clock for this trade today and markets, they're gone with the data, having

a good day there. The Dow above 400 points as you see it, and what is it? Those inflation numbers that everyone loves. That is the main event driving

stocks today as inflation begins to cool in the world's largest economy.

A drought across Europe creates a fresh challenge for energy prices, and Elon Musk sells nearly $7 billion in Tesla shares. We will tell you why.

Live from New York. It's Wednesday, August 10th. I'm Paula Newton, in for Richard Quest, and this is QUEST MEANS BUSINESS.

And good evening, and a warm welcome.

Tonight, Wall Street is celebrating as US inflation finally, finally shows those signs that it is actually slowing. The Dow now up better than 400

points. You see it there. But the one to keep your eye on is that NASDAQ, as those interest rates may moderate, it is up better than two, almost two

and a half percent.

Now, it comes as new data as we were saying shows prices were flat in the month of July, while the year-on-year increase slowed to eight and a half

percent. A reminder though it was more than nine percent in June.

Now President Biden says that's evidence his economic plan is working. So, he admits the work is not done. Listen.


JOE BIDEN (D), PRESIDENT OF THE UNITED STATES: We're seeing some signs that inflation may be getting to moderate. That's what happens when you

build an economy from the bottom up and the middle out.

The wealthy do very well and everyone has a chance. It gives everyone a chance to make progress.

Now I want to be clear, with the global challenges we face from the war in Europe to disruption of supply chains and pandemic shutdowns in Asia, we

could face additional headwinds in the months ahead.

Our work is far from over.


NEWTON: Okay, now inflation was dampened by a drop in energy costs in the past month overall, energy fell 4.6 percent, such good news and gasoline

prices fell almost eight percent. Still, this is key. Food and housing costs continue to rise. Food prices increased just over one percent and

shelter rose by half a percent in the last month alone.

Rahel Solomon has been really going through these numbers in great detail. Take us through those numbers, and I have to say, there were mixed

opinions, right, about what all of this will mean.

RAHEL SOLOMON, CNN BUSINESS CORRESPONDENT: Absolutely, as are many things these days. They are very controversial and still highly debated. But yes,

as you pointed out, Paula, 8.5 percent on the headline.

We should say that not only is that a decline from the annualized figure we saw last month, but that was better than most economists were expecting,

which we don't get to say much these days, when it comes to inflation.

Core inflation, which strips out volatile categories like energy and food, that remains steady at 5.9 percent. But what I want to focus on, Paula, is

what you just showed there, because that tells a really important picture about what consumers, American consumers are dealing with right now, which

is food prices are still elevated 1.1 percent over that month period.

Shelter, which by the way, makes up about a third of headline inflation, shelter is a huge component of CPI that continue to increase. And year-

over-year that actually increased 5.7 percent.

So that is really problematic. And these are, of course, the essential categories. I mean, these are what most people are spending their money on

day in and day out. And I want to talk about gasoline, because even though we have seen those price pressures start to reduce over the last month, I

mean, take a look over the last year, Paula.

I mean, energy is still higher by about 33 percent; gasoline, 44 percent; food, almost 11 percent. And as I just pointed out, shelter is 5.7 percent.

So look, you know, I don't know that a lot of Americans are watching this report, or watching any of our reports today on CNN celebrating because

this is what they're still experiencing, but it is certainly positive news. And hopefully we continue to see reports like this, which by the way the

Fed has said it would need to see before it starts to feel like inflation is easing. Hopefully that is a sign of more relief to come.

NEWTON: Yes, and you have pointed out to us many times, so much of this has to do with the energy component. Now, look, in the United States, gas

prices are down significantly.

SOLOMON: Oh, absolutely. But here's the thing. Energy is absolutely part of the reason why we're seeing the decline in the headline, and it is sort

of funneled into other parts of the economy as well. Airline fares were a significant component of this, too.

But here's the thing energy is volatile, Paula, right? So, if we are being benefited on the headline because of inflation now, because of energy now

what happens if energy ticks back up? I mean, we're going to be talking about a very different inflation report next month if that happens.


SOLOMON: And so, it is sort of a tricky one, right?

I mean, the stickier components of inflation in terms of shelter, services, those are remaining persistent and that is the problem. That means that it

spells at least that it is going to take some time before inflation starts to meaningfully reduce, because those things don't come down as quickly.

NEWTON: Yes, I think you took us through that quite well, and especially to point out the issues with the volatility there.

I mean, we are going -- and heading in the United States into peak hurricane season as well, which would also have an impact on those all-

important energy prices.

Good to hear from you, Rahel, on what were important numbers today. Appreciate it.

Now, although overall inflation was flat last month, as Rahel was saying, food prices still rising, right? Groceries now cost about 13 percent more

than they did last year, and the cost of food rose faster than almost anything else in July. And supermarket shoppers are of course, feeling the


Vanessa Yurkevich is in fact at a grocery store in Philadelphia right now. Listen, we have leaned on you really for two-and-a-half years since the

pandemic started to really tell us what is going on in what has been a dysfunctional economy.

So tell me now, you've been there and I'm curious about the consumer perspective. And if they are feeling any changes, do they feel less

pressure on prices yet?

VANESSA YURKEVICH, CNN BUSINESS AND POLITICS REPORTER: Well, Paula, maybe they're getting a little relief on gas prices, but certainly not on food

prices. As you said, the key thing to look at is food at home. That's grocery store items. That's up 1.3 percent in July and 13.1 percent year-

over-year, so there is no relief there.

And food, yes, you can make substitutions, but it is not something you can totally cut out of your budget, some of the key items that where the prices

are really still going up, it is meat, it's chicken. Maybe you're going to see a little bit of cooling off on whole milk. That's where we're actually

seeing a decline in this report. And also things like eggs, those prices are still rising. That's a key staple for many people.

But actually, Paula, hotdogs, those have dropped in price by about 6.1 percent, but shoppers here really aren't seeing any movement on prices just


And the owner of this store, Klein's Supermarket, he tells me that he hears it from customers. They're asking him, "When are we going to see prices

drop?" He says he doesn't have an answer, unfortunately. And he is not just feeling the pinch on food prices, he is feeling it on everything else, as



ANDREW KLEIN, CO-OWNER, KLEIN'S SUPERMARKET: It is everything else from the price of our refrigeration gases to the price of our packaging

materials to just delivery charges and extra diesel charges.

So, we're really getting squeezed on both ends and it is really making it difficult to set our prices.


YURKEVICH: And a new survey out just this week looked at US small business owners, 37 percent of them said inflation is the number one pain point they

are facing as it relates to their business.

Andrew, who you just heard from says he hasn't taken a loss this year in business slightly down in profits, but not a loss. He says, Paula, though,

these inflationary numbers on food items don't start to come down, then he could potentially see some loss because ultimately, Paula, he really

doesn't want to be passing these extra costs down to the consumer. But he can only absorb so much.

So unfortunately, in this report for food prices, sort of a lose-lose for the small business owner and the American people -- Paula.

NEWTON: Yes, and such a difficult position as a small business owner to decide whether or not to pass it on and how that is going to affect your


Vanessa, I can't thank you enough. You always bring us those really important stories from on the ground for those small business owners,

especially who've been dealing with so much in the last couple of years.

Vanessa Yurkevich for us in Philadelphia. Appreciate it.

Now today's inflation report makes the Federal Reserve's path to -- yes, that soft landing we all dream of a little hazy. Economic indicators are

sending mixed signals to the Central Bank, the US jobs market is incredibly strong. We know that more than a half million jobs are created last month


GDP though on the other hand, it has shrank for two consecutive quarters now. And by some definitions, you know, that is the sign of a recession.

And now we have that Consumer Price Index and it shows inflation may be slowing. Diane Swonk is Chief Economist at KPMG and she joins me now.

Always good to have you, but especially on a day like this to help us make sense of some of this.

Now, the market has already weighed in. They like these numbers, because they feel it may mean the Fed does not have to be as hawkish going forward.

Where do you stand on that?

DIANE SWONK, CHIEF ECONOMIST, KPMG: Actually, I think the Fed is going to be still very hawkish going forward. It's easy to get in inflation from

sort of the lofty highs we've seen from six percent core inflation, stripping out those volatile food and energy prices, which are still

important down to four percent.


SWONK: That isn't a hard move to make, it's much harder to get it from four to two. And why do we care about that? Well, once we get around two

percent, it's not affecting our daily lives as much. It's not distorting our behaviors and our decisions, and that's the Fed's ultimate goal.

And I think the reason you see the Fed, actually, people in the Fed coming out and saying, "Hey, we still look like we're going to be raising rates

for a while, and we're going to be holding them high for a while." It's because they want to not just get inflation down, they want to get it down

to a level that it's not significant and distorting our everyday behavior as it is today.

NEWTON: Yes, and it is such a good point to make, because even when we talk about things like food, we have noticed, right, a shift away from

certain proteins because like beef because they become so expensive.

Now, I do want to get your input on the dysfunctionality of the current economy in general. Can we even read the indicators right now in historical

terms? And I want to point out that Larry Summers once again, repeating today that okay, these data looks okay, but everything that we see is still

largely volatile. What do you think?

SWONK: Well, I think it's important to understand, first of all, the two negative quarters in a row, the only other time we had two negative

quarters in a row, and it was not considered a recession by the National Bureau of Economic Research, which is the economist definition, not the

public's definition, was in 1947 when we were coming out of World War Two. We saw a big drawdown in Defense spending, a big drawdown in inventories,

but consumer spending and employment continued to power ahead.

In the second quarter of this year, and even in the first quarter, domestic demand held up in the second quarter a little bit, but not in all

categories. We saw the housing market cratered, investment flat-lined, and consumer spending slowed.

That, at the same time, the employment continued to go ahead, so it doesn't qualify as a recession. But for most workers out there, their wages, they

lost them to this inflation and then some since the onset of the pandemic, reopening since the pandemic should have started to abate. That is why they

feel like they're losing ground.

They actually feel like we're in a recession, even though it's not what economists classify a recession, and it heightens the need that the Federal

Reserve has to really get inflation much lower and not distorting our everyday lives and dominating our everyday lives.

The question is, of course, does that mean an increase in the unemployment rate? And sadly, I think it does. I think we're at that stage of the game,

even though we got this cooling, one of the things Fed Chair Jay Powell is worried about is ongoing pressures on food prices, and gasoline prices,

those could come back at any time. Russia could weaponize its oil exports yet again.

Those are things they are worried about because at this late stage, it's gone on for so long, that it threatens to become something like we saw in

the 1970s, more entrenched.

And Jay Powell addressed this issue at his press conference and said, hey, we can't grow food, we can't pump oil, but we can hammer demand to get it

down to a supply constrained world. And that sadly, in the place that they still feel they are even after today's data.

NEWTON: And so given everything that you've just said, can I get your take, then on the fiscal component on this? I mean, we have some

legislation in the United States that looks like it'll pass. It is in fact called the Inflation Reduction Act.

But you know, even places like Moody's are pointing out that look, this will not lower inflation in the short term at all. Do you think there will

be some help there on that side? On the legislative side? Or do you think this is just, you know, we're trying to heal from this pandemic economy,

and that it's still going to take much more time than anyone wants it to?

SWONK: Well, I think all of the above are absolutely true. There is no question that the inflation we're feeling is part of the pandemic and it is

going to continue to be a residual of both pandemic aid and the pent up demand that we created, and the distortions and supply chain disruptions

that we had. So, it's all of the above.

I do think it is important that we are dealing in real time with climate change and that is something that adds to inflation over time, because it

causes you know, famine, floods, fires -- all the things that disrupt supply chains and disrupt our access to that very one thing that you

focused on the most, food.

And I think that's really important to understand about where we're at. And so going forward, anything that focuses on getting a transition that's more

palatable away from things that make climate change worse towards renewables is really important in containing inflation. And that's where we

do need to go longer term, otherwise, we're going to have a longer term that deals with more shortages, more critical shortages, that get to the

very basics of life.

NEWTON: Yes, and the global economy in a tough spot where that is concerned, especially given the energy crisis created, of course by the war

in Ukraine.

Diane Swonk, really good to see you and I appreciate share your insights here today.

Now it appears the world's richest person is freeing up some cash. Elon Musk recently sold billions in Tesla stock. The next chapter of his epic

battle with Twitter. We'll have more on that next.



NEWTON: Donald Trump says he declined to answer questions about whether his company manipulates the value of its real estate. Now, Mr. Trump was

seen heading to a deposition at the New York State Attorney General's Office. You see him there.

The former US President calls the civil investigation: "A politically motivated witch hunt." Mr. Trump is in the middle of multiple legal


On Monday, the FBI searched his Mar-a-Lago home in Florida that was part of an investigation into the handling of classified documents. On Tuesday, he

lost a fight to keep his tax returns from Congress. Lawmakers are also looking into his effort to overturn the 2020 election.

CNN's Kara Scannell is following this story and she is outside the AG's office there in New York.

And I know the former President is still inside there. And tell us why is it significant that he essentially pleaded the Fifth in all of this? And

crucially, which actual questions that he refused to answer about his businesses?

KARA SCANNELL, CNN CORRESPONDENT: Well, Paula, we're about an Hour Six now since the former President Donald Trump arrived at the AG's office right

behind me. We're seeing some activity at the door. We think he might be close to leaving.

He said that he wasn't going to answer these questions because he claimed the New York attorney general's investigation was politically motivated.

Letitia James, the AG is a Democrat, and he also pointed to that FBI search warrant on Mar-a-Lago on Monday. You know, all of this is evidence that he

says that this is all politically motivated.

We don't know what questions he is being asked right now, though we do know this investigation is focused on the accuracy of his financial statements.

Those statements have been provided to lenders, to insurers, and used possibly to gain tax benefits.

This investigation has been going on since 2019. This is the final stages of it. We knew that when Donald Trump's son Eric Trump was deposed in 2020,

he declined to answer more than 500 questions. So you can imagine that these questions are targeted. They're going to relate to the financial

statements, and one reason why the AG said that she wanted to depose the former President, she wants to know what his role was in the preparation of

these financial statements and the way that they came up with the value for the assets.

You know, many of the well-known Trump assets are included in these statements and there are questions about their accuracy. Now, we're still

waiting to see when he is going to leave, but I doubt he's going to answer any questions or inform us about what he was asked. But that's the nature

of the questions that they're going at here, trying to get to the core of whether these financial statements were improperly or falsified or if

anybody was misled and what exactly his role was in that -- Paula.


NEWTON: All right, Kara Scannell --

SCANNELL: I think we are seeing activity now.

NEWTON: Oh, he might be coming out there? There we go.

SCANNELL: Yes, it looks like we might be seeing -- we're seeing some of the vans leave the garage right now. So I think when we see that police

escort, it often indicates that it's the former President. That's how he came in today, several hours ago and that's just how he's leaving.

You can also hear some people shouting questions at him, but the windows are up on the van, so we're not hearing or seeing him or hearing any


But this will be about wrapping Hour Six when Trump was inside giving this deposition, refusing to answer questions, asserting his Fifth Amendment

rights -- Paula.

NEWTON: Yes, Kara, as you said, six hours and you pointed out that he could be at Question 495 or 505, given everything that the AG wanted to get

through in this day.

I appreciate how closely you've been watching this case, Kara, we've been watching your reporting carefully, especially as this case continues in

that district.

Kara Scannell for us live outside the AG's Office. Appreciate it.

Now, we are going to the newest chapter in the saga of Elon Musk versus Twitter. The billionaire just sold nearly eight million Tesla shares. He

says he needed to raise billions of dollars in case he is forced -- in his words -- to complete the purchase of Twitter.

Now, you'll all remember this, Musk said in April that he wasn't planning to sell any more Tesla stock. Shares of Tesla and Twitter are both up this


Paul La Monica is in New York. You've been following Elon Musk and his Tesla stock. So we get it, right? He needs the money to pay for Twitter,

but there could still be the challenge of actually owning Twitter, if he is in his words forced to buy it, right?

PAUL LA MONICA, CNN BUSINESS REPORTER: Oh, definitely, Paula. I mean, it's pretty clear now that Musk is having so much buyer's remorse that he

doesn't want to actually go through with this deal, and I think at this point, it's just a matter of whether or not he is forced legally to acquire

Twitter and take that company private.

So raising this nearly $7 billion, Musk is saying that it is being done just so that he can avoid having to do an emergency sale, if the courts

decide that he has to buy Twitter, and also if all their backers that he had lined up in the original Twitter deal, do not come up with financing.

So there are a lot of ifs here, of course, Paula, and I think you know, if Musk had his druthers, he could just walk away from this deal and not have

to worry about it. But Twitter and you know, a Court has a few other things to say about that.

NEWTON: Yes, there has been speculation that what he is actually looking for is a better price. He still sold the stock. I mean, it will be a

challenge for him to own this company, right? Especially given not just the issues with Twitter itself, but the fact that the ad market, the ad

industry is quite challenged at the moment.

LA MONICA: Yes, there are a lot of questions even before the digital advertising market really went into freefall, as evidenced by what's

happened to earnings from not just Twitter, but Snapchat's parents Snap and Facebook owner, Meta platforms. There were also questions about whether or

not Elon Musk had the ability to run Twitter, in addition to Tesla, SpaceX, The Boring Company, Neuralink -- I mean, the list goes on and on with all

of the companies that Musk has some involvement with.

Did he really want to be doing day-to-day operations at Twitter as well? Because we all know that this guy who is a workaholic. You don't imagine

that if he is forced to buy Twitter, he's just going to let it sit idly by? He's probably going to make some moves and pay some attention to that

company. And you know, his time is split. There are only so many hours in the day.

NEWTON: Yes. It will be interesting to see if we get more news on this in the next few weeks, if there are negotiations behind the scene that maybe

we don't know about.

Interesting, as always, Paul, thanks for following it for us. Appreciate it.

Now, the London Stock Exchange says it delivered strong earnings in the first half. All divisions reported revenue growth, and that's despite major

headwinds in that UK economy.

Now the number of IPOs in London fell by nearly half from a year earlier and their value plunged 94 percent. Now, the British economy is also under

pressure, as you know from the consequences of Brexit, and seeing inflation higher than at any time since the 1980s.

David Schwimmer is the CEO of the London Stock Exchange and he joins me now in what can only be called a time of adversity. Now, you've admitted the

IPO market is slow, but you say you expect it to recover, but given Brexit is a firm reality now, how do you expect it to affect you competitively

going forward as we know how fiercely competitive those markets can be?


DAVID SCHWIMMER, CEO, LONDON STOCK EXCHANGE GROUP: So Paula, relatively little effect on us competitively, if I can put it that way, and just to --

sorry to correct you, but I am the CEO of the London Stock Exchange Group, and the reason I make that distinction is that the London Stock Exchange,

great part of our business, fantastic franchise, iconic brand is less than five percent of our revenues.

So really important business, yes, IPOs have slowed in the first half given what's going on in the world, but in terms of our overall business, very

strong first half, top line growth, up seven percent and we've seen broad based growth across our three divisions of capital markets, post trade, and

data and analytics. We are 13 percent up in capital markets; post trade, up nine percent; data and analytics up five percent.

So Brexit, yes, we're navigating through that just fine. We're a globally diversified business. We operate in 190 countries around the world. We have

over 40,000 customers and we are a diversified by product, by customer, by geography and businesses, as I said, doing very well.

NEWTON: I hear you. In terms of that purchase of Refinitiv, which, you know, will admit as a game changer. It transformed the London Stock

Exchange in essentially what you do, and you're now into that data -- your data and analysis company as well, a lot of competition in that space. And

I hear you that the results have been good. You also paid a very hefty price tag for what you got there.

I'm just wondering about that payoff, and given what you're seeing as a general market sentiment. So give us that forward guidance that we might be

looking for, given the volatility in markets right now.

SCHWIMMER: So we -- just with respect to the Refinitiv business, you're right, we acquired it last year. We paid a very attractive price and I'll

say 11 times EBITDA multiple which was relatively low, and had about 40 percent plus EPS accretion in the first year.

So from that perspective, from a value perspective, great for our shareholders.

In terms of the environment, look, there's a lot of uncertainty in the markets. I don't need to tell you this, but with concern about inflation,

concern about recession risk, rising interest rates, the geopolitical challenges, concern about energy -- a lot of uncertainty.

Our business I say is very well positioned for an environment like this. As I mentioned, we are very diversified. We have 73 percent of our revenues as

recurring revenues, subscription revenues. The products that we provide are really important to our customers. It's hard for our customers to conduct

their daily business without access to our products, our services, our workflow.

And then there are also aspects of this environment, the uncertainty, the volatility, that actually leads to benefits for certain parts of our

business. So for example, interest rate uncertainty leads to higher trading volumes on Tradeweb, our fixed income venue or higher cleared volumes on

our clearinghouse, LCH.

So it is a challenging environment, but we're very well-positioned, we also -- we generate a lot of cash. We have a very strong balance sheet. So we're

positioned very well for an environment like this. We'll see how it goes.

NEWTON: And I do take your point on Brexit, but I'm going to just assume that you've diversified as per Brexit. You saw Brexit coming and decided it

was time to diversify there.

We're going to get you back though just to talk about the environment in the next few months with what else is going on in the UK, and that is quite

a political race going on, which will affect the City of London as well.

We'll leave it there for now. Thanks so much. Appreciate it.

SCHWIMMER: Thank you.

NEWTON: Next up, here for us, here comes the sun. The CEO of a solar energy company on how we can reduce emissions and tackle rising fuel costs

right around the globe.



NEWTON: So a startling illustration of the impact of climate change in Europe, the Rhine River, a vital artery for trade and transport for

centuries, is drying up. By the end of this week, it will be virtually impossible at a key point for the barges and heavy -- that carry heavy

cargoes for businesses all along that river. Christina Macfarlane now has more on Europe's drought.


CHRISTINA MACFARLANE, CNN CORRESPONDENT (voice-over): Extreme heat that has played much of Europe this summer, combined with little rainfall is causing

dangerous drought conditions. New data from the European drought observatory found that 63 percent of the land in the European Union and the

U.K. is either under drought warnings or alerts. That's about the same size as India and it has farmers worried.

CHRISTIAN DANIAU, PRESIDENT, CHARENTE CHAMBER OF AGRICULTURE (through translator): There have been a lot of heat waves, but it's mostly the lack

of rain the damages the crops. We've had other heat waves we've seen some already but when they are combined with a lack of rain, then it's


MACFARLANE (voice-over): The new figures show that 47 percent of the land is under a drought warning, meaning there is a deficit of moisture in the

soil. While 17 percent is under more severe alert, meaning the vegetation is stressed. This satellite image of a cloudless Western Europe shows the

brown dry land. Compare that to this image from May.

July was the driest month on record for many parts of the continent. In France, the Loire River is so low, it can be crossed on foot in some

places. On this river along the French Swiss border, these tourist boats aren't doing any business. In Spain, one reservoir is 84 percent empty,

leaving officials concerned about the region's water supply.

Italy's longest river, the River Po, is seeing its worst drought in 70 years. And in Germany, near record low water levels on the Rhine could have

a major impact on energy this winter, little flow in the river will affect the output of coal fired power plants, and transporting the coal will

become more expensive and difficult since ships won't be able to carry a full load. Parts of the river may become impossible for many barges as

early as this weekend.

PETER CLAEREBOETS, CAPTAIN & OWNER, SERVIA (through translator): Normally, you have more than two meters under the ship. But now you only have 40

centimeters in some places. And then for us, the challenge is to get past those points without touching, without damaging the ship.

MACFARLANE (voice-over): Back to Back heat waves have caused wildfires to spread more rapidly. This place in southwestern France has already

destroyed 6,000 hectares of land. Europe is already seeing one of its hottest summers ever. The heat combined with months of very little rainfall

also made it one of the driest, threatening the economy and worrying residents.



NEWTON: Now across the Atlantic, meantime, the U.S. is on the verge of signing a major new climate bill into law, the Inflation Reduction Act

passed by the Senate on Sunday will channel more than $350 billion into measures designed to help the planet and it aims to lower the cost. This is

crucial here of sustainable energy technologies and energy saving devices, and give rebates and tax breaks to buyers of electric vehicles, clean

energy, and electric appliances.

Now, as that bill heads to the house for approval, we want to bring in the CEO of solar energy company, Sunnova, John Berger joins me now from Aspen

in Colorado. And I know how closely you've been following this as it's tried to make its way through Congress. If it is signed into law, and we

believe it will be, how transformative will this new legislation be not just for you as a company, but the industry and more importantly, the


JOHN BERGER, CHAIRMAN, PRESIDENT & CEO, SUNNOVA: Well, thanks for having me, Paula. It's going to be big transformation. This is the first time and

really ever in history that the United States government finally did something to address climate change, really, at the same time with that

we're facing a huge global energy crisis on top of the climate energy crisis, or climate crisis.

And so what this bill will do, it will lower power bills for consumers by allowing access and providing tax credits to buy down the solar systems,

batteries, and other energy technologies to further lower those power bills. At the same time, those are clean technologies. So they're really

putting the United States on the forefront of driving home new clean energy that lowers power bills. In addition, they put some provisions in there

about bringing the manufacturing of those solar modules and battery home to the United States.

NEWTON: Now, why are these incentives actually needed? And the reason is, the technology has been around for such a long time, I'll even go back to

the Obama administration and their push on solar. Why don't we already see it all over the country? I mean, you can go to a place like Florida and

residentially not much solar.

BERGER: Well, it's really gathered a lot of steam over the last few years. And the reality is that natural gas, coal, and oil has been cheap for a

very long time up until very recently. And so there wasn't a whole lot of a financial incentive for consumers to really shift other than the fact that

there'll be some local higher power prices in places like California, not in places like Florida, or Texas, for instance.

And so it really has led to an uneven adoption across the country. What this is doing, coupled with high oil prices, high natural gas prices, high

coal prices, which we believe by the way, this respite on low or lower oil prices, is going to be just that, it's going to be a very temporary

respite. As those prices move up, coupled with the tax credits here, it's really going to set off an acceleration in a boom, to drive the American

homeowner towards these types of technologies at a faster clip. And that's what this act is supposed to do. It is supposed to drive us at a faster

adoption clip. And I believe strongly it will do just that.

NEWTON: And that brings me to my next question. You know, we're just talking on the show about this dysfunctional economy. There are supply

chain issues everywhere. Do you worry that companies like yours won't be able to fulfill demand, and this is crucial, you're at affordable prices,

right? Because the key components of this in a green economy, they're supposed to help those that are having the most difficult time in trying to

keep their quality of life and these economies?

BERGER: Well, certainly, and the Act goes to address that very issue, Paula. So there's a portion of this that has disadvantaged communities

taking, for instance, right now, you can get a tax credit on the cost of a solar and battery system, that's about 26 percent of the cost. Now, you're

going to be able to get 30 percent. But if you're a part of a disadvantaged community, you could get as much as 40 to 60 percent off that cost.

So it really addresses those that are there less fortunate in life that really need to be able to have the same access to the technologies that the

rest of us have. In addition, you know, right now, you know, our average rate off the utility pricing is about 20 percent. And that's climbing as

utilities raise rates in a very rapid fashion. So the best thing that you can do as a homeowner is to get solar and battery service on your house as

fast as you can, lock that in for 25 years. Because the chances that because of the global war, when you look at what's happening in Ukraine,

or, you know, the climate change, all these things are going to drive those enterprises --

NEWTON: I'm sorry, I only have 30 seconds left, but I do want to get that answer from you. What about you guys and your industry being able to

provide for a lot of the infrastructure that's needed especially residentially?


BERGER: We need a lot more manufacturing, a lot more equipment, this Act provides just that. To bring it all home to United States, to build those

battery factories, to build solar module factories, and then create the jobs here. So it really does a lot to make sure that we have the right

supply chain to go out and serve that demand that is trying to accelerate and that we are confident. The consumers in the United States are going to

come up and want to adopt more and more because it makes sense for their family and their pocketbook.

NEWTON: We will certainly keep up with whether or not the, you know, this does turn out to be everything everyone wants it to be. I will say that

perhaps your results were overwhelming. Your size, though, in general, was underwhelming. And I'll take that point because as I said, at this point in

time, we expected to see solar take off so much more right around the world, not the least of which here in the United States.

Thanks so much appreciate you weighing in on this new piece of legislation. And that's Quest Means Business for us. I'll be back at the top of the hour

as we make that dash to the closing bell. Marketplace Europe though is up next.


NINA DOS SANTOS, CNN EUROPE EDITOR: Hello, welcome to Marketplace Europe. I'm here at the European Space Agency's 5G Hub in Oxfordshire, where

researchers are firing up the latest advances in connected tech. Almost two-thirds of E.U. households actually have 5G coverage according to the

European Commission.

However, a report by Ericsson says that Europe is still lagging behind the United States and parts of Asia when it comes to subscriptions. So the 5G

fight back begins here.


SANTOS (voice-over): If Europe wants to get 5G ready, it might have to aim even higher than these masts. In fact, it may be satellites sitting

thousands of miles above the Earth that hold the key to getting us connected. Here the European Space Agency, Antonio Franchi says it's the

opportunity of a lifetime.

ANTONIO FRANCHI, HEAD OF SPACE FOR 5G STRATEGIC PROGRAMME, ESA: So we see the digitalization of industry and society really requires connectivity

anywhere on Earth. And 5G promise to provide the connectivity which provide the connectivity fabric to enable this digital society. We believe

satellite plays an instrumental and fundamental role in complementing the 5G terrestrial connectivity with space assets. The ultimate goal of being

ubiquitous connectivity on Earth, so everybody and everything connected anytime, anywhere on Earth.


SANTOS (on camera): In terms of the future connectivity of a 5G, and then thereafter, a 6G world, what type of timeframe do you think we're looking


FRANCHI: Typically, a time span of about 10 years from one G to the next. So we expect in the next 10 years, this connectivity will be revolutionized

will improve life on Earth, will provide better services globally. And hopefully, we'll take care of our young generation and also our older

generation, we can provide a much better global digital health care for everybody.

SANTOS: These headsets offer a tangible example of how 5G networks can be used. They're all linked to one 5G network via satellite, many thousands of

kilometers above where I'm standing. They can help people via augmented reality train for all sorts of complicated professionals like say oilfield

service engineers or pilots, even doctors.

In this case, these devices have come preloaded with an example of what a 5G Smart City would look like. Let's take a look. I can actually see a

whole 5G connected city sprang up in 3D like a hologram, which has driverless cars, planes above us, hospitals that are connected to the

internet. It's quite impressive.

(voice-over): 5G's impact isn't just hypothetical, though. This is Darwin, the self-driving shuttle. It's a test project that ESA has been working on

with the mobile operator, O2. It's already fairing workers around the area. And O2 hopes it can show off the potential of 5G connections. I took a ride

with David Owens, the company's head of technical trials.

DAVID OWENS, HEAD OF TECHNICAL TRIALS, VIRGIN MEDIA O2: It's really exciting that this is actually real. It's not a trial in terms of the

technology. It's a trial in how people get used to the technology and using it in their daily lives to commute around the campus.

SANTOS (on camera): None of this would be possible without 5G networks, right?

OWENS: Yes, 5G plays a vital role in ensuring that we can operate shuffles autonomously. It's a number of key partnerships, a number of key

technologies that we need to enable the shuttle to work properly. And 5G is part of that technology roadmap that we need. We've been working on a lot

of different projects to give really good examples of how 5G can help industry, can help transport. We've also been working on a number of

projects that have been focused on the creative industry. You know, one of the things that we love, Virgin Media O2 is big entertainment venues at the

O2. And we focus a lot of our projects around those giving fans better experiences at those venues.

SANTOS (voice-over): Owens says it's a marathon not a sprint when it comes to 5G. But the future being mapped out makes it clear. This new tech is

already very much in motion.


SANTOS: After the break, powering a new reality, we'll take you inside the metaverse and the battle for bandwidth.


SANTOS: As more of our continent gets connected, more and more Europeans are getting a chance to dabble in new technology, and few innovations

received as much hype recently as the metaverse, the consultants EY say that telcos can be key players in getting it off the ground. Anna Stewart

helps us get up to speed.



ANNA STEWART, CNN REPORTER (voice-over): What used to be science fiction is now the word on everyone's lips.

UNIDENTIFIED FEMALE: Quote, the metaverse.


UNIDENTIFIED MALE: And the metaverse.


STEWART (voice-over): So what is the metaverse and will it become the next frontier for big tech? Think of it like a more immersive version of the

internet, a digital world where your very own avatar can go shopping, attend concerts, or just hang out with friends. And companies are already

competing for your attention. Facebook changed its name to Meta. Nike bought a virtual shoe company. Even Kraft Heinz is making a play for the

metaverse. And more investments are coming.


In 2021, Meta said, it would create up to 10,000 jobs in Europe over the next five years in a push to make the region a Metaverse hub. But just like

the real world, digital societies don't function without infrastructure. Europe's internet providers are already trying to keep up with historic

demand for data. Powering the metaverse is a whole different prospect.

Artur Sychov is a tech entrepreneur from the Czech Republic. His virtual reality world Somnium Space has been operating since 2017. Now as interest

in the metaverse grows, he says it's time for users to think big.

ARTUR SYCHOV, FOUNDER & CEO, SOMNIUM SPACE: Metaverse is you know the spatial environment, the spatial place, it's a platform where you can come

in and literally be whoever or whatever you want to be. And also you could create anything you like. But let me give you a quick example on the

building. This is the Somnium Mall in the city center. I'm on the roof. I can climb this mountain. You can visit all the parcels. You can go to those

kayaks, so these are kayaks, and I can actually fly there. These are just few small possibilities I just showed it within 15 seconds. But as I said,

you can literally do anything you like.

STEWART (on camera): I mean, the technology is extraordinary just watching you in the metaverse right now, it relies on a lot of bandwidth. Are

telecoms companies ready for what could be an explosion in demand for bandwidth?

SYCHOV: I think they are. We are entering the territory of mobile phones having, you know, close to gigabit up and down internet speeds on the 5G

network with latency may be 30 milliseconds, which is plenty enough to hold a lot of data and even do wireless VR. Generally, telecom companies will

play a big role in the development and also accessibility of this technology to many more people. But I think we're moving in the right

direction, actually.

STEWART: Do you think that has put people off entering the metaverse because they think that they need a very expensive headset, they need a big

computer, they need hand thing (INAUDIBLE).

SYCHOV: The biggest hurdle so far, which I've seen is people not understanding what is actually possible. Because majority of people, 99

percent of people actually don't realize that what I'm doing right now and how we're talking right now. And then I'm in the metaverse inside, that

that is actually technically possible. Because once they realize one, once many people realize that this is possible, they actually jump and do those

things because it's excited, right? They want to do the same. They want to explore. They want to meet with people. They want to visit live content.

They want to drive NFT cars, like I will do right now.

STEWART: You're off. Right. Well, I think I'd like to come in there and have a look at that car. Would that be possible?

SYCHOV: Yes, of course. Let's do that. I'll meet you in the city center in a minute.

STEWART (voice-over): Now, before I get into the metaverse, myself, I need to sort out my outfit. And as Otto was telling me, the possibilities are

endless. My producer says I should go for a more traditional look rather than a dinosaur costume, which I think is a shame. But it's then just a

case of grabbing my headset. And away we go.

SYCHOV: Hello.

STEWART (on camera): Hi, I'm here. I'm wearing a slightly odd outfit. I much prefer yours.

SYCHOV: Let's go outside.

STEWART: Right Artur. Well, why don't you show me around?

SYCHOV: So we could of course play the bowling and the shooting game. But we probably can go and have a look at the car, which I promise you to show

and --

STEWART: I love to go see the car.

SYCHOV: Drive, drive, drive, yes, turn around, turn around.

STEWART (voice-over): It's all very dramatic with a high speed car chase at sunset. But as we head up to the mountaintop, Artur is adamant this is more

than just a fad.

SYCHOV: There's certain community forming around this understanding of the power of this platform, right? When people pay tens of thousands of dollars

for a virtual land parcel, they probably are not doing it out of fun, they have an intent. They have a wish or a dream they want to build on top of


STEWART (on camera): What's your advice to brands that want to somehow have a presence in the metaverse or they want to have purpose in the metaverse?

What is your advice to them? I'm guessing most of them are consumer facing brands.

SYCHOV: I would say what I see right now it's many brands are using this as the marketing vehicle by just claiming that they were in the metaverse. We

do this and that. But they're no utility behind what they're doing, yet. I would recommend brands to really, really, really think about the utility to

let people engage with those items to let people form a real life experience in VR with those items because that's where the connection



SYCHOV: Strikes.

STEWART (voice-over): From bowling alleys to space stations to a daytime firework display. There are certainly no shortage of distractions in this

corner of the metaverse. There's still one thing though, that I've always wanted to try, learning to fly.

SYCHOV: Forward, just spread your arms and move forward and you would fly.

STEWART (on camera): That was great. You know, I've had such a good time I really enjoyed it.

SYCHOV: Let's do a selfie together, wait, oops. Three, two, one, fantastic. High five. Bye-bye.

STEWART: Well, that was extraordinary. I have to go sit down in a dark room now for a little bit.


SANTOS: That's it for this month's edition of Marketplace Europe for now. We'll see you next time.


NEWTON: Hello. I'm Paula Newton and this is the dash to the closing bell. We are just two minutes away. Stocks, yes, that inflation data aged well,

they're rallying on those new numbers showing that prices are starting to stabilize. Now the Dow up, you know, this some of the best numbers we've

seen all day up 500 points right now. And it's been in the green all day long now. The S&P about better by about 2 percent now, but this is where we

get to the real news. That NASDAQ shooting up nearly 3 percent at this point and it's on pace to close outside here, outside of the bear market

territory. Now if inflation slows down, the Fed might reconsider the size and speed of its interest rate hikes.

Diane Swonk chief economist at KPMG told us how Jerome Powell might be reading these latest numbers listen.


DIANE SWONK, CHIEF ECONOMIST, KPMG: One of the things Fed Chair Jay Powell is worried about is ongoing pressures on food prices and gasoline prices.

Those could come back at any time. Russia could weaponize its oil exports yet again. Those are things are worried about because at this late stage,

it's gone on for so long, that threatens to become something like we saw in the 1970s more entrenched. And Jay Powell addressed this issue at his press

conference said, hey, we can't grow food. We can't pump oil, but we can hammer demand to get it down to a supply constrained world.



NEWTON: Now as you can imagine, a lot of the Dow components in the green there. As you can see Disney is up. They report after the bell, a lot of

people keeping an eye on that report for today. And that's it for our dash to the bell. I'm Paula Newton. We will begin to hear that closing bell on

Wall Street. There it is. "THE LEAD" with Dane Bash starts right now.